Avis juridique important

Judgment of the Court of 14 July 1994. - Criminal proceedings against Matteo Peralta. - Reference for a preliminary ruling: Pretura circondariale di Ravenna - Italy. - Articles 3 (f), 7, 30, 48, 52, 59, 62, 84 and 130r of the EEC Treaty. - Case C-379/92. European Court reports 1994 Page I-03453 Swedish special edition Page I-00015 Finnish special edition Page I-00015

Summary Parties Grounds Decision on costs Operative part

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1. Preliminary rulings ° Jurisdiction of the Court ° Limits ° International agreement not binding on the Community ° Excluded

2. Freedom to provide services ° Community rules ° Whether a trader from a Member State may rely on them against that State by reason of his activity of providing services to another Member State

(EEC Treaty, Art. 59; Council Regulation No 4055/86, Art. 1(1))

3. Freedom to provide services ° Principle of non-discrimination ° Scope ° Restrictions ° Concept ° Disadvantages ensuing for a provider of services from being subjected to particularly constraining requirements in force in his place of establishment ° Permissible

(EEC Treaty, Art. 59; Council Regulation No 4055/86, Art. 9)

4. Transport ° Maritime transport ° Free movement of goods ° Workers ° Freedom of establishment ° Freedom to provide services ° Environment ° National legislation prohibiting in State waters all vessels and on the high seas only vessels flying the national flag from discharging harmful chemical substances and penalizing infringements by masters of vessels who are nationals of the enacting State by suspending their professional qualification ° Permissible

(EEC Treaty, Arts 3(f), 7, 30, 48, 52, 59, 62, 84 and 130r; Council Regulation No 4055/86)

1. The Court may not rule on the question whether legislation of a Member State is compatible with an international agreement, such as the International Convention for the Prevention of Pollution from Ships, called "the Marpol Convention", if the Community is not party to that agreement and it does not appear that the Community has assumed, under the Treaty, the powers previously exercised by the Member States in the field to which the agreement applies or that its provisions have the effect of binding the Community.

2. Since Article 59 of the Treaty must apply in all cases in which a provider of services offers services on the territory of a Member State other than that in which he is established and Article 1(1) of Regulation No 4055/86 lays down that freedom to provide maritime transport services between Member States and between Member States and third countries is to apply in respect of nationals of Member States who are established in a Member State other than that of the person for whom the services are intended, a maritime carrier who carries goods to other Member States may rely, as against the Member State in which he is established and whose flag his vessels fly, on an infringement of the freedom to provide maritime transport services recognized by Community law.

However, as regards the complaints he may assert against it, his situation is different from that of a carrier established in another Member State who, when providing services, must therefore satisfy simultaneously the requirements imposed by two Member States, that whose flag his vessels fly and that in which he intends temporarily to exercise his activity.

3. Since the difference in treatment applied by a body of national legislation between national maritime carriers and those from other Member States is due to the fact that the jurisdiction which may be exercised over the first, by virtue of the law of the flag, is not the same as that which may be exercised over the second, which is limited to that which may be exercised by a State in the waters over which it has jurisdiction, no discrimination prohibited by Article 9 of Regulation No 4055/86, applying the principle of freedom to provide services to maritime transport between Member States and between Member States and third countries, exists. At all events, the application of a body of national legislation cannot be regarded as contrary to the principle of non-discrimination solely because other Member States apply less strict provisions.

Moreover, where national legislation does not make a distinction between vessels according to whether they carry goods internally or to other Member States, does not make any distinction regarding services for exported products and for products marketed nationally and does not afford any particular advantages to the domestic market, to national transport operations or to national products, that legislation cannot be regarded as restricting freedom to provide services to other Member States, which is prohibited by the aforesaid regulation.

The indirect advantages which carriers from other Member States may derive from the fact that they are subject to less strict requirements are merely the consequence of the absence of harmonization of national laws to which the various providers of services in the various Member States in which they are established are subject.

4. Articles 3(f), 7, 30, 48, 52, 59, 62, 84 and 130r of the Treaty and Regulation No 4055/86, applying the principle of freedom to provide services to maritime transport between Member States and between Member States and third countries, do not preclude the legislation of a Member State from prohibiting all vessels, regardless of the flag which they fly, from discharging harmful chemical substances into its territorial waters and its internal waters, or from imposing the same prohibition on the high seas only on vessels flying the national flag, or, finally, in the event of infringement, from penalizing masters of vessels who are nationals of that State by suspending their professional qualification.

In Case C-379/92,

REFERENCE to the Court under Article 177 of the EEC Treaty by the Pretura Circondariale di Ravenna for a preliminary ruling in the criminal proceedings before that court against

Matteo Peralta,

on the interpretation of Articles 3(f), 7, 30, 48, 52, 59, 62, 84 and 130r of the EEC Treaty,

THE COURT,

composed of: G.F. Mancini, President of Chamber, acting as President, R. Joliet, F.A. Schockweiler, G.C. Rodríquez Iglesias, F. Grévisse (Rapporteur), M. Zuleeg and J.L. Murray, Judges,

Advocate General: C.O. Lenz,

Registrar: R. Grass,

after considering the written observations submitted on behalf of:

° Matteo Peralta, by Giuseppe Conte and Giuseppe Michele Giacomini, of the Genoa Bar,

° the Italian Government, by Professor Luigi Ferrari Bravo, Head of the Department for Contentious Diplomatic Affairs of the Ministry for Foreign Affairs, acting as Agent, assisted by Oscar Fiumara, Avvocato dello Stato,

° the Commission of the European Communities, by Vittorio Di Bucci, of its Legal Service, acting as Agent,

having regard to the Report for the Hearing,

after hearing the oral observations of Matteo Peralta, the Italian Government and the Commission of the European Communities at the hearing on 9 February 1994,

after hearing the Opinion of the Advocate General at the sitting on 11 May 1994

gives the following

Judgment

1 By order of 24 September 1992, received at the Court on 19 October 1992, the Pretora Circondariale di Ravenna (District Magistrate' s Court, Ravenna) referred to the Court for a preliminary ruling pursuant to Article 177 of the EEC Treaty six questions on the interpretation of Articles 3(f), 7, 30, 48, 52, 59, 62, 84 and 130r of the EEC Treaty.

2 Those questions were raised in criminal proceedings brought against Matteo Peralta by the Italian authorities for breach of Law No 979 of 31 December 1982 laying down provisions for the protection of the sea (GURI No 16, of 18 January 1983, Ordinary Supplement, p. 5).

3 Article 16 of Law No 979 provides:

"In territorial waters and internal maritime waters, including ports, it shall be prohibited for any vessel, regardless of nationality, to discharge into the sea or to cause to be discharged into the sea hydrocarbons or hydrocarbon mixtures or any other substances harmful to the marine environment mentioned in List A annexed to this Law.

Vessels flying the Italian flag shall also be prohibited from discharging the substances referred to in the foregoing paragraph even outside territorial waters."

4 Infringements of those provisions are penalized, under Article 20 of the same Law, by fines of LIT 500 000 to 10 million and terms of imprisonment of up to two years. Professional sanctions may also be imposed. Masters of vessels who are Italian nationals may be suspended for a period of up to two years. Masters who are not Italian nationals may be prohibited from mooring at Italian ports for a period determined by the Minister for the Merchant Navy.

5 It appears from the documents before the Court that Mr Peralta, an Italian national, is the master of a tanker registered in Italy which is specially equipped for the transport of chemicals. The shipowner is a company governed by Italian law.

6 It is established that during the first three months of 1990 Mr Peralta repeatedly ordered the discharge into the sea of water which had been used to flush tanks which had previously contained caustic soda at a time when the vessel was outside the limit of Italian territorial waters (in most cases, in an area lying between 12 and 24 miles from Italian baselines). Caustic soda is one of the harmful substances mentioned in Annex A to Law No 979.

7 After hearing the appeal against the criminal sanctions imposed on Mr Peralta, the Pretore di Ravenna stayed proceedings and referred the following questions to the Court for a preliminary ruling:

"(1) Do the provisions of Articles 16 and 20 of Law No 979/82 constitute restrictions within the meaning of Articles 7, 48, 52 and 59 of the EEC Treaty and are they consequently prohibited by Article 62 of the same Treaty in so far as they are not justified by objective reasons relating to the protection of the public interests of the State in question?

(2) Under Community law as it now stands and in the light of the Community provisions referred to in Question 1, is a rule of a Member State compatible with Community law if it prescribes treatment ° even a criminal penalty ° (for the nationals of that State) by reason of their nationality, but not for nationals of the other Member States for identical conduct; and is such a rule of criminal law compatible with the principle of proportionality guaranteed by Community law inasmuch as it entails, inter alia, for the master of the vessel the automatic and mandatory additional penalty of the temporary suspension of the exercise of his professional activity and work?

(3) Under Community law as it now stands, can the Member States' retention of competence for matters concerning criminal law affect the fundamental liberties guaranteed by the Treaty, such as the free movement of goods and the freedom of movement of persons and, in particular, do the provisions of Articles 16 and 20 of Law No 979/82 constitute an obstacle to the exercise of those liberties?

(4) Do the principles defended by the Community legal order in the field of the environment, in particular the principle of prevention laid down in Article 130r et seq. of the Treaty, preclude a law of a Member State which, by imposing on national vessels an absolute prohibition against discharging hydrocarbons and harmful substances into the high seas, has, in practice, the effect of forcing such vessels to use an alternative method of discharge, which is inefficient from every point of view and, in any case, contrary to the obligations which that State has undertaken at an international level and in respect of which the Community has adopted implementing measures?

(5) Do the Community principles designed to guarantee that competition between persons supplying shipping and port services in the Community is free but at the same time fair and not artificially distorted and that the demand for services is satisfied with the least possible damage to the environment, and in particular Articles 3f and 84 of the EEC Treaty, preclude a national rule such as the one laid down in Articles 16(17) and 20 of Law No 979/82, which, by imposing an absolute prohibition against the discharge of tank-flushing liquids into the high seas only on vessels registered in the State in question, even though those vessels are equipped with the extremely expensive decontamination equipment prescribed by international agreements ratified by the Community, distorts competition among seaports and shipping companies in the Community?

(6) Is Article 30 of the Treaty compatible with a rule of a Member State which, by imposing an absolute prohibition against discharging hydrocarbons and harmful substances into the high seas exclusively on national vessels, even though they are equipped with the extremely expensive technologies prescribed by the agreements applicable in that field, forces those vessels to utilize special technologies and to use an alternative method of discharge, which is inefficient, costly and, in any case, in breach of the obligations which that State has undertaken at the international level and in respect of which the Community has adopted implementing measures? In particular, can the criminal penalties in question and the economic burdens which fall exclusively on the national fleet, in a way which is manifestly discriminatory and entirely irrational, be regarded as measures having an effect equivalent to quantitative restrictions on imports since those burdens give rise to additional costs with consequences for the price of the goods transported, as well as affecting imports?"

9 It appears from all the documents before the Court that the Pretore is essentially asking the Court whether Community law precludes legislation like the Italian legislation in question in so far as it impedes the activities of national undertakings engaged in sea transport, like the undertaking employing Mr Peralta. Such legislation could have the effect of, in particular, slowing down cleaning operations by tankers which could be carried out at sea in compliance with the relevant international agreements which Italy has signed, or of making them more difficult or costly than for vessels of other Member States.

10 The Italian court can see a number of ways in which the Italian legislation could have such an impeding effect and considers the objections which could be made against it. The Italian legislation

° fails to observe "international agreements ratified in Community law";

° infringes Article 7 of the Treaty by discriminating on grounds of nationality;

° introduces restrictions which are contrary to Articles 3(f), 30, 48, 52, 59 and 62 of the Treaty and, in particular, to the principle of freedom to provide services in the matter of marine transport;

° infringes Article 130r of the Treaty.

Community law as applicable at the time of the events in question

11 The main proceedings concern the application of Italian legislation concerning sea-going vessels and transport by sea. In Part Two of the Treaty, transport is the subject of a separate title, Title IV.

12 In Title IV, Article 84(2) provides that the Council may decide whether appropriate provisions may be adopted for sea transport. By virtue of Article 61 of the Treaty, such particular provisions concern in particular "freedom to provide services".

13 On the basis of Article 84(2) the Council adopted Regulation (EEC) No 4055/86 of 22 December 1986 applying the principle of freedom to provide services to maritime transport between Member States and between Member States and third countries (OJ 1986 L 378, p. 1). That regulation entered into force on 1 January 1987. It was therefore applicable at the time of the events in question.

14 However, Article 84 does not exclude the application of the Treaty to transport, and marine transport remains, on the same basis as the other modes of transport, subject to the general rules of the Treaty (see the judgment in Case 167/73 Commission v France [1974] ECR 359, paragraphs 31 and 32).

Observance of international conventions on the discharge of harmful substances into the sea

15 From the papers in the case it appears that, although its order for reference does not state a question in these terms, the national court is asking this Court about the compatibility of the Italian legislation with the International Convention for the Prevention of Pollution from Ships, called "the Marpol Convention" (United Nations Treaty Series, Volume 1341, No 22484). It appears to consider that this Convention produces effects in the Community legal order.

17 Whether a national provision adopted by a Member State is compatible with a convention such as the Marpol Convention is not therefore a matter on which the Court may rule.

Article 7 of the Treaty

Article 3(f) of the Treaty

19 The national court enquires whether the principles of Community law for ensuring undistorted competition preclude national legislation like the Italian legislation in question. According to the national court, the legislation causes distortions of competition between ports and shipowners in the Community.

20 The competition rules laid down in the Treaty, and, in particular, Articles 85 to 90, apply to the transport sector (see the judgment in Joined Cases 209 to 213/84 Ministère Public v Asjes and Others [1986] ECR 1425, paragraph 45, and the judgment in Case C-185/91 Bundesanstalt fuer den Gueterfernverkehr v Gebr. Reiff [1993] ECR I-5801, paragraph 12). The same is true, in particular, for the field of sea transport (see in particular Council Regulation (EEC) No 4056/86 of 22 December 1986 laying down detailed rules for the application of Articles 85 and 86 of the Treaty to maritime transport, OJ 1986 L 378, p. 4).

22 However, those provisions may not be relied upon as against legislation like the Italian legislation. That legislation does not require or foster anti-competitive conduct since the prohibition which it lays down is sufficient in itself. Nor does it reinforce the effects of a pre-existing agreement (see, to this effect, the judgment in Meng, cited above, paragraphs 15 and 19).

Article 30 of the Treaty

Article 48 of the Treaty

26 The national court enquires about the compatibility with Article 48 of a system of sanctions such as that laid down in the Italian legislation in question, which, by providing for the suspension of the professional qualifications of Italian masters who fail to observe the prohibition of discharging harmful substances into the sea, punishes Italian masters more severely than masters of any other nationality.

Article 52 of the Treaty

30 It is not possible to ascertain from the order for reference the reasons for which the national court enquires about the relationship of the Law in question to Article 52 of the Treaty. In the absence of such an explanation, it should be noted that, according to Mr Peralta, the Law in question deprives Italian marine transport undertakings operating vessels flying the Italian flag of the possibility to establish themselves in other Member States and compels them to use cabotage in Italian territorial waters. He also points out that the ports of other Member States do not have the plant for treating flushing liquids which such undertakings need in order to be able to comply with the Italian legislation.

31 Even though, according to their wording, the provisions of the Treaty guaranteeing freedom of establishment are directed in particular to ensuring that foreign nationals and companies are treated in the host Member State in the same way as nationals of that State, they also prohibit the Member State of origin from hindering the establishment in another Member State of one of its nationals or of a company incorporated under its legislation which comes within the definition contained in Article 58. For the rights guaranteed by Article 52 et seq. would be rendered meaningless if the Member State of origin could prohibit undertakings from leaving in order to establish themselves in another Member State (see the judgment in Case 81/87 The Queen v Treasury and Commissioners of Inland Revenue, ex parte Daily Mail and General Trust [1988] ECR 5483, paragraph 16).

32 However, legislation like the Italian legislation does not contain any provision which can be an obstacle to the establishment of Italian transport undertakings in Member States other than Italy.

33 It should also be recalled that, according to the judgment in Case C-221/89 The Queen v The Secretary of State for Transport, ex parte Factortame and Others [1991] ECR I-3905, paragraph 23, the conditions laid down for the registration of vessels must not form an obstacle to freedom of establishment. The legislation of the kind in question does not, however, concern the registration of vessels.

35 Article 52 does not therefore preclude legislation like the Italian legislation.

Article 59 of the Treaty

36 The national court is enquiring about a situation in which an Italian master put in command of a vessel flying the Italian flag by a provider of services of Italian nationality claims that Italy, the Member State in which that provider of services is established, is infringing the freedom to provide maritime transport services.

Whether the freedom to provide maritime transport services may be relied upon

37 As the Court finds in paragraph 13 of this judgment, Regulation No 4055/86 was applicable at the time of the events in question.

38 Article 1(1) of that regulation provides:

"Freedom to provide maritime transport services between Member States and between Member States and third countries shall apply in respect of nationals of Member States who are established in a Member State other than that of the person for whom the services are intended."

41 Furthermore, the Court has held that the purpose of Article 59 of the Treaty was to abolish restrictions on the freedom to provide services offered by persons not established in the State in which the service was to be provided and that, consequently, the provisions of Article 59 had to apply in all cases in which a person providing services offers those services in a Member State other than that in which he is established (judgment in Case C-154/89 Commission v France [1991] ECR I-659, paragraphs 9 and 10).

42 Since the vessel which he commands performs deliveries intended for other Member States, Mr Peralta may rely, as against Italy, on an alleged infringement of the freedom to provide maritime transport services recognized by Community law.

The existence of discrimination between vessels owing to the different flags which they fly

43 Under Article 9 of Regulation No 4055/86, which refers to the principle laid down in Article 7 of the Treaty, the minimum requirement applying to legislation such as that in question in the main proceedings is that it must not discriminate on grounds of nationality between persons providing maritime transport services.

44 On this point, legislation of the kind in question meets the requirement of non-discrimination as regards the rules applicable to vessels crossing territorial sea and internal Italian waters. All vessels, whichever flag they fly and whichever the nationality of the undertakings operating them, are subject to the prohibition on discharging harmful substances.

45 Outside territorial sea limits, the Italian legislation distinguishes between foreign vessels and vessels flying the national flag, which are the only ones subject to the prohibition on discharging harmful substances.

The existence of restrictions on the freedom to provide maritime transport services

49 The national court indicates that under the Italian legislation restrictions arise on the freedom to provide maritime transport services to other Member States, even if that legislation could not be held to be discriminatory.

52 Mr Peralta complains, on the contrary, of the indirect advantages enjoyed by carriers in other Member States who are not subject, on the same conditions, to the prohibition on discharging residues of caustic soda into the sea. However, in the absence of harmonization of the laws of the Member States in this field, those restrictions are merely the result of the national rules of the country of establishment to which the trader remains subject.

53 It follows from the foregoing that Regulation No 4055/86 does not preclude the contested provisions of a Law such as the Italian Law relating to the discharge of harmful substances into the sea by merchant ships.

54 Consequently, the reference made by the national court to Article 62, to which Article 1(3) of the regulation refers, does not call for a specific response. Article 62, which is complimentary to Article 59, cannot prohibit restrictions which do not fall within the scope of Article 59 (see the judgment in Case C-159/90 Society for the Protection of Unborn Children Ireland v Grogan and Others [1991] ECR I-4685, paragraph 29).

Article 130r of the Treaty

55 Finally, the national court enquires whether Article 130r et seq. precludes legislation of the same kind as the contested legislation which has the effect of requiring Italian vessels to use an alternative system for treating flushing water, which, in its view, is inefficient and contrary to the international obligations which Italy has assumed.

56 On this point, it should be recalled that, as the Court held at paragraph 17 above, it is not for the Court to rule on the compatibility of a national provision adopted by a Member State with a convention such as the Marpol Convention. Nor may it interpret Article 130r in the light of an international convention which is not binding on the Community and to which, moreover, not all the Member States are parties.

Costs

60 The costs incurred by the Italian Government and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the proceedings pending before the national court, the decision on costs is a matter for that court.

On those grounds,

THE COURT,

in answer to the questions referred to it by the Pretore di Ravenna, by order of 24 September 1992, hereby rules:

Articles 3(f), 7, 30, 48, 52, 59, 62, 84 and 130r of the EEC Treaty and Council Regulation (EEC) No 4055/86 of 22 December 1986 applying the principle of freedom to provide services to maritime transport between Member States and between Member States and third countries do not preclude the legislation of a Member State from prohibiting all vessels, regardless of the flag which they fly, from discharging harmful chemical substances into its territorial waters and its internal waters, or from imposing the same prohibition on the high seas only on vessels flying the national flag, or, finally, in the event of infringement, from penalizing masters of vessels who are nationals of that State by suspending their professional qualification.