C-203/96

2. The Raad van State wishes to ascertain in particular whether that legislation envisages the application of the principles of self- sufficiency and proximity only in relation to waste for disposal or whether it also allows their application in relation to waste for recovery. Moreover, it questions whether the Netherlands' policy is a correct implementa­ tion of those principles. In the event that the 3. Council Directive 75/442 on waste was Community legislation does not apply the adopted on 15 July 1975 on the basis of principles of self-sufficiency and proximity Articles 100 and 235 of the Treaty. All of its in relation to waste for recovery, the Raad substantive provisions were replaced by 3 van State seeks to ascertain whether the Council Directive 91/156. The latter direc­ Netherlands' policy in question can never­ tive was adopted on 18 March 1991 on the theless be justified under Article 130t of the basis of Article 130s of the Treaty. I shall refer to Directive 75/442, as amended by

* Original language: English. 1 — OJ1993 L 30, p. 1. 3 — Council Directive 91/156/EEC of 18 March 1991 amending 2 — OJ 1975 L 194, p. 39. Directive 75/442/EEC on waste, OJ 1991 L 78, p. 32.

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Directive 91/156, as 'the Waste Directive' or 6. Article 5 embodies the principles of self- simply 'the Directive'. sufficiency and proximity which are at issue in this case. It provides as follows:

'1 . Member States shall take appropriate 4. The Directive lays down a number of measures, in cooperation with other Member general provisions and general principles States where this is necessary or advisable, to regarding the disposal and recovery of waste. establish an integrated and adequate network Articles 3, 4, 5, and 7 are of particular rel­ of disposal installations, taking account of evance to the present case. Those articles the best available technology not involving provide as follows. excessive costs. The network must enable the Community as a whole to become self- sufficient in waste disposal and the Member States to move towards that aim individually, taking into account geographical circum­ stances or the need for specialised installa­ tions for certain types of waste.

10. The Waste Regulation was adopted on 1 February 1993, and applied from 6 May 7 1994. Like the Directive (in its amended form) it was adopted under Article 130s. The Regulation sets out, inter alia, a system of prior notification of shipments of waste between Member States. It replaced and repealed Directive 84/631 on hazardous 8. Article 7 also provides that waste manage­ waste, but provides for the notification of ment plans 'shall relate in particular to the the transboundary movement of both haz­ type, quantity and origin of waste to be ardous and non-hazardous waste, and gave recovered or disposed of, general technical effect within the Community to the Basel requirements, any special arrangements for Convention (which was approved for the particular wastes, [and] suitable disposal sites Community by Council Decision or installations'. It stipulates that such plans 8 93/98/EEC adopted on the same date as the 'may, for example, cover the natural or legal Regulation). persons empowered to carry out the man­ agement of waste, the estimated costs of the recovery and disposal operations, [and] appropriate measures to encourage rationali­ sation of the collection, sorting and treat­ ment of waste'.

11. The Regulation applies separate sets of rules in relation to shipments of waste for disposal and shipments of waste for recov­ ery. However, prior notification is required in respect of both. The provisions relating to waste for disposal are to be found in Chapter A of Title II of the Regulation and those

9. Finally, in relation to the Directive, it is relevant to note in particular the ninth 7 — Article 44. recital, which states that '... movements of 8 — Council Decision 93/98/EEC of 1 February 1993 on the conclusion, on behalf of the Community, of die Convention waste should be reduced and ... Member on the control of transboundary movements of hazardous States may take the necessary measures to wastes and their disposal (Basel Convention), OJ 1993 L 39, p. 1. The text of the Convention is annexed to the Council that end in their management plans'. Decision.

(ii) in cases where the installation has to dispose of waste from a nearer source and the competent authority has given priority to this waste;

'In order to implement the principles of proximity, priority for recovery and self- sufficiency at Community and national levels in accordance with Directive 75/442/EEC, Member States may take measures in accord­ ance with the Treaty to prohibit generally or partially or to object systematically to ship­ ments of waste. Such measures shall immedi­ (iii) in order to ensure that shipments are in ately be notified to the Commission, which accordance with waste management will inform the other Member States.' plans.'

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DUSSELDORP AND OTHERS v MINISTER VAN VOLKSHUISVESTING, RUIMTELIJKE ORDENING EN MILIEUBEHEER

15. Finally, Article 4(3)(c) lists three further take 'the measures necessary to prevent grounds of objection. Objections may be movements of waste which are not in raised if the shipment: accordance with their waste management plans'.

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20. The Ministry's objections to the ship­ ments were made by means of two decisions

22. The questions of law raised by the appel­ 9 — See paragraphs 23 to 31. lants concern the lawfulness of the Minis-

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DUSSELDORF AND OTHERS v MINISTER VAN VOLKSHUISVESTING, RUIMTELIJKE ORDENING EN MILIEUBEHEER

try's objection to the shipment of waste to that, on account of the principle of self- another Member State of the European sufficiency, the export of dangerous waste for Union. They contend that the contested rule incineration should be restricted as far as was an unjustifiable restriction upon the free possible, in part because elsewhere the emis­ movement of goods, particularly since the sion requirements for incineration were less principles of self-sufficiency and proximity strict than in the Netherlands. in waste management may be invoked under the Regulation only as a ground for object­ ing to shipments of waste for disposal, not waste for recovery.

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undesirable price increases, conditions were disposal or recovery. Secondly, it concludes imposed in the permit given to AVR. that the policy laid down in the Plan amounts to a prohibition on exports if the quality of the intended processing abroad is the same as or lower than the quality of the processing available in the Netherlands.

26. The appellants maintain that AVR's treatment of oil filters amounts to a disposal rather than a recovery operation because it incinerates the filters. According to the appellants, although AVR makes use of some of the heat produced by the incineration in order to generate electricity and recovers 29. Thirdly, it concludes that the Plan must some of the residues, that is only incidental. be assumed to be a 'waste management plan' The appellants maintain that, in contrast, within the meaning of the Directive. As Factron's process enables the whole of the 10 explained above, under the Waste Direc­ oil filter to be recycled. tive, Member States are required to draw up 'waste management plans' and the Regu­ lation refers to the enforcement of such plans. The appellants argue that the Plan in issue in the present case cannot be classified as a waste management plan within the 27. According to the appellants, AVR is a meaning of the Community legislation. The limited partnership, in which the Nether­ Raad van State, however, disagrees with the lands State and the district of Rotterdam appellants on that point. According to the own a 55 % share (the remainder being observations of the Commission and the owned by private undertakings). The appel­ Netherlands Government, the Plan was lants also maintain that one of the members indeed notified as a 'waste management plan' of the Surveillance Board of AVR is the to the Commission on 13 September 1993. director of the waste management division of the Netherlands Ministry. They state that that Ministry lays down the Netherlands' policy in relation to waste and thus decides whether a particular export should be allowed to proceed.

31. Finally, it is to be noted that the Nether­ lands Government explains that the Ministry '1 . (a) Having regard to the scheme of is to change its policy regarding the export Regulation (EEC) No 259/93 of 1 of waste for recovery. Such exports will be February 1993 on the supervision permitted unless the amount of waste recov­ and control of shipments of wastes ered abroad is appreciably less than that within, into and out of the Euro­ recovered in the Netherlands. The Govern­ pean Community and Directive ment maintains that that policy is in confor­ 75/442/EEC of 15 July 1975 on mity with Article 7(4)(a), fifth indent, of the waste (as amended by Directive 1 Regulation. 1In so far as is relevant here, 91/156/EEC), read in conjunction that provision stipulates that objections to with each other, do the principles of shipment of waste for recovery may be self-sufficiency and proximity apply raised 'if the ratio of the recoverable and solely to the shipment between non-recoverable waste ... [does] not justify Member States of waste for disposal the recovery under economic and environ­ or also to waste for recovery? mental considerations'. The Commission invites the Court to consider the compatibil­ ity of that new policy with Community law by way of an obiter dictum. In my view, however, that would not be appropriate since no question has been posed in relation (b) If the Court of Justice takes the thereto and accordingly no observations view that Regulation (EEC) No have been submitted on that point. The fact 259/93 and Directive 75/442/EEC that the policy set out in the Plan has now do not provide a basis for the appli­ changed does not obviate the need to answer cation of the principles of self- the questions referred. As the Commission sufficiency and proximity to the observes, there is always a risk that the shipment between Member States of present practice will continue and it might waste for recovery, can Article 130t still be relevant to know whether the previ­ of the EC Treaty then provide a ous policy was illegal for the purpose of basis for rules such as those con­ establishing whether or not the Ministry is tained in the relevant part of the liable for damages. Long-term Plan for Disposal of Dangerous Waste of June 1993 drawn up by the Netherlands Gov­ 11 — Quoted at paragraph 17 above. ernment?

4. Are the exclusive rights to incinerate 35. In considering that question it may be dangerous waste conferred by the Neth­ useful to examine first the meaning and his­ erlands authority on AVR Chemie CV tory of the principles of self-sufficiency and in Sectoral Plan 10 of Part II of the proximity, and their application by the Long-term Plan compatible with Article Court.

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DUSSELDORF AND OTHERS v MINISTER VAN VOLKSHUISVESTING, RUIMTELIJKE ORDENING EN MILIEUBEHEER

38. It seems that the first appearance of the principles of self-sufficiency and proximity in a Community text was in a Commission Communication on Community Strategy for Waste Management Policy dated 18 Septem­ 1 ber 1989, 7followed by a Council Resolu­ 1 37. Environmental policies were given an tion dated 7 May 1990. 8The Commission express legal basis in Community law by the Communication did not expressly mention Single European Act which came into force either principle but did refer to the need to on 1 July 1987 and which introduced into develop a network of facilities for the final the Treaty a specific title on the environ­ disposal of waste so that certain areas within ment. That title 13 comprises Articles 13 Or, the Community were not left under- 130s, and 130t, and was amended by the equipped, and to the desirability of waste Treaty on European Union. Article 130r(2) being disposed of in the nearest suitable cen­ 1 provides that Community policy on the tres (with exceptions for recyclable waste). 9 environment shall be based on, inter alia, the principle that 'environmental damage should as a priority be rectified at source' (hereinaf­ 14 — Case C-2/90 [1992] ECR I-4431, discussed at paragraphs 45 ter 'the principle of rectification at source'). to 50 below. 15 — Paragraph 34 of the judgment 16 — Paragraph 35 of the judgment. 17 — SEC (89) 934 final; see Damian Chalmers, 'Community Policy on Waste Management — Managing Environmental 12 — At paragraphs 13 and 14 respectively. Decline Gently', Yearbook of European Law, 1994, p. 280. 13 — Originally Title VII but now Title XVI by reason of 18 — OJ 1990 C 122, p. 2. amendment by the Treaty on European Union. 19 — At pp. 23 to 25.

39. In the Walloon Waste case the Court referred to the appearance of the principles of self-sufficiency and proximity in the Basel 41. The Convention requires the parties to Convention on the control of transboundary 'ensure that the transboundary movement of movements of hazardous wastes and their hazardous wastes and other wastes is 20 disposal. The Convention was signed on reduced to the minimum consistent with the 22 March 1989 and approved on behalf of environmentally sound and efficient manage­ 24 the Community on 1 February 1993, after ment of such wastes ...', and 'to ensure that the judgment in the Walloon Waste case, by the transboundary movement of hazardous 21 Council Decision 93/98/EEC. The Waste wastes and other wastes only be allowed if: Regulation was designed, inter alia, to make the existing Community system for the supervision and control of waste movements comply with the requirements of the Con­ vention, as evidenced by the fourth recital of the preamble to Decision 93/98 and the first (a) the State of export does not have the recital of the preamble to the Regulation. technical capacity and the necessary Although the title of the Convention refers facilities, capacity or suitable disposal to the control of transboundary movements sites in order to dispose of the wastes in of hazardous wastes and their 'disposal', it question in an environmentally sound applies to both waste for disposal and waste and efficient manner; or for recovery since the term 'disposal' is defined as including recovery operations. 22 23 — See Article 2(3) which refers to the transboundary move- ment of hazardous wastes 'or other wastes'; Article 1(2) defines 'other wastes' as wastes listed in Annex II: the only wastes listed therein are 'wastes collected from households' 20 — Paragraph 35 of the judgment, cited at paragraph 45 below. and 'residues arising from the incineration of household 21 — Cited in note 8. wastes'. 22 — Article 2(4) provides that 'disposal' means 'any operation 24 — Article 4(2)(d). See also the 18th recital of the preamble specified in Annex IV'; Annex IV includes a list of 'opera- where it is stated that the transboundary movement of haz- tions which may lead to resource recovery, recycling, recla- ardous wastes and other wastes should be reduced to the mation, direct reuse or alternative uses'. minimum possible.

45. The application of the principles of self- sufficiency and proximity to the free move­ 43. Moreover, Article 4(2)(b) of the Conven­ ment of waste has already been addressed by tion requires each party to 'ensure the avail­ this Court to a certain extent in the Walloon ability of adequate disposal facilities, for the environmentally sound management of haz­ ardous wastes and other wastes, that shall be 27 — See also the eighth recital of the preamble where it is stated located, to the extent possible, within it, that hazardous wastes and other wastes should, as far as is compatible with environmentally sound and efficient man- agement, be disposed of in the State where they were gener- ated. 28 — Peter Von Wilmowsky, 'Waste disposal in the internal mar- ket: the state of play after the ECJ's ruling on the Walloon 25 — Article 4(9). Import Ban', Common Market Law Review, 1993, p. 541 at 26 — Article 4(2)(e). p. 560, note 37.

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taken into account only in the case of mea­ sures which apply without distinction to both domestic and imported products ... . However, in assessing whether or not the barrier in question is discriminatory, account must be taken of the particular nature of waste. The principle that environmental damage should as a matter of priority be 46. Various aspects of that judgment have remedied at source, laid down by Article been the subject of criticism, in particular the 130r(2) of the Treaty as a basis for action by way in which the Court applied the prin­ the Community relating to the environment, ciples of self-sufficiency and proximity in entails that it is for each region, municipality order to find that the import ban was not 32 or other local authority to take appropriate discriminatory. It should be noted, how­ steps to ensure that its own waste is col­ ever, that the Court cannot be said to have lected, treated, and disposed of; it must justified the ban on the basis of the prin­ accordingly be disposed of as close as pos­ ciples of self-sufficiency and proximity as sible to the place where it is produced, in such. Although it used those principles to order to limit as far as possible the transport find that the rule was not discriminatory, the of waste. environmental justification which it identi­ fied was Wallonia's limited capacity to receive waste for tipping and the consequent

real danger to the environment from imports 47. It accordingly seems to me that the of waste for tipping. The Court stated Court cannot be said to have endorsed the that: blanket application of the principles of self- sufficiency and proximity as grounds of jus­ tification for any measure contrary to Articles 30 or 34: each measure adopted in implementation of such principles must, in my view, be individually justified. That point is important in the present case because the Raad van State states expressly that if the 'With respect to the environment, it is Court takes the view that the principles of important to note that waste is matter of a self-sufficiency and proximity may be special kind. Accumulation of waste, even invoked when objecting to the planned before it becomes a health hazard, consti­ export of waste for recovery, the question tutes a danger to the environment, regard then arises whether Article 34 limits the way being had in particular to the limited capac­ in which those principles may be applied. ity of each region or locality for waste recep­ tion.

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with the Treaty'. There is thus nothing in to waste for recovery since that case con­ the legislation to suggest that it was intended cerned waste for disposal. Although the ref­ that implementation of the principles of self- erence to 'treatment' in paragraph 34 of the sufficiency and proximity should not be sub­ judgment is ambiguous, the rule in question ject to scrutiny under the Treaty. in that case concerned the storage, tipping, or dumping of waste and, with the possible exception of storage, those activities are dis­ 37 posal operations.

waste for recovery in addition to shipments and 86/279. 41 However, the judgment refers of waste for disposal. to waste for disposal and, even if it could be shown that the term 'disposal' was used loosely, the facts of that case pre-dated the Regulation. Moreover, rather than constitut­ ing an outright export ban, the German restrictions were expressly limited to a list of circumstances which appeared environmen­ tally justifiable. 50. The Walloon Waste case is not, in any event, authority for concluding that the prin­ ciples of self-sufficiency and proximity apply 37 — Moreover, since the Court referred in that paragraph to treatment 'and' disposal and elsewhere referred only to dis- posal, in using the word 'treatment', the Court might have had in mind treatment prior to disposal, perhaps in order to render waste safe pending or during disposal. 35 — With regard to the provisions of the Regulation and the 38 — Case C-422/92 [1995] ECR I-1097. Directive it is clear that they cannot authorise Member States to breach the Treaty: see, for example, Joined Cases 39 — Case C-155/91 [1993] ECR I-939. 80/77 and 81/77 Commissionnaires Réunis v Receveur des 40 — Cited in note 30. Douanes [1978] ECR 927; Joined Cases C-363/93 and 41 — Council Directive 86/279/EEC of 12 June 1986 amending C-407/93 to C-411/93 Lancry v Direction Générale des Directive 84/631 on the supervision and control within the Douanes [1994] ECR I-3957. European Community of the transfrontier shipment of haz- 36 — At paragraph 27. ardous waste, OJ 1986 L 181, p. 13.

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Assessment 55. The principles of self-sufficiency and proximity are referred to in the Directive only in relation to waste for disposal (see Article 5 and the seventh recital). Similarly, in the Regulation they feature only in the list of grounds for objecting to shipments of 53. In the present case the appellants, the waste for disposal, not in that relating to 44 Commission and France all contend that the waste for recovery. Moreover, the 10th Community legislation does not apply the recital of the preamble to the Regulation principles of self-sufficiency and proximity refers to the principles of proximity, priority in relation to waste for recovery. The Neth­ for recovery and self-sufficiency (in similar erlands and Denmark, however, are of the terms to the terms of Article 4(3)(a)(i) of the opposite view. Regulation) in relation to 'waste for dis­ posal': '... Member States should be able to implement the principles of proximity, prior­ ity for recovery and self-sufficiency at Com­ munity and national levels — in accordance with Directive 75/442/EEC — by taking measures in accordance with the Treaty to prohibit generally or partially or to object 54. It is clear to my mind that the Directive systematically to shipments of waste for dis­ and the Regulation do not envisage the posal ...'

42 — Paragraph 14 of the judgment 44 — The seventh recital of the preamble to the Regulation makes 43 — The Regulation entered into force on the third day follow- reference to the principles of proximity and self-sufficiency ing its publication, on 6 February 1993, in the Official Jour- in rehearsing the provisions of the Directive which refer to nal of the European Communities, but applied only 15 those principles. It accordingly similarly refers to those months after publication (Article 44). principles only in the context of waste for disposal.

57. Moreover, the Explanatory Memoran­ 58. Furthermore, the second recital of the dum which accompanied the original pro­ preamble to the Waste Directive refers to the posal for the Regulation stated that 'The Council Resolution of 7 May 1990 on waste strategy highlights distance and rational, policy, in which the Council undertook to 48 environmentally sound management as crite­ accelerate the amendment of the Directive, ria which can justify intervention from the and that Resolution states expressly, albeit in competent authorities in waste disposal mat­ a footnote, that 'It is noted that self- ters; environmentally sound management ... sufficiency in waste disposal does not apply 49 will be the only criterion for [the interven­ to recycling.' It might be argued that the tion of the competent authorities] if the fact that there is no similar footnote in 45 operation involves further use.' Similarly, it stated that 'the system, laid down by the proposal for a Regulation is based on the 46 — P. 5. principle that any shipment which leaves the 47 — In the original proposal, provided certain conditions were complied with, a separate regime applied in relation to jurisdiction of one competent authority for waste for recovery. The grounds for objecting to the ship- any other jurisdiction in the Community ment of waste for recovery were not listed and in fact only the competent authority of destination could lodge objec- will be judged on the same criteria (environ­ tions. In relation to waste for disposal, on the other hand, Article 4(3) provided that the competent authority of dis- mentally sound management and, where dis­ patch could raise objections to a planned shipment if there was 'an authorised centre significantly nearer than the one posal is involved, proximity). This system is chosen by the notifier and which [used] suitable technolo- also able to guarantee the supply of new gies to ensure a high level of protection of the environment and human health'. disposal installations with a high level of 48 — Paragraph 15 of the Resolution. 49 — That statement appears as a footnote to the fifth recital of the preamble to the Resolution which provides that '... it is important for the Community as a whole to become self- sufficient in waste disposal and it is desirable for Member 45 — COM (90) 415 final — SYN 305, 26 October 1990, p. 4. States individually to aim at such self-sufficiency'.

60. What is clear, however, is that the econ­ omic and environmental arguments for allowing cross-border trade are stronger where waste is to be recovered rather than disposed of. Where waste is simply to be dis­ posed of, it is easy to see that the economic benefits conferred on waste-disposal under­ takings by a single market are overridden by 59. It has been argued that the application of the environmental interest in preventing the principles of self-sufficiency and proxim­ unnecessary transport of waste and ensuring ity in relation to waste for recovery would that Member States make adequate arrange­ discourage the recovery of waste, as opposed ments to dispose of their own waste in an to its disposal, and that that would be con­ environmentally sound manner. Any deve­ trary to the express aim in Article 3 of the 51 lopment of technologies resulting from free Directive of encouraging such recovery. movement of waste would moreover be spe­ The appellants argue that cross-border cific to waste disposal. movement of waste for recovery is necessary in order to ensure that enough business is available to make recovery businesses eco­ nomically viable and to ensure competition between undertakings so as to encourage the development of new technologies. It is to be noted, however, that the Netherlands Gov­ ernment argues, along similar lines, that it is necessary to restrict exports of waste for recovery from the Netherlands so as to ensure that AVR has enough business and 61. Waste for recovery, on the other hand, raw material to make it economically viable. provides substitute raw materials for a wide variety of Community industries. The econ­ omic benefits of a single market are therefore 50 — Namely the reference in paragraphs 7 and 11 to the facilita- much greater. Moreover, the environmental tion of 'the disposal of waste in one of the nearest suitable arguments are much more finely balanced. facilities' and to the minimisation of the movement of waste. While the transport of waste over distances 51 — Cited at paragraph 5. 'Priority for recovery' is also men- may, depending on the type of waste, entail tioned in Article 4(3)(a)(i) of the Regulation, see paragraph 13 above. certain environmental risks, a single market

63. The appellants argue that the Regulation should be interpreted in the light of the Basel Convention and that that Convention makes it clear that the principles of self-sufficiency and proximity do not apply in relation to waste for recovery. I agree that, since the Regulation was intended to implement that 53 Convention, it may, subject to compliance with the Treaty, be interpreted in the light of 62. Thus the Regulation clearly envisaged the Convention. I do not, however, agree different rules applying in relation to waste that the Convention clarifies the issue. for recovery and waste for disposal: that is evident from the eighth recital of the pre­ amble to the Regulation which states that '... it is necessary to apply different procedures depending on the type of waste and its des­ tination, including whether it is destined for disposal or recovery', and from the structure of the Regulation. Thus Chapter A of Title II concerns the procedure to be applied in 64. As set out above, Article 4(2) of the relation to waste for disposal and Chapter B Convention requires parties to ensure the 54 of that same title concerns the procedure to availability of adequate disposal facilities be applied in relation to waste for recovery. and the term 'disposal' is defined in the Con­ 55 The procedure in relation to shipments of vention as including recovery operations. waste for recovery is less restrictive in that However, although parties are generally the consent of the competent authorities can required to prohibit transboundary move­ be tacit and no general prohibitions may be ments of waste, certain exceptions apply, laid down. 52 If, however, self-sufficiency and which include the situation in which the proximity were to constitute general grounds waste in question is 'required as a raw mate­ for objecting to shipments of waste for rial for recycling or recovery industries in 56 recovery, in addition to shipments of waste the State of import' (Article 4(9)). for disposal, the difference between the two regimes would be considerably reduced 53 — See paragraph 39 above. 54 — See paragraph 41 above. 55 — See paragraph 39 above. 52 — Compare Article 4(3)(a)(i) in relation to waste for disposal. 56 — Quoted in full at paragraph 41 above.

69. That conclusion does not, however, mean that, in a particular case, an objection to a shipment of waste for recovery might 66. It can be argued that, in any event, the not be justified under Community law on principles of self-sufficiency and proximity environmental protection or public health apply only at Community level and that the grounds because, for example, exceptionally Convention cannot be regarded as compel­ hazardous waste was being transported ling the Community to introduce measures incompatible with the EC Treaty rules on the free movement of goods. 58 — Parties might be entitled under the Convention to prohibit the export of waste for recovery by virtue of Article 4(11) of the Convention, which provides that nothing in the Convention shall prevent a Party from imposing additional requirements that are consistent with the provisions of the 57 — See the discussion of Article 11 in Katharina Kummer, Convention, and are in accordance with the rules of inter- International Management of Hazardous Wastes, Oxford, national law, in order better to protect human health and 1995, at pp. 88 to 99. the environment.

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unnecessarily far and thereby creating an 72. The appellants argue, inter alia, that unacceptable risk to public health or the Article 130t cannot apply because, in their environment. It is clear that such risks view, the Community legislation has totally increase directly in relation to the distance harmonised the field and Article 130t cannot 59 that such waste is transported. apply in cases of total harmonisation; and because, rather than going further in the same direction as the Community legislation, the contested rule, in their view, runs counter to it.

71. That article provides that 'the protective measures adopted pursuant to Article 130s shall not prevent any Member State from maintaining or introducing more stringent protective measures. Such measures must be compatible with this Treaty. They shall be 74. In my view, however, none of the issues notified to the Commission.' which might arise under Article 130t need to be resolved in the present case. Article 130t provides that the measures permissible by virtue of that article must in any event be 59 — As the Economic and Social Committee observed at para­ graph 3.2.2. of its Opinion on the Communication from the compatible with the other provisions of the Commission on the review of the Community strategy for waste management, 'risks from toxic substances ... increase Treaty. For the reasons given below, I con­ according to the distance they are transported i. e. accord­ sider that the contested rule is contrary to ing to the areas and number of people at risk of contamina­ tion', OJ 1997 C 89, p. 2. Article 34 of the Treaty.

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DUSSELDORP AND OTHERS v MINISTER VAN VOLKSHUISVESTING, RUIMTELIJKE ORDENING EN MILIEUBEHEER

Question 2 raw material for AVR in order to make it economically viable.

75. Question 2 appears to be asking whether 78. With regard to the principle of proxim­ the contested rule is a correct implementa­ ity, however, some recovery installations tion of the principles of self-sufficiency and abroad might be nearer than AVR to the proximity. Since I have concluded that those source of waste in question in a particular principles cannot be applied in relation to case. Thus, in some cases the contested rule waste for recovery, it may be unnecessary to may actually be contrary to the principle of address that question. Nevertheless I have proximity. As for the principle of self- the following observations. sufficiency, as the Commission points out, the Member States are not under an absolute obligation to become self-sufficient.

81. It is first necessary to clarify the nature 61 of the contested rule. As mentioned above, the appellants argue that there was an out­ right ban on the export of oil filters, presum­ ably because they consider that it had been decided that the quality of the processing of such filters abroad was nowhere superior to 83. In the present case those conditions that of the processing in the Netherlands, appear to be satisfied. The contested rule has and hence a general prohibition had been as its specific object or effect the restriction imposed. The Raad van State, however, con­ of patterns of exports. Moreover it is dis­ siders that there was no general ban on the criminatory because it favours a domestic export of oil filters because, in its view, there processor of waste over processors in other Member States. It follows that the contested were no grounds under the Plan for object­ rule constitutes a measure having equivalent ing to export if it could in fact be shown that effect to a quantitative restriction on exports a better quality processing method was avail­ within the meaning of Article 34. able abroad. Since the nature of the Plan is a question of fact or of national law, it is appropriate to proceed on the assessment adopted by the Raad van State.

84. I turn now to the issue of justification. The Netherlands Government argues that its objections to the export of waste for recov­ ery are designed to achieve the best possible 82. According to established case-law, method of recovery and continuity of Article 34 does not catch measures applicable without distinction to domestic trade and to exports: the test which has been repeated on numerous occasions is that set out in 62 — Case 155/80 [1981] ECR 1993; sec also Joined Cases 141/81 to 143/81 Holdijk [1982] ECR 1299, paragraph 11 of the judgment; Case 172/82 Fabricants Raffineurs d'Huile de Graissage v Inter-Huiles [1983] ECR 555, paragraph 12; Case 237/S2Jongeneel Kaas v Netherlands [1984] ECR 483, paragraph 22 and Case C-47/90 Delhaize v Promalvin 61 — At paragraph 24. [1992] ECR I-3669, paragraph 12.

85. In making those observations, however, the Netherlands Government appears to be referring to the export of waste for recovery generally. It has not shown that the transport of the oil filters in question further than nec­ essary posed a threat to the health or life of humans. Nor has it shown that the nature of 87. Moreover, the appellants maintain that the recovery process abroad posed such a the Netherlands Government does now threat — even assuming that it would be allow similar shipments to proceed. The entitled to rely on such considerations. It is Government admits that it will be changing not suggested that Factron's recovery facility its policy, explaining that objections to the is not up to required standards. Indeed, the export of waste for recovery will be made on Netherlands Government accepted at the rel­ the basis of the rate of recovery abroad com­ evant time that Factron's recovery process 63 pared with that in the Netherlands. It was comparable, albeit not superior, to that states, somewhat cryptically and unconvinc- of AVR. As the Commission points out, it ingly, simply that that change in policy was appears that no reference to public health made because, in relation to waste for recov­ was made in the decisions objecting to the ery, the importance of self-sufficiency for shipments, even though Article 7(4)(a), sec­ hygiene and the environment has diminished. ond indent, allows objections to be raised if a No further explanation is given. shipment is not in accordance with national laws and regulations relating to environmen­ tal protection, public order, public safety or health protection. 63 — See paragraph 31 above for a description of the new policy.

89. Environmental considerations which go beyond the concerns mentioned in Article 36 may qualify as imperative requirements 64 within the meaning of Cassis de Dijon. However, they can constitute justification for measures caught by Article 34 only in the event that the measure is applicable without distinction. That of course suggests that imperative requirements can never justify measures caught by Article 34 since mea­ sures are only caught by that article if they 65 are discriminatory. 91. Even assuming, however, that the con­ tested rule could be said to be capable of jus­ tification in certain circumstances by refer­ ence to the imperative requirement of environmental protection, it would not, in my view, be justified on the facts since a threat to the environment has not been proved. It has not been shown that the trans­ port of the waste in question in itself poses 90. In the Walloon Waste case I concluded an environmental threat. Nor, as mentioned that the Walloon import ban could not be earlier, has it been suggested that the treat­ justified on environmental grounds because ment abroad is not up to required standards. it discriminated against imports. The Court As the Court stated in Inter-Huiles, 68 in succeeded nevertheless in applying that such circumstances 'clearly, the environment ground of justification by finding that the is protected just as effectively when the measure was not discriminatory. However, in

66 — Sec, for example, the cases cited by Peter Oliver, at pp. 112 64 — Case 120/78 Rewe-Zentral v Bundesmonopolverwaltung für and 113: Case 113/80 Commission v Ireland [1981] ECR Branntwein [1979] ECR 649; in relation to environmental 1625; Case 16/83 Pronti [1984] ECR 1299; Case 274/87 considerations, see, for example, Case 302/86 Commission v Commission v Germany [1989] ECR 229 and Case Denmark [1988] ECR 4607, paragraph 8 of the judgment. C-238/89 Pall [1990] ECR I-4827. 65 — See, to the same effect, Peter Oliver, Free Movement of 67 — Peter Oliver, at p. 113. Goods in the European Community, Third Edition, 1996, 68 — Inter-Huiles, cited in note 62, at paragraph 14 of the judg- Sweet & Maxwell, at p. 122. ment.

92. The Netherlands Government maintains that the rule is needed in order to ensure an adequate supply of oil filters to AVR for use as fuel. According to the Netherlands Gov­ ernment, in the absence of a sufficient supply of oil filters AVR would be obliged to use a 94. I accordingly conclude, in answer to less environmentally friendly fuel. However, question 3(a), that the contested rule consti­ even if the prevention of the use of less envi­ tutes a quantitative restriction on exports ronmentally friendly fuel could in principle within the meaning of Article 34 of the be accepted as a justifiable environmental Treaty, and that it cannot be justified on the aim, it would have to be shown that the con­ basis of either Article 36 or the imperative tested rule was proportionate to that aim, requirements. and it has not been shown that a sufficient supply of environmentally friendly fuel could not be provided by means which are 71 — See, for example, Case 7/61 Commission v Italy [1961] ECR 70 less restrictive of intra-Community trade. 317, at p. 329, and Case C-324/93 Evans Medical and Mac- Farlan Smüh [1995] ECR I-563. 72 — Case 72/83 Campus Oil Limited v Minister for Industry and Energy [1984] ECR 2727, paragraph 35 of the judg- ment; Nertsvoederfabriek Nederland, cited in note 69, para- graph 15, where, quoting Campus Oil, the Court stated that 69 — Case 118/86 Openbaar Ministerie v Nertsvoederfabriek 'the mere fact that national provisions, justified by objective Nederland [1987] ECR 3883, at paragraph 16 of the judg- circumstances corresponding to the needs of the interests ment. referred to therein, enable other objectives of an economic 70 — See, for example, Nertsvoederfabriek Nederland, cited in nature to be achieved as well, does not exclude the applica- note 69, in which the Court considered that an implicit tion of Article 36. That applies with greater force where the restriction on the export of poultry offal did not appear objective of an economic nature necessarily enables the necessary in order to safeguard health. objective relating to health to be attained.'

Question 4 97. The Raad van State considers that, as a result of sectoral plan 10 of Part II of the Plan, AVR constitutes a public undertaking or an undertaking with special or exclusive rights within the meaning of Article 90(1) of the Treaty. The Raad van State also considers 96. Question 4 asks whether the exclusive that, as sole holder of an authorisation to rights granted to AVR under sectoral plan 10 incinerate dangerous waste in the Nether­ 73 of Part II of the Plan are compatible with lands, AVR is in a dominant position in a the first and second paragraphs of Article 90, substantial part of the common market. It in conjunction with Article 86 of the Treaty. reasons that it is accordingly necessary to Article 90(1) states that, in relation to public consider whether AVR has abused that undertakings and undertakings to which dominant position, contrary to Article 86 of Member States have granted special or exclu­ the Treaty, having regard to the possibility of sive rights, Member States may neither enact justification under Article 90(2) of the nor maintain in force any measure contrary Treaty. The Netherlands Government, on the to the rules of the Treaty, particularly those other hand, maintains that the Plan did not in Article 6 and Articles 85 to 94. Article give AVR exclusive rights with regard to the 90(2) states that undertakings entrusted with incineration of oil filters. It explains that it the operation of services of general economic made a comparison between the process of interest or having the character of a revenue- recovery of waste oils by Factron abroad and producing monopoly are subject to the rules that carried out by AVR simply because at of the Treaty, in particular to the rules on the relevant time there was no other under­ taking in the Netherlands which was capable of treating waste oil, or at least not to as high 73 — According to the Netherlands Government, that part of the a standard. The Netherlands Government Plan is not relevant since it concerns only inflammable accordingly maintains that AVR has no packaged waste which has nothing to do with the present litigation; it is sectoral plan 19 which concerns oil filters. exclusive rights as far as waste for recovery is The nature of the Plan is discussed at paragraphs 23 to 31 above. concerned. However, the question whether

98. The Raad van State asks expressly about the application of Article 90 only in relation 99. The Raad van State observes that AVR to a possible abuse of a dominant position generally charges higher prices for treating by AVR, contrary to Article 86. The Com­ waste (including the recovery thereof) than mission argues that it is, therefore, unneces­ foreign undertakings, and that the policy sary to address the fourth question if, as I contained in the Plan involves a limitation of have suggested, the contested rule is in markets, so that there might be an abuse breach of Article 34 and is not justified within the meaning of subparagraphs (a) and under Article 36 or the imperative require­ (b) of Article 86 respectively. Those subpara­ ments since the rule would be unlawful in graphs provide, respectively, that abuse of a any event. However, question 4 concerns not dominant position may, in particular, consist only the export restriction which I have con­ in 'directly or indirectly imposing unfair sidered under Article 34, but also the exclu­ purchase or selling prices or other unfair sive rights granted to AVR for the incinera­ trading conditions' or 'limiting production, tion of waste. In any event, the issue of a markets, or technical development to the breach of Article 90 in conjunction with prejudice of consumers'. Article 86 is not rendered manifestly irrel­ evant by virtue of a finding that Article 34 has been infringed, and it is primarily for the national court to assess the necessity of its 74 — The relevant case-law is discussed in the Opinion of Advo­ cate General Cosmas of 26 November 1996 in Joined Cases questions. The question might even be raised C-157/94, C-158/94, C-159/94 and C-160/94 Commission v Netherlands, Italy, France and Spain, at paragraphs 86 to whether Article 90(2) could apply to what 90.

100. The national court does not specifically Article 86, it may need to consider whether seek guidance on Article 86 itself, and it may the Netherlands is in breach of Article 90(1) therefore be sufficient to make three com­ in conjunction with Article 86. The Nether­ ments. First, when a State confers a legal lands Government would only be in breach monopoly upon an undertaking in respect of of Article 90(1) in conjunction with Article a substantial part of the common market, 86 if the exclusive rights granted to AVR that undertaking will be in a dominant pos­ caused the breach of Article 86. While any 75 ition within the meaning of Article 86, and such abuse may be a consequence of the the territory of a Member State over which dominant position enjoyed by AVR, the the monopoly extends may constitute a sub­ mere fact that the Netherlands has conferred 76 stantial part of the common market. Sec­ exclusive rights on AVR is clearly not in ondly, it is well-established that the mere itself sufficient to demonstrate that there is grant of exclusive rights does not in itself an infringement of Article 90(1). It would necessarily create an abuse of a dominant have to be shown that AVR either abused its 77 position. Thirdly, the mere fact that the dominant position merely by exercising its charges of an undertaking with special or exclusive rights, or that the rights conferred exclusive rights are higher than those of created a situation in which AVR was 79 other undertakings in the same line of busi­ induced to commit such abuses. However, ness does not necessarily constitute proof of so far as the alleged unfair prices are con­ an abuse of its dominant position, although cerned, it does not appear to be suggested it is a relevant factor to be taken into that the Netherlands is itself responsible for account. The Court has held that there will the pricing policy of AVR: at most it has be an abuse if prices are excessive because only facilitated any unfair prices by the they bear no reasonable relation to the eco­ exclusive rights granted to AVR and there is nomic value of the product supplied; the no indication that AVR's pricing policy was questions to be determined are whether the an inevitable result of any of the exclusive difference between the costs actually rights which it has been granted. incurred and the price actually charged is excessive, and, if so, whether a price has been imposed which is either unfair in itself or 78 when compared to competing products.

be classified as a service of general economic the rules of the Treaty, that derogation interest is for the national court in so far as it should be interpreted restrictively. is a question of fact or requires an interpreta­ 80 tion of the applicable national legislation. However, the following observations can be made as to the general meaning of the con­ cept of an undertaking 'entrusted with the operation of services of general economic 105. The reason for the assignment of par­ interest'. ticular tasks to undertakings is often that the tasks need to be undertaken in the public interest but might not be undertaken, usually for economic reasons, if the service were to be left to the private sector. The potential lacuna may often occur because the perfor­ mance of certain tasks such as the provision of services to remote regions is not profitable 83 (for example, airline services, postal ser­ 84 85 103. It seems to me that a waste manage­ vices, a telecommunications network, 86 ment function might well be said to consti­ and the provision of electricity ). tute a service of general economic interest 81 within the meaning of Article 90(2). How­ ever, AVR must be shown not simply to be performing a service of general economic interest in relation to waste management but actually to have been 'entrusted' with such a 106. If the Raad van State were to find that service in the sense that certain obligations AVR was entrusted with a service of general are imposed on it by the State in the general economic interest and that it was in breach economic interest. Indeed, Article 90(2) of Article 86 it would be necessary to show refers to the assignment of 'particular tasks' that requiring AVR to comply with the to the undertakings in question. competition rules of the Treaty would obstruct the particular tasks assigned to it. Again, it is ultimately for the national court to decide whether any anti-competitive behaviour engaged in by AVR is necessary 87 for the achievement of AVR's tasks.

107. The test for determining whether the application of the competition rules would Obstruct' the performance of the tasks in question has been formulated in different 88 ways. In Almelo the Court stated that 'restrictions on competition from other economic operators must be allowed in so far as they are necessary in order to enable the undertaking entrusted with ... a task of 69 108. Article 90(2) expressly allows for cer­ general interest to perform it'. In Sacchi 90 tain exemptions from the Treaty rules for and CBEM it considered that the rules of undertakings rather than for Member States. the Treaty would apply unless their applica­ To the extent that Article 90(2) could never­ tion would be 'incompatible' with the per­ theless be invoked as authorising derogations formance of the assigned tasks. In the more 91 from the Treaty rules where Member States recent case of Corbeau, however, the confer special rights on undertakings inas­ Court considered the test to be whether the much as the rules in themselves cause the restriction on competition or even the exclu­ undertaking to breach Article 86 and thereby sion of all competition from other economic result in breach of Article 90(1), the exclusive operators is necessary 'in order to allow the rights would have to be examined under holder of the exclusive right to perform its Article 90(2). On that point, the Netherlands task of general interest and in particular to Government argues that the exclusive rights have the benefit of economically acceptable 92 are necessary in order to make AVR eco­ conditions'. The Court considered the nomically viable. However, as the Commis­ starting point of such an examination to be sion points out, it must be shown to the sat­ 'the premise that the obligation on the part isfaction of the national court that that objective cannot be achieved equally well by other means. 88 — Cited in note 86, paragraph 49 of the judgment. 89 — Case 155/73 [1974] ECR 409. 90 — Case 311/84 CBEM v CLT and IPB [1985] ECR 3261. 91 — Cited in note 75. 93 — Paragraph 17 of the judgment. 92 — Paragraph 16 of the judgment. 94 — Paragraph 19 of the judgment.

(3) Where an undertaking is found to have infringed Article 86 of the Treaty by abuse of a dominant position within the common market or a substantial part of it, a Member State which has granted special or exclusive rights to that undertaking will be in breach of Article 90(1) of the Treaty only if the grant of the special or exclusive rights caused the infringement of Article 86.

(4) Where, in the absence of Article 90(2), the conduct of an undertaking would be unlawful under Article 86 of the Treaty, that undertaking may rely on Article 90(2) of the Treaty only if it can be shown that it has been specifically

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OPINION OF MR JACOBS — CASE C-203/96

entrusted with the operation of services of general economic interest and only if the application of Article 86 would make it impossible for it to perform the particular tasks assigned to it.

I-4110