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The HOB–vín Judgment: A Failed Attempt to Standardise the Visual Imagery, Packaging and Appeal of Alcohol Products

Published online by Cambridge University Press:  20 January 2017

Alberto Alemanno
Alberto Alemanno*
Affiliation:
EU Law and Risk Regulation, HEC Paris Georgetown University Law Center
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Abstract

National rules of a EEA State, such as those at stake in the present judgment, under which a State monopoly on the retail sale of alcohol, may refuse to accept for sale alcoholic beverages that are lawfully produced and marketed in another EEA State on the grounds that the labelling of the products contains loaded or unrelated information, are in breach of Article 18 of Directive 2000/13/EC (‘the labelling Directive’ or ‘Directive’), and cannot be justified by a public health objective. Another rule requiring alcoholic beverages to carry stickers stating that their contents are alcoholic, in addition to the mandatory indication of the actual alcoholic strength by volume, ‘cannot be considered effective’ if it has been adopted without regard to the notification procedure laid down in Article 19 of the labelling Directive. However, individuals and economic operators who have been harmed by the incorrect application of the Directive may rely on the free movement of goods in order to render the State liable for the breach of EEA law, regardless of whether such a directive is being made or has been made part of the legal order of Iceland, since it has been incorporated in the EEA Agreement. Failure to notify the second rule in accordance with the Directive qualifies as a sufficiently serious breach of EEA law. Such a breach entails State liability if the national court finds a direct causal link between the breach of the obligation resting on the State and the damage sustained by the injured party (author's headnote).

Type
Case Notes
Information
European Journal of Risk Regulation , Volume 4 , Issue 1 , March 2013 , pp. 101 - 112
Copyright
Copyright © Cambridge University Press 2013

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References

1 Judgment of 11 December 2012.

2 The EFTA Court has jurisdiction with regard to EFTA States which are parties to the EEA Agreement (at present Iceland, Liechtenstein and Norway).

3 Case E-6/07, HOB vín ehf. v Faxaflóahafnir sf., Judgment – 5 March 2008 EFTA Court Report 2008, p. 128; Case E-4/05, HOB-vín v the Icelandic State and the State Alcohol and Tobacco Company of Iceland, Judgment – 17 January 2006 EFTA Court Report 2006, p. 4.

4 Alcopop is a colloquial term describing certain flavoured alcoholic beverages, including: malt beverages to which various fruit juices or other flavourings have been added; beverages containing wine to which ingredients such as fruit juice or other flavourings have been added; beverages containing distilled alcohol and added ingredients such as fruit juices or other flavourings. According to Wikipedia, the term ‘alcopop’ (a portmanteau of the words alcohol and pop) is generally used by advocates of tighter restrictions on alcoholic beverage sales, who argue that the beverages are especially appealing to underage drinkers.

5 There is disagreement, in the light of Article 8 EEA and Protocol 3 to the EEA Agreement, about the extent to which the products in question should fall under heading 22.05 or 22.06 of the Harmonized System and about what conclusions to draw concerning the applicability of EEA law to these products.

6 Paragraph 46.

7 Decisions No 107/2001 of the EEA Joint Committee of 28 September 2001, amending Chapter XII of Annex II to the Agreement.

8 The prohibition enshrined in Article 18(1) may suffer an exception in relation to the following possible justifications: protection of public health, prevention of fraud, unless such provisions are liable to impede the application of the definitions and rules laid down by this Directive, protection of industrial and commercial property rights, indications of provenance, registered designations of origin and prevention of unfair competition.

9 Paragraph 79.

10 Paragraph 80.

11 Cases E-6/96 Wilhelmsen [1997] EFTA Ct. Rep. 53, paragraph 85; E-9/00 ESA v Norway [2002] EFTA Ct. Rep. 72, paragraph 44, and E-4/04 Pedicel [2005] EFTA Ct. Rep. 1, paragraph 54.

12 Case E-1/97 Gundersen [1997] EFTA Ct. Rep. 108, paragraph 20, and E-4/04 Pedicel [2005] EFTA Ct. Rep. 1, paragraph 55.

13 Paragraph 86.

14 Paragraph 82.

15 Paragraph 84.

16 Paragraph 85.

17 Paragraph 90.

18 Paragraph 90.

19 Paragraph 97.

20 Paragraph 97.

21 Paragraph 109.

22 Paragraph 102.

23 Paragraph 111.

24 Paragraph 113.

25 See Cases E-9/97 Sveinbjörnsdóttir [1998] EFTA Ct. Rep. 95, paragraphs 62 and 63; E-4/01 Karlsson [2002] EFTA Ct. Rep. 240, paragraph 25; and E-8/07 Ngyen [2008] EFTA Ct. Rep. 226, paragraph 31.

26 Paragraph 120.

27 Ibidem.

28 Paragraph 124.

29 Paragraph 126.

30 Paragraph 127.

31 Paragraph 128.

32 Paragraph 129.

33 Paragraphs 134–136.

34 Paragraph 137.

35 Yet one might observe that at the hearing the plaintiff expressly stated that he accepted all observations as submitted by the Commission.

36 Paragraph 74.

37 Only the Commission seems to have encouraged the Court to read ‘protection of consumers’ in Article 18(2) (see Report for the Hearing, paragraph 148), but the Commission identified such a ground of justification under the second indent, ‘prevention of fraud’.

38 The only judgment interpreting Article 18 of Directive 2000/13 as encompassing not only public health but the protection of consumers, appears to be Case C-239/02 Douwe Egberts [2004] ECR I- 7007, paragraph 39 (‘Directive 2000/13 none the less enables the Member States to apply non-harmonised national provisions prohibiting trade in directive-compliant foodstuffs where they are justified under Article 18(2) without its being necessary to appraise them in the light of Articles 28 EC and 30 EC. Amongst the grounds mentioned therein are the protection of public health and consumers’).

39 Paragraph 79.

40 Paragraph 82.

41 It also appears unclear why the Court decided to perform the proportionality scrutiny by referring to Article 5.10, fourth indent, of the product selection rules, relating to people's general sense of propriety whereas, when reformulating the question, it took as a point of reference the third indent of those rules, which covers loaded or unrelated information or implications that alcohol enhances physical, mental or social ability. Regardless of the exact grounds invoked by the defendant to justify its ‘refusal decision’, the intent pursued by these production selection rules is to control the visual imagery of the packaging of alcoholic beverages marketed in Iceland.

42 ÁTVR justified its ‘refusal decision’ by observing that: the illustrations on the cans “are evidently intended to make the products sensually appealing and challenging”, and their sexual reference is obvious; the “frivolous pictures with a sensuous, even lewd undertone” were at the outer limit of the public's sense of propriety; such a combination of image and alcoholic beverages was not compatible with its product selection policy, and it was irrelevant that “the attempted reference had been to energy, stamina or enjoyment, or some other image-related aspect which had absolutely nothing to do with the product”; and eventually the principles applying to alcohol were “different from those applying to other consumer products”, and consideration had to be given to the Icelandic Government's alcohol policy and how it had been interpreted, “guided by values such as moderation, caution and conservatism”. See Report for the Hearing, paragraph 30.

43 Report for the Hearing, paragraph 64.

44 Report for the Hearing, paragraph 73.

45 Report for the Hearing, paragraphs 103 and 105.

46 Report for the Hearing, paragraph 93.

47 Ibidem.

48 Case C-544/10 Deutsches Weintor [2012] not yet reported.

49 Asked to determine whether the description of a wine as ‘easily digestible’ was a health claim and therefore prohibited pursuant to Article 4(3), the Court adopted a broad interpretation of the definition of what constituted health claims. See paragraph 41.

50 Pursuant to Directive 98/34/EC, as amended by Directive 98/48/ EC, Member States are obliged to notify the Commission about draft national technical regulations relating to all products, and draft national regulations specifically concerning information society services.

51 See Lenaerts, Koen and Gutman, Kathleen, “‘Federal Common Law’ in the European Union: A Comparative Perspective from the United States”, 54 American Journal of Comparative Law (2006), at p.81 CrossRefGoogle Scholar as quoted by Baudenbacher, Carl, “If not EEA State Liability, then What? Reflections Ten Years after the EFTA Court's Sveinbjörnsdóttir”, 10 Chicago Journal of International Law (2009), at p. 333.Google Scholar

52 See, e.g., E-4/01 Karlsson [2002] EFTA Ct. Rep. 240, paragraph 36.

53 See, e.g., Case C-150/99 Stockholm Lindöpark [2001] ECR I-0493 paragraph 38; E-4/01 Karlsson [2002] EFTA Ct. Rep. 240, paragraph25

54 Case E-4/01 Karlsson [2002] EFTA Ct. Rep. 240, paragraph 48.

55 Case E-9/97 Sveinbjörnsdóttir [1998] EFTA Ct. Rep. 95.

56 Paragraph 60.

57 Sveinbjornsdottir, paragraph 63.

58 Norway and Iceland do not accept that they are required to treat EEA provisions that have not been implemented into their national legal orders as capable of being directly applicable.

59 Paragraph 120.

60 Joined Cases C-46/93 and C-48/93 Brasserie du Pêcheur and Factortame [1996] ECR I-1029, paragraph 23.

61 Paragraph 128.

62 Paragraph 128.

63 Case E-1/94 Restamark [1994–1995] EFTA Ct. Rep. 15, paragraph The expression of ‘quasi–direct effect’ draws from Carl Baudenbacher, The EFTA Court Ten Years On, p. 26.

64 Baudenbacher, “If not EEA State Liability, then What?”, supra note 51.

65 Ibidem, at p. 358.

66 On the growing role played by effectivenes in the case law of the EFTA Court, see, e.g., Case E-2/10, Kolbeinsson v the Icelandic State 2009–2010, EFTA Ct Rep. 46, p. 234, pararagraph 46 ; Case E-3/11, Pálmi Sigmarsson v Selabanki Íslands, EFTA Ct Rep. paragraph 48.

67 Carl Baudenbacher, “If not EEA State Liability, then What?”, supra note 51.

68 This methaphor belongs to Carl Baudenbacher. See his article “If not EEA State Liability, then What? ”, supra note 51.

69 Political Declaration of the High–level Meeting of the General Assembly on the Prevention and Control of Non–communicable Diseases (document A/66/L.1).

70 Alemanno, Alberto and Erico, Bonadio, “Plain Packaging of Cigarettes under EU Law”, in Mitchell, Andrew, Tania, Voon and Liberman, Jonathan (eds.), Public Health and Plain Packaging of Cigarettes: Legal Issues (Cheltenham: Edward Elgar, 2012).Google Scholar

71 Case E-16/10 Philip Morris [2011] EFTA Ct. Rep. 330. See on this judgment, Alberto Alemanno, “The Philip Morris Judgment: The EFTA Court Enters the Post-Keck Debate with a Precautionary Twist”, 9 European Law Reporter (2011).

72 For an overview, see Alemanno, Alberto, “Out of Sight Out of Mind – Towards a New EU Tobacco Products Directive”, 18(2) Columbia Journal of European Law (2012).Google Scholar

73 While it would be wrong to interpret this emerging regulatory approach as paving the way to plain packaging in the alcohol industry, the Icelandic stance vis–à–vis the packaging of alcoholic products seems to call for less ideological more serious thinking about the policy and legal implications of reducing the visual appeal of the packaging of products beyond tobacco.

74 Being subject to the principle of “homogeneous interpretation”, the EFTA Court is bound by the case law of the CJEU but only insofar as relevant case law exists. See Baudenbacher, Carl, “The EFTA Court: An Actor in the European Judicial Dialogue”, 28 Fordham International Law Journa (2005), pp. 353 Google Scholar–391 and also Baudenbacher, Carl, “The EFTA Court, the ECJ, and the Latter's Advocates General – a Tale of Judicial Dialogue”, in Anthony Arnull, Piet Eckhout and Takis Tridimas, Continuity and Change in EU Law. Essays in Honour of Jacobs, Sir Francis (Oxford: Oxford University Press, 2008), pp. 90 et sqq.Google Scholar

75 While several Member States have discussed the possibility to adopt plain packaging in their jurisdictions, the UK is the only EU Member State – together with the EU – that has held a public consultation on the standardized packaging of tobacco. This was concluded on August 10, 2012, and some follow-up action is expected from the UK Department of Health (DH). The UK stance in HOB seems to confirm what was declared at the beginning of the consultation by the DH: “The Government has an open mind at this stage about introducing standardised packaging”.

76 Vaale–Hallberg, Marie, “Fighting Non–Communicable Diseases: Possible Comprehensive Ban on the Marketing of Unhealthy Food and Beverages to Children”, 4 European Food and Feed Law Review (2012), pp. 213–215.Google Scholar

77 The labelling Directive has been repealed by Regulation EU No 1169/2011 on consumer information. The latter cannot be implemented as statutory law in any of the EEA States until the EEA Joint Committee has adopted a decision to make the Regulation part of the EEA Agreement. The decision is pending, and it is uncertain when the Committee will adopt it.