Article 16 - Freedom to conduct a business
Article 20 - Equality before the law
Key facts of the case:
Reference for a preliminary ruling — Common fisheries policy — Regulation (EU) No 1380/2013 — Article 16(6) and Article 17 — Allocation of fishing opportunities — National legislation laying down a method based on objective and transparent criteria — Inequalities in the conditions of competition between operators in the sector — Charter of Fundamental Rights of the European Union — Articles 16 and 20 — Freedom to conduct a business — Equal treatment — Proportionality.
Outcome of the case:
On those grounds, the Court (Fifth Chamber) hereby rules:
Article 16(6) and Article 17 of Regulation (EU) No 1380/2013 of the European Parliament and of the Council of 11 December 2013 on the Common Fisheries Policy, amending Council Regulations (EC) No 1954/2003 and (EC) No 1224/2009 and repealing Council Regulations (EC) No 2371/2002 and (EC) No 639/2004 and Council Decision 2004/585/EC, and Articles 16 and 20 of the Charter of Fundamental Rights of the European Union, must be interpreted as not precluding legislation of a Member State, such as that at issue in the main proceedings, by which that Member State adopts a method of allocation of fishing opportunities which, while being based on a transparent and objective allocation criterion, may create a difference in treatment between operators having fishing vessels flying that Member State’s flag, provided that that method pursues one or more general interests recognised by the European Union and respects the principle of proportionality.
1) This request for a preliminary ruling concerns the interpretation of Article 2(5)(c), Article 16(6) and Article 17 of Regulation (EU) No 1380/2013 of the European Parliament and of the Council of 11 December 2013 on the Common Fisheries Policy, amending Council Regulations (EC) No 1954/2003 and (EC) No 1224/2009 and repealing Council Regulations (EC) No 2371/2002 and (EC) No 639/2004 and Council Decision 2004/585/EC (OJ 2013 L 354, p. 22), and of Articles 16 and 20 of the Charter of Fundamental Rights of the European Union (‘the Charter’).
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18) In the third place, the referring court points out that when a Member State implements an EU regulation it must comply with the Charter. Thus, it asks whether Articles 16 and 20 of the Charter, concerning freedom to conduct a business and equality before the law, preclude a Member State from adopting a method of allocation of fishing quotas which creates unequal conditions for fishing operators seeking to secure fishing opportunities, even if that method is based on the criteria set out in Article 17 of Regulation No 1380/2013.
20) In those circumstances, the Lietuvos vyriausiasis administracinis teismas (Supreme Administrative Court of Lithuania) decided to stay the proceedings and to refer the following question to the Court of Justice for a preliminary ruling:
‘Are Articles 17 and 2(5)(c) of Regulation (EU) [No 1380/2013], read in the light of Articles 16 and 20 of the [Charter], to be interpreted as meaning that, when a Member State exercises the discretion provided for in Article 16(6) [of that regulation], it is prohibited from choosing a method of allocation of the fishing quotas allocated to it which causes unequal conditions for [operators] who are competing for a greater quantity of fishing opportunities, even if that method is based on a transparent and objective criterion?’
25) By its question, the referring court asks, in essence, whether Article 16(6) and Article 17 of Regulation (EU) No 1380/2013, and Articles 16 and 20 of the Charter, must be interpreted as precluding legislation of a Member State, such as that at issue in the main proceedings, by which that Member State adopts a method of allocation of fishing opportunities which may create a difference in treatment between operators having fishing vessels flying that Member State’s flag.
32) In the second place, it must be established whether the adoption of such a method of allocation entails an infringement of Articles 16 and 20 of the Charter, when that method leads to the creation of more favourable conditions for operators having a historical share of catch levels (‘historical operators’), to the detriment of operators who do not have such a historical share and wish to enter the fishing market or increase their production (‘new operators’).
34) In that regard, it must be pointed out that, under Article 16 of the Charter, the freedom to conduct a business in accordance with European Union law is recognised. The protection conferred by that article covers the freedom to exercise an economic or commercial activity, freedom of contract and free competition (judgment of 17 October 2013, Schaible, C‑101/12, EU:C:2013:661, paragraph 25).
35) As regards Article 20 of the Charter, it enshrines the general principle of EU law of equal treatment, which requires that comparable situations must not be treated differently and different situations must not be treated in the same way unless such treatment is objectively justified (judgment of 5 July 2017, Fries, C‑190/16, EU:C:2017:513, paragraph 30).
36) It follows from Article 52(1) of the Charter that any limitation on the exercise of the rights and freedoms recognised by it cannot be accepted unless it is provided for by law and respects the essence of those rights and freedoms. Moreover, in accordance with the principle of proportionality, such limitations may be made only if they are necessary and genuinely meet objectives of general interest recognised by the European Union or the need to protect the rights and freedoms of others.
38) Furthermore, that law establishes, first, a system of auction allowing new operators to acquire non-allocated fishing opportunities, on the basis of the balance of the quota granted to the Republic of Lithuania after allocations on the basis of historical share have been made. In addition, that law limits the fishing opportunities which can be allocated to each operator for a given species of fish to 40%. Thus, the allocation method at issue in the main proceedings, since it does not entail the complete closure of the market in question, respects the essence of the freedom guaranteed by Article 16 of the Charter.
39) Second, the Law on Fisheries does not have the effect of calling into question the principle of equal treatment, and provides in particular, in Article 171(4), for the possibility of taking into account specific situations in which operators may find themselves. Therefore, that method respects also the essence of the rights that the different types of operators derive from Article 20 of the Charter.
40) Nevertheless, it is still necessary to ascertain whether such limitations on the freedoms set out in Articles 16 and 20 of the Charter meet an EU objective of general interest and, if so, whether they respect the principle of proportionality.
44) Where national legislation, such as that at issue in the main proceedings, pursues the objectives of the common fisheries policy, as enshrined in Regulation No 1380/2013, it must be found to meet an objective of general interest recognised by the Union within the meaning of Article 52(1) of the Charter.
51) As regards the question whether or not that method entails restrictions on the freedoms enshrined in Articles 16 and 20 of the Charter that go beyond what is necessary to achieve the objectives pursued by the national legislation at issue in the main proceedings, it is apparent from the order for reference, first of all, that the historical share may be increased or decreased according to certain criteria, in particular environmental criteria or criteria which contribute to the development of the local economy. The referring court also notes that the historical share is reduced for each infringement, whether serious or not, occurring during the reference years referred to in Article 171(1) of the Law on Fisheries, by 2% or 0.5% retrospectively.
56) In the light of all those considerations, the answer to the question referred is that Article 16(6) and Article 17 of Regulation (EU) No 1380/2013, and Articles 16 and 20 of the Charter, must be interpreted as not precluding legislation of a Member State, such as that at issue in the main proceedings, by which that Member State adopts a method of allocation of fishing opportunities which, while being based on a transparent and objective allocation criterion, may create a difference in treatment between operators having fishing vessels flying that Member State’s flag, provided that that method pursues one or more general interests recognised by the European Union and respects the principle of proportionality.
57) Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.