Brasserie du Pêcheur SA v Bundesrepublik Deutschland and The Queen v Secretary of State for Transport, ex parte: Factortame Ltd and others.

• Jurisdiction: European Union
• ECLI: ECLI:EU:C:1995:407
• Docket Number: C-48/93,C-46/93
• Celex Number: 61993CC0046
• Court: Court of Justice (European Union)
• Procedure Type: Reference for a preliminary ruling
• Date: 28 November 1995

OPINION OF ADVOCATE GENERAL
TESAURO
delivered on 28 November 1995 (1)


Joined Cases C-46/93 and C-48/93

Brasserie du Pêcheur SA
v
Federal Republic of Germany


(Reference for a preliminary ruling from the Bundesgerichtshof under Article 177 of the EC Treaty)


The Queen
v
Secretary of Transport ex parte Factortame Ltd and Others


(Reference for a preliminary ruling from the High Court of Justice, Queen's Bench Division, Divisional Court, under AArticle 177 of the EC Treaty)

((Principle of the liability of a Member State for loss or damage caused to individuals owing to infringements of Community law attributable to it – Infringements attributable to the legislature – Conditions for liability on the part of the State – Quantum of damages))

1. State liability for infringements of Community law and the resultant obligation to make reparation to individuals, which is the subject of inter alia the well-known judgment in Francovich , (2) continues to arouse great interest. That judgment, however, has not cleared up every aspect; many question marks remain, some relating to important issues.The questions from the Bundesgerichtshof (Federal Court of Justice, Case C-46/93) and the High Court of Justice (Case C-48/93), which raise the issue once again of infringements of the Treaty already found in preceding judgments of this Court, consequently afford an opportunity, if not of resolving all the remaining difficulties associated with this complex subject, at least of providing further clarification, in particular about the existence of State liability in cases other than failure to implement a directive and about the Community preconditions for an individual's right to reparation.As a result, the Court will have to consider a number of important institutional aspects, in particular the relationship between Community law and the national legal systems. Consequently, this is an area in which the correct operation of the Community legal system as a whole has to be assessed. I Facts, national legislation, questions referred for a preliminary ruling 2. Whilst referring to the Report for the Hearing for a detailed account of the relevant legislation and the facts which have given rise to these proceedings, I shall confine myself to those aspects which are most relevant for present purposes. (a) Case C-46/93 ( Brasserie du Pêcheur ) 3. Brasserie du Pêcheur SA, a French brewery the seat of which is at Schiltigheim (Alsace), claims that it was forced to discontinue exports of beer to Germany in late 1981 because the beer produced by it did not comply with the purity requirements laid down in Paragraphs 9 and 10 of the Biersteuergesetz (3) (Law on Beer Duty, hereinafter the BiStG). More specifically, as emerged at the hearing, the persistent checks carried out by the German authorities at retailers' premises and the resultant claims that the beer in question did not satisfy the requirements laid down caused the brewery's German sole importer to refuse to renew the distribution contract.Following the judgment of 12 March 1987 (4) in which the Court held that the prohibition against the marketing of beers imported from other Member States which did not comply with the BiStG was incompatible with Article 30 of the Treaty, Brasserie du Pêcheur brought an action against the Federal Republic of Germany for compensation for the loss suffered by it as a result of that import restriction between 1981 and 1987, in the sum of DM 1 800 000, which is presumably a fraction of the loss actually incurred. That action was dismissed by the lower courts. Brasserie du Pêcheur is pursuing the same claim in its appeal on a point of law before the Bundesgerichtshof. 4. Given that the infringement in question must be regarded as an omission on the part of the legislature, since it had not amended the BiStG to accord with Community law, the Bundesgerichtshof points out that compensation for damage is governed in Germany by Paragraph 839 of the Bürgerliches Gesetzbuch (German Civil Code) in conjunction with Article 34 of the Grundgesetz (Basic Law). According to the first paragraph of the latter provision, If a person infringes, in the exercise of a public office entrusted to him, the obligations incumbent upon him as against a third party, liability therefor shall attach in principle to the State or to the body in whose service he is engaged. The first subparagraph of Paragraph 839 of the Bürgerliches Gesetzbuch provides, in contrast, that if an official wilfully or negligently commits a breach of official duty incumbent upon him as against a third party, he shall compensate the third party for any damage arising therefrom. In the event that he acted negligently, he will be answerable for the damage only if the injured party has no other possibility of obtaining compensation.Apart from the exercise of a public office and a breach of official duty, therefore, the applicability of the rules in question depends on the further requirement that the official duty breached should be referrable to the third party ( Drittbezogenheit ), which means that the State is responsible only for breaches of official duties the exercise of which is expressly directed at a third party and therefore has the aim of protecting a right of the third party. However, it is precisely that requirement which is normally absent in the case of a legislative wrong, including the illegality in point in this case. (5) As the national court has pointed out, in fact, in the BiStG the legislature imposed burdens concerning the community which do not relate in particular to any individual or class of individual capable of being regarded as third parties for the purposes of the provisions adverted to. (6) Secondly, the national court observes that neither in this case can there be State liability on account of an unlawful act of the public authority which is capable of being equated with expropriation, a principle developed by the case-law of the Bundesgerichtshof (Federal Court of Justice). (7) The national court considers this to be inevitable in that the principle in question, according to that case-law, does not permit compensation to be granted for loss or damage arising out of laws infringing the Grundgesetz, which is equatable to compensation for loss or damage resulting from infringement of a Community obligation. Moreover and in any event, in this case there was no interference with the appellant's legal interest which may be protected under the law of property. 5. The Bundesgerichtshof, taking the view that German law affords no basis for upholding the appellant's damages claim, has therefore made a reference for a preliminary ruling to the Court in order to establish whether the principle of State liability for loss or damage caused to individuals by infringements of Community law attributable to it, as may be inferred from the judgment in Francovich , is applicable to the case pending before it. More specifically, it has asked the Court: 1. Does the principle of Community law according to which Member States are obliged to pay compensation for damage suffered by an individual as a result of breaches of Community law attributable to those States also apply where such a breach consists of a failure to adapt a national parliamentary statute to the higher-ranking rules of Community law (this case concerning a failure to adapt Paragraphs 9 and 10 of the German Biersteuergesetz to Article 30 of the EEC Treaty)? 2. May the national legal system provide that any entitlement to compensation is to be subject to the same limitations as those applying where a national statute breaches higher-ranking national law, for example where an ordinary Federal law breaches the Grundgesetz of the Federal Republic of Germany? 3. May the national legal system provide that entitlement to compensation is to be conditional on fault (intent or negligence) on the part of the organs of the State responsible for the failure to adapt the legislation? 4. If Question 1 is to be answered in the affirmative and Question 2 in the negative: (a) May liability to pay compensation under the national legal system be limited to the reparation of damage done to specific individual legal interests, for example property, or does it require full compensation for all financial losses, including lost profits? (b) Does the obligation to pay compensation also require reparation of the damage already incurred before it was held in the judgment of the European Court of Justice of 12 March 1987 in Case 178/84 Commission v Germany [1987] ECR 1227 that Paragraph 10 of the German Biersteuergesetz infringed higher-ranking Community law? (b) Case C-48/93 ( Factortame III ) 6. The action for damages arising out of the application of the Merchant Shipping Act 1988 brought by the 97 applicants in the main proceedings is the sequel to the well-known Factortame affair, of which I shall merely set out the gist.The law in question provided for a new register for all British fishing vessels and hence also for vessels already registered on the former register. In particular, the new registration system, which became compulsory on 1 April 1989, imposed stricter conditions relating to the nationality, residence and domicile of the natural and legal persons who were the true owners of the vessels. If those requirements were not met, fishing vessels were ineligible to be entered on the new register and consequently were not allowed to fish under the British flag.The new registration system was challenged in the Divisional Court, which by order of 10 March 1989 suspended the application of the new registration system by interim injunction, which was subsequently overturned by the Court of Appeal. (8) Concurrently,...