OPINION OF ADVOCATE GENERAL SHARPSTON delivered on 15 May

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1 OPINION OF ADVOCATE GENERAL SHARPSTON delivered on 15 May This appeal concerns an attempt by one of the Austrian Länder to introduce, with a view to creating a farming area free of genetically modified organisms (GMOs), a law imposing a general ban on the cultivation of genetically modified plants or seed, and on the breeding and release of transgenic animals. working environment on grounds of a problem specific to that Member State arising after the adoption of the harmonisation measure'. The Commission considered that no such evidence had been produced, and rejected the request for approval of the draft law. 2. However, under Directive 2001/18, 2 the release or placing on the market of a GMO is subject to an authorisation regime which requires a health and environmental risk assessment on a case-by-case basis. 4. That decision was challenged before the Court of First Instance by both the Land in question, Land Oberösterreich (Upper Austria), and the Republic of Austria. The Court of First Instance dismissed the actions in a joint judgment, and both applicants have appealed. 3. The draft law was notified to the Commission with a view to obtaining a derogation from the directives requirements, pursuant to Article 95(5) and (6) EC, on the basis of new scientific evidence relating to the protection of the environment or the 1 Original language: English. 2 Directive 2001/18/EC of the European Parliament and of the Council of 12 March 2001 on the deliberate release into the environment of genetically modified organisms and repealing Directive 90/220 (OJ 2001 L 106, p. 1). 5. They submit essentially that the Court of First Instance disregarded the fact that Austria had not been able to respond to an opinion of the European Food Safety Authority ('EFSA'), in breach of its right to be heard; did not give proper consideration to the specific nature of the problem in Upper Austria, thereby failing to give ade- I

2 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION quate reasons for its decision; and failed to give proper weight to the precautionary principle. of the harmonisation measure, it shall notify the Commission of the envisaged provisions as well as the grounds for introducing them. Community legislation Treaty provisions 6. The Commission shall, within six months of the notifications as referred to in paragraphs 4 and 5, approve or reject the national provisions involved after having verified whether or not they are a means of arbitrary discrimination or a disguised restriction on trade between Member States and whether or not they shall [sic] constitute an obstacle to the functioning of the internal market. 6. Article 95(4), (5) and (6) EC provides: '4. If, after the adoption by the Council or by the Commission of a harmonisation measure, a Member State deems it necessary to maintain national provisions on grounds of major needs referred to in Article 30, or relating to the protection of the environment or the working environment, it shall notify the Commission of these provisions as well as the grounds for maintaining them. 5. Moreover, without prejudice to paragraph 4, if, after the adoption by the Council or by the Commission of a harmonisation measure, a Member State deems it necessary to introduce national provisions based on new scientific evidence relating to the protection of the environment or the working environment on grounds of a problem specific to that Member State arising after the adoption In the absence of a decision by the Commission within this period the national provisions referred to in paragraphs 4 and 5 shall be deemed to have been approved. When justified by the complexity of the matter and in the absence of danger for human health, the Commission may notify the Member State concerned that the period referred to in this paragraph may be extended for a further period of up to six months.' 7. Community policy on the environment is dealt with in Articles 174 to 176 EC. In particular, Article 174(2) provides: I

3 'Community policy on the environment shall aim at a high level of protection taking into account the diversity of situations in the various regions of the Community. It shall be based on the precautionary principle and on the principles that preventive action should be taken, that environmental damage should as a priority be rectified at source and that the polluter should pay. In this context, harmonisation measures answering environmental protection requirements shall include, where appropriate, a safeguard clause allowing Member States to take provisional measures, for non-economic environmental reasons, subject to a Community inspection procedure.' 9. The deliberate release or placing on the market of a GMO is subject to an authorisation regime. There is a procedure for releases of GMOs for any purpose other than placing on the market (essentially for the purpose of experimentation part B of the directive, Articles 5 to 11), which involves authorisation at national level, and a procedure for placing GMOs on the market as or in products (part C, Articles 12 to 24), which lays down a Community procedure, the final decision being valid throughout the European Union. The Community procedure under part C is initiated before the competent authority of the Member State in which the GMO is to be first placed on the market and includes extensive involvement of the competent authorities of all the Member States Among the general provisions in part A, Article 4 provides, inter alia, that, Directive 2001/18 in accordance with the precautionary principle, Member States must ensure that all appropriate measures are taken to avoid adverse effects on human health and the environment which 8. The deliberate release of GMOs into the environment has been governed since 17 October 2002 by Directive 2001/18, the aim of which is to approximate national legislation and procedures in that field. 3 A helpful flowchart of the part C procedure appears as Annex A-2 to WTO Panel Reports WT/DS291/R, WT/DS292/R and WT/DS293/R, European Communities Measures Affecting the Approval and Marketing of Biotech Products, of 29 September I

4 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION might arise from the deliberate release or the placing on the market of GMOs; Member States must designate a competent authority to examine notifications and decide whether the environmental risk assessment carried out is appropriate; any person wishing to submit a notification under part B or part C must carry out an environmental risk assessment; Member States and the Commission must ensure that GMOs which contain genes expressing resistance to antibiotics in use for medical or veterinary treatment are taken into particular consideration, with a view to identifying and phasing out antibiotic resistance markers in GMOs which may have adverse effects on human health and the environment; Member States must ensure that the competent authority organises inspections and other control measures and that necessary measures are taken to terminate the release or placing on the market, to initiate remedial action if necessary, and to inform its public, the Commission and other Member States. 11. In part C, Article 20, headed 'Monitoring and handling of new information', reads: Member States and where appropriate the Commission must ensure that potential adverse effects on human health and the environment are accurately assessed on a case-by-case basis; '1. Following the placing on the market of a GMO as or in a product, the notifier shall ensure that monitoring and reporting on it are carried out according to the conditions specified in the consent. The reports of this monitoring shall be submitted to the Commission and the competent authorities of the Member States. On the basis of these reports, in accordance with the consent and within the framework for the monitoring I

5 plan specified in the consent, the competent authority which received the original notification may adapt the monitoring plan after the first monitoring period. 2. If new information has become available, from the users or other sources, with regard to the risks of the GMO(s) to human health or the environment after the written consent has been given, the notifier shall immediately take the measures necessary to protect human health and the environment, and inform the competent authority thereof. In addition, the notifier shall revise the information and conditions specified in the notification. competent authority shall within 60 days after receipt of the new information, forward its assessment report indicating whether and how the conditions of the consent should be amended or the consent should be terminated to the Commission which shall, within 30 days of its receipt, forward it to the competent authorities of the other Member States. Comments or reasoned objections to further placing on the market of the GMO or on the proposal for amending the conditions of the consent shall, within 60 days following the circulation of the assessment report, be forwarded to the Commission which shall immediately forward them to all competent authorities. 3. If information becomes available to the competent authority which could have consequences for the risks of the GMO(s) to human health or the environment, or under the circumstances described in paragraph 2, it shall immediately forward the information to the Commission and the competent authorities of the other Member States... When the information has become available after the consent has been given, the The competent authorities and the Commission may discuss any outstanding issues with the aim of arriving at an agreement within 75 days from the date of circulation of the assessment report. In the absence of any reasoned objection from a Member State or the Commission within 60 days following the date of circulation of the new information or if outstanding issues are resolved within 75 days, the competent authority which prepared the report shall amend the consent as proposed, I

6 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION shall transmit the amended consent to the notifier and shall inform the other Member States and the Commission thereof within 30 days. such as suspension or termination of the placing on the market, shall be applied, including information to the public. 4. So as to ensure its transparency, the results of the monitoring carried out under part C of the Directive shall be made publicly available/ 12. Also in part C, Article 23, headed 'Safeguard clause', reads as follows: The Member State shall immediately inform the Commission and the other Member States of actions taken under this Article and give reasons for its decision, supplying its review of the environmental risk assessment, indicating whether and how the conditions of the consent should be amended or the consent should be terminated, and, where appropriate, the new or additional information on which its decision is based. '1. Where a Member State, as a result of new or additional information made available since the date of the consent and affecting the environmental risk assessment or reassessment of existing information on the basis of new or additional scientific knowledge, has detailed grounds for considering that a GMO as or in a product which has been properly notified and has received written consent under this Directive constitutes a risk to human health or the environment, that Member State may provisionally restrict or prohibit the use and/or sale of that GMO as or in a product on its territory. 2. A decision shall be taken on the matter within 60 days...' 13. After the material time in the present case, Regulation No 1829/ introduced Article 26a, which provides: '1. Member States may take appropriate measures to avoid the unintended presence of GMOs in other products. The Member State shall ensure that in the event of a severe risk, emergency measures, 4 Regulation (EC) No 1829/2003 of the European Parliament and of the Council of 22 September 2003 on genetically modified food and feed (OJ 2003 L 268, p. 1). I-7149

7 2. The Commission shall gather and coordinate information based on studies at Community and national level, observe the developments regarding coexistence in the Member States and, on the basis of the information and observations, develop guidelines on the coexistence of genetically modified, conventional and organic crops/ 15. Directive 2001/18 also provides for the placing on the market and experimental release into the environment of transgenic animals, although no applications have yet been submitted for approval. 16. As regards release for purposes other than placing on the market (with authorisation at national level), it would appear that there have been more than 2000 notifications throughout the Community since Directive 90/220 came into force, of which three were in Austria (two in 1996 and one in 1997) At the time of the contested decision in the present case, no GMOs had been authorised (at Community level, for placing on the market) under Directive 2001/18. Since then, five applications concerning plant material have been granted, 5 none of them for cultivation, and eight more are pending, 6of which five include cultivation as a requested use. Eighteen authorisations for the placing on the market of GMOs had been granted under the previous Directive 90/220, 7of which nine included authorisation for cultivation. 5 See lists at authorised_prod_2.htm and aspx?dossclass=3. 6 See lists at pending_products.htm and aspx?dossclass=0. 7 Council Directive 90/220/EEC of 23 April 1990 on the deliberate release into the environment of genetically modified organisms (OJ 1990 L 117, p. 15). It had the same aims as Directive 2001/18 and its provisions were similar but, following a number of amendments, was repealed and replaced by the present directive. See list at eu/environment/biotechnology/authorised_prod_l.htm. 17. It may be noted that, in the light of concerns as to the safeness of GMOs, no Community authorisations for placing on the market were in fact granted between October 1998 and July 2004, although a number of experimental releases were authorised at national level in certain Member States. The effects of that informal 'moratorium' agreed upon between the Member States 9 were challenged in the World Trade Organisation, 10 and it has now been abandoned. 8 See table at 9 See Annex III to the draft minutes of the 2194th Council meeting (Environment) held in Luxembourg on 24 and 25 June See the Panel Reports cited in footnote 3. I-7150

8 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION Coexistence guidelines 18. On 23 July 2003, while the request in issue in the present case was pending, the Commission adopted recommended guidelines for ensuring coexistence between GM crops and other types of farming. 1 1 and the use of transgenic animals for breeding or release, in particular for the purposes of hunting and fishing, 12 was introduced in the Upper Austrian legislature in Its aim was stated to be 'to safeguard organic farming as well as traditional agricultural crop and animal products from GMO contamination (hybridisation). In addition, natural biodiversity, particularly in sensitive ecological areas, as well as genetic resources in nature, including those of hunting and fishing, are to be protected from GMO contamination.' It was based on a report ('the Müller report' 13 ) commissioned by the Upper Austrian authorities. 19. Those guidelines address the economic aspects of coexistence, which may entail loss of income and/or increased expense for farmers who wish to avoid admixture of GMOs, and seek to help Member States develop national strategies and approaches to minimise the risks. They draw a clear distinction between those issues and the environmental and health aspects dealt with in Directive 2001/18. The draft law and the contested decision 21. The draft law was notified to the Commission by Austria on 13 March 2003, with a view to its approval pursuant to Article 95(5) and (6) EC, by way of derogation from Directive 2001/18. The Austrian Government put forward justifications based essentially on the Müller report. That report, it asserted, had brought to light new 20. A draft law prohibiting the cultivation of genetically modified seed and plant material 11 Commission Recommendation of 23 July 2003 on guidelines for the development of national strategies and best practices to ensure the coexistence of genetically modified crops with conventional and organic farming (OJ 2003 L 189, p. 36). 12 Landesgesetz, mit dem der Anbau von gentechnisch verändertem Saat- und Pflanzgut sowie der Einsatz von transgenen Tieren zu Zwecken der Zucht sowie das Freilassen von transgenen Tieren insbesondere zu Zwecken der Jagd und Fischerei verboten wird (Oberösterreichisches Gentechnik-Verbotsgesetz 2002). The text may be downloaded from, inter alia, 13 'GVO-freie Bewirtschaftungsgebiete: Konzeption und Analyse von Szenarien und Umsetzungsschritten'. The full text may be downloaded from, inter alia, I-7151

9 scientific evidence showing a danger for the local environment, and had demonstrated that Upper Austria had a specific farming structure, with small-scale farms and a substantial proportion of organic farming. It also stated that the issue of coexistence between GM and non-gm crops, not tackled by Directive 2001/18, was still regarded as unsolved. 23. The EFSA panel stated in its opinion of 4 July 2003, 15 inter alia: 22. To assist in its assessment, the Commission requested EFSA 14 to provide a scientific opinion in particular as to whether the Müller report provided any new scientific evidence, in terms of risk to human health and the environment, that would justify banning cultivation of GMOs authorised under Directive 90/220 or Directive 2001/18, and as to whether the scientific information presented provided new data that would invalidate the provisions for the environmental risk assessment under those directives. 14 By virtue of Articles 22(5)(c) and 29(1) of Regulation (EC) No 178/2002 of the European Parliament and of the Council of 28 January 2002 laying down the general principles and requirements of food law, establishing the European Food Safety Authority and laying down procedures in matters of food safety (OJ 2002 L 31, p. 1). 'The evidence presented was mostly a review of current knowledge on crop to crop gene flow and crop to wild relative gene flow of a few crop types with limited references to gene flow studies in Austria. The evidence also examined issues of co-existence of GM and non-gm varieties of three main crop types and this was the main argument presented for establishing the GMO exclusion area in Upper Austria. The report concluded that gene flow per se was a hazard without reference to any environmental or human health impacts or consequences of gene flow. Gene flow is a basic biological function that is fundamental to the evolution and survival of all living species. No scientific evidence was presented which showed that gene flow from transgenic organisms is per se different to gene flow from conventional or organically grown organisms. Furthermore no reports of GM crop or animal studies in Austria were presented which indicated any adverse consequences of gene flow. The report cited only a limited number of peer reviewed references on which evi opinions/178.html. I-7152

10 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION dence is based. A rather high number of references were not directly related to GMOs, but reported on biological invasions, pesticide persistence and ozone depletion. Furthermore, many references were dedicated to legislation or economic affairs and therefore did not provide further scientific evidence to justify the exclusion of GMOs in Upper Austria. No references were made to GM animals. No scientific evidence was presented which showed that this area of Austria had unusual or unique ecosystems that required separate risk assessments from those conducted for Austria as a whole or for other similar areas of Europe. No specific cases were presented of impacts of GMOs on biodiversity, either directly or through changes in agricultural practices.' 24. It concluded that: No evidence was presented in the report to show that co-existence is an environmental or human health risk issue. EFSA was not asked by the Commission to comment on the management of co-existence of GM and non-gm crops, but the Panel recognised that it is an important agricultural issue. ' the scientific information presented in the report provided no new data that would invalidate the provisions for the environmental risk assessment established under Directive 90/220/EEC or Directive 2001/18/EC. The scientific evidence presented contained no new or uniquely local scientific information on the environmental or human health impacts of existing or future GM crops or animals. the scientific information presented in the report provided no new scientific evidence, in terms of risk to human health and the environment, that would justify a general prohibition of cultivation of genetically modified seeds and propagating material, the use of trans- I-7153

11 genic animals for breeding purposes and the release of transgenic animals, authorised for these purposes under Directive 90/220/EEC or Directive 2001/18/EC in this region of Austria/ 25. The Commission reached its decision on 2 September adoption of Directive 2001/18/EC on 12 March This assessment is confirmed by the EFSA. In addition to this, Austria relies on the fact that the Müller Study was released on 28 April 2002, about a year after the date of adoption of Directive 2001/18/EC (12 March 2001). However, the vast majority of the sources referred to in the bibliography were published prior to the adoption of Directive 2001/18/EC. Therefore, the core of the study appears more as a validation of previous works than like new material identifying specific problems arising after the adoption of Directive 2001/18/EC.' 26. In the course of its assessment it noted that it was clear from the report of the Austrian Committee on National Economic Affairs ('the committee report') that Austria was fully aware of the possibility offered by the safeguard clause in Directive 2001/18, 17 but considered it an inappropriate means to meet the objectives of a total ban of GMOs in the province of Upper Austria At point 70, it stated that: 27. The Commission then considered, at point 65, that: '[T]he Müller Report contains data, which were for a large part available prior to the 'in light of the documentation provided by Austria, particularly the excerpts from the Müller study included with the notification, it is clear that small-structured farming systems are certainly not specific to this region and exist in all Member States. The acceptance of the Act with regard to Article 95(5) of the Treaty cannot, therefore, be founded on such justification', Commission Decision 2003/653/EC of 2 September 2003 relating to national provisions on banning the use of genetically modified organisms in the region of Upper Austria notified by the Republic of Austria pursuant to Article 95(5) of the EC Treaty (OJ 2003 L 230, p. 34) ('the contested decision'). 17 Article 23, quoted in point 12 above. 18 Point 56 of the contested decision. 19 The reference to 'excerpts' included with the notification is puzzling. From footnote 1 to point 63 of the decision it seems clear that the Commission received the full report, together with a number of other documents, all of which it passed on to EFSA whose own opinion appears to indicate that it considered the full report. Point 70 may refer to excerpts which were actually included in the actual letter of notification. It is clear from the German version that the word Act' in English refers to the draft law. I

12 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION going on, at point 71, to quote, from the EFSA opinion, the last two paragraphs set out above at point 23 of this Opinion. (76) Consequently, the request from Austria for introducing national measures aimed at prohibiting the use of GMOs in Upper Austria does not fulfil the conditions set out in Article 95(5).' 29. The Commission concluded: 30. The Commission therefore rejected the notified provisions. '(74) Article 95(5) of the EC Treaty requires that, if a Member State deems it necessary to introduce national provisions in derogation from Community harmonisation measures, the national provisions must be justified by new scientific evidence relating to the protection of the environment or the working environment, there must be a problem specific to the State making the request, and the problem must have arisen after the adoption of the harmonisation measure. (75) In this case, after having examined the Austrian request, the Commission considers that Austria has not provided new scientific evidence relating to the protection of the environment or the working environment, and has not demonstrated that there is a specific problem within the territory of Upper Austria, which arose following the adoption of Directive 2001/18/EC on the deliberate release into the environment of GMOs, and which makes it necessary to introduce the notified national measures. The judgment under appeal 31. Both Austria and Land Oberösterreich brought actions seeking annulment of the contested decision. The Court of First Instance joined the cases, and gave judgment on 5 October 2005 dismissing both actions. 20 Both parties now seek to have that judgment set aside. 32. The applicants raised four pleas in law: (i) infringement of the right to be heard, (ii) breach of the obligation to state reasons, (iii) infringement of Article 95(5) EC and (iv) breach of the precautionary principle. Of 20 Joined Cases T-366/03 and T-235/04 Land Oberösterreich and Austria v Commission [2005] ECR II I

13 those, only the first and third are expressly in issue on appeal, although the precautionary principle is also relied on in argument. Infringement of the right to be heard 33. The applicants argued that the Commission had not given them an opportunity to state their views before adopting the contested decision. Although the Court of Justice had ruled in Denmark v Commission 21 that the right to be heard did not apply to the Article 95 EC procedure, the circumstances of this case called for a different answer. First, Denmark v Commission concerned a request under Article 95(4) for derogation relating to a national measure already in force whereas, here, since the notified measure was still in draft form, the Commission could have continued the procedure in accordance with the third subparagraph of Article 95(6) EC, in order to give the Member State the opportunity to state its views. Second, in the present case, the Commission had sought an expert report from EFSA, on which its decision was based. It should therefore have given Austria the opportunity to state its views on the EFSA opinion The Court of First Instance noted that, in Denmark v Commission, the Court of Justice relied on the fact that the procedure in Article 95(4) EC was initiated by a Member State, the Commission adopting its decision merely in response to that initiative. Thus the Member State could comment in its request on the decision sought, and was indeed required to indicate the grounds for maintaining the national provisions in question. The Commission in turn must be able, within the prescribed period, to obtain the necessary information without having to hear the Member State again. Moreover, the second and third subparagraphs of Article 95(6) EC provide, respectively, that the derogating national provisions are deemed to have been approved if the Commission does not take a decision within a certain period and that no extension of that period is allowed where there is a danger for human health. The intention was thus that the procedure should be speedily concluded. That objective would be difficult to reconcile with a requirement for prolonged exchanges of information and observations The Court of First Instance considered that the same reasoning could be applied to the procedure in Article 95(5) EC. It too is initiated by the notifying Member State, which may comment on the decision sought, and must be concluded rapidly. The fact that the national measures are still in draft form does not mean that the right to be heard must apply, and the requirement for speed is 21 Case C-3/00 [2003] ECR I-2643, paragraphs 47 to Paragraphs 32 to 35 of the judgment under appeal. 23 Paragraphs 38 and 39 of the judgment under appeal. I

14 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION no less when the national measure has not yet entered into force. Article 95(6) EC applies without distinction whether the measures are in force or in draft form. Also, the Commission may extend the deadline for taking a decision only if the complexity of the matter makes it necessary and in the absence of danger for human health, not so that the Member State can be given the opportunity to state its views Since the right to be heard did not apply, it was irrelevant that the Commission did not rule on the basis only of information submitted by Austria, but asked EFSA to produce a report, on which the contested decision was based. Moreover, the fact that the right to be heard was not applicable did not mean that the Commission was obliged to come to a decision solely on the basis of the information provided in support of the request for derogation. On the contrary, it was clear from Denmark v Commission that the Commission must be able, within the prescribed period, to obtain the information which proves to be necessary without having to hear the Member State again The procedures in Article 95(4) and (5) EC are both intended to ensure that no Member State applies rules derogating from the harmonised legislation without obtaining prior approval from the Commission. Under both procedures, the measures in question are inapplicable as long as the Commission has not adopted its decision. Under Article 95(5) EC, that follows from the very nature of the measures, still in draft form. Under Article 95(4) EC, it follows from the subjectmatter of the procedure: harmonising measures which concern the establishment and functioning of the internal market would be rendered ineffective if Member States retained the right unilaterally to apply national rules derogating from those measures The Court of First Instance therefore dismissed the plea. Infringement of Article 95 (S) EC 24 Paragraphs 40 to Paragraphs 43 and 44, citing Case C-41/93 France v Commission [1994] ECR I-1829, paragraphs 29 and 30, and Case C-319/97 Kortas [1999] ECR I-3143, paragraph 28 (concerning the procedure under Article 100a(4) of the EC Treaty, the predecessor of Article 95(4) EC). 26 Paragraphs 45 and The applicants submitted that the requirements of Article 95(5) EC were satisfied. The notified measure was intended to protect the environment, was based on I

15 new scientific evidence, was justified by a problem specific to Austria and complied with the principle of proportionality The Court of First Instance noted that under Article 95(4) EC, the maintenance of existing provisions must be justified on grounds of major needs referred to in Article 30 EC or relating to the protection of the environment or the working environment. Under Article 95(5) EC, the introduction of new provisions must be based on new scientific evidence relating to the protection of the environment or the working environment on grounds of a problem specific to that Member State arising after the adoption of the harmonisation measure The difference is that national provisions predating a harmonisation measure are known to the Community legislature, which cannot or does not seek to be guided by them for the purpose of harmonisation. It is therefore considered acceptable for the Member State to request that its own rules remain in force, if they are justified on grounds of major needs referred to in Article 30 EC or relating to the protection of the environment or the working environment. The adoption of new national legislation is more likely to jeopardise harmonisation. By definition, the Community legislature could not have taken account of such legislation 27 Paragraph 59 of the judgment under appeal. 28 Paragraph 61. when drawing up the harmonisation measure. In that case, the needs referred to in Article 30 EC are not taken into account, and only grounds relating to protection of the environment or the working environment are accepted, on condition that the Member State provides new scientific evidence and that the need to introduce new national provisions results from a problem which is specific to the Member State and subsequent to the adoption of the harmonisation measure It is for the Member State to prove that the conditions for application of Article 95(5) EC are met. 30 Here, it was for Austria to demonstrate, on the basis of new scientific evidence, that the level of environmental protection afforded by Directive 2001/18 was not acceptable having regard to a problem specific to Austria which arose after the adoption of that directive In its decision, the Commission had rejected the argument that there was a specific problem within the meaning of 29 Paragraph 62, citing Case C-512/99 Germany v Commission [2003] ECR I-845, paragraphs 40 and 41, and Denmark v Commission, paragraphs 56 to Opinion of Advocate General Tizzano in Germany v Commission, point 71; Denmark v Commission, paragraph Paragraphs 63 and 64 of the judgment under appeal. I

16 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION Article 95(5) EC, on the ground that it was clear from the notification that the small size of farms was not specific to Upper Austria but a common characteristic to be found in all the Member States. The Commission also adopted the conclusions of EFSA, in particular that 'the scientific evidence presented contained no new or uniquely local scientific information on the environmental or human health impacts of existing or future GM crops or animals' and that no scientific evidence was presented which showed that this area of Austria had unusual or unique ecosystems that required separate risk assessments from those conducted for Austria as a whole or for other similar areas of Europe'. 32 Oberösterreich stated that the draft measure was prompted by the imminent expiry of an agreement between Member States temporarily not to issue consents for GMOs. 33 Such considerations could not invalidate the findings in the contested decision The Court of First Instance therefore rejected the arguments disputing the Commission's findings as to the existence of a problem specific to the notifying Member State. The conditions required by Article 95(5) EC being cumulative, it was sufficient that only one of them was not satisfied for the request for derogation to be rejected. 35 The whole plea was therefore dismissed. 44. The applicants had failed to refute those assessments convincingly, merely drawing attention to the small size of farms and the importance of organic production in Upper Austria. There was no evidence to rebut EFSA's conclusion that Upper Austria had not been shown to contain unusual or unique ecosystems requiring separate risk assessments from those for Austria as a whole or other similar areas of Europe. At the hearing, the applicants were unable to state whether the presence of GMOs had been recorded in Upper Austria. Land 46. As a consequence, the fourth plea alleging breach of the precautionary principle was dismissed as irrelevant; since the conditions for granting the request under 32 Paragraph 65 of the judgment under appeal; see also points 23 and 28 above. 33 See point 17 above. 34 Paragraphs 66 and 67 of the judgment under appeal. 35 Germany v Commission, cited in footnote 29, paragraph 81. I

17 Article 95(5) EC were not met, the Commission had no option but to reject the application. 36 Procedural irregularity Arguments on appeal 47. The two appeals are very similar, even to a considerable extent identically worded, although that of the Republic of Austria is rather more complete. It does not seem helpful to present them separately. 48. The judgment under appeal is challenged on two grounds: (i) 'procedural irregularity', under which heading the appellants take issue with the reasoning dealing with their third plea at first instance, namely, 'infringement of Article 95(5) EC'; and (ii) 'breach of Community law', under which they challenge the conclusion on their right to be heard in response to the EFSA opinion. 50. The appellants assert that they had demonstrated in their applications at first instance that all the conditions stipulated in Article 95(5) EC were fulfilled. In particular, they had shown that there was a problem specific' (which does not mean unique') to Upper Austria. Even if similar configurations exist in other areas of the Community, the fact remains that farming in Upper Austria is characterised by particularly small areas and by a particularly high rate of organic farming, which means that usual methods are insufficient to prevent the spread of GMOs. Since the Court of First Instance dismissed the plea on the ground that that single condition was not fulfilled, it should have given the submissions more thorough consideration, instead of which it merely followed the Commission and the EFSA opinion. Nor should it have simply omitted to consider whether the other conditions in Article 95(5) EC were fulfilled. 49. On those grounds, the appellants ask the Court to set aside the judgment under appeal and, principally, to annul the contested decision or, in the alternative, to refer the case back to the Court of First Instance for fuller consideration. 36 Paragraph 71 of the judgment under appeal. 51. Austria considers that new scientific evidence is a crucial element in Article 95(5) EC, and that the precautionary principle cannot be ignored. The Commission however did not carry out a thorough scientific risk analysis. Nor did it ask EFSA to address the central issue in Austria's argument, namely the coexistence of GMOs and natural crops, yet it based its decision I

18 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION entirely on the EFSA opinion. That central issue, which is highly controversial, as is clear from debates within the Council, was thus not examined by either the Commission or the Court of First Instance. Since the scientific evidence was never examined in the light of the precautionary principle, the Court of First Instance failed in its duty to give adequate reasoning. 54. The Commission submits that those arguments are entirely unfounded in so far as they allege a procedural irregularity in the form of an inadequate statement of reasons. It deals with the criticisms of the substance of the reasoning in response to the plea of 'breach of Community law'. 52. The appellants criticise also the Court of First Instances reliance on the fact that there was no evidence of the presence of GMOs in Upper Austria. Given the Community legislature's duty to 'take as a base a high level of protection' in harmonising legislation concerning health, safety, environmental protection and consumer protection, 37 it cannot be the case that a Member State may have recourse to Article 95(4) and (5) EC only once damage has actually occurred. 53. The failure to examine the scientific evidence thoroughly constitutes, in the appellants' view, a breach of both the right to be heard and the duty to provide adequate reasons. 55. The Commission first summarises paragraphs 63 to 67 of the judgment under appeal as follows. 38 Since, according to settled case-law, it is for a Member State invoking Article 95(5) EC to prove that the conditions for its application are met, it was necessary to examine whether the contested decision had wrongly considered that such proof had not been adduced. The decision was based on the findings that small agricultural holdings are a feature of all Member States and that, according to EFSA, there was no scientific evidence demonstrating that Upper Austria had an exceptional or particular ecosystem requiring a separate risk assessment from that for Austria as a whole or other similar regions in Europe. The applicants had not adduced any evidence casting doubt on that assessment, merely stressing the small size of holdings and the importance of organic farming in 37 Article 95(3) EC. 38 Cf. points 42 to 44 above. I

19 Upper Austria. Consequently, the applicants' general considerations were not such as to invalidate the concrete assessments in the contested decision. That, in the Commissions submission, is a perfectly adequately reasoned assessment. 59. Finally, the question of the right to a fair hearing is irrelevant in this context, since that right is not alleged to have been infringed in the procedure before the Court of First Instance. Breach of Community law 56. Second, the Commission stresses that new scientific evidence' and protection of the environment' are not elements of a specific problem' but that all three are cumulative conditions for the application of Article 95(5) EC; if any one of them is absent, the request must be rejected. 60. The appellants submit that the Court of First Instance was wrong to consider that the reasoning in Denmark v Commission, to the effect that the right to be heard did not apply in the context of Article 95(4) EC, was also valid in the context of Article 95(5). 57. Third, paragraph 71 of the judgment under appeal explains why the precautionary principle is irrelevant, and is not challenged, at least in any explicit or circumstantiated manner. 61. The two cases cited by the Court of First Instance to support its reasoning in that regard 39 both referred to the old Article 100a(4) of the EC Treaty, which did not distinguish between measures already in force and new measures to be adopted. 58. Fourth, considerations relating to alleged failures by the Commission or debates within the Council are irrelevant to the question whether the judgment under appeal is vitiated by an error of law. 62. Under the present Article 95(4) and (5) EC, the two situations are distinguished. A national measure in force does not cease to 39 See footnote 25. I

20 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION exist when Community harmonisation with which it is incompatible is introduced. Unless and until it is approved by the Commission, it becomes inapplicable to the extent of the incompatibility, but may apply in other cases. That coexistence with the harmonising measure gives rise to uncertainty and thus to the urgency referred to in Denmark v Commission. Where proposed measures are concerned, there is no particular Community need for a speedy resolution. 64. Consequently, the ruling in Denmark v Commission is not relevant, and the Court of First Instances decision was in breach of the Community law right to be heard (and the right to a fair hearing under Article 6 of the European Convention on Human Rights). 65. Finally, by basing its reasoning on a misinterpretation of the term specific' in Article 95(5) EC and thus failing to examine the other conditions in that provision, the Court of First Instance also infringed Community law. 63. The appellants take issue also with the statement, at paragraph 67 of the judgment under appeal, that 'the applicants have not put forward evidence to rebut EFSA's conclusions'. What was at issue before the Court of First Instance was the Commissions findings of fact. There has never been an opportunity to challenge EFSAs conclusions, which should be treated not as emanating from the Commission but as an independent expert report on which Austria should have been able to present comments. A mere blanket adoption of those conclusions by the Commission is not compatible with its responsibility to take a decision under Article 95(5) EC. 66. The Commission deals first with the alleged breach of the right to be heard or the right to a fair hearing. The Court of First Instance relied on Denmark v Commission solely in order to state that the requirements of the internal market mean that a Member State may not apply rules derogating from a harmonising measure without Commission approval. There is no difference in that regard between Article 95(4) and (5). A drawn-out debate is equally undesirable, and the need for clarification and certainty is equally great, in both cases. In other regards, I

21 the appellants appear to confuse the right to be heard in the administrative procedure and the right to a hearing before the Court of First Instance, their arguments being to that extent irrelevant or inadmissible. Commission did not object in principle to such measures. 41 Assessment 67. Second, the Commission stresses that there was no need in the judgment under appeal to examine in detail what might constitute a specific problem', since the criterion of new scientific evidence' was not met. Preliminary remarks 69. At the hearing, the agent for the Commission began his submissions with a reminder that this is an appeal before the Court of Justice, and that its scope is circumscribed by its nature. It is indeed salutary to bear that fact in mind and to consider its context. 68. It states moreover that the absence of such evidence is unsurprising, since on 7 November 2005 Austria notified the Commission of a fundamentally different draft law for Upper Austria 40 which, like those previously notified by other Member States and other Austrian Länder, seeks not to impose a blanket ban on GMOs but rather to introduce specific measures to prevent contamination of non-gmo crops. The 40 Oberösterreichisches Gentechnik-Vorsorgegesetz, notified (No 2005/610/A) under Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations (OJ 1998 L 204, p. 37). 70. The role of this Court is to determine whether the appellants have identified any breach of procedure or error of law in the judgment under appeal such as to vitiate that judgment. 41 The legislation has now been adopted by the Upper Austrian legislature (LGBl. 79/2006, p. 261). Under it, any person intending to cultivate authorised GMOs must declare the intention to the authorities. Various grounds for refusal of permission, connected essentially with the situation of the land concerned, are specified, but the authorities may instead impose various conditions if that would suffice to prevent any spread of the GMOs. I

22 LAND OBERÖSTERREICH AND AUSTRIA v COMMISSION 71. The role of the Court of First Instance was to determine whether the applicants had identified any essential procedural defect, error of law or manifest error of assessment in the Commissions decision such as to justify its annulment. 72. The role of the Commission was to determine whether Austria had justified its request under Article 95(5) EC by producing new scientific evidence relating to the protection of the environment or the working environment on grounds of a problem specific to that Member State arising after the adoption of Directive 2001/ A second preliminary remark concerns the Commissions contention that in presenting their grounds of appeal the appellants confuse to some extent the grounds of 'breach of procedure' and 'infringement of Community law'. I agree, but do not consider that anything turns on the point. Provided that a ground of appeal falls within a permissible category, it is of no consequence whether the appellant has categorised it correctly. All the arguments raised by the appellants appear to me to fall within a category provided for in Article 58 of the Statute of the Court of Justice. I note too that, as the Commission points out, the appellants do not expressly challenge the Court of First Instances finding that their plea of breach of the precautionary principle was irrelevant. That does not however, in my view, preclude them from invoking that principle in the context of their challenges to other aspects of the judgment. 75. In essence, the appellants allege that the Court of First Instance 73. None of those roles properly involves any decision as to what is, or is not, appropriate environmental policy. As regards Community policy, such decisions are to be taken jointly by the Parliament and the Council, on a proposal by the Commission (acting here in a different capacity) and after consulting the Economic and Social Committee and the Committee of the Regions. 42 Member States for their part retain freedom to determine national environmental policy within their sphere of competence. wrongly dismissed their claim that their right to be heard was infringed because the Commission relied on the EFSA opinion but did not give them an opportunity to comment on it; 42 See Articles 175(1) and (3) and 251 EC. misinterpreted the concept of a problem specific to' a Member State or region as I

23 a result of failing to examine properly the submissions in that regard, and consequently gave inadequate reasons for its conclusion; different connotations. The appellants refer to Article 6 of the European Convention on Human Rights, which guarantees a fair and public hearing in the determination of civil rights and obligations or of any criminal charge. failed to examine the submissions in the light of the precautionary principle. 76. I shall deal with the first two allegations in that order, considering where appropriate the possible relevance of the precautionary principle. 78. The notion of the principe du contradictoire' often expressed in Latin as audi alteram partem or audiatur et altera pars is clearly applicable primarily to adversarial proceedings, in which opposing parties must be able to respond to each others' allegations before a decision is reached by the adjudicating body. Typical examples include civil litigation, arbitration and accusatorial criminal proceedings and, of course, direct actions before this Court or the Court of First Instance. 43 Right to be heard 77. '[T]he right to be heard does not apply to the procedure in question', stated the Court of First Instance at paragraph 45 of its judgment, echoing the words of this Court at paragraph 50 of Denmark v Commission. It may be helpful to reflect on what is meant by the 'right to be heard' in that context. Where the English version of both judgments speaks of the 'right to be heard', the French uses principe du contradictoire', an expression (closely reflected in other language versions) which may have somewhat 79. More broadly it applies also to, inter alia, cases where a person's rights or interests may be affected by a procedure initiated against him by an authority, in which he must be allowed to respond to the elements which the authority proposes to take into account. Such cases include inquisitorial criminal proceedings and many administrative proceedings in the Community sphere, for 43 It applies also in appeals, even though they are not strictly directed against the party or parties successful at first instance, and in preliminary reference procedures, where a number of parties may make submissions to the Court and enjoy an opportunity to respond to each others' submissions. I

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