JUDGMENT OF THE COURT (Fifth Chamber)
22 June 1999 (1)
(Free movement of goods Freedom to provide services Free movement ofcapital National provision prohibiting the issue of a summary payment orderto be served outside national territory Compatibility)
In Case C-412/97,
REFERENCE to the Court under Article 234 EC (ex Article 177) by the PreturaCircondariale di Bologna, Italy, for a preliminary ruling in the proceedings pendingbefore that court between
ED Srl
and
Italo Fenocchio
on the interpretation of Articles 34 and 59 of the EC Treaty (now, afteramendment, Articles 29 EC and 49 EC) and Article 56 EC (ex Article 73b), for thepurpose of determining the compatibility with those provisions of a national ruleprohibiting the issue of a summary payment order to be served outside nationalterritory,
THE COURT (Fifth Chamber),
composed of: J.-P. Puissochet, President of the Chamber, P. Jann (Rapporteur),D.A.O. Edward, L. Sevón and M. Wathelet, Judges,
Advocate General: G. Cosmas,
Registrar: L. Hewlett, Administrator,
after considering the written observations submitted on behalf of:
the Italian Government, by Professor Umberto Leanza, Head of the LegalDepartment of the Ministry of Foreign Affairs, acting as Agent, and OscarFiumara, Avvocato dello Stato,
the French Government, by Kareen Rispal-Bellanger, Head of theSubdirectorate for International Economic Law and Community Law in theLegal Affairs Directorate of the Ministry of Foreign Affairs, and GautierMignot, Foreign Affairs Secretary in the same directorate, acting as Agents,
the Austrian Government, by Christine Stix-Hackl, Gesandte in the FederalMinistry of Foreign Affairs, acting as Agent, and
the Commission of the European Communities, by Laura Pignataro andPaolo Stancanelli, of its Legal Service, acting as Agents,
having regard to the Report for the Hearing,
after hearing the oral observations of the Italian Government, represented by OscarFiumara; the French Government, represented by Régine Loosli-Surrans, chargéde mission in the Legal Affairs Directorate of the Ministry of Foreign Affairs, actingas Agent; and the Commission, represented by Paolo Stancanelli, at the hearing on26 November 1998,
after hearing the Opinion of the Advocate General at the sitting on21 January 1999,
gives the following
Judgment
- 1.
- By order of 29 November 1997, received at the Court on 5 December 1997, thePretura Circondariale di Bologna (District Magistrates' Court, Bologna) referredto the Court for a preliminary ruling under Article 234 EC (ex Article 177) aquestion on the interpretation of Articles 34 and 59 of the EC Treaty (now, afteramendment, Articles 29 EC and 49 EC) and Article 56 EC (ex Article 73b), for thepurpose of determining the compatibility with those provisions of a national rule
prohibiting the issue of a summary payment order to be served outside nationalterritory.
- 2.
- That question has been raised in proceedings for a summary payment orderbrought by ED Srl (hereinafter 'ED), a company incorporated under Italian lawwhose registered office is in Funo di Argelato, against Mr Fenocchio, who isresident in Berlin, Germany.
- 3.
- ED supplied goods to Mr Fenocchio to the value of ITL 19 933 700. Since MrFenocchio paid only a sum of ITL 100 000 by way of down-payment and did notpay the balance, ED applied, on 6 October 1997, to the Pretura Circondariale diBologna, under Article 633 of the Italian Code of Civil Procedure (hereinafter 'theCode) for the issue of a summary order for payment of the outstanding sum,together with interest and costs.
- 4.
- It is not in dispute that the application complied with all the relevant substantiveconditions laid down. However, since the debtor was resident in Germany, theorder would have had to be served on him in that State. The applicationaccordingly conflicted with the final paragraph of Article 633 of the Code, whichprovides that 'the order may not be made if service on the defendant pursuant toArticle 643 must be effected outside Italy or the territories under Italiansovereignty.
- 5.
- The national court explains that the special procedure for a summary paymentorder enables an enforceable court order against a debtor to be obtained quicklyand cheaply. The procedure involves a summary examination in which the plaintiffmust simply prove the debt with appropriate documentary evidence. The order isissued by the judge ex parte. The debtor has the right to oppose the order. If hedoes so, ordinary contentious proceedings between the parties commence.
- 6.
- According to the national court, the justification for the prohibition on recourse tothat procedure where the debtor resides abroad was originally to avoid the debtor'snever knowing of an order issued against him or not becoming aware of it untilafter expiry of the period laid down for opposing it, which would prevent theexercise of his right to defend the action. However, while that reason was valid in1940, when the rule was adopted, it is no longer justified today, when serviceabroad no longer poses a major problem and the time-limits for opposing an orderare sufficiently long. The national court adds that that is particularly true in thecase of States which are signatories to the Hague Convention of 15 November 1965on the Service Abroad of Judicial and Extrajudicial Documents in Civil orCommercial Matters, Article 10(a) of which allows service by post.
- 7.
- The national court is accordingly uncertain whether the prohibition at issue iscompatible with Articles 34 and 59 of the Treaty and Article 56 EC. Undertakingsestablished in Italy could be led to prefer to maintain business relations with
customers operating in that Member State rather than with foreign customers, sinceit is only as against Italian customers that they may have the special protection andreduced costs afforded by the procedure for obtaining summary payment orders. For that reason, the free movement of goods could be affected, as could thefreedom to provide services, since the procedure for obtaining summary paymentorders may also be used in the case of debts arising from the supply of services. Where debts relate to sums of money, the prohibition at issue could also amountto interference with the free movement of capital.
- 8.
- The national court states, furthermore, that the provision in question has previouslybeen considered in the context of an objection alleging unconstitutionality raisedbefore the Corte Costituzionale (Constitutional Court). In its order dismissing theobjection (see Order No 364 of 27 June 1989 Giurisprudenza Costituzionale 1990,IV, p. 1161), the Corte Costituzionale held that the Community Treaties did notenable general principles affecting legal proceedings to be identified, this field beinggoverned by the domestic law of the Member States. The prohibition on the issueof a summary payment order which was to be served abroad was merely a groundexcluding the protection conferred by that procedure and did not involve a lack ofjurisdiction since ordinary proceedings could still be brought.
- 9.
- In those circumstances, the Pretura Circondariale di Bologna decided to stayproceedings and refer the following question to the Court for a preliminary ruling:
'Must the prohibition on issuing a summary payment order where it is to be servedon the defendant outside Italy or the territories under Italian sovereignty, thatprohibition being laid down by the last paragraph of Article 633 of the Code ofCivil Procedure, be regarded as a restriction or measure having equivalent effectcapable of hindering, directly or indirectly, actually or potentially, the freemovement of goods, services and capital guaranteed by Articles 34, 59 and 73b ofthe Treaty of Rome?
Article 34 of the EC Treaty (now, after amendment, Article 29 EC)
- 10.
- According to the settled case-law of the Court, Article 34 of the Treaty applies tonational measures which have as their specific object or effect the restriction ofpatterns of exports and thereby the establishment of a difference in treatmentbetween the domestic trade of a Member State and its export trade, in such a wayas to provide a particular advantage for national production or for the domesticmarket of the State in question (see, in particular, Case 237/82 Jongeneel Kaas andOthers v Netherlands [1984] ECR 483, paragraph 22).
- 11.
- It is true that the effect of the national provision referred to in paragraph 4 aboveis to subject traders to different procedural rules according to whether they supplygoods within the Member State concerned or export them to other Member States. However, as the French and Austrian Governments have rightly pointed out, the
possibility that nationals would therefore hesitate to sell goods to purchasersestablished in other Member States is too uncertain and indirect for that nationalprovision to be regarded as liable to hinder trade between Member States (see, ina different context, Case C-69/88 Krantz v Ontvanger der Directe Belastingen [1990]ECR I-583, paragraph 11, Case C-339/89 Alsthom Atlantique v Sulzer [1991] ECRI-107, paragraphs 14 and 15, and Case C-93/92 CMC Motorradcenter vBaskiciogullari [1993] ECR I-5009, paragraph 12).
- 12.
- As far as this part of the question is concerned, the conclusion must therefore bethat Article 34 of the Treaty does not preclude national legislation which excludesrecourse to the procedure for obtaining summary payment orders where service onthe debtor is to be effected in another Member State of the Community.
Article 59 of the EC Treaty (now, after amendment, Article 49 EC)
- 13.
- In this regard, it need only be stated that, as has been pointed out by the Commission and the majority of the Member States which have submittedobservations to the Court, the main proceedings have no connection with a supplyof services.
- 14.
- Consequently, there is no need to answer the part of the question relating toArticle 59 of the Treaty.
Article 56 EC (ex Article 73b)
- 15.
- Article 56(2) EC provides:
'Within the framework of the provisions set out in this Chapter, all restrictions onpayments between Member States and between Member States and third countriesshall be prohibited.
- 16.
- In order to ascertain the scope of that provision, it should be compared with theprovision which it replaces, namely the former Article 106(1) of the EEC Treaty(which became Article 73h(1) of the EC Treaty, in turn repealed by the Treaty ofAmsterdam). Article 106(1) stated:
'Each Member State undertakes to authorise, in the currency of the Member Statein which the creditor or the beneficiary resides, any payments connected with themovement of goods, services or capital, and any transfers of capital and earnings,to the extent that the movement of goods, services, capital and persons betweenMember States has been liberalised pursuant to this Treaty.
- 17.
- Like Article 106 of the EEC Treaty, Article 56(2) EC is intended to enable aperson liable to pay a sum of money in the context of a supply of goods or servicesto discharge that contractual obligation voluntarily without undue restriction andto enable the creditor freely to receive such a payment. However, that provisionis not applicable to the procedural rules which govern an action by a creditorseeking payment of a sum of money from a recalcitrant debtor.
- 18.
- The reply to be given to the national court must therefore be that a nationalprocedural provision, such as that in question in the main proceedings, does notconstitute a restriction on the freedom to make payments.
Costs
- 19.
- The costs incurred by the Italian, French and Austrian Governments and by theCommission, which have submitted observations to the Court, are not recoverable.Since these proceedings are, for the parties to the main proceedings, a step in theaction pending before the national court, the decision on costs is a matter for thatcourt.
On those grounds,
THE COURT (Fifth Chamber),
in answer to the question referred to it by the Pretura Circondariale di Bologna byorder of 29 November 1997, hereby rules:
1. Article 34 of the EC Treaty (now, after amendment, Article 29 EC) does notpreclude national legislation which excludes recourse to the procedure forobtaining summary payment orders where service on the debtor is to beeffected in another Member State of the Community.
2. A national procedural provision, such as that in question in the mainproceedings, does not constitute a restriction on the freedom to makepayments.
| PuissochetJann Edward Sevón Wathelet |
Delivered in open court in Luxembourg on 22 June 1999.
R. Grass
J.-P. Puissochet
Registrar
President of the Fifth Chamber