Nearly three decades ago, the European Court of Justice (ECJ) issued a celebrated decision, Cassis de Dijon, in which it established the principle of “mutual recognition.” The ECJ ruled in 1979 that “there is therefore no valid reason why, provided that they have been lawfully produced and marketed in one of the Member States, alcoholic beverages should not be introduced into any other Member State.”(para.14) At the same time, however, the ECJ also noted that “Obstacles to movement within the Community resulting from disparities between the national laws relating to the marketing of the products in question must be accepted in so far as those provisions may be recognized as being necessary in order to satisfy mandatory requirements relating in particular to the effectiveness of fiscal supervision, the protection of public health, the fairness of commercial transactions and the defense of the consumer.” (para.8).
On February 14 2007, the European Commission proposed a Regulation reincarnating the Cassis de Dijon decision, together with three other initiatives on free movement of goods and harmonization. The proposed Regulation on “laying down procedures relating to the application of certain national technical rules to products lawfully marketed in another Member State and repealing Decision 3052/95/EC” requires member states to accept products from other member states unless the former (importing states) prove the necessity of their bans. This strong pro-market, pro-integration ethos is reminiscent of the GATT doctrine. Under GATT Article XI:1, trade restrictive regulations are prohibited in general. Under Article XX of GATT, a regulating (importing) state should prove that its restriction is necessary (or relating) to achieve certain regulatory goals, such as protection of human health or the environment. In contrast, under the SPS, which is a lex specialis to GATT Article XX (b), this burden of proof seems to be reversed because the SPS declares that members have a “right” to regulate in the sanitary or phytosanitary areas.
One might interpret the Commission’s proposal as yet another attempt to breathe a new life into the EU’s Common Market project. After all those years since Cassis de Dijon, European businesspeople are still complaining about additional production costs caused by diverging regulatory standards of member states, ranging from electrical equipments to clothing. See today’s article in Financial Times covering this issue. Who knows? This new proposal touching on everyday economic lives of European people might revive a sign of life of the EU Constitution, as neo-functionalists would maintain.
One caveat. This proposal, like the Cassis de Dijon (mutual recognition) principle itself, applies only to non-harmonized areas, i.e., where no EC Regulations and Directives apply. So, huge chunks of products, such as cars and pharmaceuticals, are excluded from this Proposal.