COSTA

that

seeing

imposed

been

Treaty
States

and

but

in

Commission

Community

177,

the

law

9. Article

as

by

tionals

does

not

more

duty

its

State

Member States
than

rules

nationals of

those

the country

governing

the

undertakings.

part

10. Article 37

(2)

constitutes

in

EEC

the

of

its

all

Article

102

contains

EEC

the

of

Community law capable

ing individual rights which

provisions

no

capable of creating

Treaty

which

individual

are

courts

of

11.
11.

The
the

Article 93
tains

no

able

of

EEC

the

of

Treaty

con

are

cap

which

provisions

individual

creating

A Member State's

EEC Treaty,

the

subject

to

rights

regards

its

any

or

execution

the adoption

of

is

which

nor,

effect,

to

measure

any

which

capable

or

States

of

individuals.

and

and

law,

their

nationals

created

national

of

system

forms

thus

own

has

Such

becomes an integral

the legal

States,

directly

and

in

must

an
part

their

concerns

Article

53

constitutes
able

of

of
a

the

Community

creating

Treaty

product

cap

capable

States,

for the

whether

part

relates

by

the

in

to

each

activity
such

or

its

of

inter

which

it is

playing such a
exports between

capable of

in imports

nationals

to

dealing

virtue

technical

conditions

is

court

the economic

which,

and

an effective part

case

and

of

of competition and

Member

review

as

regarding

subject,

rights

first, have

the main action to assess

matter

in

and

of monopolies

It is

nature

rule

individual

of

Member

with

product

protect.

EEC

(2)

object

procured

must,

the subject

under

rights which

of

transactions

commercial

national

8.

their

conditions

means

trade between

favour it

whose

individual

courts

part of

by

secondly must play

in such trade.

Member

the

the

are

which

object

being

relations

obligation

bodies

their

producing direct effects

between Member

of

the

as

nationals

goods

marketed,

either

by the States or by the Commission,

is legally complete and consequently
on

between

States regarding

neither

as

Article 37

of

provisions

EEC Treaty have

tion

obligation under

conditions

protect.

the prohibition of any new measure

contrary to the principles of Article
37
that is any measure having as
(1),
its object or effect a new discrimina

which national courts must protect.

7.

creat

national

rights

which national courts must protect.

6.

must

Treaty

provisions a rule

of

5.

of

legal

the

whatever

to

pres

obliga

the

on

system

is

na

of

establishment

establishment,

Commission.

the

for

Treaty

as no new measure

of other

severe

cribed

Article

EEC

the

of

long

the

subjects

the

the

of

53

satisfied so

to allege,

right

fulfil any

tions or breach of
of

the

on

or under

failure

either

concerned to

by
them

obligation

individuals

give

which national courts must protect.

have

creating individual

this

the

of

bind

ENEL

States

which

them

upon

which

without

rights,
part

Member

the

those obligations

respect

of

the

or

Member States.

In Case 6/64

Reference

to the

Court

under

Conciliatore, Milan, for

that court

Article

177

of

the

EEC

preliminary ruling in

Treaty by

the action

the

Giudice

pending before

between
587

JUDGMENT OF 15.7.1964

CASE 6/64

Costa

flaminio

and

ENEL

(Ente Nazionale Energia Elettrica

formerly
on

the interpretation

THE

Electricity Board),

of Articles

102, 93, 53

37

and

of

the said

Treaty

COURT

composed of:

Presidents
and

(National

Volta undertaking)

the Edison

of

A. M.

Donner, President, Ch. L.

Hammes

and

A.

L. Delvaux, R. Rossi, R. Lecourt

Chambers,

Trabucchi,

(Rapporteur)

W. Strau, Judges,

Advocate-General: M. Lagrange
Registrar: A. Van Houtte
gives

the

following
JUDGMENT

Issues
I

Facts

of

fact

order

procedure

and

law

and of

16

of

Law No 1643

By
and

subsequent

Republic

of electric

energy

and

organization, the Ente

Na

zionale

Energia

In

Elettrica

(or

decided

the electricity

ENEL)

by

1957,

Law No 1203

payment of an

Conciliatore, Milan, Mr Costa, as a

Edison Volta, a company
the nationalization, and

as

having

and

gation

1670
the

shareholder of

by

EEC, incorporated into Italian

that

ber 1962

invoice for electricity between Flaminio

Costa and ENEL, before the Giudice

affected

the

issued in

transferred.

proceedings about

of

and

the

of

Articles

Treaty,

102, 93, 53 and 37 of the said

Articles, he alleged, had

which

been infringed

by

the

Law

ber 1962. The Giudice

588

interpretation

of

Decem

Conciliatore, by

of

ary

1963

No 219

and

1963)

infringe Articles

37

the

of

Court

file

This

hereby

be

14 March

of

stays

transmitted
of

proceedings

copy of the
Court of

the

Economic

Luxembourg.'

application

for

by

in

to

European

the

transmitted

received

the

that a certified

preliminary ruling

the Registrar

Giudice Conciliatore
was

decrees

Law (No

102, 93, 53 and

aforementioned Treaty, the

and orders

was

that

alle

Decem

15 December 1962, No 36 of
No 138 of 25 Febru

Community in

obtain an

February 1963,

Justice

to

to the
of

presidential

execution

Treaty

so as

14 October

of

regard

Law No 1643

electricity consumer, requested the

court to apply Article 177 of the EEC
an

follows:

law

which

to

as

Having regard to Article 177 of the

Treaty of 25 March 1957 establishing

undertakings

Electricity Board)

assets of

were

Italian

the

production

an

(National

decrees
the

created

the

6 December 1962

nationalized

distribution

and

of

1964 acceding to

January

this request,

the

to the

Court

of

Court

the

and

Registry

on

COSTA

20

February 1964.

Mr Costa

statement

written

15

1964. He

May

interpretation

his

observations in

of

lodged

case

Treaty, in

the

on

Court 'for

asked the

of

an

parti

Articles 102, 93, 53 and 37'.

In its statement of case lodged on 23 May

cular of

1964,

that

mitted

the

for

application

liminary ruling

missible'

Government

Italian

the

pre

inad

and that there were no grounds

day,

also

no grounds

were

sub

'absolutely

was

for raising the questions referred.

in its statement of case lodged
same

ENEL,
the

on

submitted

that

there

for raising

these

ques

tions.
statement

1964,

the

dated 23

of case

EEC Commission
both

observations

the

on

The Court

May
its

made

relevance

of

the interpreta

questions put and on

tion of the abovementioned

also received an

Articles.

169

'application

intervene', filed in the Registry on

20 May
1964, which was declared
inadmissible

by

order of

3 June 1964.

Observations

Statute

by

Treaty

the

Court depends
request

177

it

20

Court

the

of

the

of

Court

the

it

of

involves

of Justice

national

to

judge

of

case

Treaty; it is

the

for

not

facts

the

or

may have led

to make its choice of

the considerations

the

the

of

mere existence of a

meaning of Article
from the question

the

that

interpretation

which

court

finally the Commission raises the point

Court's examination cannot
that
the
itself

concern

led

the

or

the solution
their

On the admissibility of the

for

reference

is

Giudice Conciliatore did

whether

dispute

was

in

Treaty,

and

that

inter

it

law

Italian

the

res

not

itself to asking the Court to

the Treaty but also asked

declare

that

conformity with
because of this

obligation

decide

this case
resemb

from

envisaged
and

the

as such

for

however

is

fulfil

to

as

170

and

It

its

the

questions

relating solely to the

interpretation as permitted by

those

Article 177.

Finally
complains

bear

to

for failure

Articles 169

which

adopt

dispute. In

the

seems

inadmissible.
to

to

importance for

their

to an action

Court

in

The Italian Government

of

reasons

court

with

wording

lance

the

with

national

referred

preliminary ruling

pret

on

hand that

other

jurisdiction

appears

submitted

the

inadmissible'.

the

the

within

and

subject of

trict

the
consequently
before the Court of

and

claims on

Community

submitted

Article

under

the

Treaty. The only

under Articles

that

'absolutely

are

Justice

Mr Costa

under

170

and

present proceedings

questions

to

II

is

procedure possible

questions.

In its

the

ENEL

the obligations of the

his

set out

Commission

the

that

points out

judgment dated 7 March 1964

Italian

the

failed

court

constitutional

to

apply this Article in a similar case and

thus took a decision involving certain

to

repercussions

in

munity law

on

future

the

Com

of

as a whole.

the
the

On the interpretation of Article 102

preliminary ruling is inadmissible.

A

national

have

court,

recourse

for the

of

purposes

it has only

to

apply

not a provision of

cannot
a

be

national

national

law

of

used

of a

is

a
on

when,

dispute

domestic law

and

Treaty. Article 177

means

of

allowing
the initiative of a

Member

State

cannot

claimed,
procedure

deciding

the

as

court,

that

it

to this

State,

to

subject

to the procedure

for

preliminary ruling for infringement

of

As to the interpretation

Mr Costa
tion

suggests

the

with

that

of

Article 102,

prior

Commission

consulta

be

should

Mem

regarded as an obligation

for the

ber State in

not as a mere

right.

102

would

Failure
when

question and

Any other interpretation

to

faced

potential

deprive

it

consult
with

danger

the

the
of

of

its

of

Article

purpose.

Commission,

existence

distortion,

of

consti-

589

JUDGMENT OF

tutes

irregularity. A Member State

an

itself appreciate the likelihood

cannot

distortion
a

power

without

unilaterally assuming

has

which

been

not

conferred

It

distortion.
if

that,

to

seems

is

there

for consulting
the time

existence of a

cerning nationalization
the Italian Republic did
The Italian Government

case

in

as
a

setting up

the

achieve

informed

and

in

this

meaning

as

intended

of public

the

of

long

of competition

the

as
not

are

of

a question of

service

Article 43

constitution

by

German

by a

the

it is

as

objectives

in

indicated

long

that

out

Article 222. There

to

within

public

the

this case.

points

when

referred

distortion

Article 102

tions

adopted,

accepted nationalization

and

no

con

not respect

written question submitted

deputy,

that,

and

was

rule of procedure applicable

Commission,

grounds

disputed law

the

when

its

to

as

be

would

Commission

the

however

state

doubt

any

existence, then there

the

Court

Justice

of

dispute is
the

of

ENEL

points

those

similar

that

out

under

coming

condi

adversely

the

the

arguments

establishment

equally to

all

The Commission has

law in dispute but
the

With

to

regard

Article

the

that

considers

of an

economic

of

the

activity

automatically results in the creation of a

system in which hidden aid is granted to
nationalized

Commis

The

sector.

accordingly intervene in

must

cordance with

ac

the procedure prescribed

by Article 93.
which

visions of

suffices

to

Commission
to

not

that

respect

considera

in

compatible

(3)

the

under

nationalization

The
to

do

with

nevertheless

bring

the

matter

retains

before

is

no

Law

the

on

ENEL has nothing

law.

Community

On the interpretation of Article 53

With

to

regard

Article 53

to

The

interpretation

the

which

restrictions on

new

any

in

their

Mr Costa

in

the

tion

to see

claims

of a sector of

Article.

legality

Community
best

Article

with

as

system

and

enshrined

regard

Article.
sector

nationalized

Article

of

to

denial

is the

53.
of a

method

the freedom

by

the

nationals

States

and

of

property

of private

abolition

constitutes a

Member

of

both
the

of

said
of

na

state.

derogating

former

of

to the above

calculated to prevent

establishment

the

system

application

Nationalization

a measure

justify

conceivable

the

nationaliza

the above

with

ownership and the

property is contrary
No rule exempts a

from

the

territories,

the economy

cannot

of

States from

prohibits

right of establishment

tionalizing

169.

point

that there

Article 93.

establishment of

Finally, Article

pro

Commission

and

in

be

ENEL

and

show

between

incompatibility

Member

are

Article

facts

action

to

proves

and

Com

The

Treaty.

the

with

that the

only

notify.

question

The Italian Government

out

Com

question

the right to take

mission reserves
aid

draft

the

of procedure

failure to

the

concerns

if the

studied

without

matter

the

committing
infringement which itself

entitle

action

power

considers

do

Article 93

procedural

590

in

infringement

by

the

opinion

to the

relates

other

The Commission
States

take

aid

Common Market. In the

mission's

every

interpretation

the

93, Mr Costa

nationalization

the

coming to
that it is incompatible

conclusion

with

incompatible

scheme.

interpretation of Article 93

the

sion

the

where

of

rule under

procedural

Article 222

the

cases

accompanied

introducing
forward

puts

of a public service applies

On

in

incompatibility

material

to

utility
Italian

affected.

and

CASE 6/64

tion.

The Commission denies the

is

of

it.

on

at

15.7.1964

55

cannot

be

considered

from Article 53,

as

the

is

exclusively concerned with

latter
exempting from the ambit of the
the official powers of the State and not

the

the

the

activity.

power

to

pursue

an

economic

COSTA

Government

Italian

The

interpretation
53 does

State

the

on

this

to

objects

that

ground

Article

apply where the Member

leaves to free private

not

concerned

(without any distinction

enterprise

that

nationality)

is

which

to

reserved

not

the

of

part

to

as

economy

the

public

authorities.

In
be

the

of

regarded as

the

the

regards

Article 53

intended

as

of

exercise

should

to place foreign

footing

same

interpretation

same

that

suggests

ers on

nationals

as

productive

activity.

This

is

not

infringed if

law

instituting a public service reserves to

by

the relevant

the

sector of

token

same

foreigners

and

alike

Commission

The

in

regarded

light

is

not

the Treaty. Articles 5

alleviating the

from

the

sectors of
ever

the

the

inconsistent
and

90

lishment

of new

which

sions

the sector

in

the

is

by foreign

has

imports

effect on

the

require

question.

On the interpretation of Article 37

duties

or

quantitative restrictions.

interpretation

with

technical

restrictive

as protective

have nothing to do

not

monopoly,

same

that

from

produced

difficult if

commercial

creating

submits

result

of

the

render

impossible.

this

on

of

result

goods

undertakings

Government

resulting

the

to

monopoly
importation of similar

field

exclusion

Therefore,

deci

the

to adopt criteria outside

competition.

deci

its

of

character

and

the

binding

in reaching those

power

economics

those

other words

Rebutting

restrictions

might

identical to

are

management, the

ineluctable

sions, the

of

estab

legal monopoly, in

and

of

cases

existing

allowing the
ones. The consequences

of nationalization
of a

it

and

purpose

whilst

with

nationalizing
Article 53 how

possible

being justified by
in

eliminate

discrimination

are aimed

of

economy.

to

States

ments

to

if its only

effect

nationalization

case of nationalization, such restrictions

not

were

no

By

right of establishment of nationals of

other

have

sector.

that, when
Article 222,

discrimination

potential

would

nationals

consequences

operation

applies

of

the

the economy,

excluding
from this

considers

the

nationailization

at

to

also

such

principle

State

ENEL

sole power of

support

ENEL

Italian

the

Article 37

can

the operation

of

a public service nor with an article whose

depends

production

sources

(themselves

to

only be

which can

concession)

limited

on

subject

natural

public

by

used

necessarily limited number of producers.

The rules of the Treaty safeguarding a

free

market

cannot

the

system

of

Moreover,

as

prejudices

the

be

public

with

concerned
services.

222 in no way
in Member States

Article
rules

governing the system of property

ship, it is possible for the constitutional

owner

In

respect of

37

to the

the requirements

effect

progressively

that Member
adjust

any

of

Article

States

State

shall

mono

polies of a commercial character so as to

avoid

discrimination

all

tionals

of

between

na

Member States regarding the

conditions

under

cured

marketed,

and

which

goods

Mr Costa

are

pro

asks

the

authorities
and

in

the

basis

outside

sequently, the

imports in

activity but

every

measure

either on
a

by

itself or

monopoly

on a

which

is

body
by its

subject

very

to

it

nature

commercial.

Article applies, he claims, not

actual cases of discrimination but

not

in

and

decisions,

remain

terms
of

Con

of exports

sector

rather

con

which, on

competition.

exclusion

such

sidered

this provision very

way that it refers to
which a State confers

on

rule

being

of

property

of objective

any

Court to interpret
a

to prescribe the goods

capable

sidered as public

widely in

such

each

services

of

must

the

be

and
con

commercial
exercise

of a

public service.

In

support of

reference

in

the

to

this
the

Treaty,

The

said

'commercial

only

to

the said

interpretation and
position

ENEL

of

considers

monopolies'

Article

specified

to

be

public

by

Article 37

or

the

in

private

591

JUDGMENT OF

institutions,

organizations aiming, as
make

imports

the

of

objective

public

depends

article

be

the

outside
and

is

and

requirements

provision

any

its

by

very

relating to

222,

of goods

nationalization

as

or

may

under

permissible

the creation of a

in

trade

tactual

new

mono

respect

must

into

taken

Member

commodity in

the

of

be

the

of

estimate

between

existence

States in
question

nature

Article 37

of

considered

However,

parti

agreements and complex administrative

procedures

the circulation

of

Although

poly cannot.

service;

international

on

field

Article

never

CASE 6/64

services.

free

the

could

international trade in

moreover
cular

That

of goods.

the

to

and

exports

disturb

to

calculated

movement

be

of

concentration

15.7.1964

considera

tion.

T here

competi

tion.

is no need

to

inquire whether

the

creation of a

Commission

The

Article 37
State

finally

should

or

prohibitions

exclusive

To fall

export.

in Article 37

measure must

that

considers

character

37

applied whenever a

an

establishes

import

be

impugned

to operate

(2),

the said

of

not

to the

subject

and

commodity

discretionary

are

power

administering body.

the

of

importation

the

where

exportation

the

within

the

be intended

to

right

monopoly of a commercial
is inconsistent with Article

in

Grounds

of

judgment

Order dated

16 January 1964, duly sent to the Court, the Giudice

Milan, 'having regard to Article 177 of the Treaty of 25
March 1957 establishing the EEC, incorporated into Italian law by Law

By

Conciliatore

14 October

No 1203

of

No 1643

of 6

that

of

Court

On

the

By
as

application

complaint

by

with

the

Court

the

of

Article

is

made

that the

and

37

of

Law

execution

the aforementioned

file be

transmitted to

question

behind the

intention

Article 177,

ruling

on

the

present

Article, however,

case, there

is

them.

This

compatibility

of a national

national courts against whose

no judicial

remedy,

the
provision

must refer

preliminary ruling may be

Treaty'

of

question posed was to

Treaty.

ofJustice so that a

Treaty

decrees issued in

177

regarding the working of the

means of

tation

592

infringe Articles 102, 93, 53

the terms of this

in

to the allegation that

regard

of Justice.

submission

obtain,

law

having

and

and the presidential

stayed the proceedings and ordered that the

the

The

1957,

December 1962

Law

Treaty',

On the

of

whenever

gives

to a specific case

or

the
to

question

Court
decide

no

of

given upon

interpretation is

jurisdiction

upon

the

either

the validity

of a

decisions,

matter

to the

the 'interpre
raised

to

before

apply the

provision

of

COSTA

domestic law in

Nevertheless,
formulated

Court

On the

of

the

law

between

is

either

On the

to

that the

apply

a national

By

contrast with

its

own

integral

legal

of

the

international
of

court

upon

facts

of

of

has

and

requested an

clear

or

the

context

interpretation

dispute before it.

separation

it

Justice,

the case

inasmuch

cannot

of

functions

empower

to criticize the

the

grounds and

to apply the national

the request

of the

law

Giudice Conciliatore
is

as a national court which

obliged

to

itself of Article 177.

treaties, the EEC T reaty has created

entry into force of the Treaty, became an

on the

systems

of

Member States

the

of unlimited

own

and,

have

The integration into

Treaty,

to the

Articles in the

their

and

which

duration, having its

legal capacity
more

and

own

capacity

institutions,

particularly,

body

stemming from a
from the States to the Com

real powers

or a transfer of powers

thus created a

of representation on

sovereign

of

law

rights,

which

albeit within

binds both their

themselves.

derive from the

the

to the

by the
Treaty, but

given

international

legal

sovereignty

fields,

nationals

be

apply.

plane

and

relation

solution of

munity, the Member States have limited their

limited

should

necessary

Court

submits that

Community

not

court was obliged

which,

personality, its

limitation

of

do

Giudice Conciliatore.

cannot avail

the

bound to

creating
own

the

to

imperfectly

question

decision

Italian law in

and the

ordinary

system

part

courts are

law

the

necessary for the

'absolutely inadmissible',

its

for it

for interpretation.

The Italian Government

By

possible

which alone pertain

the abovementioned

177 is based

courts

request

submission

of

from

extract

that the Milan

made

investigate

the

to

interpretation is

an

which was not

national

purpose of

is

be

would

those questions

of an

by

stated

Since, however, Article

latter

it

as

Consequently

validity

that

submission

Treaty

Treaty.

interpretation

complaint

of the

power

national court

the

of

the

the points

The

the

not upon

upon

Court has

the

by

interpretation

of

Treaty,

Article 169.

under

only

to the

relation

ENEL

the

laws

Community,

make

of each
and

Member State

more

it impossible for

of provisions

generally the terms

the

States,

as

and

which

the spirit

corollary, to accord

593

JUDGMENT

to

precedence
accepted

by

be inconsistent
law

domestic laws,

The

that

with

and

measure

Such

system.

State

to

The

jeopardizing
(2) and giving rise

in

force

of

Community

deference

to

subsequent

the attainment of the objectives

without

by

subsequent

the

States

discrimination

to the

(for

provisions

legislative

acts

of

the

of

the

prohibited

lose

would

by

tions

The

their purpose if the

precedence of

regulation

'shall be

This provision,
less if

State

law is

binding'

all

is

subject

these

nature, be overridden

being

basis

The

of

the

transfer
system

with

it

of

by

its

by
of

the

domestic

law,

by

be

quite

means

(4),

which

obliga

Community

of their

arising

framed,

and without

with

the legal

Community
Treaty carries

system

to the

under

the

sovereign

with

against

rights,

the concept

Article 177 is to be

whenever questions

law

question.

domestic legal

incompatible

Consequently

into

obligations

limitation

meaning

legislative

law stemming from the Treaty,

because
of its special and original
not,

called

their

of a

law.

domestic legal provisions, however

States from

subsequent unilateral act

cannot prevail.

226)

that the

character as

the rights and

permanent

effects

Community

could

Community itself being

legal

Articles 8

and

Article 189, whereby a

in all Member States'.

to no reservation, would

observations

law,

by

applicable

unilaterally nullify its

source of

deprived

example

225).

Treaty

the

could renounce their

confirmed

'directly

and

which

independent

(for

Article 93 (2),

Member States

measure which could prevail over

It follows from

of

clear and

and

ordinary law.

Community

could

by

derogate from

authority to

the third subparagraph

means of an

Wherever the

it does this

15, 93 (3), 223, 224

Articles

example

are subject to a special authorization procedure

(4), 25, 26, 73,

signatories.

the right to act unilaterally,

Applications, by Member States for

out

system

under the Treaty

establishing the Community
be unconditional, but merely contingent, if they could be called

grants

precise

an

legal

7.

question

Treaty

17

over

a measure cannot therefore

executive

another

in Article 5

out

CASE 6/64

subsequent

of reciprocity.

legal

one

15.7.1964

obligations undertaken

would not

in

basis

vary from

cannot

Treaty set
by Article

unilateral

them on a

OF

of

applied

the

which

Community

regardless

relating to the interpretation

of

the

of

any

Treaty

arise.

The

questions put

and

37

effects

if so,
594

102, 93, 53,

by the Giudice Conciliatore regarding Articles
first to enquiring whether these provisions produce direct
directed
are
and create individual rights which national courts must protect, and,

what their

meaning is.

COSTA

On

interpretation

the

Article 102

that,

provides

of

ENEL

Article

'there is

where

102

fear'

reason to

that a

provision

laid

by law may cause 'distortion', the Member State desiring to proceed

therewith shall 'consult the Commission'; the Commission has power to

down

recommend to

the Member States the adoption

to avoid

of suitable measures

distortion feared.

the

This Article,

placed

is designed to
nations

the

objectives

all

taken an obligation to the

create

those cases

Article, but
the

by

this

rights

which

State

on the part of

On

does

obligation

framework

the

the

of

Under Article 93

States, is

'keep

to

national

give

law

different

States have

States,

them as

for

must

the

by

means of

functioning
By

of

virtue

(1)

and

of

(2),

Article

the

but

to the

to

right

Article 177
breach

to

being

plans

the

grant

its

or

of

their

duty

cooperation with

all systems

of aid

Member

existing in those

by

the

proposed

aid,

the

measures

informed, in

Member State

into

proceedings

sufficient

concerned

effect until the

not

Community

before the Court

of

Justice,

completed.

These provisions,

and,

either

of

93

Commission is to be
alter

procedure, and, if necessary, any

by States',

this

allege,

adoption of appropriate measures required

Article 93 (3),

entitled to put

aids

For

Common Market.

time,

have been

which

protect.

provisions of

of its obligations or

Commission, in

under constant review

of

any

might

under

Commission.

with a view

the

their

consultation

States'

of

more

procedure of

legislation

individuals the

and

fulfil any

the

courts

ensure respect

not

Community

concerned to

interpretation

the

distortion,

Community which binds

individual

the

becoming

their projected

where

of a possible

its part, the Commission is bound to

within

from

Treaty

Laws',

of

Member States have limited

by agreeing to submit to an appropriate

By binding themselves unambiguously to prior

Commission in

failure

the

of

this provision,

virtue of

of

initiative

of

not

devoted to the 'Approximation

differences between the legislation

risk, however slight,

create a

does

chapter

to the

regard

By

consultation.
with

the

prevent the

with

pronounced.

freedom

in

are

on

designed,

the

internal

in

contained

other

on

hand,

affairs

from

headed 'Aids

granted

to eliminate progressively

existing

the section of the

the one

hand,

Treaty

States in

the conduct

'in any form

whatsoever'

to prevent the individual

introducing

new aids

595

OF

JUDGMENT

which

likely directly

are

products

distort

in

thus

provided

of

any

the

not

plans

binds them

for aid,

as

and

in Article 93,

by

Article,

an

93

(3),

however,

give

of its

obligations or

States,

thus entered
which

is

is

not

save

into

by

as

the

neither subject

It is

producing direct

question

Community,
in

in the

ensure respect

system of

of

the

present case.

for the

Member

which

the case

provisions of

States,

to

keep

failure

duty on

the part

undertake not

in

any

the

concerned

Commission.

to

introduce any

new

in the Treaty. The

provided

restric

amounts

legally

measure either

by

to a

obligation

duty

not

to act,

regards

its

execution or

States

or

by

the

the Com

in itself and is consequently capable

the relations between Member States and

complete

on

prohibition

Community,

the Member

of

their territories of nationals of other

to any conditions, nor, as

of

by the State

Article 53

otherwise

express

concerns their

either

of

States simply

effects

an

throughout the

directly

breach

of

legally

therefore

individuals. Such

Treaty

in

time'

sufficient

laid down in Article 93,

the

rights except

cooperation with

of establishment

effect, to the adoption

mission.

with

individual

which

53 the Member States

tions on the right

Member

procedures

obligation

by means of Article 177,

interpretation

By Article

merely

abolition of

existing systems of aids. This obligation does not,

individuals the right to plead, within the framework of Com

and

legal

hand, they have

for the

and

otherwise

review

to fulfil any

the

ack

Common Market

of new ones.

creates no

is required, in

and

constant

munity law

of

the

with

or

potentially, to

Member States have

the

on the other

accepting the

into

entered

States but

provision of Article

under

On

threaten,

undertakings

even

to create any more, save as

For its part, the Commission is bound to

this

certain

expressly undertaking to inform the Commission 'in

States have

final

favour

to

which

incompatible

introduction

the

aids and

existing

so

CASE 6/64

to submit themselves to appropriate procedures

agreed

By

implicitly
the Treaty;

Article 92,

of

undertaken

in

and

way,

virtue

that such aids are

nowledged

have

By

competition.

indirectly

or

appreciable

an

15.7.1964

States,

forms

nationals, in

which

and thus

part of

whose

came

became
the

into force

an

law

favour it has

integral
of

those

created

the

with

part of

States

the

and

individual

rights which national courts must protect.

T he interpretation of Article 53

in

the context of the

which is sought requires

Chapter relating to the

that it be considered

right of establishment

in

which

After enacting in Article 52 that 'restrictions on the freedom of

establishment of nationals of a Member State in the territory of another
it

occurs.

596

COSTA

Member State

shall

in Article 53 to

the

restrictions on

by

persons

On

nationals of

governing

the

the

(1)

provides

exists

between

measure which

one

long

of

freedom

'under the

the country

where

to

the

estab

more severe rules than those

whatever

the

legal

Article 37

Member States

that

shall

progressively

adjust

Member States.

of

nationals

adjust

undertaken

any

By Article 37 (2), the

introducing any new

from

dual

in

obligation:

requested

is

first

the

the second place, a

The interpretation

aspects of the

mar

laid down in Article 37 (1).

State monopolies, in

new measures.

obligation together with

principles

any

discrim
so as to ensure that no

conditions under which goods are procured and

is contrary to the

to avoid any

of

as no new measure subjects

are under an obligation to refrain

an active one

that

undertakings

law

the country of establishment,

Thus, Member States have

place,

stated

the

This is dealt

and pursue activities as

up

the

Member States to

character'

Member States

it is

where

by

monopolies of a commercial

ination regarding the

keted

conditions

undertaking.

interpretation

Article 37

'State

for

Article 52,

nationals

satisfied so

of nationals of other

prescribed

what

effected'.

Article 53 is therefore

system

on

new

of nationals of

a right of establishment.

the right to take

own

chapter goes on

introduce any

not

in their territories

to set up and manage

and

laid down for its

is

of

include

stages', this

shall

is, therefore,

question

Member States have

such establishment

lishment

progressive

'Member States

that

the second paragraph

conditions

ENEL

right of establishment

of establishment shall

self-employed

by

abolished

Member States'. The

other

nationals of other
with

be

provide

passive

of the second

first necessary for this

interpreta

tion.

Article 37 (2) contains an absolute prohibition: not an obligation to do

something but an obligation to refrain from doing something. This obligation
is not accompanied by any reservation which might make its implementation
subject
which

to any positive

is

capable of

Member States

Such

clearly

ly

law. This

is essentially

prohibition

effects on

the legal relations

one

between

and their nationals.

expressed prohibition which came

throughout the
system of the

act of national

producing direct

Community,

Member

concerns their

and

States, forms

nationals, in

so

became

part of

whose

the

favour it

into force

an

integral

law

of those

creates

with

part

States

individual

the

of

Treaty

the

legal

and direct

rights which

597

OF

JUDGMENT

national courts must protect.

fact

the

Articles 37

that

(1)

By

and

occur.

between Member States'. The

principles

(2)

'discrimination regarding
between
marketed
.

Thus, by

the

in

reference

in Article 37

order

procured

whether

any

discrimination between

be

to

remain

regarding

effective part

is a matter

whether

by

in

then only

such

for the

its

are

is

court

dealing with

being hampered,
Member States
and

procured

the

is

that

regard

results

marketed

consequence thereof.

by

Article 37 (1). It does

so

To fall

far

they

as

under

capable

product

States,

State

this prohibition the

first, have

must,

transac
as their object

of

and

tend to introduce the

being

the

secondly

subject

must

play

of

an

trade.

court

dealing

with

the

the main action to assess in each case

under review relates

the technical
an

capable

nationals of

in

between Member

nature and

it is subject, is

to.

question

commercial

trade

they

bodies

or

introduce

tend to

under which goods are

nationals of

be the

will

which

any State monopolies, but merely those 'of

the economic activity

virtue of

between

of

referred

bodies in

competition and

goods

itself or

and

discrimination

cases of

which

'the

Having

in

the ways

monopolies

as

for the

whether this objective

to

them.

new

far

considered the means envisaged

character',

monopolies and

It

under

the creation

prohibit

commercial

a matter

new

measure

so

(2)

establishment

under which goods are

sets out

prohibit

in

they

restrictions

in Article 37

the conditions

to examine

from the disputed

(1)

requested

which

Member States'.

of

(2), any

first

the conditions

tions

the wording and

thus to prevent the

to

are prohibited

discrimination regarding
and marketed. It is therefore

main action

There

of

interpretation

the conditions

in Article 37

(1)

is

nationals

new cases of

not

complexity

the reference

Article 37

this way,

be thwarted in

objective might

specified

object of

paragraph

and

specified the objective

ing

the

CASE 6/64

overlap, the

(1)'

laid down in

new

any

procured

this

reason of

37

it necessary to examine them as a part of the Chapter in

This Chapter deals with the 'elimination of quantitative

makes

of

15.7.1964

or

effective

ofplaying
Member States.

to such a

international
part

product

conditions

in imports

which,

to

or

which

exports

Costs
The

ity

costs

and

Court,
ies
the

598

the

are not recoverable and as these proceedings

to the

main

Giudice

court.

Commun

by the Commission of the European Economic

Italian Government, which have submitted observations

incurred

action

are

the

so

far

as

to the

the

part

step in the action pending before

decision on costs is a matter for that

concerned, a

Conciliatore, Milan,

are, in

COSTA

On

ENEL

those grounds,

Upon reading the pleadings;

Upon

hearing the report of the Judge-Rapporteur;

Com
hearing the observations of the parties to the main action, the
Govern
mission of the European Economic Community and the Italian
Upon

ment;
Upon

hearing

Having
the

the

regard

opinion of

to Articles

European Economic

Having

regard

the

on the

European Economic

Community;

Having regard to the

pean Communities;

Rules

THE

177

and

the

of

Treaty

establishing

Community;

Protocol

to the

Advocate-Gnral;

37, 53, 93, 102

of

Statute

Procedure

of

the

of

the

Court

Court

of

Justice

ofJustice of the

of

the

Euro

COURT

Ruling upon
As

over

the

plea of

inadmissibility based

subsequent

atore,

Milan,

to the

interpretation

and also

measure

unilateral

Community law,

Article 177

on

are admissible

in

so

far

of provisions of

take

cannot

by

the questions put

as

declares:

precedence

Giudice Concili

the

they

the

hereby

relate

EEC

in this

case

Treaty;

rules:

1. Article

102

creating

contains

individual

no

provisions

rights

which

are

which

national

of

capable

courts

must

protect;

2. Those individual
relates

equally

3. Article 53

constitutes a

individual
prohibits
ment

portions of

contain no

rights

any

of nationals

national

measure
of other

whatever

which

for

the

the

question

rule capable of

courts

must

subjects

the

Member States to

rules than those prescribed

establishment,

which

provisons;

Community

which

new

Article 93 to

such

nationals

legal

It

establish

more

of the

system

creating

protect.

severe

country

of

governing the

undertakings.

4. Article 37

(2)

is in

all

its

provisions a rule of

Community law
599

OF MR

OPINION

LAGRANGE

creating individual
protect. In so far as the

capable of

must

concerned, it
to

contrary

goods

which

transactions

and

Article

37

and

which

(1),

must

that

play

means

of

as their object

product

trade

any

conditions

by

marketed,

commercial

is,

discrimination

first, have

must,

Court is

new measure

any

States regading the

procured

of competition and

secondly

to the

put
of

object or effect a new

regarding

the subject

States,
and

are

bodies

monopolies or

being

its

question

of

principles

as

rights which national courts

introduction

nationals of Member

between
in

the

having

measure

the

prohibits

CASE 6/64

of

capable

between Member
in

an effective part

such

trade;

further declares:

The decision
the

the

on

costs of

present action

Hammes

Donner

is

a matter

for

in

open court

Trabucchi

Lecourt

Rossi

Delvaux

Delivered in

the

Conciliatore, Milan.

Guidice

Luxembourg

on

15

Strau

July

1964.

A.

A. Van Houtte

Donner

M.

President

Registrar

OPINION OF MR ADVOCATE-GENERAL LAGRANGE

DELIVERED

Mr President,
Members of the

ON

25 JUNE

are such

Court,

as

177

the

of

once,

come

but from

longer

question
a

EEC
from

an

ruling

Treaty

itself, in
tation

is

does

Article

not,

for

security

of

the

respect of which your

requested

in

or of

rather of a certain

provisions

Treaty

interpre

circumstances

1Translated from the French.

600

under

which

Netherlands court,
Italian one, and it is no

Regulation No 3, but
of

upon

a question of social

number

to

that

<ap note>1</ap note>

in issue the

bring

tutional relations

Economic
The preliminary
you have to give

1964

between

the

consti

European

Community

and

its Member

States. This highlights

the

importance

of

the

judgment

pronounce

in

known

you:

to

practising in
under

an

you

this

case.

Mr

Milan,

are called upon to

The facts

Costa,

claims that

obligation

are

lawyer

he is

to pay an

not

invoice

amounting to 1925 lire demanded of

him in respect of the supply of electricity

by

the

'Ente Nazionale

Elettrica (ENEL)'. He

per

l'Energia

objected

to this