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Brussels, 21 December 2005

Internal Market: infringement proceedings regarding pharmacies in Italy and road testing in Germany; closure of cases against Italy, France, Belgium and Greece

The European Commission has formally requested Italy to modify the legal framework relating to the acquisition of holdings in, and the establishment of, retail pharmacies. In the Commission's view, the Italian legal provisions, as interpreted by the Constitutional Court, are in breach of Articles 43 and 56 of the EC Treaty concerning respectively the right of establishment and the free movement of capital in the European Union. In addition, the Commission has requested that Germany amend its national legislation on roadworthiness testing centres as it is not compatible with the right of establishment. The Commission’s requests take the form of “reasoned opinions”, the second stage in infringement procedures under Article 226 of the EC Treaty. If the Commission does not receive satisfactory replies within two months, it may bring these matters before the Court of Justice. The Commission has also decided to close a series of cases involving national laws that have been brought into line with EU law on the right of establishment and the free movement of services. These relate to the trade-fair and exhibition sector in Italy, privileged access to information for certain broadcasters in Belgium, media ownership in Greece and aerial photography in France.

Italy: acquisition of holdings in and the right of establishment of retail pharmacies

The Italian regulations, as interpreted by the Constitutional Court, prohibit enterprises involved in or linked to firms involved in the retail pharmaceutical sector from acquiring holdings in companies running community pharmacies, within the framework of the current process of privatising community pharmacies in Italy. These regulations also prohibit natural persons not possessing a qualification in pharmacy and legal persons not made up of pharmacists from owning private retail pharmacies.

These restrictions are likely to prevent or hinder operators from other Member States from buying into or establishing retail pharmacies. They can only be considered as compatible with the EC Treaty if they are justified by objectives of general interest and are necessary and proportionate to the objectives pursued. According to the Italian authorities, these restrictions are justified by the need to protect public health (for the first restriction by avoiding conflicts of interest and for the second due to better supervision of persons dispensing medicine).

However, the Commission feels that the restrictions in question go beyond what is necessary to meet the public-health objective. The dangers of conflicts of interest can in fact be avoided by measures other than simply banning enterprises linked to firms involved in the pharmaceutical distribution sector from investing in retail pharmacies. As for the ban on non-pharmacists or legal persons not made up of pharmacists from owning pharmacies, this also goes beyond what is necessary to safeguard public health, since a requirement stipulating that a pharmacist must be present to dispense medicine to patients and manage stocks would be sufficient.

Germany: roadworthiness testing

The Commission has decided to send a reasoned opinion to Germany relating to authorisation requirements laid down in Annex VIIIb of the Road Traffic Licensing Regulation.

This Regulation contains authorisation rules requiring: 1) the compulsory affiliation of at least 60 independent experts exercising this particular activity on a full-time basis; 2) the exclusive affiliation of such independent experts; 3) the affiliation and/or employment of a certain number (at most 30) of experts and/or their employees (as inspection engineers); 4) the establishment of these experts and/or employees in a particular area of the German territory.

The Commission considers that these quantitative and qualitative requirements relating to the internal structure and legal form of such organisations are in breach of Article 43 of the EC Treaty on freedom of establishment.

Less restrictive measures can be employed for ensuring that periodic roadworthiness tests are effective and contribute to road safety in general. For example, the inspection organisation could be required to supervise all testing personnel and to ensure that its inspection engineers provide appropriate guarantees for their professional qualifications.

Closed cases

The Commission has decided to close the following cases since the restrictions previously noted concerning the right of establishment and the freedom to provide services have been removed.

- Italy: trade fairs and exhibitions

The judgment of the Court of Justice of 15/1/2002 (case C-439/99), delivered in relation to infringement proceedings initiated by the Commission in 1996, sanctioned the non-compliance with the freedom to provide services and the freedom of establishment of a particularly long series of national provisions laid down in national laws and in the regulations of five regions (Lombardy, Liguria, Emilia-Romagna, Friuli-Venezia Giula and Veneto) and the Autonomous Province of Trento. As a result of the Commission’s reasoned opinion on non-compliance with this judgment (IP/04/885), the various regional laws have finally been brought into line with the Treaty.

In particular, the Commission had requested amendments to the provisions of the regional legislation concerning: a) the blanket obligation on operators to obtain official recognition; b) compliance with particularly strict time limits; c) the prohibition on trade fairs other than those included in the official calendar; d) the requirement that the organisation of trade fairs conform to regional planning objectives; e) the presence of local operators on advisory committees.

The regulatory and administrative aspects of the new regimes for trade fairs have also been simplified. In particular, in order to organise a trade fair, operators are no longer required to be established in Italy, to be enrolled on an Italian national register or to have obtained prior authorisation.

- Belgium: privileged access to information for certain broadcasters

After the Commission sent a reasoned opinion to Belgium in January 2005, amendments were made to the Flemish Region’s decree on the freedom of information, which gave broadcasters approved by the Flemish Community privileged access to events in the Flemish-speaking region or, under certain conditions, the Brussels region. These broadcasters benefited from free access to events, where they were able to record and broadcast short news items, and they were able to make their own recordings of sporting events, which were even free of charge if the holder of the exclusive rights had not been approved by the Flemish Community.

The amendments made to these provisions have put an end to the system that discriminated against broadcasters established in other Member States. They have also eliminated the difference in the level of protection of exclusive rights, which varied according to whether the holder of the rights was approved by the Flemish Community or not. The Commission has thus been able to close the infringement case.

- Greece: media ownership

Greek legislation required media companies (television stations, radio stations, newspapers and magazines) to have registered shares held by individuals (in the words of the legislation "registered to a natural person”). With regard to television and radio, one clause stated that companies lawfully established outside Greece in a country where there was no obligation that shares be registered to a natural person, could be authorised, under certain conditions, to hold a small share of the capital of a radio or television company.

Since these provisions failed to comply with the principles of free establishment and free movement of capital, the Commission initiated infringement proceedings against Greece, sending it a letter of formal notice in July 2005 (IP/05/987).

The Greek legislation referred to in the letter of formal notice was amended by Law 3314/10.11.2005 to bring it into line with Community law. Therefore, the infringement proceedings can now be closed.

- France: aerial photography

Under the French Aviation Code (Article D-133-10), only non-French nationals were required to obtain authorisation to take aerial photographs. In addition, more complex administrative procedures were laid down for non-residents in France.

Further to the Commission’s reasoned opinion (IP/04/937), France adopted:

1) a new Ministry-of-Transport Decree (No. 2005/865 of 27/7/2005), which amended Article D133-10 of the Civil Aviation Code by removing the requirement for prior authorisation to take aerial photographs (and more generally to record images and data) and introduced a system whereby a simple declaration is made (at the latest 15 days before aviation activities begin), regardless of nationality; persons living outside France must submit this declaration to the civil aviation authorities in Paris;

2) a new Order from the same Ministry (of 27/7/2005), applying the above-mentioned Article of the Civil Aviation Code, which sets out the practical arrangements for submitting this declaration, with the form attached to submit the prior declaration (also possible by electronic means).

Given that the discriminatory aspects of the original legislation have been removed and in view of the administrative simplification of the regime for operators interested in aerial photography, the Commission has decided that this case should be closed.

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