The freedom of movement for goods means the abolition of customs duties and charges having equivalent effect in addition to quantitative restrictions in trade and measures having equivalent effect in intra-Community trade. In both cases, the abolition of barriers is based on the standstill concept, according to which Member States are not authorised to restore such instruments between themselves.
Goods crossing the Community's internal borders have not been subject to controls since January 1, 1993. The abolition of border formalities has needed further measures in the following areas.
The need to use the Single Administrative Document (SAD) in intra-Community trade, which was used mainly for administering tax controls, for collecting statistical data and for safeguarding Member States' economic, commercial or public policy interests was eliminated in 1993 but at the same time a series of measures were taken to define new rules governing the movement of goods. The SAD is still used within in the EU and in Switzerland, Norway and Iceland and third countries trade relations.
Actually the tax control arrangements (VAT and excise duty) are controlled at the actual business premises (VAT) or authorised warehouses (excise duty). The collection of statistical data - previously carried out systematically at frontiers - is replaced by company returns, which form an integral part of national data-collection systems. These general arrangements apply to all products but there are some special rules for the circulation, control or marketing of certain goods (for example agricultural goods, cultural objects, weapons for dual use etc.) taking into account their different nature.
The abolition of controls at internal borders requires that external frontiers are administered consistently and in a "Community spirit", according to same rules and standards.
The abolition of custom duties has already been studied under the Customs Union chapter. In this chapter it is focused on the abolitions of quantitative restrictions and measures having equivalent effect.
Efforts were subsequently directed towards eliminating all barriers which still impeded free movement, particularly charges and measures having equivalent effect to customs duties or quantitative restrictions. The Court of Justice played a key role in this respect, compensating for the absence of any reference in the Treaties by providing definitions of these types of obstacles to trade.
Quantitative restrictions were interpreted as any measure which amount to a total or partial restraint on imports, exports or goods in transit.
As to the charges having equivalent effect to customs duties, it considered any duty, whatever its name or procedure, which is imposed on imported products but not similar national products as having the same restrictive effect on the free movement of goods as a customs duty, because it alters the price. As for measures having equivalent effect to quantitative restrictions, the Court defined these as any trade regulation in the Member States likely to hinder Community trade, directly or indirectly, actually or potentially. Such measures range from regulatory designed to enforce minimum standards, for example, of weight, size, content, certification requirements, testing requirements.
Principle of mutual recognition
In the course of the interpretation of the elimination of quantitative restrictions by the ECJ the Court established the mutual recognition principle, which became one of the cornerstones of the free movement of goods.
The ECJ in the famous Cassis de Dijon case (case 120/78) stated that if a product has been lawfully produced and marketed in one of the Member States it will comply with the mandatory requirements in another Member States so its importation can not be restricted or banned.
Derogation from the free movement of goods
Since the principle of the internal market is the free movement of goods, the EC Treaty ensures in a limited scope derogations from this fundamental principle. According to the EC Treaty the free movement of goods does not preclude prohibitions or restrictions on imports, exports or goods in transit justified on the ground of public morality, public policy or public security, the protection of health and life of humans, animals or plants, the protection of national treasures possessing artistic, historic or archaeological value, or the protection of industrial and commercial property. Such prohibitions or restrictions shall not constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States.
The ECJ has interpreted the scope of the Article 30 through numerous cases. The elements of the Article were analysed in Case 113/80 Commission vs. Ireland about the restrictions on the importation of souvenirs. For example, the restriction on the basis of public morality was defined in Case 34/79 R vs. Henn and Darby. The frame of the public policy and public security was examined in the case Campus Oil Ltd Case 72/83.
| Previous chapter | Next chapter |