Saturday, May 5, 2012

Opel Austria GMBH v. Council case brief

Opel Austria GMBH v. Council

FACTS
-Duty imposed on gearboxes produced by General Motors in Austria. Imposed to offset certain state aids extended by Austria to GM.
-Regulation adopted on basis of common commercial policy power and 1972 Council regulation on imposition of safeguards provided for in Austria-EC free trade agreement (FTA).
-FTA agreement superseded by EEA agreement.

***

→ P claims: EEA agreement was part of the factual and legal situation existing at time when regulation adopted. By adopting regulation a few days before EEA agreement entered into force, Council infringed on principle of good faith.

According to the principle, pending the entry into force of an international agreement, signatories to an international agreement may not adopt measures which would defeat its object and purpose.

Rule (State is obliged to refrain from acts which would defeat the object of a treaty)
-Court asks if EEA has direct effect:
    Provisions of such an agreement may have direct affect if they are unconditional and     sufficiently precise.
-EEA agreement states customs duties on imports/exports and any charges having equivalent effect are prohibited between contracting parties.
-Here the rule is unconditional and precise.

RULES
-Any pecuniary charge, however small and whatever its designation and mode of application, which is imposed unilaterally on domestic or foreign goods by reason of the fact that they cross a frontier, and which is not a customs duty in the strict sense, constitutes a charge having equivalent effect within the meaning of articles 31 and 38 TFEU, even if it is not imposed for the benefit of the state, is not discriminatory or protective in effect or if the product on which the charge is imposed is not in competition with any domestic product.
-Court holds by adopting the contested regulation in the period in question, the P's legitimate expectations were frustrated.

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