Case C-347/02

Commission of the European Communities

v

French Republic

(Insurance – Third non-life insurance directive – Bonus-malus system)

Summary of the Judgment

Freedom of movement for persons – Freedom of establishment – Freedom to provide services – Direct insurance other than life assurance – Directive 92/49 – Freedom to set rates – Bonus-malus system not resulting in the direct setting of premium rates by the State – Permissible

(Council Directive 92/49)

A bonus-malus system applicable to motor insurance contracts which, while having effects on changes in the amount of premiums, does not, however, result in the direct setting of premium rates by the State since insurance undertakings remain free to set the amount of the basic premium cannot be equated with a system of approving premium rates that is contrary to the principle of freedom to set rates laid down by Directive 92/49 on the coordination of laws, regulations and administrative provisions relating to direct insurance other than life assurance and amending Directives 73/239 and 88/357.

Full harmonisation in the field of non-life insurance rates precluding any national measure liable to have effects on rates cannot be presumed in the absence of a clearly expressed intention to this effect on the part of the Community legislature.

(see paras 24-25)

JUDGMENT OF THE COURT (Grand Chamber) 7 September 2004 (1)

(Insurance – Third non-life insurance directive – Bonus-malus system)

In Case C-347/02, ACTION under Article 226 EC for failure to fulfil obligations, brought on 30 September 2002,

applicant,

v

defendant,

THE COURT (Grand Chamber),,

composed of: V. Skouris, President, P. Jann, C.W.A. Timmermans (Rapporteur), C. Gulmann and J.N. Cunha Rodrigues, Presidents of Chambers, R. Schintgen, F. Macken, N. Colneric, S. von Bahr, R. Silva de Lapuerta and K. Lenaerts, Judges,

Advocate General: C. Stix-Hackl,

after hearing the Opinion of the Advocate General at the sitting on 30 March 2004,

gives the following

‘Article 8 of Directive 72/239/EEC shall be replaced by the following:

“Article 8

…

3.Member States shall not, however, adopt provisions requiring the prior approval or systematic notification of general and special policy conditions, scales of premiums and forms and other printed documents which an undertaking intends to use in its dealings with policyholders.

Member States may not retain or introduce prior notification or approval of proposed increases in premium rates except as part of general price-control systems.

…”.’

‘Member States shall not adopt provisions requiring the prior approval or systematic notification of general and special policy conditions, scales of premiums, or forms and other printed documents which an insurance undertaking intends to use in its dealings with policy-holders. They may only require non-systematic notification of those policy conditions and other documents for the purpose of verifying compliance with national provisions concerning insurance contracts, and that requirement may not constitute a prior condition for an undertaking’s carrying on its business.

Member States may not retain or introduce prior notification or approval of proposed increases in premium rates except as part of general price-control systems.’

‘2.

3.‘Insurance contracts falling within the branches referred to in Article R. 321-1(3) and (10) of the Insurance Code and concerning motor vehicles must include the clause for the reduction or increase of premiums or subscriptions annexed to this article’ (the bonus-malus clause).

On those grounds, the Court (Grand Chamber) hereby:

Signatures.