Introduction. Directive 98/34/EC, an instrument of transparency at the service of the Internal Market


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At the beginning of the 1980s the Commission, basing itself on a Court of Justice ruling known as the ‘Cassis de Dijon’ judgment, launched a new policy designed to complete the internal market on the basis of three concepts:

- Acceptance in each Member State of products lawfully manufactured in the rest of the Community (‘mutual recognition’);

- Harmonisation limited to important economic sectors covering, in particular, health, safety and the environment;

- A prevention-based approach to monitoring national regulations.

Since 1984, Directive 83/189/EEC2which, following codification later became Directive 98/34/EC3, has laid down a preventive mechanism, the scope of which has been progressively extended.

Today, the Member States of the European Union are obliged to notify to the Commission and to the other Member States any draft technical regulation concerning products and Information Society services before they are adopted in national law.

The concept was revolutionary at the time and has remained so - to the extent that the Commission is examining whether it could be extended to other areas.

The exchange of information is carried out in accordance with a two-pronged procedure which divides the Directive into two distinct but complementary parts.

The first part relates to the procedure for the provision of information on new national initiatives which should lead to the formulation of national standards between the national stand-ardisation bodies, the European standardisation bodies, namely CEN (European Committee for Standardisation), CENELEC (European Committee for Electrotechnical Standardisation) and ETSI (European Telecommunications Standards Institute), and the European Commission. The Commission has given the European standardisation bodies responsibility for implementing this procedure, by means of an annual contract.

The second part of the Directive is addressed to the Member States who have agreed to take part in a reciprocal transparency and monitoring system in the regulatory field. This initiative was original in several ways:

- The system is of a preventive nature: information is provided when technical regulations relating to products or rules on Information Society services are still at the draft stage, and may be amended in order to conform with the principles of the internal market.

- It is not only the Commission which can examine and monitor the texts through the operation of standstill periods, but also all the Member States; the latter have acknowledged the advantages of a procedure which allows for reciprocal infiuence over their legislative processes. The Treaty itself merely made provision for retrospective monitoring by the Member States, through the use of the more cumbersome infringement procedures which are rarely applied between Member States.

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- The system also permits national draft legislation to be put on ice for a certain period to facilitate discussion at Community level on the matter in the light of harmonisation initiatives. Moreover, by means of this legislative observa-tory, the real needs for harmonisation can be identified more easily.

The system, which got o? to a slow start, has gained momentum and has provided the Commission, the Member States and enterprises with a window on the activities of national authorities and standardisation bodies in the technical field (rules relating to product composition, labelling, name, testing, etc., as well as rules relating to product life cycle through to disposal). The scope of the Directive has been progressively extended, so that it now covers all agricultural and industrially manufactured products and takes account of an ever growing number of provisions, in particular to prevent any measures which indirectly require compliance with technical specifications from slipping through the net. In 1998, the procedure was extended by Directive 98/48/EC to encompass rules on Information Society services4.

The geographical scope of the Directive was also gradually extended. Directive 98/34/EC, which was already implemented in part in the EFTA countries since 1990,5has also been partly extended to Turkey under the Association Agreement with that country6. The Directive has also provided a model for a Convention of the Council of Europe7.

The application of the notification procedure has given rise to new practices. An entire philosophy of information exchange, dialogue and cooperation has evolved between the Member States. This mechanism has also proved to be a formidable benchmarking tool which allows Member States to draw on the ideas of their partners in order to solve common problems regarding technical regulations, especially in newly regulated sectors such as GMOs, domain names and gene therapy.

Moreover, the Commission is using Directive 98/34/EC as an educational tool with a view to adjusting Member States’ legislative style.

Through this instrument, the Commission not only succeeds in removing provisions which are contrary to Community law, but also contributes to the formulation of provisions to be written into national legislation to ensure that economic operators are fully informed of their rights and permit application in practice of the principle of ‘mutual recognition’ contained in the European Court of Justice (ECJ) interpretation of Articles 28 et seq. of the Treaty.

According to this principle, each Member State must accept the sale in its territory of any product lawfully manufactured or marketed in another Member State, subject, where legitimate interests, such as health and safety questions are at stake, to these products guaranteeing an equivalent level of protection. The corollary to this acceptance of products from the rest of

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the Community- extended by the Agreement on the European Economic Area to products from EFTA countries signatory to the Agreement8- is mutual recognition of the regulations relating to the design, manufacture and testing of products, and the conformity assessment procedures used; the Member States and the Commission are informed about these regulations through the procedure for the provision of information established by Directive 98/34/EC.

Furthermore, the provisions of Decision 1/95 of the EC-Turkey Association Council of 22 December 1995 on implementing the final phase of the Customs Union9, which provides for the elimination of quantitative restrictions or measures having equivalent efiect between the EU and Turkey, are interpreted for the purposes of their implementation and application to products covered by the Customs Union, in conformity with the relevant decisions of the European Court of Justice concerning provisions of the EC Treaty, in particular Articles 28 to 30 thereof.

Directive 98/34/EC, by extending the scope of application of the information procedure to rules on Information Society services, ensured, since August 1999, the prevention of new barriers to the freedom of establishment and the free movement of Information Society services by providing a mechanism to analyse the compatibility of new national legislation in this field with Articles 43 and 49 of the EC Treaty.

According to the case-law of the European Court of Justice, Articles 43 and 49 of the Treaty require the elimination of restrictions, i.e. of all ‘measures which prohibit, impede or render less attractive the exercise of such freedoms’ (freedom of establishment and freedom to provide services)10.

To be admissible as an exception to the fundamental freedoms of the internal market in a non-harmonised area, a national restriction must, on the basis of this case law comply with the principles of non-discrimination, necessity and proportionality11.

As regards freedom to provide services, in particular, this means that national regulations which make no allowance for requirements already met by an operator in his Member State of establishment, from which he ofiers his services12will prove to be a disproportionate restriction and therefore inadmissible under Community law where the service in question is provided, as in the case of Information Society services, without the provider having to enter the territory of the Member State in which the service is received.13Therefore, when examining national draft rules in the field of Information Society services, the Commission’s overriding objective has been, for example, basing itself on the case-law of the Court of Justice, to oppose any national regulatory approach aimed at applying blanket, extra-territorial legal arrangements which make no distinction between operators based in the notifying Member State and those wishing to provide services in such Member State without, however, being established there. The Commission has also made sure that planned national rules do not impose needless or exces-

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sive legal or administrative costs on operators and possibly on users.

In order to enable the Directive to be fully efiective, all the players - national authorities, standardisation bodies and the economic operators of the European Union - need to have a thorough understanding of its provisions and so be precisely aware of their rights and obligations. This is all the more important since the Court of Justice, in April 1996, established the principle that failure to comply with the notification obligation results in the technical regulations concerned being inapplicable, so that they are unenforceable against individuals.14The aim of this booklet is to inform all the actors - and particularly Europe’s manufacturers and Information Society service providers - of the objectives, content and scope of a key instrument of Community law for the removal at source of technical barriers to the free movement of goods, to the freedom of establishment and the freedom to provide Information Society services in the internal market.

[2] Directive of 28 March 1983. OJ L 109, 26.4.1983, p. 8.

[3] Directive of 22 June 1998. OJ L 204, 21.7.1998, p. 37.

[4] Directive 83/189/EEC was amended principally by Council Directive 88/182/EEC of 22 March 1988 (OJ L 81, 26.3.1988, p. 75) and by European Parliament and Council Directive 94/10/EC of 23 March 1994 (OJ L 100, 19.4.1994, p. 30). Directive 98/34/EC of 22 June 1998 codified Directive 83/189/EEC and all its subsequent amendments while Directive 98/48/EC of 20 July 1998 amended Directive 98/34/EC.

[5] The Agreement between the Member States of EFTA and the EEC laying down a procedure for the provision of information in the field of technical regulations entered into force in November 1990. The Agreement on the European Economic Area, applicable since 1 January 1994, subsequently incorporated Directive 83/189/EEC with the necessary adaptations. Switzerland, though not a signatory to this Agreement, continues to apply the procedure for the exchange of information.

[6] Agreement establishing an Association between the European Economic Community and Turkey (OJ C Vol. 16 No C 113, 24.12.1973) and Decision 1/95 of the EC-Turkey Association Council of 22 December 1995 on implementing the final phase of the customs union (OJ L 35, 13.2.1996, p. 1).

[7] Convention No 180 of the Council of Europe on Information and Legal Co-operation concerning ‘Information Society Services’.

[8] It must be pointed out that the relevant provisions of the Agreement on the European Economic Area apply only to ‘products originating in the Contracting Parties’ and not, consequently, to products simply marketed there.

[9] OJ L 35, 13.2.1996, p. 1.

[10] Case C-439/99 Commission v Italy - ‘Trade Fairs’ [2002] ECR I-305.

[11] Case C-76/90Dennemeyer’ [1991] ECR I-4221; Case C-369/96 ‘Arblade’ [1999] ECR I-8453 and Case C-55/94 ‘Gebhard’ [1995] ECR I-4165.

[12] See ‘Arblade’ judgment cited above, footnote 11.

[13] See ‘Dennemeyer’ judgment cited above, footnote 11.

[14] Case C-194/94 ‘CIA Security’ [1996] ECR I-2201.

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