Opinion of the Advocate-General
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Mr President,
Members of the Court,
Introduction: disputes referred to the Court of Justice concerning the marketing of terminals without type-approval
The present case ° like the Taillandier case (Case C-92/91) in which I am delivering my Opinion today ° must be seen in the context of a series of requests for preliminary rulings, (1) all arising from the same fact, namely the marketing (and in some instances, the mere possession) of telecommunications terminal equipment (usually telephones, cordless telephones and telefax equipment) which has not received the prior authorization or type-approval of the competent national bodies. (2)
Such a proliferation of judicial proceedings within what is, after all, a short space of time cannot be due to mere coincidence. On closer examination the dispute appears to be the tell-tale sign of tension manifesting itself ° in some countries at least ° over the marketing of terminals by independent operators (that is, operators unconnected with public entities trading in the telecommunications sector). Those tensions are attributable to the process of liberalization which has taken place in recent years in the market for telecommunications terminals; it is a process largely due to technological innovation and the consequent changes in economic and legal relations (3), which has tended gradually to eliminate national monopolies and privileges and hence to secure acceptance of the right of traders to import and market freely the equipment concerned.
At Community level, the principle of liberalization, already identified as the essential aim of the Commission' s Green Paper on telecommunications (4) was later embodied in law, as Commission Directive 88/301/EEC of 16 May 1988 on competition in the markets in telecommunications terminal equipment (5) (hereinafter "the directive on terminal equipment"), and was finally upheld by the Court in the well-known judgment in Case 202/88 (France v Commission [1991] ECR I-1223).
In itself, the assertion of the right to import and market terminal equipment does not, however, ensure that the markets are effectively integrated. Clearly, the importation and (still more) the marketing of terminal equipment continues to be subject, at least in part, to a complex system of national rules and inspections. Although the enforcement of such rules and inspections is to some extent indispensable in the absence of a framework of Community or international provisions, it may in some circumstances have the effect of obstructing trade in a manner which is unjustified or at least disproportionate to the (legitimate) aims pursued. Hence the need for proper guarantees, precisely with a view to preventing the freedom to import and sell terminal equipment from remaining a dead letter, having no practical effect.
Amongst those guarantees, the first and perhaps most important is the rule set out in the Green Paper and laid down in Article 6 of the directive on terminal equipment, requiring the independence (or, as it is sometimes termed, the separation) of regulatory and supervisory functions with regard to terminals (including the granting of type-approval) from activities of an economic or commercial nature; this fundamental guarantee may be supplemented by others, governing the procedures for the adoption of national technical specifications, and indeed their content, or the proper conduct of inspections to ensure that the equipment complies with those specifications.
That being so, it may readily be seen that the extent of the scope of those guarantees is the central issue in the judicial proceedings arising from the marketing of terminal equipment without type-approval. On that issue there are two opposing interests: on the one hand, the interest of traders in being allowed to market terminal equipment as freely as possible, and in any event without impediments or restrictions lacking any objective justification, and, on the other, the public interest in ensuring that such marketing complies with the provisions and procedures which are the only means of upholding certain essential requirements, the most important of which are the safety of users and operators and the proper functioning of the public telecommunications network.
The Court of Justice has already made an important contribution to resolving the issue in its judgment in RTT v GB-Inno-BM, mentioned above. The present case should serve to enlarge upon that earlier ruling, not only ° I believe ° on account of the special nature of the legal arguments adduced but also because, of the cases cited, Decoster is the first to involve events which occurred after the entry into force of the directive on terminal equipment.
The French rules on terminal equipment capable of being connected to the State telecommunications network
Pursuant to Article D440 et seq. of the French Code des Postes et Télécommunications (Postal and Telecommunications Code) (hereinafter "the PTT Code"), terminal equipment (telephonic, telegraphic and radio-electrical equipment) may be supplied either by the PTT or by private competitors. In the latter case the PTT does not intervene in dealings between user and supplier but requires type-approval for the equipment in question (Article D444 of the PTT Code, as amended by Article 3 of Decree No 85/336 of 12 March 1985).
In pursuance of that principle, and for the purpose of regulating the marketing of terminal equipment intended for connection to the public telecommunications network, the French Government adopted Decree No 85-712 on 11 July 1985. Article 2 of Decree No 85-712 provides that terminal equipment may not be manufactured for the domestic market, imported, kept for sale, sold or distributed (with or without a charge) unless it complies with the provisions laid down in the decree.
Under Articles 3 and 4 the equipment must meet a number of essential requirements for the proper functioning of the network and user safety.
To that end, Article 6 of the decree provides that manufacturers, importers, retailers and distributors of the equipment must show that the equipment complies with the essential requirements set out in Articles 3 and 4.
Article 6 further provides that the evidence may be supplied by the person concerned by submitting any one of four documents, namely a report drawn up by a body authorized by the Minister for Industry, a type-approval certificate (agrément) issued pursuant to the PTT Code, a certificate of compliance issued under Law No 78-23 of 10 January 1978 on consumer protection and information, or any other document accepted as equivalent by decree of the Minister for Industry.
In order to implement Decree No 85-712 the Ministère du Redéploiement Industriel et du Commerce Extérieur issued a formal "Notice" on 1 November 1985 regarding the terminal equipment liable to be connected to the State telecommunications network. The Notice first contains a list, updated to 30 September 1985, of the technical standards and specifications to be used for the purposes of Articles 3 and 4 of Decree No 85-712, and establishes that equipment complying with those standards or specifications is regarded as being in conformity with those two articles.
The Notice further describes how interested parties can show evidence, in accordance with the requirements of Article 6 of Decree No 85-712, that the terminal equipment complies therewith. It establishes that:
° the Centre National d' Études des Télécommunications (CNET) is authorized by the Minister for Industry to issue the "report" under Article 6 mentioned above;
° type-approval (agrément) is to be issued by the Direction Générale des Télécommunications, pursuant to the PTT Code, in respect of equipment complying with the specifications set out in the list annexed to the Notice;
° other documents attesting compliance, referred to in Article 6, are to be established later.
It should be noted that the judicial proceedings have not disclosed whether, following the Notice issued in November 1985, any evidential documents other than the type-approval certificate and the CNET report were drawn up.
Proceedings before the national court
The facts of the case before the national court are extremely straightforward: between May and October 1989 Francine Gillon, née Decoster, marketed telecommunications equipment (in particular telefax machines) without first obtaining either the type-approval certificate or any other document accepted as evidence of compliance with the essential requirements under Articles 2 and 3 of Decree No 85-712. Indeed, it is clear from the order for reference that Mrs Gillon did not even apply for the documents in question.
Mrs Gillon was accordingly prosecuted and ordered at first instance to pay a fine of FF 50 000. The first-instance court held that the marketing of terminal equipment without the mandatory certificates under Decree No 85-712 amounted to commercial deception (fraude commerciale) for the purposes of Article 1 of the Law of 1 August 1905.
Neither at first instance nor on appeal did the accused deny the facts as alleged. However, she disputes their relevance under criminal law, claiming that the marketing of equipment without type-approval or other certificates of compliance does not constitute an offence, because Decree No 85-712 requiring the prior acquisition of such documents is inapplicable inasmuch as it conflicts with certain provisions of the directive on terminal equipment and Council Directive 83/189/EEC of 28 March 1983 laying down a procedure for the provision of information in the field of technical standards and rules (6) (hereinafter "the directive on technical standards").
There are two objections raised by Mrs Gillon which are recorded in the order for reference.
The first objection concerns an infringement of Article 6 of the directive on terminal equipment. Article 6 reads as follows:
"Member States shall ensure that, from 1 July 1989, responsibility for drawing up ... specifications ..., monitoring their application and granting type-approval is entrusted to a body independent of public or private undertakings offering goods and/or services in the telecommunications sector."
The accused claims that at the material time the French authority responsible for drawing up technical specifications and monitoring the compliance of equipment with the prescribed requirements was not independent of the body which managed the public telecommunications network and, simultaneously, marketed terminal equipment in competition with other economic operators. It follows ° according to the accused ° that application of Decree No 85-712 must be suspended on the ground that it subjects traders to technical specifications and monitoring procedures which are respectively laid down and conducted by a body unable to provide the essential guarantee of independence required by the Community directive.
The second objection relates to the infringement of the provisions of both the directive on technical standards and the directive on terminal equipment requiring Member States, as a preliminary matter, to communicate to the Commission in draft form the technical standards and specifications for certain products, including in particular telecommunications terminals. The accused claims that the technical specifications for the equipment at issue were adopted without the prior communication laid down by the Community legislation: in the circumstances of this case, this calls for suspension of the application of Decree No 85-712, and hence authorizes her to market the equipment freely, that is, "en dehors de toute procédure d' agrément ou d' homologation".
In view of the arguments relied upon by the accused, the appellate court considered it necessary to refer to the Court of Justice three questions on the matter, as to whether the abovementioned directives have direct effect and what the implications must be as regards the applicability of the contested national decree in this case. (7)
It should, however, be noted that in the procedure before the Court of Justice Mrs Gillon presented arguments on matters not included amongst those discussed in the order for reference. Besides repeating the points regarding lack of independence on the part of the regulatory and supervisory body, and failure to communicate the relevant technical specifications (respectively Chapter II and Chapter I of her observations), she put forward three further arguments, as follows: the existence of discriminatory practices by the French authorities to the detriment of terminals imported from other Member States (Chapter III); practices by France Télécom involving abuse of a dominant position (Chapter IV); and the question whether national technical specifications which have not been harmonized under Community law are applicable to terminals which have already received type-approval in another Member State (Chapter V).
The discussion which follows is principally concerned with the question of the independence of the national regulatory and supervisory body (heading A below). The other points put forward will, for reasons to be given later, be considered briefly (heading B below).
A ° Independence of the body drawing up the technical specifications, monitoring their application and granting type-approval
(a) Legal basis for the requirement of independence
As pointed out earlier, the rule under which Member States must entrust responsibility for drawing up technical specifications, monitoring their application and granting the relevant type-approval, to a body independent of public or private undertakings offering goods or services in the telecommunications sector ° envisaged earlier in the Commission' s Green Paper ° was expressly set out in Article 6 of the directive on terminal equipment.
The preamble to the directive shows clearly that Article 6 is an essential part of the general plan to liberalize the market in telecommunications terminals which underlies the directive. The guarantee of independence ° that is, the impartiality of the regulatory, supervisory and licensing functions ° is rightly presented as a key to ensuring that no conflict of interests arises in the market in question and hence that transparency and true competitive equality prevail. (8) The importance of that guarantee is consistently emphasized, moreover, in the commentaries on recent developments in European telecommunications law. (9)
As noted above, the validity of Article 6 (together with other provisions of the directive on terminal equipment) was upheld by the Court in Case 202/88. That judgment provides two points of relevance to the present case. In the first place, the Court held that the Commission is empowered under Article 90(3) of the Treaty to adopt measures of a legislative nature, specifying "the obligations arising from the Treaty". (10) In the second place, the Court held that Article 6 of the directive on terminal equipment does not conflict with the Treaty. On this point the Court gave judgment in general terms, without specifying the provisions of the Treaty against which the compatibility of Article 6 was assessed. In its reasoning the Court in fact reiterates the ideas (discussed above) set out in the preamble to the directive:
"a system of undistorted competition, as laid down in the Treaty, can be guaranteed only if equality of opportunity is secured as between the various economic operators. To entrust an undertaking which markets terminal equipment with the task of drawing up the specifications for such equipment, monitoring their application and granting type-approval in respect thereof is tantamount to conferring upon it the power to determine at will which terminal equipment may be connected to the public network, and thereby placing that undertaking at an obvious advantage over its competitors."
Thus the Court seems to follow the Commission' s approach, whereby fair conditions of competition may be said to exist only in so far as the system set up by the Member States guarantees independence and impartiality of legislation and supervision, which presupposes the separation of those functions from activities of an economic or commercial nature.
That approach was later confirmed by the recent ruling in RTT v GB-Inno-BM. The judgment ° which relates to facts predating the entry into force of the directive on terminal equipment ° establishes primarily, in general terms, that Articles 3(f), 90 and 86 of the Treaty are automatically infringed whenever a body with a (statutory) monopoly over the management of the telecommunications network derives from State provisions the opportunity to distort competition in the related, but separate, market in terminal equipment.
As is evident from the reasons given by the Court for its decision, such a distortion of competition may be said to arise whenever the body enjoying a monopoly in the management of the telecommunications network then combines the business of marketing terminals with the responsibilities of laying down the relevant technical specifications, monitoring their application, and granting type-approval for the equipment concerned.
According to the Court, in order to maintain effective competition and guarantee transparency, it is necessary "to entrust responsibility for drawing up technical specifications, monitoring their application and granting type-approval to a body independent of public or private undertakings offering competing goods and/or services in the telecommunications sector."
The judgment therefore makes it clear that the legal basis for the obligation to guarantee the independence of regulatory and supervisory functions in respect of telecommunications terminals is to be found, in some circumstances at least, in Article 86 of the Treaty, read in conjunction with Articles 3(f) and 90 thereof. As regards the circumstances which must be present before the abovementioned provisions may be applied in combination, these may be summarized as follows:
° the body in question holds a dominant position in the market in telecommunication services;
° it distorts competition in the neighbouring market in terminal equipment;
° it does so by virtue of a national measure which enables it to alter unilaterally the conditions under which terminal equipment is marketed.
Furthermore ° even though in RTT v GB-Inno-BM the Court gives no express ruling on the point ° the basis for the requirement of independence in question may be found not only in Articles 3(f), 86 and 90 of the Treaty but also in Article 30 thereof. According to the case-law of the Court, a national provision whose effect is to facilitate an abuse of a dominant position liable to impair intra-Community trade is usually incompatible with the prohibition under Article 30 of measures having equivalent effect (judgments in Case C-179/90 Merci Convenzionali Porto di Genova v Siderurgica Gabrielli [1991] ECR I-5889 and Case 13/77 Inno v ATAB [1977] ECR 2115). Moreover, in the RTT ruling the Court made a point of observing that the national measures in dispute were likely to impede imports of equipment from other Member States and thereby adversely affect trade between Member States (11) for the purposes of Article 86.
That is not all, however. There may be adverse effects on trade even if there is no dominant position of the kind described in RTT. The merging, or combining, within a single body of the functions of marketing, on the one hand, and of legislation and supervision, on the other, will, if it interferes with equal opportunities as between competitors, automatically result in discrimination ° at least potential discrimination ° against imported products, irrespective of whether the body in question is present and holds a monopoly or at least a dominant position in the separate market in telecommunication services.
It is precisely that broader view which is reflected by Article 6 of the directive on terminal equipment. Article 6 demands, without qualification, the separation of marketing activities from regulatory and monitoring activities, and it shows clearly that this separation is required even where the body marketing terminal equipment does not at the same time operate in the market for telecommunication services. (12)
In the light of those considerations, therefore, I take the view that the specific obligation set out in Article 6 of the directive on terminal equipment, although broader in scope than the obligation laid down by the Court in RTT v GB-Inno-BM, does not represent an innovation in relation to the Treaty, in that its legal effects on Member States are not substantially different from those already arising from Article 30 and the combined provisions of Articles 3(f), 86 and 90 of the Treaty.
(b) Direct effect of Article 6 of the directive on terminal equipment
That being so, the reply to the questions of interpretation raised in this case seems relatively simple. To begin with, as far as Article 6 of the directive on terminal equipment (the subject of the second question from the national court) is concerned, I believe that its direct effect should be recognized without any hesitation. As was observed above, Article 6 in fact merely defines obligations which the Treaty itself lays down and imposes on Member States. It would thus be illogical to maintain that the specific provision adopted by the Commission pursuant to Article 90(3) does not have direct effect when the general provisions of the Treaty to which it gives effect do. Moreover, whilst it is true that Article 6, in obliging Member States to entrust regulatory and supervisory functions to an independent body, allows them a margin of discretion as to the system to be created to that end, it is equally true that, if viewed in the light of the preamble to the directive, that provision lays down a clear, precise and unconditional prohibition of the retention of any system whatsoever which allows any single entity to combine those functions with the supply of goods and/or services in the telecommunications sector. Furthermore, since that prohibition is designed to ensure that equal conditions of competition prevail in the relevant market, it is also clear that the provision is intended to protect the legitimate interests of undertakings operating in that market, which may, by virtue of Article 6 and the aforesaid Treaty provisions, require Member States not to confer regulatory or supervisory functions on a body, whether public or private, in competition with them.
(c) The Community system in force prior to the commencement date set by Article 6 of the directive on terminal equipment
Since it has been established that Article 6 has direct effect, it is necessary briefly to deal with a second issue. It seems desirable to outline the law as it stood prior to the commencement date (1 July 1989) after which, pursuant to Article 6, Member States come under the obligation to ensure the independence of bodies responsible for drawing up specifications, monitoring their application and granting type-approval. Admittedly, the latter point was not specifically referred to by the national court; however, it is undoubtedly relevant to the settlement of the dispute, inasmuch as the material events (that is, the marketing by Mrs Gillon of terminal equipment without type-approval) occurred between May and October 1989, and hence during a period which straddles the date laid down by Article 6.
In the light of the earlier observations, moreover, the answer presents no difficulties. It is sufficient to note that, even prior to the date under Article 6, and indeed before the adoption of the directive on terminal equipment itself, the requirement of independence existed and was binding on Member States, by virtue of the Treaty provisions on the movement of goods and on competition. The RTT judgment which was seen earlier to refer to an episode comparable to the events in the present case but occurring before the adoption of the directive on terminal equipment, shows that legislation which does not ensure independent regulating and monitoring of terminal equipment and thereby gives rise to conflicts of interest is, at least in some circumstances, automatically incompatible with Articles 3(f), 86 and 90 of the Treaty. Furthermore, for the reasons given above, it is correct to say that even where the preconditions for the application of Article 86 (in conjunction with Article 90) are not satisfied, that type of legislation creates in any event a potential obstacle to trade within the Community and thus falls within the scope of the prohibition under Article 30 of the Treaty.
It follows that even before the directive on terminal equipment was adopted, Member States were bound under the Treaty to ensure that the drawing-up of technical specifications, the monitoring of their application and the granting of type-approval for the equipment was performed by a body independent of the undertakings offering goods or services in the telecommunications sector. (13)
(d) The contested national legislation
Turning now to the disputed provisions, I must make the preliminary remark that, in France as in other Member States, there have been attempts in recent years to introduce a gradual deregulation of the telecommunications sector. The relevant measures adopted by the French authorities enable, roughly speaking, three separate stages to be distinguished:
° the first falls within the period preceding the adoption of Decree No 89-327 of 19 May 1987;
° the second falls within the period between Decree No 89-327 and Law No 90-568 of 2 July 1990;
° the third belongs to the period following Law No 90-568.
Of those three stages, only the second and, conceivably, the first are relevant for present purposes. The third stage, on the other hand, belongs to a period (Law No 90-586 having entered into force on 1 January 1991) which clearly post-dates the events material to this case.
That being so, it is tolerably clear from the evidence produced before the Court that, either in the first or in the second stage, the national system in question did not afford sufficient guarantees of independence, inasmuch as all the activities in question ° that is to say, the drawing-up of technical specifications, the monitoring of their application, the granting of type-approval for terminal equipment and the marketing of that equipment ° were performed by administrative organs all of which formed part of the central administration of posts and telecommunications which, moreover, was also responsible for the monopolistic management of the public telecommunications network.
In particular, the situation prior to Decree No 89-327 was as follows:
° under Decree No 86-129 of 28 January 1986 (Article 2), the drawing-up of regulations on telecommunications and the monitoring of compliance with their general principles were entrusted to the Délégation Générale à la Stratégie, directly under the aegis of the Minister for Posts and Telecommunications (PTT);
° the Délégation Générale à la Stratégie operated in concert with the other directorates general of that ministry, including in particular the Direction Générale des Télécommunications (Article 2 of Decree No 86-129);
° the Direction Générale des Télécommunications embraced the Direction des Affaires Commerciales et Télématiques, whose task was to propose and implement policy on trade and telematics (Article 14 of Decree No 86-129);
° terminals other than those supplied by the administration were subject to type-approval (Article D440 et seq. of the PTT Code);
° according to the Ministerial Notice of 1 November 1985, cited above, type-approval for terminal equipment was the responsibility of the Direction Générale des Télécommunications;
° although the French Government has not clearly defined the formal status of France Télécom at the time, it was clearly part of the central administration of the PTT and responsible at managerial level for conducting trade in the telecommunications sector; (14)
° as regards the report issued by the CNET and considered equivalent to type-approval for the purposes of the ministerial notice, it is clear that the CNET forms part of France Télécom as a "centre de recherche de l' exploitant public" (reply of the French Government to a question from the Court) ° which evidently rules out any guarantee of independence in the issuing of the certificate of compliance.
The situation does not seem to have been substantially changed by the entry into force of Decree No 89-327. On the contrary, by altering the internal structure of the PTT administration and by defining the powers of the various departments, Decree No 89-327 reveals even more clearly the fusion of purely business activities and those relating to the drawing-up of technical specifications, monitoring and type-approval. Thus:
° it sets up a Direction de la réglementation générale ° in place of the Délégation générale à la strategie ° which defines and enacts the general legal framework for the activities of the sector in question; in particular, the directorate is responsible for:
° monitoring compliance with the regulations in force;
° preparing draft laws and regulations and drawing up directives governing the activities of the various economic operators in the sector;
° establishing and publishing technical specifications and type-approval procedures for terminal equipment (Article 2 of Decree No 89-327);
° it does not alter the commercial functions performed by the PTT administration;
° it reveals further evidence of the close functional relationship between the Direction générale des télécommunications ° and hence France Télécom ° and the directorate responsible for laying down rules in that sector (the Direction de la réglementation générale); one of the departments of the Direction générale des télécommunications (the Direction des affaires industrielles) puts forward the technical specifications for terminal equipment (Article 4 of Decree No 89-327). (15)
In brief, those points disclose that at the material time neither the adoption of rules nor the granting of type-approval for terminal equipment (nor more generally the monitoring of compliance (16) were carried out by a body independent of the entity marketing the terminal equipment itself. On the contrary, all those activities were conducted by a single entity (namely the central administration of the PTT). Of course, those tasks could have been distributed between various general directorates or other departments of that administration. Nevertheless, the tasks could be traced back to a single State administration and were, in hierarchical terms, subject to a single decision-making authority. Moreover, the prevailing system entailed a relationship ° whether hierarchical or functional ° between the various directorates (as is indeed obvious, the departments in question being part of one and the same ministry). Lastly, even within the Direction générale des télécommunications itself, commercial responsibilities were interwoven with vested powers as regards the drawing up of specifications and the granting of type-approval.
Only later, under Law No 90-568, was a separation achieved, at organizational level at least, between business activities and the other activities (drawing up and monitoring regulations and granting type-approval). The law divorced both the management of the public telecommunications network and business activities from the central administration of the PTT. Those functions are still performed by France Télécom but the latter no longer forms part of the Ministry for Posts and Telecommunications, operating instead as a body incorporated under public law and endowed with its own legal personality. At the same time as the constitution of France Télécom was amended, the Direction générale des télécommunications within the PTT administration was abolished.
In the light of the foregoing considerations I believe that the conclusion must be that, at least until Law No 90-568 entered into force, the drawing-up and monitoring of regulations and the granting of type-approval were emphatically not performed by a body independent of the traders who marketed terminal equipment, and that this points to an infringement both of Article 6 of the directive on terminal equipment and, for the reasons stated above, of Article 30 of the Treaty. Furthermore, it may safely be assumed in this case that prior to Law No 90-586 the PTT administration was responsible not only for the marketing of terminal equipment but also monopolized the management of the public telecommunications network. The national measures in question therefore allow monopoly powers to be extended from the market in telecommunications services to the related, but separate, market in terminal equipment; this situation must, in accordance with the judgment in RTT v GB-Inno-BM, be considered to conflict with the combined provisions of Articles 3(f), 86 and 90 of the Treaty.
It would have been possible to reach a different conclusion only if there had been evidence that, at the material time, any trader had, in practice, had an opportunity to have specific terminal equipment tested for compliance with the essential requirements of safety and the proper functioning of the network :
° by a body independent of the PTT administration; and
° by reference to technical parameters laid down by a body independent of the PTT administration.
Subject to the findings and appraisals which are the exclusive preserve of the national court, I can do no more than reiterate that according to the documents before the Court the situation prevailing in France at the material time did not lend itself to that hypothesis in any way.
(e) Inapplicability of Decree No 85-712
A further point is that failure to observe the abovementioned Community provisions should have the result of making the contested national decree, that is Decree No 85-712, inapplicable. As we have seen, the decree requires traders to seek type-approval for the equipment (or at least to obtain certification showing its compliance with certain standards). However, in so far as the body laying down technical standards (on the basis of which type-approval is issued) and granting type-approval (or carrying out equivalent inspections) is simultaneously one of the traders concerned (or is closely related), there is clearly no possibility of the inspection procedures affording other competitors proper guarantees of impartiality.
Lack of independence therefore constitutes a defect which not only vitiates a particular decision on a given request for type-approval but which goes to the very heart of the entire system of rules and inspections introduced by a Member State with regard to the marketing of terminal equipment. It follows that in this case the procedures laid down by Decree No 85-712 for the granting of type-approval for terminal equipment do not fulfil the essential conditions under Community law and must accordingly be regarded as inapplicable.
I am, of course, perfectly aware of the implications of that conclusion. Expressed simply, it means that Member States are not entitled to apply type-approval (or similar) procedures unless their impartiality is guaranteed (with the result that no criminal liability arises on the part of traders who, like Mrs Gillon, have sold terminal equipment without type-approval during a period in which the impartiality of the legislation and of the inspections was not assured).
This means, however, that terminal equipment may legitimately be offered for sale without prior inspection (even by means of a procedure providing no guarantees of impartiality) to establish its compliance with requirements such as user safety or proper functioning of the network.
Thus the safeguarding of those requirements comes, in effect, to be subordinated to the protection of competition: an unsatisfactory result, both in general terms (since in the Treaty non-economic imperatives of that kind take precedence over the protection of competition and trade) and in the light of the specific provisions of the directive on terminal equipment, which preserves the right of Member States to refuse to allow such equipment to be connected when it does not meet essential requirements such as those specified above (Article 3 of the directive, referring to the requirements laid down in Article 2(17) of Directive 86/361/EEC). If, where the granting of type-approval is not impartial, traders cannot be obliged to seek it, it follows that the national authority, rather than refusing to allow equipment to be connected, will only be able to intervene ex post facto to have it disconnected and, if need be, to react to such disruption or damage as is found to have occurred. (17)
Moreover, even though it may give rise to some misgivings, the matter must now in my opinion be regarded as settled, following the judgment in RTT v GB-Inno-BM. That ruling was given on a preliminary reference arising out of an action brought by a public body (RTT) for an injunction against a private competitor (the trading group GB-Inno-BM). The object of the injunction sought was to require GB-Inno-BM to desist from its practice of selling terminal equipment which had not received type-approval without informing the purchaser of that fact.
The defendant had pleaded inter alia the incompatibility with Community law of the national provisions (Articles 3 and 91 of the Belgian Decree of 20 September 1978) which made the connection of terminal equipment subject to authorization by the RTT and required prior type-approval for terminal equipment supplied by operators other than RTT. GB-Inno-BM contended that these obligations to seek authorization and type-approval were illegal inasmuch as RTT thereby assumed, simultaneously, the role of regulatory and supervisory body and that of interested party, with the result that even the obligation to inform the purchaser of the absence of type-approval had to be regarded as illegal.
According to the report for the hearing in that case, the national court considered, in the light of those arguments, "that it was necessary to ascertain whether a procedure for approval such as that imposed by the RTT was lawful because otherwise it would be unlawful to require a trader selling telephones to tell his customers that it was necessary to submit them for approval." (18)
As has been stated more than once, the judgment of the Court shows that the rules of competition in the Treaty may be invoked by a trader opposing the application of a national system which empowers another competitor to lay down the technical standards for the products at issue and to monitor their application.
Hence there is every reason to believe that, as a result of the Court' s decision, the national court considered that there were no legal grounds for the injunction sought by the RTT, and accordingly permitted the defendant to market equipment without type-approval, and indeed to do so without informing the purchaser that such approval had not been granted.
Consequently, unless the Court sees fit to revise that precedent, I believe that the national court' s question should be answered as follows: Articles 30, 3(f), 86 and 90 of the EEC Treaty, together with Article 6 of the directive on terminal equipment, preclude the application of national provisions such as those laid down in French Decree No 85-712, which require traders seeking to market terminal equipment to demonstrate ° by means of type-approval or an equivalent procedure ° that the equipment complies with certain requirements (relating in particular to user safety and proper functioning of the network) where there is at the same time no guarantee of the independence, in relation to any trader offering goods or services in the telecommunications sector, of the body which:
° issues the type-approval certificate (or an equivalent document);
° draws up the technical specifications used for the purpose of issuing the type-approval certificate (or an equivalent document).
B ° Other questions raised in this case
In view of the answer given to the question as to the independence of the body laying down the rules and granting type-approval in the market for terminal equipment, no purpose would be served by considering the other questions raised in this case. It is only for the sake of completeness and, of course, for the eventuality that the Court may decide not to follow the solution advocated above that I now propose to examine briefly the remaining points which have emerged during the proceedings.
As we know, the questions raised relate to the following matters:
° the technical specifications on the basis of which the French authorities should have granted type-approval for the equipment in question were allegedly adopted without regard to the procedural requirements under the directive on technical standards and the directive on terminal equipment, which ° in the contention of Mrs Gillon and the Commission ° means that those specifications are inapplicable;
° terminal equipment already granted type-approval in another Member State should ° according to Mrs Gillon ° be subjected to "simplified" inspections in the Member State of importation, which means in practice that national technical specifications which are not indispensable for safeguarding certain essential requirements are inapplicable to such equipment;
° the existence of discriminatory practices on the part of the French authorities in granting of type-approval for terminal equipment;
° the existence of abuses by France Télécom of its dominant position.
Those matters call for a general remark: the criticisms set out above ° unlike the objection that the regulatory and supervisory body is not independent ° do not cast doubt on the entire system established by Decree No 85-712 for the granting of type-approval for terminal equipment. What inference would have to be drawn if those criticisms were found to be valid? The reply to that question is, in my opinion, very simple. It is clear that the application of technical specifications which, on substantive or procedural grounds, are illegal invalidates an individual decision (whether favourable or unfavourable) given by the national authority. The result is the same when the decision regarding type-approval involves discrimination against the imported product. Finally, it is self-evident that any infringement of Article 86 of the Treaty by a public undertaking renders illegal the abusive conduct in question.
On closer inspection, therefore, the defects complained of may affect the outcome of the type-approval procedure but not the actual principle of type-approval established by the contested decree.
It follows that, had Mrs Gillon been adversely affected by refusal to grant type-approval, or by any other act incompatible with Community law, she could have responded by asserting its illegality under the procedures provided for that contingency. She would, however, have had to seek type-approval, and this she has not done.
On the other hand, the mere possibility that refusal to grant type-approval might prove to be illegal could not in any way serve to exempt Mrs Gillon from seeking it and could not therefore positively authorize her to market terminal equipment "en dehors de toute procédure d' agrément ou homologation".
I therefore consider that, in this regard, the answer to be given to the national court can be formulated as follows: neither the alleged incompatibility with Community law, on grounds of form or substance, of national technical specifications for terminal equipment, nor the alleged implementation by the national authorities of discriminatory practices in the granting of type-approval for such equipment nor the alleged adoption by France Télécom of conduct constituting an abuse of a dominant position within the meaning of Article 86 of the Treaty can serve to exempt those marketing such equipment from the need to seek type-approval (or an equivalent document) in accordance with French Decree No 85-712.
Conclusion
In the light of those considerations, I consider that the following answer should be given to the national court:
Articles 30, 3(f), 86 and 90 of the EEC Treaty, together with Article 6 of Commission Directive 88/301/EEC of 16 May 1988 on terminal equipment, preclude the application of national provisions such as those contained in French Decree No 85-712, which require traders seeking to market terminal equipment to demonstrate ° by means of type-approval or an equivalent procedure ° that the equipment complies with certain requirements (relating in particular to user safety and proper functioning of the network) where there is at the same time no guarantee of the independence, in relation to any trader offering goods or services in the telecommunications sector, of the body which:
° issues the type-approval certificate (or an equivalent document);
° draws up the technical specifications used for the purpose of issuing the type-approval certificate (or an equivalent document).
Should the Court find it necessary to consider the other points raised in these proceedings, I propose that the following answer be given to the national court:
Neither the alleged incompatibility with Community law, on grounds of form or substance, of national technical specifications for terminal equipment, nor the alleged implementation by the national authorities of discriminatory practices in the granting of type-approval for such equipment nor the alleged implementation by France Télécom of conduct constituting an abuse of a dominant position within the meaning of Article 86 of the Treaty can serve to exempt those marketing such equipment from the need to seek type-approval (or an equivalent document) in accordance with French Decree No 85-712.
(*) Original language: Italian.
(1) ° Besides the present case and Taillandier, I would point out RTT v GB-Inno-BM, on which judgment was delivered on 13 December 1991 (Case C-18/88 [1991] ECR I-5941) together with the references to the Court, still pending, in Lagauche (Case C-46/90, in which the Court decided to reopen the oral procedure following the Opinion of Advocate General Lenz), Evrard (Case C-93/91), Sauges (Case C-164/91), Henryon and Others (Joined Cases C-238 to 240/91), Gleyzes (Case C-288/91) and Marchandeau (Case C-323/91).
(2) ° There are, obviously, differences between the various cases. Those differences do not, however, relate to the event at issue, which is invariably the marketing of terminals without approval of the specific type of terminal under consideration ° a difference which sometimes carries implications for the scope of the national provisions which apply.
In addition, the event in question may clearly arise in the context of different legal relations, whether substantive or procedural. For example, whereas the reference to the Court in RTT v GB-Inno-BM arose from an action brought by a competitor, namely the national telecommunications body, which sought an injunction against a trader selling terminal equipment without type-approval, this case derives from criminal proceedings brought against a trader who had been selling equipment without type-approval.
(3) ° Specialized publications emphasize how technological development has played a crucial role in the evolution of economic and legal structures in the telecommunications sector in general and in the market for terminals in particular. The speed of innovation, the merging of sectors which were previously separate and characterized by differing economic and legal structures (postal services and telecommunications, information and audio-visual activities), the variety of means for transmitting information (which, of course, has its counterpart in the range of terminals available) ° in short, the emergence of that broad and complex area of activity commonly known as information technology ° have profoundly changed the nature and characteristics of the goods and services bought and sold, opening up new fields of action to vigorous international competition.
As far as telecommunications terminal equipment is concerned, there is no doubt that, even before Community provisions were adopted, the changes mentioned above had far-reaching repercussions on the structure and functioning of the European markets. The competition (mainly) from non-member countries (the USA, Japan and the newly industrialized countries) and the need for industrial cooperation on account of the scale of the investment required have gradually reduced the divisions between the various national markets of Europe, thereby weakening not only the exclusive rights enjoyed (de jure or de facto) by national (public) bodies with regard to the supply of terminal equipment but also the privileged links between such bodies and certain national producers (Alcatel, Siemens, Italtel and so on).
It is precisely the influence of those factors which explains why the Member States were largely willing to accept the liberalization programme set out by the Commission in the Green Paper and later embodied in the directive on terminal equipment. That directive was ° as I had occasion to point out in my Opinion in Case 202/88 ° challenged before the Court by certain Member States on formal grounds alone, relating to the use of Article 90(3) as its legal basis; its liberalizing tendency, which had already received general assent, went unchallenged.
With regard to developments in the telecommunications sector and the market for terminal equipment, see E. Stevers, Telecommunication Regulation in the European Community (Working Paper No 89/421), Istituto Universitario Europeo, 1990, pp. 12 ff; AA. VV., Vers une nouvelle réglementation des télécommunications , Brussels 1990, pp. 1 ff and 175 ff; C. Overbury and P. Ravaioli, The Application of EEC Law to Telecommunication , Annual Proceedings of Fordham Corporate Law Institute, 1989, pp. 271 ff.
(4) ° Commission communication: Green Paper on the development of the common market for telecommunications services and equipment, COM (87) 290 of 30 June 1987.
(5) ° OJ 1988 L 131, p. 73.
(6) ° OJ 1983 L 109, p. 8.
(7) ° It is worth emphasizing that in all the requests for preliminary rulings from French courts arising from proceedings brought against persons charged with the marketing of unapproved terminals, the questions submitted to the Court are the same as, or at least largely comparable to, the questions raised here.
(8) ° To that end paragraph 9 of the preamble to the directive states:
Stronger competition in the terminal equipment market requires the introduction of transparent technical specifications and type-approval procedures ... To ensure that [these] are applied transparently, objectively and without discrimination, the drawing-up and application of such rules should be entrusted to bodies independent of competitors in the market in question.
Similarly, paragraph 17 states that:
Monitoring of type-approval specifications and rules cannot be entrusted to a competitor in the terminal equipment market in view of the obvious conflict of interest. Member States should therefore ensure that the responsibility for drawing up type-approval specifications and rules is assigned to a body independent of the operator of the network and of any other competitor in the market for terminals.
(9) ° See Stevers, op. cit., p. 17, where the measures needed to ensure market participation in the competitive markets on fair terms are described as including the separation of regulatory and operational activities in order to prevent possible abuse of dominant position in type approval , and also ibid. p. 39; see also H. Ungerer, Comments on Telecommunication Regulatory Reform in the European Community , published in AA. VV., Deregulation or Re-regulation?, London, 1990, p. 103; M. Coleman, European Competition Law in the Telecommunications and Broadcasting Sectors , European Competition Law Review, 1990, p. 204; AA. VV., Vers une Nouvelle Réglementation des Télécommunications , op. cit., pp. 200 ff and pp. 224 ff; J. Scherer, European Telecommunication Law , published in AA. VV., The Law of Information Technology in Europe, Deventer, 1991, p. 228; C. Overbury, P. Ravaioli, op. cit, pp. 282 ff and 302 ff; B. Amory, Vers une Nouvelle Réglementation Européenne des Télécommunications , Revue Française d' Administration Publique, 1989, p. 671; E. Bordón Iglesias, La Libertad de Circulación de Mercancías y Política de la Competencia en el Mercado de Terminales de Telecommunicaciones , Revista de Estudios y Investigación de las Comunidades Europeas, 1990, pp. 559 ff; M. Hoskins, A Review of EEC Telecommunications Policy: Too Much of a Good Thing , European Business Law Review, 1992, p. 8; P. Ravaioli, La Communauté Européenne et les Télécommunications: Développements Récents en Matière de Concurrence , Revue Internationale de Droit Economique, 1991, p. 103.
(10) ° In this connection it may be useful to point out that the directives adopted by the Commission under Article 90(3) are binding for the purposes of Article 189 of the Treaty (see judgment in Case 226/87 Commission v Greece [1988] ECR 3611), so that the obligations laid down in those directives, even if limited to defining (or determining or expressing , to use other terms occurring in the judgment) obligations already substantively embodied in the Treaty, are still to be regarded as formally autonomous. Accordingly, Member States are bound to give effect to them unless they intend to challenge the legality of the directive by applying to the Court for its annulment (as has occurred in respect of all directives adopted under Article 90(3) to date). Moreover, should such an application to the Court be out of time, it is at least doubtful whether the Member State appearing as defendant in proceedings under Article 169 for failure to implement the directive is entitled to raise, as an ancillary matter, the issue of its legality by reference to the exception under Article 184 of the Treaty.
It will be recalled that, in the case of a decision adopted by the Commission under Article 90(3), the Court held in Case 226/87 that the Member State to which the decision was addressed may not ° having failed to challenge it in time ° plead its illegality in proceedings brought by the Commission for failure to give effect to it.
However, the right of a Member State, in an action for failure to fulfil its obligations, to object that a regulation or (more importantly) a directive is illegal (and Article 184 refers to regulations alone), is a matter of dispute for which no firm guidance may be found in previous judgments. An exhaustive study both of the academic debate on the point and of the relevant case-law of the Court is set out in the Opinion of Advocate General Darmon in Case C-258/89, to which I would draw attention, whilst pointing out that the Court did not address itself explicitly to the question of principle raised by the Advocate General (judgment in Case C-258/89 Commission v Spain [1991] ECR I-3977).
(11) ° The judgment refers to the impairment of competition between Member States (paragraph 27). However, not only the reasoning as a whole, which emphasizes the impact of national legislation on imports, but also the general structure of the ruling, which seeks in the passage in question to show that one of the conditions for the application of Article 86, namely an adverse effect on intra-Community trade, has been fulfilled demonstrates that the Court in fact stressed the distortion, not so much of competition as of trade between Member States.
(12) ° This accords with the view of P. Ravaioli; op. cit., p. 120, note 29.
(13) ° It must be said that, in the light of that conclusion, the very introduction of a commencement date under Article 6 of the directive seems superfluous. That is probably due to the fact that, at the time when the directive was adopted, RTT v GB-Inno-BM had not yet been decided. Accordingly, the Commission was entitled to the view that the obligation to ensure independent rules and inspections could not be inferred from the Treaty but was, at least in part, created by the directive. Hence, in so far as the Commission may have believed that, in view of the substantive obligations laid down by the directive (that is to say, those under Articles 2, 3, 6 and 7), the directive itself was instituting new obligations rather than merely setting out obligations already contained in the Treaty, it may have considered it advisable to make the effects of one of the provisions of the directive subject to a commencement date, clearly intended to allow States a period of grace for enacting the legislative amendments required.
On the other hand, it must be emphasized that the commencement date relates only to Article 6 of the directive, and does not in any way seek to ° nor indeed could it ° limit the effects of the obligations directly imposed by the Treaty.
(14) ° The assertions of the Commission and Mrs Gillon, which incidentally were in no way contradicted by the French Government, to the effect that France Télécom was simply the shop-front for the PTT administration, are borne out in specialized publications. See in particular AA. VV. Vers une Nouvelle Réglementation des Télécommunications , op. cit., p. 93, which explains that France Télécom is the trade name of the Direction générale des télécommunications; see also J. Chevallier, La Mutation des Postes et Télécommunications , AJDA, 1990, p. 667.
(15) ° The French Government has not explained whether under Decree No 89-312 type-approval was invariably issued by the Direction générale des télécommunications or by some other directorate within the Ministry for Posts and Telecommunications. The decree itself is silent on this point. In any case, even if responsibility for type-approval had been transferred to another directorate, this would not substantially change matters.
(16) ° Indeed, it is not clear from the documents before the Court whether, subsequent to the abovementioned Ministerial Notice of November 1985, certificates of compliance were introduced which were distinct from type-approval certificates and the CNET report. However, that is irrelevant. Even on the supposition that certificates of compliance were issued by a body totally unconnected with the PTT administration, and hence that there was at least a possibility of having equipment checked for compliance pursuant to Decree No 85-712 by an independent and impartial body, the fact remains that the technical specifications serving as parameters for the inspection would nevertheless have been laid down by the PTT administration, and hence by an entity which ° as we have seen ° was not independent.
(17) ° P. Ravaioli, op. cit., p. 113, note 18, observes significantly that since the connection of equipment, pursuant to the directive on terminal equipment, is no longer governed by exclusive rights or subject to prior authorization, the refusal under Article 3 to allow such connection will be permissible only in the context of the type-approval procedure.
(18) ° The Court had also noted that the existing situation, in which the RTT alone determines the conditions governing approval and also decides on the grant of approval was very debatable when the RTT was also a competitor on the market in equipment for connection to the network.
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