OPINION OF ADVOCATE GENERAL
TRSTENJAK
delivered on 17 July 2008 (1)
Case C‑205/07
Criminal proceedings against Lodewijk Gysbrechts and
Santurel Inter BVBA
(Reference for a preliminary ruling from the Hof van Beroep te Gent (Belgium))
(Articles 28 EC to 30 EC – Directive 97/7/EC on the protection of consumers in respect of distance contracts – Period for withdrawal – Prohibition of demand for an advance or for payment before the expiry of the period for withdrawal – Interpretation of a national provision as meaning that a credit card number cannot be required before the expiry of the period for withdrawal – Sale over the internet)
I – Introduction
1. In the present case, the referring court wishes to know whether Articles 28 EC to 30 EC preclude a provision of the Belgian Law of 14 July 1991 on commercial practices and the provision of information to and the protection of consumers (‘the Belgian Law on consumer protection’) by virtue of which, in the case of a distance contract, the vendor cannot demand any advance or payment whatsoever from the consumer before the expiry of the period for withdrawal of seven working days. In the context of this analysis, it is also necessary to determine whether those articles of the Treaty preclude the specific interpretation by the Belgian authorities of the abovementioned provision of the Belgian Law on consumer protection to the effect that, when concluding a distance contract, the vendor cannot require the consumer to provide his credit card number, even though the vendor undertakes not to use it to obtain payment before the expiry of the period for withdrawal. Consequently, the present case raises important questions concerning internet sales and associated credit card payments whereby internet sales are facilitated and also encouraged.
2. In a broader context, the present case provides a good illustration of how the arrangements and conditions for payment of the purchase price must also adapt to the development of the contract of sale. In Roman law, a contract of sale, for example, was performed by the vendor delivering the goods to the buyer and receiving from him the sale price; (2) the two obligations were therefore performed simultaneously. With the development of the contract of sale, the arrangements and conditions of payment have changed considerably and those changes have been even more marked with the development of new technologies. The arrangements for payment which must contribute to the security of payments, to simplicity and, if possible, to the protection of all the parties concerned must also adapt to the development of the technologies which permit electronic management and trading. When assessing the present case, it must also be borne in mind that electronic management and commerce and the associated credit card payments will be even more widespread in the future than they are today.
3. In the context of assessing Article 29 EC, the present case involves a discussion of the important question of the definition of measures having equivalent effect to quantitative restrictions on exports which, in settled case‑law, are limited to measures of the Member States which specifically restrict exports and which treat differently, in law or in fact, internal trade and patterns of export trade and which, in so doing, confer advantages on the domestic market.
II – Legal framework
A – Community law
4. Recital 14 in the preamble to Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997 on the protection of consumers in respect of distance contracts (OJ 1997 L 144, p. 19; ‘Directive 97/7’) states as follows:
‘… the consumer is not able actually to see the product or ascertain the nature of the service provided before concluding the contract; … provision should be made, unless otherwise specified in this Directive, for a right of withdrawal from the contract …’
5. Article 6 of Directive 97/7 provides as follows:
‘1. For any distance contract the consumer shall have a period of at least seven working days in which to withdraw from the contract without penalty and without giving any reason. The only charge that may be made to the consumer because of the exercise of his right of withdrawal is the direct cost of returning the goods.
The period for exercise of this right shall begin:
– in the case of goods, from the day of receipt by the consumer where the obligations laid down in Article 5 have been fulfilled,
…
2. Where the right of withdrawal has been exercised by the consumer pursuant to this Article, the supplier shall be obliged to reimburse the sums paid by the consumer free of charge. The only charge that may be made to the consumer because of the exercise of his right of withdrawal is the direct cost of returning the goods. Such reimbursement must be carried out as soon as possible and in any case within 30 days.
3. Unless the parties have agreed otherwise, the consumer may not exercise the right of withdrawal provided for in paragraph 1 in respect of contracts:
…
– for the supply of goods made to the consumer’s specifications or clearly personalised or which, by reason of their nature, cannot be returned or are liable to deteriorate or expire rapidly,
…’
6. Article 8 of Directive 97/7 reads as follows:
‘Member States shall ensure that appropriate measures exist to allow a consumer:
– to request cancellation of a payment where fraudulent use has been made of his payment card in connection with distance contracts covered by this Directive,
– in the event of fraudulent use, to be recredited with the sums paid or have them returned.’
7. Article 14 of Directive 97/7 provides as follows:
‘Member States may introduce or maintain, in the area covered by this Directive, more stringent provisions compatible with the Treaty, to ensure a higher level of consumer protection. Such provisions shall, where appropriate, include a ban, in the general interest, on the marketing of certain goods or services, particularly medicinal products, within their territory by means of distance contracts, with due regard for the Treaty.’
B – The Rome Convention
8. Article 5, entitled ‘Certain consumer contracts’, of the Rome Convention on the Law applicable to Contractual Obligations opened for signature in Rome on 19 June 1980 (OJ 1980 L 266, p. 1; ‘the Rome Convention’) is worded as follows:
‘1. This Article applies to a contract the object of which is the supply of goods or services to a person (“the consumer”) for a purpose which can be regarded as being outside his trade or profession, or a contract for the provision of credit for that object.
2. Notwithstanding the provisions of Article 3, a choice of law made by the parties shall not have the result of depriving the consumer of the protection afforded to him by the mandatory rules of the law of the country in which he has his habitual residence:
– if in that country the conclusion of the contract was preceded by a specific invitation addressed to him or by advertising, and he had taken in that country all the steps necessary on his part for the conclusion of the contract, or
– if the other party or his agent received the consumer’s order in that country, or
– if the contract is for the sale of goods and the consumer travelled from that country to another country and there gave his order, provided that the consumer’s journey was arranged by the vendor for the purpose of inducing the consumer to buy.
3. Notwithstanding the provisions of Article 4, a contract to which this Article applies shall, in the absence of choice in accordance with Article 3, be governed by the law of the country in which the consumer has his habitual residence if it is entered into in the circumstances described in paragraph 2 of this Article.
…’
C – Belgian law
9. In Belgium the consumer’s right to withdraw in the case of distance contracts is governed by Article 80 of the Belgian Law on consumer protection.
10. Article 80(3) of the Belgian Law on consumer protection provides as follows:
‘Without prejudice to the application of Article 45(1) of the Law of 12 June 1991 on consumer credit, no deposit or any form of payment whatsoever may be required from the consumer before the end of the withdrawal period of seven working days referred to in paragraph 1.
If the right of withdrawal provided for in paragraphs 1 and 2 is exercised, the vendor shall repay the amounts paid by the consumer, without costs. This repayment shall be made within 30 days of the withdrawal.’
…’
III – Facts, main proceedings and question referred
11. Santurel Inter BVBA (‘Santurel’), whose business manager is Mr L. Gysbrechts, is a company specialising in the wholesale and retail sale of food supplements. Most of the sales are done over the internet, with the goods ordered being dispatched by post.
12. Following a complaint from a French customer, the Belgian Economic Inspection Board carried out an investigation as a result of which Santurel and Mr Gysbrechts were found guilty of offences under the distance-selling provisions of the Belgian Law on consumer protection. The offences consisted in failure to comply with Article 80(3) of the Belgian Law on consumer protection, which prohibits demands for an advance or payment from the consumer before the expiry of the period for withdrawal of seven working days. More specifically, the issue was the interpretation of that provision by the Belgian authorities to the effect that it is prohibited to require a consumer to provide his credit card number before the expiry of the period for withdrawal of seven working days.
13. In the criminal proceedings, the Court of First Instance at Dendermonde (Belgium) fined each of the accused EUR 1 250. They appealed to the Hof van Beroep te Gent (Court of Appeal, Ghent), which has referred to the Court a question for a preliminary ruling on whether the abovementioned Belgian provision is compatible with Community law.
14. According to the national court, the prohibition laid down by Article 80(3) of the Belgian Law on consumer protection creates a risk that it will be difficult for a Belgian vendor to obtain payment for goods sent to parties established in other Member States, which is even more likely in the case of small amounts for the prices of food supplements. The national court shares the view of the accused that the prohibition is an unjustified obstacle to the free movement of goods within the Community.
15. In those circumstances, the national court, by order of 20 March 2007, decided to stay the proceedings and to refer the following question to the Court for a preliminary ruling:
‘Does the Belgian Law of 14 July 1991 on commercial practices and the provision of information to and the protection of consumers constitute a measure having equivalent effect, as prohibited in Articles 28 [EC] to 30 EC, inasmuch as Article 80(3) of that national law prohibits demands for an advance or for payment from the consumer during the compulsory period for withdrawal, as a result of which the actual effect of the Law of 14 July 1991 on the trading of goods in the trader’s own country differs from its effect on trading with nationals of another Member State and does this give rise in fact to an obstacle to the free movement of goods, which is protected by Article 23 EC?’
IV – Procedure before the Court
16. The order for reference was received by the Court on 19 April 2007. In the written procedure, observations were submitted by Santurel, the Belgian Government and the Commission of the European Communities. At the hearing on 20 May 2008, the Belgian Government and the Commission presented oral argument and answered questions from the Court.
V – Arguments of the parties
17. According to Santurel, Article 80(3) of the Belgian Law on consumer protection should be interpreted as meaning that, in distance selling, the vendor may require the buyer to provide his credit card number if, in so doing, he undertakes not to use it to obtain payment before the expiry of the period for withdrawal. Santurel submits that the interpretation to the effect that it is prohibited to require the credit card number in distance selling is contrary to Articles 28 EC to 30 EC. In that connection, Santurel refers to Dassonville (3) and Keck and Mithouard (4) and argues that interpreting the Belgian Law on consumer protection as meaning that the vendor cannot require the consumer’s credit card number does not affect, in fact, exports and sales within Belgium in the same manner. Santurel considers that this interpretation of the Belgian Law constitutes a barrier to the free movement of goods and is therefore a measure having an effect equivalent to a quantitative restriction, which is prohibited by the EC Treaty.
18. In its written observations, the Belgian Government submits that Article 80(3) of the Belgian Law on consumer protection complies with the Treaty because it is an additional measure for the protection of consumers based on Article 14 of Directive 97/7. The Belgian Government accepts that this provision entails a certain level of risk that the Belgian vendor may not receive payment for goods sent abroad, but it is not, in its view, contrary to Community law. Nevertheless, if the Court were to find that the contested Belgian provision is a measure having equivalent effect within the meaning of Article 28 EC, that measure is justified on grounds of consumer protection. It aims to ensure that the consumer is able to exercise effectively his right of withdrawal. According to the Belgian Government, the measure in question is proportionate to attaining the objective of consumer protection.
19. At the hearing, the Belgian Government added that a royal decree was being enacted in Belgium which would regulate a payment system for distance selling and which would entail no risk to the consumer whilst also protecting the vendor. Under that system, the consumer would pay the purchase price to the account of an independent third party, for subsequent transfer to the vendor at the end of the period for withdrawal. The Belgian Government added that, in distance selling, the vendor could not restrict the consumer in choosing from among several methods of payment.
20. With regard to the effect on imports of Article 80(3) of the Belgian Law on consumer protection, the Commission submits that it may also affect contracts of sale concluded by vendors in other Member States with buyers established in Belgium, since Article 5(2) of the Rome Convention allows consumers to claim the level of protection prevailing in Belgium, which is higher than in their Member State. In its analysis, the Commission starts from the definition of measures having equivalent effect laid down in Dassonville (5) and then considers it in the light of Keck and Mithouard. (6) Regarding the latter case, it considers that the Belgian provision concerns all traders and that it affects, in law, domestic products and imported products in the same manner. With regard to the actual effect of the contested Belgian provision, the Commission considers that it is for the national court to make that assessment. If it appears that the actual burden on imported products is greater and that therefore the Belgian provision is a measure having equivalent effect to a quantitative restriction, the Commission considers that the measure can be justified on grounds of consumer protection and that it is proportionate.
21. With regard to the effect on exports, the Commission considers that Article 80(3) of the Belgian Law on consumer protection is not a measure having equivalent effect within the meaning of Article 29 EC. Although the provision at issue may affect trade with other Member States more than trade within Belgium, in the present case it is not a measure having the object or effect of restricting export patterns within the meaning of the Groenveld judgment (7) and the subsequent case-law. At the hearing, the Commission proposed that the Court should modify the definition of measures having an equivalent effect to quantitative restrictions on exports and should define them as measures ‘which have the effect of restricting exports and which give rise to a difference in treatment between the internal trade of a Member State and exports’. On the basis of this new definition, the Commission finds that the Belgian provision at issue is a measure having equivalent effect within the meaning of Article 29 EC. It may well be possible to justify the measure on grounds of consumer protection but, according to the Commission, it infringes the principle of proportionality.
VI – Assessment by the Advocate General
A – Introduction
22. In the present case, the national court asks whether Articles 28 EC to 30 EC preclude a provision of the Belgian Law on consumer protection which, in relation to distance contracts, prohibits a demand for an advance or payment by the consumer before the expiry of the period of seven working days for withdrawal, provided for by Directive 97/7. Although the national court has formulated its question as asking whether Article 29 EC precludes the actual wording of the Belgian provision, it is clear from the order for reference that the national court wishes to know whether the abovementioned articles of the EC Treaty preclude the interpretation applied to that provision in practice, to the effect that the vendor cannot require the consumer to provide his credit card number even if he undertakes not to use it to collect payment before the end of the period of seven working days for withdrawal. On this point, it must be observed that, according to settled case‑law, it is for the Court to provide the national court with all those elements for the interpretation of Community law which may be of assistance in adjudicating on the case pending before it, whether or not that court has specifically referred to them in its questions. (8) Consequently, when the Court determines whether Community law precludes a provision of national law, it must take account of that provision as interpreted by the Belgian authorities. (9)
23. It must be observed first of all that, in adopting the contested provision, Belgium exercised its right under Article 14 of Directive 97/7, which allows Member States to introduce or maintain, in the area covered by the Directive, more stringent provisions. However, those more stringent provisions must be compatible with the Treaty, (10) as expressly stated in that article. In the present case, therefore, the question arises whether the Treaty provisions on the free movement of goods preclude the Belgian provision at issue.
24. In this Opinion, I shall first examine the question referred in relation to Article 28 EC, and then Article 29 EC. In considering the question in relation to Article 29 EC, I shall begin with the current case‑law, then deal with and assess the reasons, if any, justifying modification of that case‑law, and, lastly, I shall propose, with reference to Article 29 EC, a reply to the national court’s question on the basis of the new, modified criteria of assessment.
B – Assessment of the question referred in relation to Article 28 EC
25. The national court’s question seeks first of all to establish whether Article 28 EC precludes the provision at issue of the Belgian Law on consumer protection. On that point, the Commission submits that, when a Belgian buyer purchases goods from a vendor established in another Member State, Article 80(3) of the Belgian Law on consumer protection may have an effect on the import of the goods into Belgium. If so, a Belgian consumer may in any case rely on Article 5(2) of the Rome Convention, whereby the law of the country where he has his habitual residence will apply to the contract. I agree with the Commission that a similar problem may in practice also arise where the so-called Rome I regulation (11) is made to apply, but the Commission’s comments are not relevant to the facts in the main proceedings.
26. The factual situation in the main proceedings does not relate to the import of goods into Belgium but, on the contrary, the export of goods from Belgium. Consequently, Article 28 EC is not relevant to the facts in the main proceedings. The Court may refuse to rule on a question referred for a preliminary ruling by a national court where it is quite obvious that the interpretation of Community law that is sought bears no relation to the facts of the main action or its purpose, or where the problem is hypothetical. (12)
27. I therefore consider that there is no need for the Court to reply to the question in relation to Article 28 EC.
C – Assessment of the question referred in relation to Article 29 EC
1. Assessment on the basis of existing case-law
28. In the present case, it is necessary to determine whether Article 80(3) of the Belgian Law on consumer protection is a measure having equivalent effect to a quantitative restriction on exports. As I have already mentioned, in my analysis I shall consider both the prohibition on requiring an advance or payment in relation to distance contracts, which is clear from the actual wording of that provision, and also the specific interpretation concerning credit cards which the national authorities attribute to it, that is to say, that under no circumstances may the vendor require a consumer to provide his credit card number before the expiry of the period for withdrawal of seven working days.
29. Unlike quantitative restrictions themselves, to which the Court has given parallel definitions in the context of Articles 28 EC and 29 EC, (13) measures having equivalent effect to quantitative restrictions on exports are defined in the case-law much more restrictively than measures having equivalent effect to quantitative restrictions on imports.
30. In its earlier case-law, the Court interpreted measures having an equivalent effect to quantitative restrictions on exports in the same way as those on imports. In Bouhelier and Others, (14) in which the Court delivered judgment in 1977, it defined measures having an equivalent effect to quantitative restrictions on exports as measures which ‘hinder[ed], directly or indirectly, actually or potentially, intra-Community trade’. (15) In formulating that definition, the Court was therefore guided by the definition of measures having equivalent effect in the context of Article 28 EC given in Dassonville, (16) in which it held that ‘all commercial rules enacted by the Member States which are capable of hindering, directly or indirectly, actually or potentially, intra-Community trade’ are to be regarded as measures having an effect equivalent to quantitative restrictions on imports. (17)
31. Two years after the Bouhelierand Others judgment, in 1979 in the context of Article 29 EC, the Court radically restricted that definition in Groenveld, (18) in which it held that Article 29 EC (formerly Article 34 of the EC Treaty) included ‘measures which [had] as their specific object or effect the restriction of patterns of exports and thereby the establishment of a difference in treatment between the domestic trade of a Member State and its export trade in such a way as to provide a particular advantage for national production or for the domestic market of the State in question at the expense of the production or of the trade of other Member States’. (19)
32. In the case-law since the Groenveld (20) judgment, this definition has been confirmed by the Court many times (the so-called Groenveld test). The Court has departed from it only partially in a few cases where it has omitted half of the third part of the test (‘at the expense of the production or of the trade of other Member States’). Examples include Delhaize and Le Lion, (21)Commission v Belgium, (22) and Sydhavnens Sten & Grus. (23) The essential elements of the Groenveld test are still good law, however.
33. The Groenveld test comprises three interdependent conditions: first, the object or effect of the measure is the restriction specifically of patterns of exports; secondly, the measure gives rise to a difference in treatment between the domestic trade of a Member State and its export trade; thirdly, by virtue of the measure, a particular advantage is provided for national production or for the domestic market of the State in question, at the expense of the trade or production of other Member States.
34. In my view, the abovementioned conditions are not satisfied in the present case.
35. The Belgian measure at issue and the interpretation thereof do not have the object or effect of restricting specifically patterns of exports, since the provision and the interpretation thereof do not concern exports specifically but rather a general prohibition on demanding a payment and the impossibility of requiring a credit card number before the expiry of the period for withdrawal.
36. Likewise, that provision and the interpretation thereof do not give rise to differences in treatment either in law or in fact, between the domestic trade of a Member State and its export trade. In law, they concern all vendors to the same extent and in the same manner, irrespective of whether they sell the goods in Belgium or elsewhere. Likewise, the actual effect of the provision and the interpretation thereof are the same for sales in Belgium and sales in other countries. I do not think that we can accept the national court’s argument that the measure in question does not have the same actual effect on domestic trade in goods as on transactions with nationals of other Member States.
37. The national court asserts that it is more difficult and more onerous to recover sums from consumers established in other Member States if they do not pay for the goods they have ordered. This argument seems to me unfounded. Without specific information, we cannot infer from that belief that the recovery of money is more difficult and more onerous simply because the consumer has his habitual residence in another Member State. Nor does the fact that a consumer has his habitual residence in another Member State necessarily mean that the vendor will always have to sue him in the country where he has his habitual residence. (24)
38. In that connection, it must be observed that the Community has already adopted a number of measures in the field of judicial cooperation in civil matters having cross-border implications, which contribute to the proper functioning of the internal market. (25) According to Article 65 EC, such measures include improving and simplifying the service of judicial and extrajudicial documents, cooperation in the taking of evidence and the recognition and enforcement of decisions in civil and commercial cases, while promoting by those measures the compatibility of the conflict-of-law rules and eliminating obstacles to the good functioning of civil proceedings. In the light of all the Community measures cited, I consider that there is no foundation for the allegation that it will be more difficult for a vendor established in a given Member State to sue a consumer established in another Member State. Furthermore, it should be borne in mind that the regulation establishing a European small claims procedure will apply in future to cross-border disputes in cases such as the present, which involves a small claim. (26)
39. Lastly, since the Belgian provision has neither the object nor the effect of restricting specifically patterns of exports and does not give rise to a difference in treatment between the domestic trade of a Member State and its export trade, it does not provide a particular advantage for national production or for the domestic market of the State in question at the expense of the production or the trade of other Member States. Therefore, nor is the third condition of the Groenveld test fulfilled.
40. Consequently, on the basis of the existing case-law, a provision such as Article 80(3) of the Belgian Law on consumer protection, and the interpretation thereof, to the effect that the vendor may not, during the period of seven working days for withdrawal, require the consumer to provide his credit card number, do not constitute measures having an effect equivalent to a quantitative restriction within the meaning of Article 29 EC.
41. However, it is necessary to consider whether, with regard to the general development of the case-law on fundamental freedoms and the frequent criticism by commentators (27) of the current case-law on measures having an effect equivalent to quantitative restrictions on exports, it is still appropriate to apply the Groenveld test referred to above.
2. Arguments in favour of modifying the case-law
42. A number of arguments support a change to the existing case-law on the definition of measures having an effect equivalent to quantitative restrictions on exports.
43. The first argument which must be taken into account in this assessment is as follows: because of the restrictions of the definition used at present, many measures of the Member States may never be regarded as measures having an effect equivalent to quantitative restrictions on exports because the discrimination test necessarily requires a comparison between the effect of the measures on goods sold in the Member State of origin and on exported goods. Suppose that a particular product is made in a Member State but is intended only for export and is not sold on the domestic market. In such a scenario, it will never be possible to determine whether there are differences in treatment as between domestic trade and export trade because the goods in question are not traded on the domestic market; consequently, it will never be possible, either, to determine whether a certain measure confers an advantage on national production or on the domestic market of the Member State concerned. (28) Export of the product may be restricted significantly, but the measures restricting it can never be regarded as measures having an effect equivalent to quantitative restrictions on exports.
44. The second argument in favour of modifying the existing case‑law is the fact that Articles 28 EC and 29 EC have the same aim (29) and are based on the same principle, namely the elimination of barriers to trade flows in intra-Community trade. The Schmidberger (30) and Commission v Austria (31) cases offer a good illustration of the identical nature of that principle and, at the same time, an implicit indication that the definitions of measures having an equivalent effect for imports and exports should be harmonised. In paragraph 67 of Commission v Austria, the Court stated that ‘Articles 28 EC and 29 EC, taken in their context, must be understood as being intended to eliminate all barriers, whether direct or indirect, actual or potential, to trade flows in intra-Community trade’. In that connection, the Court referred to paragraph 56 of Schmidberger, (32) where the Court had similarly placed at the same level the definition of measures having equivalent effect on imports and on exports. Obviously these two paragraphs cannot be understood as overturning the hitherto settled case-law relating to Article 29 EC because, during the same period, the Court also delivered the Jersey Produce Marketing Organisation (33) judgment, in which it confirmed the so-called Groenveld test and, consequently, the narrow definition of measures having equivalent effect to quantitative restrictions on exports. However, the two cases show that, in the context of the free movement of goods, both imports and exports, it is necessary to begin with the principle of the elimination of barriers to trade flows in intra-Community trade. (34) In the light of that principle, I see no reason to draw such a sharp distinction between the definition of measures having an equivalent effect on exports and the definition of measures having an equivalent effect on imports.
45. The third argument to be taken into account is the importance of consistent interpretation of all four of the fundamental freedoms: the free movement of goods and services, the freedom of movement of persons and the free movement of capital. The definition of measures having an equivalent effect to quantitative restrictions on exports remains the only one of the fundamental freedoms in which the Court has persisted in requiring the existence of different treatment in order to find a restriction on that freedom. (35)
46. With regard to the free movement of goods, I have already noted that Articles 28 EC and 29 EC were both founded on the same principle and therefore the differences in the definition of measures having an equivalent effect to quantitative restrictions on imports and on exports were not justified. On that point we can agree with Advocate General Capotorti who, in his Opinion in Oebel, pointed out the fear that a heterogeneous definition of measures having equivalent effect in relation to the free movement of goods would cause confusion. (36)
47. With regard to the free movement of services, it must be observed that in this field also the Court at one time required different treatment for there to be a breach of those provisions, (37) but subsequently changed direction. (38) In relation to the freedom of movement of persons, in older judgments the Court also confined itself to prohibiting discriminatory measures of the Member States, but subsequently held that a non-discriminatory measure could also be an obstacle to the free movement of persons. (39) Safeguarding the free movement of capital also entails more than the mere prohibition of discriminatory measures. It is clear from the case-law that the Court does not confine itself to discriminatory measures but, on the contrary, starts from the concept of restrictions on the free movement of capital. (40)
48. Thus none of the fundamental freedoms – with the exception of measures having an equivalent effect to quantitative restrictions in the context of Article 29 EC – is limited to the prohibition of discriminatory measures on the part of the Member States. On the contrary, they start from the prohibition of restrictions of those freedoms. In that regard, the extremely restrictive definition of measures having an equivalent effect to quantitative restrictions on exports differs significantly from the interpretation of the other fundamental freedoms.
3. Proposed modification of the case-law
49. In the light of the reasoning set out above, I consider that the Court would be justified in modifying the Groenveld test, starting with the restrictive definition of measures having an equivalent effect to quantitative restrictions on exports.
50. In principle, there are two ways in which the Court can modify that definition. The first possibility is for the Court to apply to Article 29 EC the definitions it has developed in the context of Article 28 EC. This implies that, in order to define measures having an equivalent effect to quantitative restrictions on exports, it must apply an appropriately adapted formulation drawn from Dassonville, (41) that it must accept expressly the justification for those measures on the basis of the mandatory requirements set out in Cassis de Dijon, (42) and that selling arrangements must fall outside the definition of those measures, in accordance with the conditions laid down by it in Keck and Mithouard. (43) The second possibility is for the Court to make the very definition of ‘measures having equivalent effect’ narrower than that in Dassonville, which may perhaps also justify non-application of the criteria set out in Keck and Mithouard to restrictions on exports. Even in the context of the second possibility, a national measure may be justified by the imperative requirements set out in Cassis de Dijon.
51. Both possibilities offer advantages and disadvantages. The advantage of the second possibility is that it avoids a broad definition of measures having an equivalent effect to quantitative restrictions, which would include an infinite number of measures of the Member States. But, while making this definition narrower, we once again encounter the question of the appropriate principles on the basis of which the definition would be formulated. Another drawback of the second possibility is that the formulation of a specific new definition of measures having an equivalent effect to quantitative restrictions on exports would once again lead to inconsistency in the case-law on the free movement of goods and the fundamental freedoms in general.
52. Consequently, in my view it would be more appropriate for the definitions, restrictions and criteria set out in Dassonville, Cassis de Dijon and Keck and Mithouard to be applied also to the interpretation of Article 29 EC. It would be necessary, however, to adapt that case-law to Article 29 EC. I shall therefore set out below the criteria which the Court should apply when it decides whether a measure has an effect equivalent to a quantitative restriction on exports.
53. First of all, I propose that the Court define measures having an equivalent effect to quantitative restrictions on exports as any measure of the Member States capable of hindering, directly or indirectly, actually or potentially, intra‑Community trade.
54. In that regard, it must be borne in mind that a very large number of measures will fall within the definition of measures having an equivalent effect to quantitative restrictions on exports. (44) In practice, this means that all production conditions and restrictions, all measures which increase production costs in any manner whatsoever (45) and measures concerning working conditions, for example, could also constitute measures having equivalent effect. This could result in Member States’ measures which are not sufficiently connected with exports also being challenged.
55. In the case of goods imported into a particular Member State, the possibility of the abovementioned factors having an effect does not exist because imported goods are produced in a different Member State. Consequently, those factors can only effect restrictions on exports from the Member State. I must point out, however, that the effect of those factors on restrictions on exports is too indirect and we must therefore rule out the possibility that they may be classified as measures having an equivalent effect to quantitative restrictions.
56. I therefore propose that the Court restrict the definition of measures having an equivalent effect to quantitative restrictions on exports so as to exclude from that definition measures having an effect on exports which is too uncertain and too indirect. It must be remembered that, in the case-law to date relating to Article 29 EC, the Court has already excluded some of the abovementioned measures from the scope of that article, notwithstanding the restrictive definition of measures having an equivalent effect to quantitative restrictions on exports. In Oebel, (46) for example, the Court held that the prohibition of night work for bakers, that is to say, a measure relating to working conditions, was not a measure having an equivalent effect to a quantitative restriction on exports. In the ED case, (47) the Court observed that the possibility that a provision of the Italian Code of Civil Procedure preventing the service of a payment order on a debtor in another Member State would effect on traders in the Member State concerned in such a way that they would hesitate to sell their goods in other Member States was too uncertain and indirect (‘trop aléatoire et indirecte’, ‘zu ungewiß und zu mittelbar’) to be liable to hinder trade between Member States. (48) The Court has also applied this criterion inter alia in certain cases relating to measures having equivalent effect to quantitative restrictions on imports, (49) or concerning the freedom of movement of persons (50) and the freedom of establishment. (51) In that regard, it should be observed that the abovementioned criterion creates a cause‑and‑effect connection between the measure and the restriction on exports, unrelated to the issue of the extent of the restriction on exports.
57. Next, there is the question of how to apply, in the context of interpreting Article 29 EC, the criteria laid down in Keck and Mithouard (52) on the basis of which non-discriminatory selling arrangements fall outside the scope of Article 28 EC. In my view, it is true that we can transpose to the context of an assessment on the basis of Article 29 EC the test developed by the Court in Keck and Mithouard, but it must be adapted to the characteristics of exports.
58. On that issue, I would therefore propose that the Court should first adapt, for measures relating to exports, the wording in paragraph 16 of Keck and Mithouard to read as follows: the application to products which are exported to another Member State of national provisions restricting or prohibiting certain selling arrangements is not such as to hinder directly or indirectly, actually or potentially, trade between Member States, so long as those provisions apply to all relevant traders operating within the national territory and so long as they affect in the same manner, in law and in fact, the marketing of domestic products and of those which are exported to another Member State.
59. However, I think we should take into consideration the fact that certain selling arrangements hinder or restrict exit from the market even though they do not discriminate either in law or in fact. There are many reasons in favour of such an adaptation of the Keck and Mithouard test.
60. The first reason is that such an interpretation of Article 29 EC best meets the aim and purpose of the free movement of goods. In the context of cases involving Article 28 EC, it has appeared that, by applying strictly the test developed in Keck and Mithouard, it has been possible to exclude without justification certain selling arrangements with a very restrictive effect on imports. That is why it has been noted on several occasions in Advocate Generals’ Opinions (53) and in academic writing (54) that selling arrangements which hinder or restrict access to the market should be regarded as measures having equivalent effect to quantitative restrictions on imports. This position is supported by the argument that the application of the criteria laid down in Keck and Mithouard is relevant in principle only after the goods concerned have been imported into the market of the Member State concerned. (55) In the same way that certain selling arrangements may restrict access to the market at the time of import, certain selling arrangements may restrict exit from the market at the time of export.
61. It is true that the vast majority of national measures governing selling arrangements do not have a sufficiently direct effect on restrictions on the free movement of goods to be regarded as restrictions on exit from the market. They include, for example, certain rules on the opening hours of businesses, (56) the sale of certain goods in some shops only (57) or by certain traders only. (58) Those selling arrangements (59) must in any event be analysed in the light of the Keck and Mithouard test because to do otherwise would signal a return to the period before that case, when traders challenged the validity of any rules ‘whose effect [was] to limit their commercial freedom’. (60) Some selling arrangements may restrict exports more directly because they are more closely linked with the actual crossing of the border by the goods. (61) Rules prohibiting the sale of certain products on the internet are examples. (62) However, on the basis of the characteristics of those selling arrangements, it is difficult to create two predefined, clearly delimited categories of selling arrangements, which is why at this stage I merely refer to examples by way of illustration. It is more appropriate to distinguish selling arrangements by reference to their effect, that is to say, to determine whether they can have an effect on access to or exit from the market.
62. The second reason for excluding from the Keck and Mithouard test those selling arrangements which restrict exit from the market relates to the fact that the characteristics of exports must be taken into account when the principles enshrined in that judgment are applied in practice. The criteria of origin laid down in Keck and Mithouard, which were drawn up in relation to restrictions on imports, are based on the principle that selling arrangements do not restrict imports if domestic goods and goods imported into the market in which they are sold are subject to identical conditions in fact and in law with regard to their sale. This principle may be applied by analogy to exports: identical conditions in fact and in law must exist for the goods sold on the market in a given Member State and for the goods that are intended to leave that market, so that the national measure has no greater effect on the exported goods than on sales in the Member State of origin.
63. The practical application of that principle may have different consequences for both exports and imports, however. In the case of imports, when the Keck and Mithouard test is applied, no discrimination will be found on the national market between the domestic product and the foreign product whereas, in the case of exports, no discrimination will be found on the national market between two domestic products, one of which will be exported. If the national measure does not give rise to discrimination in law between the exported product and that sold in the Member State of origin, discrimination will then most often be found in fact upon export solely because of circumstances arising, not on the market on which the product is sold, but outside that market. It will often be difficult, however, to find out with certainty what are the actual repercussions of external factors of that kind. It is true that the possibility cannot be ruled out that, theoretically, a national measure might have an actual effect which is different on the exported product and on the product sold in the Member State of origin by reason also of factors which originate in the market on which the product is sold.
64. The third reason also relates specifically to exports because it is true that selling arrangements will very often be an obstacle to exports and not a requirement concerning the goods. This factor will therefore be different from that in the case of imports, where it is mainly the requirements laid down by a given Member State for the goods which have a restrictive effect. The effect on exported goods of requirements relating to the goods will be different for exported goods than for imported goods. Goods imported from one Member State into another must meet two sets of requirements relating to the goods – first, the requirements laid down by the Member State of production, and then the requirements of the importing Member State. The purpose of the definition of requirements relating to goods as measures having equivalent effect upon import is to avoid the entry of goods into the Member State of import being hindered or prevented because the requirements of the Member State of import relating to the goods differ from those of the Member State of production. In the case of goods exported from a given Member State, in determining whether there is an obstacle to exports, account is taken only of the requirements relating to the goods adopted by that Member State, but not the requirements which the goods must fulfil in the Member State to which they are exported. As selling arrangements will thus very often be an obstacle to export, it is justified to exclude from the Keck and Mithouard test those selling arrangements which directly prevent or hinder exit from the market.
65. For the reasons given above, I propose to the Court that the measures of Member States concerning selling arrangements which directly prevent or hinder exit from the market be regarded as being measures having an equivalent effect to quantitative restrictions on exports.
66. I shall now consider the present case in relation to the modified interpretation of Article 29 EC.
4. Assessment on the basis of the modified interpretation of Article 29 EC
67. It appears from the reasoning set out above that, at the present stage of development of Community law, it is appropriate to modify the interpretation of Article 29 EC. I shall therefore now go on to assess the present case in relation to that modified interpretation.
68. In the context of the assessment of Article 80(3) of the Belgian Law on consumer protection, two aspects must be distinguished. On the one hand, an assessment must be made as to whether Article 29 EC precludes that provision itself, that is to say, the prohibition on demanding an advance or payment during the period of seven working days for withdrawal. On the other hand, it is also necessary to examine in relation to Article 29 EC the specific interpretation of the Belgian provision applied in practice, with the result that the vendor cannot require the consumer to provide his credit card number even if he undertakes not to use it to collect payment during the period of seven working days for withdrawal.
69. The assessment on the basis of the proposed modification of the interpretation of Article 29 EC will be made in several stages.
70. It must be observed as a preliminary point that the Belgian provision at issue and the interpretation thereof relate to selling arrangements. In this discussion, therefore, I shall first apply the criteria laid down in Keck and Mithouard. Although the Belgian provision governs conditions of payment and the interpretation of that provision concerns a specific method of payment, those are essential elements of a contract of sale and, more specifically, of a contract of sale over the internet. Consequently, they must be classified as selling arrangements. In the case-law concerning Article 28 EC, the Court has already held that internet sales are selling arrangements. (63)
71. In the context of this assessment, it is necessary to begin by addressing the question whether, first, that provision and the interpretation thereof apply to all relevant traders operating in national territory and, second, whether they affect in the same manner, in law and in fact, the marketing of both domestic products and those exported to other Member States.
72. The first criterion, drawn from Keck and Mithouard, is fulfilled because both the provision and the interpretation thereof apply to all traders selling the goods in Belgium in the context of distance selling.
73. With respect to the second criterion, it must first be observed that both the provision and the interpretation thereof affect in the same manner, in law, the marketing of domestic products and exported products because they do not include any specific rule relating to the sale of domestic goods or exported goods. Regarding the actual effect on exports, I have already said, in the context of the assessment on the basis of the existing case-law, that both the Belgian provision at issue and the interpretation thereof had the same actual effect on domestic sales and on exports. However, in keeping with the proposed modification of the interpretation of Article 29 EC, it is necessary to ascertain whether that provision or the interpretation thereof is an obstacle to leaving the market, in spite of the fact that they do not give rise to discrimination in law or in fact.
74. The vendor, prohibited from demanding payment within the seven working days allowed for withdrawal, sends the goods to the consumer without knowing whether he will ever receive the payment due to him. The vendor’s uncertainty with regard to payment may deter him from distance selling. In that respect, it matters little whether the risk associated with the receipt of payment is different for an export sale as compared with a sale in Belgium. The interpretation of the Belgian provision, under which the vendor may not require the consumer to provide his credit card number, also entails similar uncertainty for the vendor because he cannot be sure of receiving payment. That uncertainty may lead a vendor who fears not receiving payment to stop exporting goods sold over the internet or to reduce the volume of such exports. It is precisely because of such a fear that Santurel asked its customers established abroad to provide their credit card number.
75. Consequently, I find, on the basis of the proposed modification of the interpretation of Article 29 EC, that a provision such as Article 80(3) of the Belgian Law on consumer protection and the interpretation thereof to the effect that a vendor may not require a consumer to provide his credit card number constitute an obstacle to exit from the market and are therefore measures having an equivalent effect to a quantitative restriction on exports.
76. Although the measure in question is a measure having equivalent effect to a quantitative restriction on exports, it is clear from the Court’s settled case-law on Article 28 EC, which can be applied to Article 29 EC for the reasons given above, that a national rule which entails a measure having equivalent effect to quantitative restrictions may be justified on one of the grounds set out in Article 30 EC or by mandatory requirements. (64) The national measure must in any event be suitable for ensuring the attainment of the objective pursued and must not go beyond what is strictly necessary in order to attain it. (65)
77. The next question to be addressed is therefore whether the Belgian measure can be justified on one of the grounds listed in Article 30 EC, that is to say, on the basis of one of the mandatory requirements formulated by the Court in Cassis de Dijon (66) and in the subsequent case-law. In the present case, none of the grounds listed in Article 30 EC is relevant, but another possible ground is consumer protection, which is one of the mandatory requirements.
78. There is no doubt that the prohibition on demanding payment or an advance during the period for withdrawal of seven working days and the associated interpretation to the effect that the vendor may not require the consumer to provide his credit card number before the expiry of that period aim to protect consumers. By prohibiting a demand for payment or an advance during the period for withdrawal, Belgium wished to provide the consumer with a strong right of withdrawal from a distance sale, a right safeguarded by Article 6 of Directive 97/7, and create in favour of the consumer conditions for withdrawal in which he could exercise his right without the slightest risk. It is readily evident that, in the case of distance selling, the consumer has greater protection than in the case of an ordinary sale. The logic of giving consumers a right to withdraw is that, in the case of distance selling, they do not actually see the goods until after they have ordered them. (67) In that regard, the 14th recital in the preamble to Directive 97/7 states that provision should be made for a right of withdrawal because ‘the consumer is not able actually to see the product or ascertain the nature of the service provided before concluding the contract’.
79. Therefore, in enacting Article 80(3) of the Belgian Law on consumer protection, Belgium opted to ensure consumers a higher level of protection than that offered by Directive 97/7. In so doing, Belgium prevented consumers from having to await reimbursement of the sums paid in the event of withdrawal. Under Article 6(2) of Directive 97/7, reimbursement must be made as soon as possible and in any case within 30 days. At the same time, Belgium intended to protect consumers against the risk of non-reimbursement of amounts previously paid by the vendor. (68) For the reasons given above, I find that the Belgian provision at issue and the interpretation thereof can be justified on grounds of consumer protection.
80. Lastly, I must still consider whether the Belgian provision at issue and the interpretation thereof are proportionate. In the context of the proportionality test, it is necessary to ascertain whether the provision and the interpretation thereof are appropriate and necessary in order to attain the objective of consumer protection and, more precisely, whether there is a measure whereby it is possible to attain that objective with the same effectiveness, but in a way which is less restrictive for the free movement of goods. (69) First of all, I shall examine in relation to the principle of proportionality the general prohibition on demanding an advance or payment before the period for withdrawal ends, then once again the interpretation to the effect that the vendor may not require the consumer to provide his credit card number before that period expires.
81. In my view, the general prohibition on demanding an advance or payment before the period for withdrawal ends is a measure proportionate to the objective of consumer protection. Belgium has opted for a level of consumer protection whereby the consumer runs no risk in the event of withdrawal from a distance contract. As Directive 97/7 provides for a period for withdrawal of seven working days, it is acceptable not to require the consumer, during that period, to pay for the goods he receives.
82. Consequently, I find that Article 29 EC does not preclude a national provision which, in the case of a distance sale, prohibits a requirement for any payment whatsoever by the consumer during the period for withdrawal.
83. Lastly, it is necessary to ascertain whether the interpretation of the Belgian provision to the effect that the vendor may not require the consumer to provide his credit card number before the expiry of the period for withdrawal is proportionate. On this point, it must be observed that, in ascertaining whether a provision of Community law precludes a provision of national law, account must be taken not only of the wording of that provision, but also of how it is interpreted by the national authorities. (70) Community law may preclude both the wording of national provisions and also the interpretation thereof because that interpretation is binding at national level on all the persons affected. Consequently, the national authorities are bound to interpret national law in conformity with Community law. (71)
84. Regarding the interpretation to the effect that the vendor may not require the consumer to provide his credit card number before the expiry of the period for withdrawal, in my view that interpretation goes further than is strictly necessary for attaining the objective of a high level of consumer protection. Several arguments may be put forward in support of this view.
85. First of all, the vendor does not in that case require the credit card number in order to collect payment for the goods, but only as a precaution before the consumer pays for the goods. If the vendor dispatches the goods without having required provision of the credit card number, he risks never receiving payment for the goods. If the vendor does not collect the amount of payment using the credit card, the consumer’s level of protection is in no way diminished. The Belgian authorities’ fear that the vendor may use the credit card fraudulently to obtain payment before the end of the period for withdrawal or that he may even collect payment using the credit card and not send the goods at all is clearly understandable. However, to interpret the Belgian provision at issue in such a way as to enable the Belgian authorities to prevent abuses of that kind is disproportionate. Disclosure of the credit card number allows an appropriate balance to be struck between the need for a high level of consumer protection and the need not to expose the vendor to the risk that the consumer may not pay. If the consumer does not withdraw and does not pay, the vendor may collect the sale price with the credit card.
86. Secondly, in Belgium a vendor is criminally liable for breach of his obligation not to debit the credit card for the amount during the period for withdrawal. It is true that, where disclosure of the credit card number is allowed, the possibility of abuse in certain cases must also be accepted, but that possibility is reduced if there is an effective penalty for any offence. This legal rule may perhaps not be truly and entirely effective but, by providing for an appropriate penalty, it will be sufficiently effective to provide a high level of consumer protection which Belgium is endeavouring to attain. In addition, it must be borne in mind that, under Article 8 of Directive 97/7, the Member States must ensure that the consumer may request cancellation of a payment where fraudulent use has been made of his payment card in connection with distance contracts and that, in the event of fraudulent use, he is recredited with the sums paid or they are returned. Consequently, provision is also made for specific protection of the consumer, in addition to the criminal sanction for the vendor in the event of fraudulent use of a credit card.
87. Thirdly, it is also necessary to take into consideration the economic reality of payments made by credit card, which are one of what must be called the ‘new methods of payment’, and the advantages offered by that method of payment. In other, more conventional methods of payment available to the vendor in connection with distance selling (for example, bank transfer), where the vendor may not demand payment before the expiry of the period for withdrawal, a high level of protection is provided for the consumer only. On this point, payment by credit card offers a number of advantages because it gives simultaneous protection to both parties, the consumer and vendor, without the level of protection for the consumer being appreciably reduced. The latter’s level of protection is reduced only potentially and only in certain cases. Although it is appropriate to lay down a penalty to cover that eventuality, cases of fraudulent use of credit cards are rare. A situation where the consumer is given absolute protection but the vendor has none, when it would be possible to give them both such protection at the same time, could be described as summum ius summa iniuria (excessive justice becomes injustice). The impossibility of providing protection for the consumer and the vendor simultaneously where other means of payment are used does not convince me that it is not possible to offer protection to both parties if a given form of payment so permits.
88. For the abovementioned reasons, I consider it disproportionate to interpret the Belgian provision as meaning that, in distance selling, the vendor may not require a consumer to provide his credit card number during the compulsory period for withdrawal, even if he undertakes not to use it to collect payment before the expiry of that period.
89. In the light of the foregoing, I find that Article 29 EC precludes an interpretation of a national provision to the effect that, in distance selling, the vendor may not require the consumer to provide his credit card number during the compulsory period for withdrawal, even if he undertakes not to use it to collect payment before the expiry of that period.
5. Conclusion
90. It follows from the analysis above that, although Article 29 EC does not preclude the meaning of the Belgian provision at issue on the basis of a strict literal interpretation, it does preclude the interpretation given to it by the national authorities. As stated above, the national authorities are bound to interpret national law in conformity with Community law. In the final analysis, therefore, I find that Article 29 EC does not preclude a national provision which, in distance selling, prohibits a demand for an advance or any payment whatsoever by the consumer during the compulsory period for withdrawal if that provision is not interpreted as meaning that, during that period, the vendor may not require the consumer to provide his credit card number, even if he undertakes not to use it to collect payment during that period.
VII – Conclusion
91. In the light of all the above considerations, I propose that the Court’s reply to the question referred for a preliminary ruling by the Hof van Beroep te Gent should be as follows:
Article 29 EC does not preclude a national provision which, in distance selling, prohibits a requirement for an advance or any payment whatsoever by the consumer during the compulsory period for withdrawal if that provision is not interpreted as meaning that, during that period, the vendor may not require the consumer to provide his credit card number, even if he undertakes not to use it to collect payment during that period.