C-12/00

COMMISSION v SPAIN

OPINION OF ADVOCATE GENERAL ALBER delivered on 6 December 2001 1

I — Introduction chocolate products intended for human consumption (hereinafter 'Directive 73/241') 2 contains the following provi- sions:

1. These proceedings concern the free movement of chocolate products that con- tain vegetable fats other than cocoa-butter. Spain prohibits such products lawfully manufactured in other Member States of the Community from being marketed under the name 'chocolate', requiring that they be marketed under the name 'chocolate sub- stitute'. Seventh recital

II — Legal framework 'whereas the use of vegetable fats other than cocoa-butter in chocolate products is permitted in certain Member States, and extensive use is made of this facility; whereas, however, a decision relating to the possibilities and forms of any extension (1) Community law of the use of these fats in the Community as a whole cannot be taken at the present time, as the economic and technical data currently available are not sufficient to enable a final position to be adopted; Council Directive 73/241/EEC of 24 July whereas the situation will consequently 1973 on the approximation of the laws of have to be re-examined in the light of the Member States relating to cocoa and future developments;'

1 — Original language: German. 2 — OJ 1973 L 288, p. 23.

3 — This requirement was met not after three years, as planned, but only with the adoption of Directive 2000/36/EC. This ...' will be discussed again in point 23.

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(2) Spanish law comments on these drafts pursuant to Article 8(2) of Directive 83/189. By letter of 21 October 1992, which was answered on 18 March 1993, the Commission again criticised what it regarded as failure to 2. Directive 73/241 was transposed into comply with Community law through the Spanish law by Royal Decrees Nos restriction of the free movement of choc- 822/1990 and 823/1990. Article 2(16) of olate lawfully manufactured in other Royal Decree No 822/1990 of 22 June Member States. Despite a number of con- 1990 defines 'chocolate' as a product tacts between the appropriate authorities of manufactured from cocoa beans, cocoa the Spanish Government and the Commis- mass, cocoa powder or fat-reduced cocoa sion an agreement was not subsequently powder and sucrose with or without added reached. The Commission therefore cocoa-butter. This definition complies with repeated its criticism by letter of 20 March point 1.16 of Annex I to Directive 73/241. 1997. This letter remained unanswered. On Article 4(1) of the Decree prohibits the 29 July 1998 the Commission forwarded to addition of vegetable fats other than cocoa- Spain a reasoned opinion, in which it butter to chocolate. Article 2(7) of Royal reiterated its accusation that the free move- Decree No 823/1990 of 28 June 1990 ment of goods was being infringed. On requires products in which cocoa-butter is 9 November 1998 the Spanish Government- replaced by other vegetable fats to be replied that, in its view, Royal Decree designated 'chocolate substitute'. No 822/1990 was compatible with Direc- tive 73/241 and Spanish legislation there- fore complied with Community law. On 14 January 2000 the Commission brought an action against the Kingdom of Spain.

5. The Commission explicitly criticises only the provision of Royal Decree No 822/1990 which prohibits marketing under the name 'chocolate'. The provision contained in Royal Decree No 823/1990 9. The Commission sees the Spanish legis- requiring such products to be designated lation as restricting the free movement of 'chocolate substitute' is not explicitly criti- goods particularly because it prescribes the cised. use of a name with which a less attractive assessment of the product by the consumer is associated. It maintains that the term 'substitute' always designates a product used in place of another, not all of whose qualities it possesses, these qualities accounting for the value of the product it 6. The Commission claims that the Spanish replaces. The obligation to use a term of Government's interpretation of Directive lesser standing is in itself a restriction of the 73/241 results in the Member States being free movement of goods within the mean- divided into those which permit chocolate ing of the judgment in Dassonville. 6 containing vegetable fats other than cocoa- butter to be marketed under the name 'chocolate' and those, such as Spain, which refuse to allow it.

10. According to the Commission, the requirement that the product be renamed also gives rise to repackaging costs, which again leads to a restriction of the free 7. The Commission sees the obligation to movement of goods. Community law change the name of products from 'choc- requires only that the product be marketed olate' to 'chocolate substitute' as a measure having equivalent effect to a quantitative 5 — Joined Cases C-267/91 and C-268/91 Keck and Mithouard restriction; it prevents the product from [1993] ECR I-6097. being marketed under the name under 6 — Case 8/74 Dassonville [1974] ECR 837, paragraph 5.

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(2) Spain consumer protection grounds. It ensures that the consumer is informed about the composition of the product in traditional language.

15. The Spanish Government is of the opinion that prohibiting chocolate prod- ucts containing vegetable fats other than cocoa-butter from being marketed under the name 'chocolate' is compatible with Article 28 EC. It argues that Directive 73/241 does not govern the manufacture of such products and that, in the absence of the harmonisation of Community law, the Member States are empowered to legislate 19. The Spanish Government contends that on this question. Spain has done this by 'chocolate substitute' is not a negative adopting the disputed Royal Decrees. term, but is, in fact, a common designation, with which the Spanish consumer has been familiar since 1975. Products thus desig- nated are esteemed no less than products which may be known as 'chocolate'. In the Spanish Government's opinion, 'chocolate 16. Nor, according to the Spanish Govern- substitute' is a neutral term that reflects an ment, does the disputed legislation obstruct objective fact, the fact that, compared to the access of these products to the market. chocolate, the product has been altered in It merely requires them to be marketed terms of quality, taste, consistence and under the name 'chocolate substitute' ('suc- durability. In this instance, the question is cedàneo de chocolate'). not whether the minimum requirements of Directive 73/241 as regards the composi- tion of chocolate products have been satis- fied, but to what extent vegetable fats other than those listed in the Directive may be added. This question is not answered by Directive 73/241. 17. In the Spanish Government's opinion, this requirement does not constitute a measure having equivalent effect to a quantitative restriction. It is rather a selling arrangement within the meaning of the judgment in Keck and Mithouard.

22. Both parties take the view that the marketing of chocolate products containing vegetable fats other than cocoa-butter is not governed by Directive 73/241. This view can be endorsed. According to the seventh recital, 'a decision relating to the possibilities and forms of any extension of the use of these fats in the Community as a 21. The Spanish Government maintains whole cannot be taken at the present time'. that the use of the prescribed name does Article 14(2)(a) of the Directive therefore not increase the costs to the marketer. states explicitly that it does not affect the Council Directive 79/112/EEC of provisions of national laws 'at present 18 December 1978 on the approximation authorising or prohibiting the addition of of the laws of the Member States relating to vegetable fats other than cocoa-butter to the labelling, presentation and advertising the chocolate products defined in Annex I'. of foodstuffs for sale to the ultimate con- sumer 7as amended by Directive 97/4/EC of the European Parliament and of the Council of 27 January 1997 amending Directive 79/112/EEC on the approxi- mation of the laws of the Member States relating to the labelling, presentation and 23. It was to be 2000 — rather than 1976, advertising of foodstuffs 8had been trans- as required by Article 14 of Directive posed into Spanish law in such a way as to 73/241 — before Community law, in the require the marketed product to be labelled shape of Directive 2000/36/EC of the in Spanish. The same applies to the indi- European Parliament and of the Council cation of the composition of the product. of 23 June 2000 relating to cocoa and Thus, if the term 'chocolate' is replaced chocolate products intended for human with the term 'chocolate substitute' at the consumption, 9specified that certain veg- time of the repackaging which then etable fats other than cocoa-butter as listed becomes necessary, the cost of marketing in Annex II of the Directive might account this product is not increased. for up to 5% of the finished product. However, as this provision docs not have to

be transposed into national law until 26. According to the judgment in the Cassis 3 August 2003, it does not apply to the de Dijon case, it is for the Member States to current action. adopt for their territory all legislation concerning the manufacture and marketing of a product in cases where there are no Community rules. 'Obstacles to movement within the Community resulting from dis- parities between the national laws relating to the marketing of the products in ques- tion must be accepted in so far as those provisions may be recognised as being necessary in order to satisfy mandatory 24. As already pointed out, Directive requirements relating in particular to the 73/241 does not govern the question of effectiveness of fiscal supervision, the pro- the use of vegetable fats other than cocoa- tection of public health, the fairness of butter in chocolate products. This raises the commercial transactions and the defence of question disputed by the parties as to the the consumer.' However, obstacles to legal consequences of this statement. Spain movement are acceptable only if they serve takes the view that, since the adoption of a purpose which is in the general interest this legal act, the Member States have been and such as to take precedence over the free to lay down rules on the use of requirements of the free movement of vegetable fats other than cocoa-butter in goods, which constitutes one of the funda- chocolate products, possibly prohibiting mental rules of the Community. 10 the marketing of products under the name 'chocolate' if they do not comply with national legislation. The Commission, on the other hand, is of the opinion that under Article 28 EC the Member States are under an obligation to permit products lawfully manufactured in other Member States under the name 'chocolate' to be marketed in their territory under the name 'choc- olate' used in the country of origin. 27. It follows from this judgment that, a l t h o u g h the M e m b e r States are empowered to lay down rules in areas in which there is no or no more than partial harmonisation, 1 1which is true, as stated above, of the use of the name 'chocolate' for products containing vegetable fats other than cocoa-butter, such rules must be compatible with the Treaty provisions concerning the free movement of goods. 25. Directive 73/241 does not specify the In other words, where they lead to a extent to which products containing veg- etable fats other than cocoa-butter may be marketed under the name 'chocolate'. It 10 — Case 120/78 Rewe- Zentral ('Cassis de Dijon') [1979] ECR 649, paragraphs 8 and 14); Case C-470/93 Mars therefore represents no more than partial [1995] ECR I-1923, paragraph 12); Keck and Mithouard (cited in footnote 5, paragraph 15). harmonisation, not a conclusive set of rules 11 — For the imposition of language requirements see Case on the use of the name 'chocolate'. C-33/97 Colim [1999] ECR I-3175, paragraph 35.

1 3 — Dassonville (cited in footnote 6, point 5); Keck and 12 — Sec Case C-3/99 Ruwet |2000] ECR I-8749, pararaph 47. Mitbouard (cited in footnote 5, paragraph 11 ).

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judgment in the Colim case the Court ruled their free movement in the Community. 20 that measures necessitating the alteration of That is a measure having equivalent effect the packaging or the labelling of imported to a quantitative restriction within the products are not selling arrangements meaning of Article 28 EC. within the meaning of the judgment in Keck and Mithouard. 19 An interim con- clusion to be drawn, therefore, is that, as the Spanish rules do not constitute a selling arrangement, the application of the rules on the free movement of goods is not ruled out. 35. It should be borne in mind, however, that the prohibition docs not entirely exclude the marketing of these products in Spain. They may be marketed under the name 'chocolate substitute'. The Spanish Government therefore disputes the exist- ence of a measure having equivalent effect to a quantitative restriction.

(bb) Existence of an obstruction to the free movement of goods

that is compatible with Article 28 EC, 21 it 39. As regards the option of marketing the has also ruled in a number of judgments products in question under the name 'choc- that it would not be compatible with olate substitute', reference must be made to Article 28 EC and the objectives of a the possibility of negative feelings being common market for national legislation to aroused in the consumer by the use of this be allowed to restrict a generic term to one term. 'Substitute' is not an objective, neu- national variety alone to the detriment of tral term that imparts a simple piece of other varieties produced, particularly in information, as does the printed statement other Member States, by compelling the 'contains vegetable fats other than cocoa- producers of the other varieties to use butter'. The addition of the word 'substi- appellations which are unfamiliar to or less tute' implies that the product is not choc- esteemed by the consumer. 22 olate but merely a replacement. It is thus possible that the consumer will consider this product inferior or esteem it less than a product marketed under the name 'choc- olate'. It must therefore be assumed that the option of marketing the product under the name 'chocolate substitute' does not result in the disputed prohibition having no restrictive effect on the free movement of goods. 38. In the present case, the name 'choc- olate' is not restricted to Spanish products. It may, indeed, be used for all products containing only cocoa-butter. However, the marketing of products which have been lawfully manufactured in other Member States under the name 'chocolate', but 40. An interim conclusion to be drawn, contain vegetable fats other than cocoa- therefore, is that the Spanish rules obstruct butter is prohibited. Such chocolate prod- the free movement of goods. This obstruc- ucts have not traditionally been manufac- tion is compatible with Community law tured in Spain. As Spanish products are not only if it is justified. therefore affected by the prohibition, the rules benefit a typically domestic product and discriminate to the same degree against products lawfully manufactured under the name 'chocolate' in other Member States. Such conduct represents, according to the case-law to which reference has been made, (b) Justification of the restriction of the free a measure having equivalent effect to a quantitative restriction. 23 movement of goods

obstacles to intra-Community trade result- ing mistakes. The Commission's objection ing from disparities between provisions of to this argument is that consumer protec- national law must be accepted in so far as tion is not one of the grounds that may be such provisions are applicable to domestic cited in justification pursuant to Article 30 and imported products without distinction EC. and may be justified as being necessary in order to satisfy overriding requirements relating inter alia to consumer protection. However, in order to be permissible, such provisions must be proportionate to the objective pursued and that objective must not be capable of being achieved by meas- ures which are less restrictive of intra- 44. Although Article 30 EC does not Community trade. 24 explicitly refer to consumer protection as justifying derogations, the Court has nonetheless acknowledged that consumer protection is an imperative requirement- accepted in principle by Community law as justifying measures that restrict the free movement of goods. 25 Thus the second of the conditions referred to above is similarly satisfied. 42. The Spanish legislation applies to domestic and imported products without distinction. The first condition is thus satisfied.

47. The prohibition of marketing under the name 'chocolate' and the option of market- ing the products in question under the 49. The Spanish Government's argument is name 'chocolate substitute' are likely to similar to that of the Italian Government in protect Spanish consumers against making the proceedings concerning the name 'vin- a mistake. It is ensured that the only egar', where it was argued that the disputed vegetable fat contained in products which national rules were necessary because the they can acquire under the name 'choc- Italian consumer by time-honoured tradi- olate' is cocoa-butter. This protects them tion treated all vinegars as wine-vinegar. against confusing these products with The Court rejected this objection and ruled products containing other vegetable fats. that under the Combined Nomenclature of These rules are thus likely to ensure con- the Common Customs Tariff vinegar is a sumer protection. generic term which national legislation cannot restrict to domestic products. Suit- able labelling of types of vinegar manu- factured from raw materials other than wine was considered to be generally suffi- cient to ensure the protection of the con- sumer. The Italian rules were regarded as a disproportionate restriction of the free 48. To be compatible with Community movement of goods, given the availability law, however, the rules must not exceed of appropriate labelling as a less drastic what is necessary. As a less drastic measure means of protecting the consumer. 27 Simi- the Commission proposes appropriate larly, the German Government attempted labelling of the products that contain other to justify the purity requirement for beer by vegetable fats. The Spanish Government arguing that the consumer associated the

designation 'Bier' with a beverage manu- objection that to Spanish consumers 'choc- factured from only the raw materials listed olate' traditionally means products con- in Article 9 of the Biersteuergesetz. The taining as vegetable fat only cocoa-butter restriction of the generic term 'Bier' to does not in principle seem to justify the products manufactured in accordance with disputed rules. the purity requirement was intended to protect the consumer against confusion about the nature of the product. 28 The Court again rejected this argument on the grounds that consumers' conceptions are likely to vary from one Member State to another and to evolve in the course of time within a Member State, the establishment of the common market playing a major 50. It should also be pointed out, however, contributory role in this context. 'The that the Court has defined the limit of what legislation of a Member State must not can be achieved with appropriate labelling "crystallise given consumer habits so as to as being the stage at which the product consolidate an advantage acquired by concerned is altered in a respect that is national industries concerned to comply essential for its composition. 32 with them".' 29 Here too, appropriate labelling of beers not manufactured in accordance with the purity requirement was considered adequate. In addition, the Court ruled that national legislation which links the appellation 'Jenever' to a mini- mum alcohol content is not compatible with Article 28 EC and that the require- 51. The question is therefore whether the ments of fair trading can also be met with addition of vegetable fats other than cocoa- regard for traditional practices by means of butter leads to a fundamental change in the appropriate labelling of beverages with a composition of the product and whether lower alcohol content. 30 In similar cases appropriate labelling can consequently no concerning the composition of a product longer be regarded as a sufficient means of the Court has also considered labelling informing the consumer adequately and sufficient to protect the consumer's inter- protecting him against mistakes. ests. 31 Given this settled case-law, the

has always geared its rulings to an intelli- market it under the name 'chocolate' would gent consumer who can reasonably be be to mislead the consumer. The Commis- expected and trusted to inform himself. 33 sion feels, on the other hand, that, com- Thus, according to the case-law, it must be pared to chocolate containing only cocoa- assumed that consumers who are guided in butter, the product is not fundamentally their purchasing decisions by the composi- changed, since it still contains, in particu- tion of products first read the list of lar, the proportions of cocoa defined in ingredients. Although the Court has recog- Directive 73/241. nised the danger of consumers being misled in specific cases, 34 and to this extent the objections voiced by the Spanish Govern- ment are in principle justified, this danger must be regarded as slight, according to present case-law, and cannot justify obstacles to the free movement of goods. 35 There is no obvious reason for deviating from the settled case-law in these proceed- ings. 54. Point 1.16 of Annex I to Directive 73/241 defines chocolate as the product obtained from cocoa nib, cocoa mass, cocoa powder or fat-reduced cocoa powder and sucrose, which, though made with or without added cocoa-butter, contains at least 18% cocoa-butter. This indicates that cocoa-butter is to be regarded as an essen- tial ingredient of chocolate within the meaning of Directive 73/241.

chocolate. This might indicate that the 57. It should be borne in mind, on the other products which — in excess of the hand, that, according to an undisputed required minimum content of cocoa- submission by the Commission, the prod- butter — may replace cocoa-butter as ucts in question are lawfully manufactured equivalents are also to be regarded as under the name 'chocolate' in six Member essential ingredients, with the result that States. According to a further undisputed their addition should lead to a fundamental submission by the Commission, the mar- change in the product. keting of these products under the name 'chocolate' is prohibited only in Spain and Italy. All the other Member States permit them to be marketed under the name 'chocolate'. These facts indicate that the addition of vegetable fats other than cocoa- butter does not result in so fundamental a change in the composition of the product that it can no longer be regarded as falling within the category of chocolate.

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be seen as so fundamentally changing the 61. The reservations which the Spanish product that it can no longer justifiably be Government derives from legitimate con- deemed to fall within the category of cern for consumer protection should be chocolate. taken into account by ensuring that the consumer is informed clearly enough of the addition of such other fats.

59. This conclusion is endorsed by the 62. The final conclusion to be drawn is Combined Nomenclature (CN) of the therefore that prohibiting the use of the Common Customs Tariff. Chocolate is name 'chocolate' is not the least drastic listed under CN Code 1806 with other means of informing the Spanish consumer food preparations containing cocoa. Prod- of the fact that the product contains ucts containing cocoa-butter are listed vegetable fats other than cocoa-butter. under subheadings 1806 20 10, 1806 20 The requirement that the product be appro- 30 and 1806 20 50. All other subheadings, priately labelled has less of an adverse some of which explicitly use the term impact on the free movement of goods. The 'chocolate', such as subheading 1806 90, Spanish Government rules are thus dispro- do not refer to the content in cocoa-butter portionate and so fail to justify the restric- or other vegetable fats. This indicates that tion of the free movement of goods which the name 'chocolate' should be regarded as has been identified. The Commission's a generic term whose use does not depend action should therefore be upheld. on the addition or absence of vegetable fats other than cocoa-butter.

(2) The Kingdom of Spain shall bear the costs of the proceedings.

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