C-30/87

BODSON v POMPES FUNÈBRES DES RÉGIONS LIBÉRÉES

OPINION OF MR ADVOCATE GENERAL CRUZ VILAÇA delivered on 11 F e b r u a r y 1988 *

* Translated from the Portuguese.

OPINION OF MR CRUZ VILAÇA — CASE 30/87

Court's judgment of 16 December 1981 in diction to reply 'to questions of interpre- Case 244/80 (Foglia v Novello [1981] ECR tation which are submitted to it within the 3045). framework of procedural devices arranged by the parties in order to induce the Court to give its views on certain problems of Community law which do not correspond to 7. According to PFRL, the questions an objective requirement inherent in the submitted to the Court seek an academic resolution of a dispute' (paragraph 18 of the answer to a theoretical question, which has decision). no relevance to the settlement of the dispute before the national court between Corinne Bodson, in partnership with Michel Leclerc, and PFRL, which arose because Mrs 11. The Court's aim is thus to prevent the Bodson began to provide the external application of the procedure under Article services for funerals within the area covered 177 of the EEC Treaty for purposes other than those appropriate to it (paragraph 18 by the concession granted to the defendant. of the decision).

BODSON v POMPES FUNÈBRES DES RÉGIONS LIBÉRÉES

a direct knowledge of the facts of the case remedy under national law is not required to and of the arguments put forward by the refer to the Court a question of interpre- parties, and which will have to give tation or validity if the question is raised in judgment in the case, to appreciate, with interlocutory proceedings and the decision full knowledge of the matter before it, the to be taken is not binding on the court or relevance of the question of law raised by tribunal which later has to deal with the the dispute before it and the necessity for a substance of the case, provided that each of preliminary ruling so as to enable it to give the parties is entitled to institute judgment' 1 is directly relevant. proceedings on the substance of the case even before the courts or tribunals of another jurisdictional system and that during such proceedings any question of 15. In that regard, therefore, the Court's Community law provisionally decided in the jurisdiction to answer the questions referred summary proceedings may be re-examined to it is not at issue. and be the subject of a reference under Article 177 of the Treaty.

OPINION OF MR CRUZ VILAÇA — CASE 30/87

22. For that reason, as the questions 27. The Court has already acknowledged submitted for a preliminary ruling have not that Article 37 (1) of the Treaty has direct been withdrawn by the national court, the effect and may therefore be relied upon by Court of Justice must answer them having any Community national as from the end of regard to the specific circumstances of the the transitional period. 3 case.

28. Does the aforesaid provision therefore 23. (c) I therefore turn to the questions apply to monopolistic situations of the kind submitted by the Cour de cassation. referred to by the national court?

26. Moreover, the second subparagraph of Article 37 (1) provides that Article 37 'shall 32. I do not believe that the reference to apply to any body through which a Member 'national' or 'State' monopolies (depending State, in law or in fact, either directly or on which language version of the Treaty is indirectly supervises, determines or used) is to be interpreted restrictively. On appreciably influences imports or exports the contrary, where a monopoly for which a between Member States', and its scope extends to 'monopolies delegated by the 3 — Judgment of 17 February 1976 in Case 45/75 REWE v Hauplzollamt Landau [1976] ECR 181, at p. 197, State to others'. paragraph 24 of the decision.

BODSON v POMPES FUNÈBRES DES RÉGIONS LIBÉRÉES

33. As the Court has emphasized in its coordinate the management of a specific case-law, 'recourse to Member States' sector of the national economy. A domestic law in order to limit the scope of particularly glaring instance of this would provisions of Community law undermines be where the group of local monopolies led the unity and effectiveness of that law and to all or most of the concessions being cannot, therefore, be accepted'. 5 granted to the same undertaking or to the same group of undertakings.

35. It does not seem to me, therefore, that monopoly existing in France in favour of the system of 'national' monopolies — that regional artificial insemination centres. is to say 'public' or State monopolies in the broad sense — necessarily excludes those of municipal or 'communal' origin since the 39. In that case, it would appear, the national territory as a whole was covered by 4 — See, to the same effect, the Opinion of Advocate General Roemer in Case 82/71 Pubblico Ministero v SAIL [1972] ECR 119, at p. 141. 6 — Société coopérative d'amélioration de l'élevage du Béam v 5 — Judgment of 16 June 1987 in Case 118/85 Commission v Mialocq [1983] ECR 2057, at p. 2072, paragraphs 6, 7 and Italy [1987] ECR 2599, paragraph 11 of the decision. 9 of the decision.

44. In a case such as this — which, as we 41. However, there would not appear to be shall see more clearly in due course, is any reason why the interpretation should concerned essentially with territorial differ in the case of a monopoly limited to monopolies over services that are capable of only part of the national territory, since exerting only an indirect influence on Article 37 does not refer to any territorial imports — the question which must be dimension in the list of conditions for its asked is in fact whether recourse to Article application, which are defined instead by 37 is justified in order to ensure the removal reference to the effects of the monopoly on of any discrimination in intra-Community intra-Community trade. trade or whether it is sufficient to examine the situation in the light of Article 30 of the Treaty concerning measures having an effect equivalent to quantitative restrictions. 42. As the Court has explained, it follows from the provisions of Article 37 and from their structure that 'the obligation laid down in paragraph (1) aims at ensuring compliance with the fundamental rule of the free movement of goods throughout the common market, in particular by the 45. That is so particularly since, as is clear abolition of quantitative restrictions and from the case-law of the Court, commercial measures having equivalent effect in trade monopolies must be regarded as wholly between Member States', 7 and at main- incompatible with the Treaty, and must be taining normal conditions of competition 'abolished' and not merely 'adjusted', only between the economies of the Member in so far as they involve the grant of an States. 8 exclusive right to import manufactured products, a right which constitutes in itself 7 — Judgment of 3 February 1976 in Case 59/75 Pubblico Ministero v Manghera [1976] ECR 91, at p. 100, paragraph and in relation to Community exporters 9 of the decision. discrimination prohibited by Article 37 (1). 9 8 — Judgment of 13 March 1979 in Case 91/78 Hansen v Hauptzollamt Flensburg [1979] ECR 935, at p. 956, paragraph 19 of the decision. 9 — Manghera, supra, paragraph 12 of the decision.

51. However, as the Cour de cassation 47. In those circumstances, all that is stated in its first question and as the Court required for the objective pursued by Article has learned in the course of the 37 to be attained is for the monopoly to be proceedings, the external services for adjusted so as to remove any possibility of funerals comprise not only the provision of discrimination between nationals of the services but also the supply of certain goods various Member States as regards the (in particular coffins and the attendant conditions under which goods are procured ornaments) and the rental of other goods and marketed. 10 (hearses and external hangings of the house of the deceased), which may be imported from other Member States. Hence there is not just a monopoly in the provision of services and, even if that were the case, the 48. However, for that obligation to be services involved are provided through the imposed on the basis of Article 37, the other use of marketable goods which may be of conditions for the application of that substantial value. provision must also be satisfied.

judgment given in 1970, 13 that 'the conduct of the undertakings themselves and application of Article 37 is not limited to not from the manner in which the imports or exports which are directly subject monopoly is organized. to the monopoly but covers all measures which are connected with its existence and affect trade between Member States in certain products, whether or not subject to 59. According to the second subparagraph the monopoly'. of Article 37 (1), however, for the first subparagraph to be applicable, the influence exerted by the monopoly on intra- Community trade in goods must also be 54. Hence the applicability of Article 37 appreciable. The intention would appear to cannot in principle be ruled out in the case be to exclude the application of the of a monopoly such as that in the external prohibition to monopolies which have only services for funerals. an insignificant, negligible or simply marginal effect on trade between Member States. 55. It may apply in conjunction with provisions or measures concerning the supply of goods subject to the monopoly. 60. However, that is a matter which the national court must assess on the basis of the specific circumstances of the case. 56. However, as it is not, strictly speaking, Without prejudice to that assessment, it may a monopoly over the importation of goods be stated that the information available to but a monopoly over services including the the Court seems to be insufficiently disposal of certain goods on the domestic conclusive in that regard: the system market, any influence on trade between involving the grant of an exclusive Member States will be indirect. concession covers a number of communes which account for only 4 5 % of the popu- lation; the PFG group provides only part of the service in question; and the influence on 57. In my view, however, it is not apparent trade is merely indirect. The considerations from the information available that the referred to by counsel for Mrs French system has the effect of giving rise to Bodson — both in the written observations any discrimination of the kind prohibited by and at the hearing — concerning the size of Article 37. the PFG group and the extent to which it is established in France are merely of such a kind as to raise further questions regarding 58. As for the services not comprised in the the influence which they might actually have external services for funerals (such as on intra-Community trade. flowers, funeral notices and marblework), it is difficult to see how they could come within the scope of Article 37 since the 61. I therefore suggest that, in answer to provision of such services is unregulated and the first question, the Court declare that families may choose their supplier. Any Article 37 of the EEC Treaty is capable of restrictions on trade between the Member applying to a monopoly in the provision of States in this area can stem only from the funeral services, including the supply of certain goods, which is established by 13 — Judgment of 16 December 1970 in Case 13/70 Cinzano v communes or other local authorities, only in Hauptzollamt Saarbrücken [1970] ECR 1089, at p. 1095, paragraph 5 of the decision. so far as such a monopoly exerts an appre-

3. Second question: Article 90 of the EEC Treaty 67. For that reason, 'Article 90 concerns only undertakings for whose actions States must take special responsibility by reason of the influence which they may exert over 62. The national court asks whether Article such actions.' 15 90 of the EEC Treaty applies to an under- taking or to a group of undertakings to which a communal monopoly has been granted over the external services for 68. It is necessary, in substance, to ensure funerals. that action taken by the State (meaning 'the public authorities', as interpreted by the Court) in relation to those undertakings does not have the purpose or effect either of 63. (a) Article 90 (1) provides that 'in the restricting or distorting competition or of case of public undertakings and under- introducing distortions in the relationship takings to which Member States grant between those undertakings and private special or exclusive rights, Member States undertakings. shall neither enact nor maintain in force any measure contrary to the rules contained in this Treaty, in particular to those rules 69. However, as is clear from the reference provided for in Article 7 and Articles 85 to to Article 7 (prohibition of discrimination 94'. on grounds of nationality) and from the use of the adverbial phrase 'in particular', the provision in question is of general application since it covers any and every 64. First of all it should be pointed out that, measure which is contrary to the rules of although forming part of the section of the the EEC Treaty. Treaty entitled 'Rules [of competition] applying to undertakings', Article 90 (1), as is clear from its wording, is addressed primarily to the Member States and not to 70. So far as the national court is undertakings. concerned, the desire to seek an interpre- tation of Article 90 (1) is motivated primarily by the need to decide whether the undertakings holding a communal 65. Its aim is to prevent the public auth- concession to provide the external services orities from using the special relationship for funerals may be regarded as under- whereby certain kinds of undertakings are takings which enjoy 'special or exclusive subordinated to them either to compel those rights'. undertakings to act in a manner prohibited by the Treaty or to grant them certain 14 — Judgment of 6 July 1982 in Joined Cases 188 to 190/80 France, Italy and the United Kingdom v Commission [1982] advantages which are incompatible with the ECR 2545, at p. 2579, paragraph 26 of the decision. common market. 15 — Idem, paragraph 12 of the decision.

71. It seems quite clear to me that those constitute 'activities of an economic nature' undertakings, to which the public auth- are organized and operated in compliance orities, in this case the communes, had with the applicable rules of the Treaty, in lawfully granted the special right to provide, particular Articles 52, 59, 85 and 86 thereof. under the system of exclusive concessions, the external services for funerals within their territory, come within the scope of Article 90 (1). 76. As for Articles 85 and 86 of the Treaty, they form the subject-matter of the third question and I shall return to them in due course. 72. In referring to the Member States, that provision does not exclude the grant of special or exclusive rights by communes, that is to say by local authorities of the 77. As regards Articles 52 and 59, which State acting in the exercise of powers are referred to by the Commission in its conferred upon them under public law. observations, it is not apparent from the Similarly, the provision in question applies information available that a question to the relationship between those territorial concerning those provisions was raised in entities and the undertakings holding the main proceedings. Nor does the national concessions. court expressly refer to them. It is primarily for that court to determine whether, in the light of national legislation, the factual situation was such as to contravene the prin- 73. Moreover, there is nothing in the ciples of freedom of establishment and Treaty to prevent a Member State, for freedom to provide services. considerations of public interest, of a non-economic nature, from removing some funeral services from the field of compe- tition by conferring on one or more estab- 78. However, this point has not been lishments or undertakings holding disputed (and the French Government itself concessions an exclusive right to provide has undertaken to demonstrate that the them. 16 relevant legislation was not discriminatory), hence it is unnecessary to deal with it speci- fically in the answers to be given, particularly since a purely domestic situation 74. 'However, for the performance of their would appear to be at issue in the national tasks these establishments [or undertakings] proceedings, not affecting either the right of remain subject to the prohibitions against establishment or the freedom to provide discrimination and, to the extent that this services of any undertaking from another performance comprises activities of an Member State. economic nature, fall under the provisions referred to in Article 90.' 17

80. It is therefore appropriate to raise the question whether undertakings holding a communal concession to provide the 84. The burdens and the supervision external services for funerals may be referred to are connected with the classified as 'undertakings entrusted with 'particular tasks assigned' to those under- the operation of services of general takings by an act of the public authorities, economic interest'. with the result that the conditions which in the Court's view have to be fulfilled for Article 90 (2) to apply to a private under- taking 19 would appear to be satisfied. 81. The classification of the services provided by undertakings is primarily a matter for the national court on the basis of the applicable legislation. 18 85. It is clear, therefore, that those under- takings are subject to the rules of the EEC Treaty 20 and that it is only when those rules 82. However, it is clear from the documents may obstruct the performance of the before the Court that French legislation particular tasks assigned to them that a treats the external services for funerals as situation comes into being which calls for an services in the general interest and has for exception, and even then on condition that that reason entrusted them exclusively to intra-Community trade is not affected in a communes, some of which operate the manner which is contrary to the interests of services directly whilst others have given the Community. private undertakings a concession to provide them.

88. Moreover, it is difficult to envisage any 91. As I have reached the conclusion that exception being established given that a Article 90 is applicable, the question does large number of communes allow unre- not, strictly speaking, call for an express stricted freedom of competition with regard answer. Clearly, as is apparent from the to the provision of the external services. examination of the second question, Articles 85 and 86 must be complied with both by the State in its relations with the under- 89. I therefore suggest that the Court takings to which it has granted special or answer the second question as follows: exclusive rights and by the undertakings which actually enjoy those rights. 22

'(a) Article 90 (1) of the EEC Treaty 92. There is a further point I wish to make, imposes obligations on the Member however, in response to specific enquiries States in their relations with public from the national court. undertakings or with undertakings to which they grant special or exclusive rights, including undertakings to which 93. In particular, the national court asks communes entrust, in accordance with whether Article 85 is applicable to the the law, the operation of the "external contracts for a concession concluded in this services" for funerals; area between the communes and the under- takings concerned.

96. The most that can be said is that 100. However, as the Court has also contracts for a concession which contain emphasized, 26 a dominant position 'does terms requiring or encouraging concession not preclude some competition, which it holders to act in a manner contrary to does where there is a monopoly or a quasi- Article 85 would fall within the scope of monopoly, but enables the undertaking Article 90. 23 However, that would not which profits by it, if not to determine, at appear to be so in the case of the contract least to have an appreciable influence on the granting a concession to PFRL. conditions under which that competition will develop, and in any case to act largely 97. Article 86, for its part, prohibits 'any in disregard of it so long as such conduct abuse by one or more undertakings of a does not operate to its detriment'. dominant position, even if such abuse is encouraged by a national legislative provision'. 24 101. As we know, within the territory of each commune an undertaking holding a 98. According to the actual wording of concession has an exclusive right to provide Article 86, the application of the prohibition the external services and the PFG group which it lays down depends on fulfilment of has established itself in approximately various conditions, namely the existence of two-thirds of the communes which have a dominant position in a substantial part of resorted to the system of granting the common market, the abuse of that concessions. In the other communes, either position by one or more undertakings and the municipal authorities operate the service an effect on trade between Member States. themselves, or the service has been entrusted to other undertakings or else there is freedom of competition. 99. The Court has consistently held 25 that the dominant position referred to in that

presuppose the clear delimitation of the sarily a decisive or a constant factor, and its substantial part of the common market in importance varies from market to market. 30 which it may be able to engage in abuses which hinder effective competition and this is an area where the objective conditions of competition applying to the product in question must be the same for all traders'. 109. The Court has already stated, in particular, that where the market share of an undertaking is between 4 0 % and 4 5 % 104. In that connection, it is possible to that does not necessarily permit the take account of either the territory of each conclusion to be drawn that the undertaking commune viewed in isolation or the position automatically controls the market, and the of the PFG group in relation to the total market share must be determined having number of communes or simply in relation regard to the strength and number of the to all of the communes which use the competitors. 31 system of granting concessions. It remains to be determined, moreover, whether it is necessary to take account of the external services alone or of all the unregulated services as well. 110. Moreover, account must be taken of the relationship between the market shares of the undertaking concerned and of its 105. In any event, the examination pres- competitors, the technological lead of an upposes a perfect knowledge of a complex undertaking over its competitors, the factual situation which, in these pro- existence of a highly-developed sales ceedings, only the national court can network and the absence of potential possess. competition. 32

112. That conclusion is of course chal- charges unfair prices and seeks to lenged by counsel for Mrs Bodson on the strengthen its position by frequently ground that the PFG group controls acquiring shareholdings in rival under- approximately 50% of the French market as takings. a whole and holds 8 5 % of the contracts for an exclusive concession in towns with over 2 000 inhabitants. 117. In the circumstances of this case, however, the rates charged by PFG's 113. Clearly, that is a question of fact subsidiary were allegedly set out in the general conditions themselves. If, therefore, which must be assessed by the national the prices charged bore no reasonable court. relation to the economic value of the service provided, 35 it would be difficult to attribute the resultant responsibility exclusively to 114. For my part I would merely recall that, PFG. 36 In those circumstances, however, as the Court has consistently held, for the Article 90 of the Treaty may have been purpose of 'determining whether a specific infringed by the Member State in question. territory is large enough to amount to "a substantial part of the common market" within the meaning of Article 86 of the Treaty the pattern and volume of the 118. On the other hand, it must be stated production and consumption of t h e . . . that it is not just any acquisition of a share- product as well as the habits and economic holding that points to the existence of an opportunities of vendors and purchasers abuse of a dominant position or of 'conduct must be considered', 33 matters which the restricting competition'. 37 Court is evidently unable to assess under the procedure provided for in Article 177 of the Treaty.

OPINION OF MR CRUZ VILAÇA — CASE 30/87

different from those which condition normal 122. In the case of communal monopolies competition in products or services on the over funeral services, it is for the national basis of the transactions of commercial court to determine those effects. However, operators, has the effect of hindering the it must be acknowledged that it is not easy, maintenance of the degree of competition at first sight, to envisage a situation in still existing in the market or the growth of which those services may have an appre- that competition'. 38 ciable effect on intra-Community trade.

38 — Hoffmann-La Roche, supra, at p. 541, paragraph 91 of the decision. 39 — Judgment of 2 March 1983 ¡n Case 7/82 GVL v 125. As we have seen, it is clear from the Commission [1983]ECR 483, at p. 505, paragraphs 37 and 38 of the decision; see also the judgment of 25 October documents before the Court that, in those 1979 in Case 22/79 Greenwich Film Production v SACEM [1979] ECR 3275, at p. 3288; see also, with regard to the circumstances, the holder of a concession acquisition of shareholdings, the judgment of 6 March for the external services may provide those 1974 in Joined Cases 6 and 7/73 Commercial Solvents v Commission [1974] ECR 223, at p. 252, paragraph 33 of goods and services in competition with the decision. other undertakings. The conclusion can 40 — In relation to Article 85 of the Treaty, see also the judgment of 12 December 1967 in Case 23/67 Brasserie tie therefore be drawn that Articles 37 and 90 Haecht vWilkin [1967] ECR 407, at p. 415. of the Treaty are inapplicable in that sphere.

BODSON v POMPES FUNÈBRES DES RÉGIONS LIBÉRÉES

126. With regard to the first of those function and which apply in a general provisions, the Court has already manner to the production and marketing of emphasized, 41 moreover, that the rules certain products, whether or not they are contained in Article 37 concern only acti- covered by the monopoly in question. vities intrinsically connected with the specific function of a monopoly — namely 127. As regards Articles 85 and 86, their its exclusive right — but are irrelevant to applicability will depend on an assessment national provisions which have no of the facts, which is a matter for the connection with the exercise of that specific national court. 42

OPINION OF MR CRUZ VILAÇA — CASE 30/87

(3) (a) Article 85 of the EEC Treaty is not applicable to the contracts whereby communes grant concessions to undertakings to provide the external services for funerals; however, Article 90 precludes the inclusion in such contracts of terms which require or encourage those undertakings to act in a manner contrary to Article 85;

(b) it is for the national court to establish the existence of an abuse of a dominant position by those undertakings within the meaning of Article 86 of the EEC Treaty.

(4) When acting outside the scope of the exclusive concession to provide the external services for funerals, undertakings holding a concession are subject to the rules of the Treaty, in particular Articles 85 and 86 thereof, and the answers to the preceding questions are not affected by the fact that those undertakings also provide services and supply goods which are not subject to the monopoly.