ECLI:EU:C:2026:495•Judgment of the Court (Third Chamber) of 18 June 2026.#Penny Market Kft. v Komárom-Esztergom Vármegyei Kormányhivatal.#Request for a preliminary ruling from the Győri Törvényszék.#Reference for a preliminary ruling – Freedom of establishment – Freedom to provide services – Common organisation of the markets in agricultural products – Services in the internal market – National legislation imposing an obligation, for a specified period, on retailers of foodstuffs with a turnover in excess of a certain amount, to reduce the prices of certain foodstuffs and to have minimum quantities of those foodstuffs in stock – Measure taken as a result of a situation of emergency – Fines.#Case C-658/24.
Judgment of the Court (Third Chamber) of 18 June 2026.#Penny Market Kft. v Komárom-Esztergom Vármegyei Kormányhivatal.#Request for a preliminary ruling from the Győri Törvényszék.#Reference for a preliminary ruling – Freedom of establishment – Freedom to provide services – Common organisation of the markets in agricultural products – Services in the internal market – National legislation imposing an obligation, for a specified period, on retailers of foodstuffs with a turnover in excess of a certain amount, to reduce the prices of certain foodstuffs and to have minimum quantities of those foodstuffs in stock – Measure taken as a result of a situation of emergency – Fines.#Case C-658/24.
ECLI:EU:C:2026:495Eu Chamb 03 CJun 18, 2026
Full text
Provisional text
JUDGMENT OF THE COURT (Third Chamber)
18 June 2026 (*)
( Reference for a preliminary ruling – Freedom of establishment – Freedom to provide services – Common organisation of the markets in agricultural products – Services in the internal market – National legislation imposing an obligation, for a specified period, on retailers of foodstuffs with a turnover in excess of a certain amount, to reduce the prices of certain foodstuffs and to have minimum quantities of those foodstuffs in stock – Measure taken as a result of a situation of emergency – Fines )
In Case C‑658/24,
REQUEST for a preliminary ruling under Article 267 TFEU from the Győri Törvényszék (Győr High Court, Hungary), made by decision of 23 September 2024, received at the Court on 9 October 2024, in the proceedings
Penny Market Kft.
v
Komárom-Esztergom Vármegyei Kormányhivatal,
THE COURT (Third Chamber),
composed of C. Lycourgos, President of the Chamber, O. Spineanu-Matei, S. Rodin (Rapporteur), N. Piçarra and N. Fenger, Judges,
Advocate General: M. Szpunar,
Registrar: I. Illéssy, Administrator,
having regard to the written procedure and further to the hearing on 13 November 2025,
after considering the observations submitted on behalf of:
– Penny Market Kft., by B. Kemény, kamarai jogtanácsos, and L. Wallacher, ügyvéd,
– the Hungarian Government, by D. Csoknyai, Z. Fehér, R. Kissné Berta and K. Szíjjártó, acting as Agents,
– the German Government, by J. Möller and N. Scheffel, acting as Agents,
– the Austrian Government, by A. Posch, J. Schmoll and M. Kopetzki, acting as Agents,
– the European Commission, by V. Bottka and M. Mataija, acting as Agents,
after hearing the Opinion of the Advocate General at the sitting on 12 February 2026,
gives the following
Judgment
1 This request for a preliminary ruling concerns the interpretation of Articles 49 and 56 TFEU, Article 16(1) of Directive 2006/123/EC of the European Parliament and of the Council of 12 December 2006 on services in the internal market (OJ 2006 L 376, p. 36) and Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (OJ 2013 L 347, p. 671), as amended by Regulation (EU) 2021/2117 of the European Parliament and of the Council of 2 December 2021 (OJ 2021 L 435, p. 262) (‘Regulation No 1308/2013’).
2 The request has been made in proceedings between Penny Market Kft., a Hungarian undertaking and a member of the German food retail group REWE, and the Komárom-Esztergom Vármegyei Kormányhivatal (Office of the regional government of Komárom-Esztergom, Hungary; ‘the national authority’) concerning the decision of that authority to impose a fine on Penny Market on the basis of consumer protection.
Legal context
European Union law
The FEU Treaty
3 Article 49 TFEU provides:
‘Within the framework of the provisions set out below, restrictions on the freedom of establishment of nationals of a Member State in the territory of another Member State shall be prohibited. Such prohibition shall also apply to restrictions on the setting-up of agencies, branches or subsidiaries by nationals of any Member State established in the territory of any Member State.
Freedom of establishment shall include the right to take up and pursue activities as self-employed persons and to set up and manage undertakings, in particular companies or firms within the meaning of the second paragraph of Article 54, under the conditions laid down for its own nationals by the law of the country where such establishment is effected, subject to the provisions of the Chapter relating to capital.’
4 Article 56 TFEU provides:
‘Within the framework of the provisions set out below, restrictions on freedom to provide services within the [European] Union shall be prohibited in respect of nationals of Member States who are established in a Member State other than that of the person for whom the services are intended.
…’
Regulation No 1308/2013
5 Article 219 of Regulation No 1308/2013, entitled ‘Measures against market disturbance’, provides, in paragraph 1 thereof:
‘In order to react efficiently and effectively against threats of market disturbance caused by significant price rises or falls on internal or external markets or other events and circumstances significantly disturbing or threatening to disturb the market concerned, where that situation, or its effects on the market, is likely to continue or deteriorate, the [European] Commission shall be empowered to adopt delegated acts in accordance with Article 227 to take the measures necessary to address that market situation, while respecting any obligations resulting from international agreements concluded in accordance with the TFEU and provided that any other measures available under this Regulation appear to be insufficient or not suitable.
Where, in the cases of threats of market disturbances referred to in the first subparagraph of this paragraph, imperative grounds of urgency so require, the procedure provided for in Article 228 shall apply to delegated acts adopted pursuant to the first subparagraph of this paragraph.
…’
6 Article 221 of that regulation, entitled ‘Measures to resolve specific problems’, provides, in paragraphs 1 and 2 thereof:
‘1. The Commission shall adopt implementing acts taking necessary and justifiable emergency measures to resolve specific problems. …
2. To resolve specific problems, and on duly justified imperative grounds of urgency, relating to situations likely to cause a rapid deterioration of production and market conditions which could be difficult to address if the adoption of measures were delayed, the Commission shall adopt immediately applicable implementing acts …’
Directive 2006/123
7 Under Article 1 of Directive 2006/123, which is entitled ‘Subject matter’:
‘1. This Directive establishes general provisions facilitating the exercise of the freedom of establishment for service providers and the free movement of services, while maintaining a high quality of services.
2. This Directive does not deal with the liberalisation of services of general economic interest, reserved to public or private entities, nor with the privatisation of public entities providing services.
3. This Directive does not deal with the abolition of monopolies providing services nor with aids granted by Member States which are covered by Community rules on competition.
This Directive does not affect the freedom of Member States to define, in conformity with Community law, what they consider to be services of general economic interest, how those services should be organised and financed, in compliance with the State aid rules, and what specific obligations they should be subject to.
4. This Directive does not affect measures taken at Community level or at national level, in conformity with Community law, to protect or promote cultural or linguistic diversity or media pluralism.
5. This Directive does not affect Member States’ rules of criminal law. However, Member States may not restrict the freedom to provide services by applying criminal law provisions which specifically regulate or affect access to or exercise of a service activity in circumvention of the rules laid down in this Directive.
6. This Directive does not affect labour law, that is any legal or contractual provision concerning employment conditions, working conditions, including health and safety at work and the relationship between employers and workers, which Member States apply in accordance with national law which respects Community law. Equally, this Directive does not affect the social security legislation of the Member States.
7. This Directive does not affect the exercise of fundamental rights as recognised in the Member States and by Community law. Nor does it affect the right to negotiate, conclude and enforce collective agreements and to take industrial action in accordance with national law and practices which respect Community law.’
8 Article 3 of that directive, entitled ‘Relationship with other provisions of Community law’, provides in paragraph 1 thereof:
‘If the provisions of this Directive conflict with a provision of another Community act governing specific aspects of access to or exercise of a service activity in specific sectors or for specific professions, the provision of the other Community act shall prevail and shall apply to those specific sectors or professions. …
…’
9 Article 4 of that directive, entitled ‘Definitions’, provides:
‘For the purposes of this Directive, the following definitions shall apply:
1) “service” means any self-employed economic activity, normally provided for remuneration, as referred to in Article [57 TFEU];
…
5) “establishment” means the actual pursuit of an economic activity, as referred to in Article 43 of the Treaty, by the provider for an indefinite period and through a stable infrastructure from where the business of providing services is actually carried out;
…’
10 Article 14 of Directive 2006/123, entitled ‘Prohibited requirements’, reads as follows:
‘Member States shall not make access to, or the exercise of, a service activity in their territory subject to compliance with any of the following:
1) discriminatory requirements based directly or indirectly on nationality or, in the case of companies, the location of the registered office, including in particular:
(a) nationality requirements for the provider, his staff, persons holding the share capital or members of the provider’s management or supervisory bodies;
(b) a requirement that the provider, his staff, persons holding the share capital or members of the provider’s management or supervisory bodies be resident within the territory;
…’
11 Article 15 of that directive, entitled ‘Requirements to be evaluated’, provides:
‘1. Member States shall examine whether, under their legal system, any of the requirements listed in paragraph 2 are imposed and shall ensure that any such requirements are compatible with the conditions laid down in paragraph 3. Member States shall adapt their laws, regulations or administrative provisions so as to make them compatible with those conditions.
2. Member States shall examine whether their legal system makes access to a service activity or the exercise of it subject to compliance with any of the following non-discriminatory requirements:
(a) quantitative or territorial restrictions, in particular in the form of limits fixed according to population or of a minimum geographical distance between providers;
(b) an obligation on a provider to take a specific legal form;
(c) requirements which relate to the shareholding of a company;
(d) requirements, other than those concerning matters covered by Directive 2005/36/EC [of the European Parliament and of the Council of 7 September 2005 on the recognition of professional qualifications (JO 2005 L 255, p. 22)] or provided for in other Community instruments, which reserve access to the service activity in question to particular providers by virtue of the specific nature of the activity;
(e) a ban on having more than one establishment in the territory of the same State;
(f) requirements fixing a minimum number of employees;
(g) fixed minimum and/or maximum tariffs with which the provider must comply;
(h) an obligation on the provider to supply other specific services jointly with his service.
3. Member States shall verify that the requirements referred to in paragraph 2 satisfy the following conditions:
(a) non-discrimination: requirements must be neither directly nor indirectly discriminatory according to nationality nor, with regard to companies, according to the location of the registered office;
(b) necessity: requirements must be justified by an overriding reason relating to the public interest;
(c) proportionality: requirements must be suitable for securing the attainment of the objective pursued; they must not go beyond what is necessary to attain that objective and it must not be possible to replace those requirements with other, less restrictive measures which attain the same result.
4. Paragraphs 1, 2 and 3 shall apply to legislation in the field of services of general economic interest only in so far as the application of these paragraphs does not obstruct the performance, in law or in fact, of the particular task assigned to them.
5. In the mutual evaluation report provided for in Article 39(1), Member States shall specify the following:
(a) the requirements that they intend to maintain and the reasons why they consider that those requirements comply with the conditions set out in paragraph 3;
(b) the requirements which have been abolished or made less stringent.
6. From 28 December 2006 Member States shall not introduce any new requirement of a kind listed in paragraph 2, unless that requirement satisfies the conditions laid down in paragraph 3.
7. Member States shall notify the Commission of any new laws, regulations or administrative provisions which set requirements as referred to in paragraph 6, together with the reasons for those requirements. The Commission shall communicate the provisions concerned to the other Member States. Such notification shall not prevent Member States from adopting the provisions in question.
Within a period of 3 months from the date of receipt of the notification, the Commission shall examine the compatibility of any new requirements with Community law and, where appropriate, shall adopt a decision requesting the Member State in question to refrain from adopting them or to abolish them.
The notification of a draft national law in accordance with 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)] shall fulfil the obligation of notification provided for in this Directive.’
12 Article 16(1) of that directive, entitled ‘Freedom to provide services’, provides in paragraph 1 thereof:
‘Member States shall respect the right of providers to provide services in a Member State other than that in which they are established.
The Member State in which the service is provided shall ensure free access to and free exercise of a service activity within its territory.
Member States shall not make access to or exercise of a service activity in their territory subject to compliance with any requirements which do not respect the following principles:
(a) non-discrimination: the requirement may be neither directly nor indirectly discriminatory with regard to nationality or, in the case of legal persons, with regard to the Member State in which they are established;
(b) necessity: the requirement must be justified for reasons of public policy, public security, public health or the protection of the environment;
(c) proportionality: the requirement must be suitable for attaining the objective pursued, and must not go beyond what is necessary to attain that objective.’
Hungarian law
Law No XCIII of 2021 on the coordination of defence and security activities
13 Paragraph 80(1)(d), (2)(b) and (3) of the védelmi és biztonsági tevékenységek összehangolásáról szóló 2021. évi XCIII. törvény (Law No XCIII of 2021 on the coordination of defence and security activities) (Magyar Közlöny 2021/118) provides:
‘1. In a situation of emergency, the government may, by decree, suspend the application of certain laws, derogate from certain legislative provisions and take other exceptional measures to ensure the safety of life, health, people, property and the rights of citizens, as well as the stability of the national economy.
2. The government may exercise its powers under paragraph 1 to legislate in areas relating to economic security and security of supply.
3. The government may exercise its powers under paragraph 1 – to the extent necessary in accordance with the triggering event, and in a manner proportionate to the objective to be achieved – to prevent and manage an event triggering a state of war, a state of emergency or a situation of emergency and to prevent or counteract its adverse effects.’
Decree 162/2023
14 The háborús élelmiszerár-infláció csökkentése érdekében szükséges intézkedésekről szóló 162/2023. (V. 5.) Korm. rendelet (Government Decree 162/2023 on measures necessary to reduce food price inflation in a context of war) of 5 May 2023 (Magyar Közlöny 2023/66; ‘Decree 162/2023’) entered into force on 6 May 2023.
15 Paragraph 1(2)(2) of Decree 162/2023 provides:
‘For the purposes of this decree, the term “trader” shall mean: a trader whose principal activity is classified as “4711 – Retail sale in non-specialised stores with food, beverages or tobacco predominating” in the Statistical Classification of Economic Activities and whose net turnover, in accordance with a kiskereskedelmi adóról szóló 2020. évi XLV. törvény [(Law No XLV of 2020 on tax on the retail sector)], exceeded 1 000 million forint (HUF) [(approximately EUR 2 500 000)] in 2021.’
16 According to Paragraph 2 of that decree:
‘(1) With regard to products in the categories listed in Annex 1 (“product categories with a mandatory discount”) and the groups of products listed in Annex 2, traders shall, from 1 June 2023 to 30 June 2024, be obliged to apply a price reduction – in all stores (or, in the case of distance selling, on each platform on which that activity is carried on).
(2) In the case of the product categories listed in Annex 1, for the duration of the price reduction described in subparagraph 1, traders shall – in the promotional period and, from the end of that period, recurrently – in respect of at least one product, to be chosen by the traders in each promotional period from each of the product categories with a mandatory discount (“discounted product”), apply a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price which they have applied in the 30 days prior to the price reduction applied in respect of a given product (“promotional price”).’
17 Paragraph 3(1) of that decree provides:
‘Traders shall be obliged
(a) to trade in the discounted products, and
(b) to put on sale, on a daily basis, at least the average quantity of such products sold daily in 2022, such that the needs of customers are met at all times.’
18 The products covered by Decree 162/2023 and covered by the present case are listed in points 16 and 20 of Annex 1 to that decree, which read as follows:
‘Annex 1 – Categories of products with a mandatory discount:
…
16. Fresh fruit
…
20. Mineral waters and soft drinks.’
The dispute in the main proceedings and the questions referred for a preliminary ruling
19 In the light of the situation of armed conflict which has been ongoing since February 2022 in Ukraine, a country neighbouring Hungary, the Hungarian Government invoked, on 24 May 2022, a ‘situation of emergency’, which has been extended on several occasions, leading it to adopt certain exceptional measures by decree, as authorised by Paragraph 80 of Law No XCIII of 2021.
20 In that context, in order to protect consumers from excessive inflation, the Government adopted, inter alia, Decree 162/2023, which introduced a scheme of mandatory price reductions from 6 May 2023.
21 In essence, Paragraph 2(2) of that decree, read in conjunction with Paragraph 1(2)(2) thereof, obliges traders engaged in the activity of retailing foodstuffs with an annual turnover in excess of HUF 1000 million (approximately EUR 2 500 000) in 2021 to apply, for a specified period (‘promotional period’), a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price which they have applied in the preceding 30 days for at least one product of their choice from among each product category specified in Annex 1 to that decree. In addition, Paragraph 3(1) of that decree required those traders to place the relevant products on the market in the average daily quantity sold in 2022 in order to ensure that the needs of customers are met at all times.
22 In the event of a breach of the obligations under Decree 162/2023, fines may be imposed by the national authority. In addition, that authority may order the trader in question to temporarily cease its activities in the store concerned by the infringement.
23 On 20 February 2024, the national authority carried out an on-the-spot check in a store operated by Penny Market.
24 That national authority found that two of the products concerned by the promotional period, namely apples, and mineral waters and soft drinks falling respectively within the categories of products referred to in points 16 and 20 of Annex 1 to Decree 162/2023, were not on the shelves in that store and that no sale of those products had been made there on the day of the inspection.
25 By decision of 27 March 2024, that national authority therefore imposed a fine of HUF 4 000 000 (approximately EUR 10 000) on Penny Market. In the grounds of that decision, it is stated that Penny Market infringed Paragraph 3(1) of Decree 162/2023 because those products, although they were in stock, were not on the shelves at the time of the inspection, with the result that no sale had yet been made at the time of the inspection. Thus, Penny Market had not ensured the marketing of the products during one day of the promotional period spread over a week. The national authority therefore considered that that store had not offered for sale the average daily quantity sold in 2022 so as to ensure that the needs of customers are met at all times.
26 Penny Market challenged that decision before the Győri Törvényszék (Győr High Court, Hungary), which is the referring court. As regards apples, it claimed, first, that it had notified the competent ministry of a delay in the delivery of that product and, second, that it had sold, on the day of the inspection, the average daily quantity sold in 2022. According to Penny Market, the national authority should have examined the sales for the entire day and should not have based its conclusions on a particular point in time. Penny Market submits that, in the category of mineral waters and soft drinks, there had been a replacement product available to consumers.
27 The referring court observes that Penny Market was created by a German food retail group and that its capital is therefore not held by Hungarian persons. Since the activity of retailing foodstuffs is a commercial activity within the meaning of Article 57(b) TFEU, that court is uncertain whether Decree 162/2023 is compatible with EU law, in particular with the freedom to provide services and Regulation No 1308/2013. In the present case, freedom of establishment is also applicable, since it extends to the exercise by Penny Market of economic activities as an independent undertaking.
28 In those circumstances, the Győri Törvényszék (Győr High Court) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
‘(1) Must Articles 49 and 56 TFEU, together with Article 16(1) of [Directive 2006/123], be interpreted as permitting national legislation which, invoking a situation of emergency, obliges … retailers in the food sector with an annual turnover in excess of HUF 1 000 million [(approximately EUR 2 500 000)] to apply, in respect of certain categories of products, for a specified period of time, a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price they have applied in the preceding [30] days and which, where that obligation is not complied with, provides that a fine should be levied on a mandatory basis?
(2) Must [Regulation No 1308/2013] be interpreted as permitting national legislation which, invoking a situation of emergency, obliges exclusively retailers in the food sector with an annual turnover in excess of HUF 1 000 million [(approximately EUR 2 500 000)] to apply, in respect of certain categories of products, for a specified period of time, a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price they have applied in the preceding [30] days and which, where that obligation is not complied with, provides that a fine should be levied on a mandatory basis?’
Consideration of the questions referred
The second question
29 By its second question, which it is appropriate to examine first, the referring court asks, in essence, whether Regulation No 1308/2013 must be interpreted as precluding legislation of a Member State which, having regard to a situation of emergency, obliges traders engaged in the activity of retailing foodstuffs with an annual turnover in excess of EUR 2 500 000, on pain of a fine, first, to apply, in respect of certain categories of products falling within the scope of that regulation, for a specified period of time, a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price they have applied in the preceding 30 days and, second, to always have minimum quantities of certain products in stock during that period.
30 It must be recalled that, under the Common Agricultural Policy (CAP), which, in accordance with Article 4(2)(d) TFEU, is based on a competence shared between the EU and the Member States, the Member States have legislative powers which allow them, as is apparent from Article 2(2) TFEU, to exercise their competence to the extent that the European Union has not exercised its competence (judgment of 12 September 2024, SPAR Magyarország, C‑557/23, EU:C:2024:737, paragraph 35 and the case-law cited).
31 According to settled case-law, where there is a regulation on the common market organisation (CMO) in a given sector, the Member States are nevertheless under an obligation to refrain from taking any measures which might undermine or create exceptions to it. Rules which interfere with the proper functioning of a CMO are also incompatible with such common organisation, even if the matter in question has not been exhaustively regulated by it (judgment of 12 September 2024, SPAR Magyarország, C‑557/23, EU:C:2024:737, paragraph 36 and the case-law cited).
32 In the absence of a pricing mechanism, the free formation of selling prices on the basis of fair competition is a component of Regulation No 1308/2013 and constitutes the expression of the principle of free movement of goods in conditions of effective competition (judgment of 12 September 2024, SPAR Magyarország, C‑557/23, EU:C:2024:737, paragraph 37 and the case-law cited).
33 However, the establishment of a CMO does not prevent the Member States from applying national rules intended to attain an objective relating to the general interest other than those covered by that CMO, even if those rules are likely to have an effect on the functioning of the common market in the sector concerned, provided that those rules are appropriate for securing attainment of the objective pursued and do not go beyond what is necessary for attaining that objective (judgment of 12 September 2024, SPAR Magyarország, C‑557/23, EU:C:2024:737, paragraph 38 and the case-law cited).
34 In the first place, it should be noted, as the referring court has observed, that an obligation, such as that referred to in Decree 162/2023, to sell certain agricultural products at a mandatory reduced gross retail sale price, in a specified minimum quantity, prevents traders from freely determining their selling prices and the quantities which they wish to sell on the basis of economic considerations based on fair competition. That obligation thus undermines fair competition, which, as has been pointed out in paragraph 32 of the present judgment, is a component of Regulation No 1308/2013.
35 In the second place, in accordance with the case-law referred to in paragraph 33 of the present judgment, the measures referred to in Decree 162/2023 must be justified by the intention to attain an objective relating to the general interest other than those covered by the CMO.
36 In the present case, according to the Hungarian Government, that decree pursues a twofold objective, namely combating inflation and the protection of disadvantaged consumers by means of a guaranteed supply of basic foodstuffs at affordable prices.
37 In that regard, it is true that the Commission is, under certain conditions, empowered, under Articles 219 and 221 of Regulation No 1308/2013, to take the measures necessary to respond, first, to threats of market disturbances caused by significant price rises or falls on internal or external markets or by other events and circumstances, including in emergency situations, and, second, to specific problems in emergency situations. However, in view of the specific situations which they govern, those provisions cannot be interpreted broadly, to such an extent as to consider that that regulation as a whole covers the objectives relating to the general interest pursued by Decree 162/2023, namely combating inflation and the protection of disadvantaged consumers by means of a guaranteed supply of basic foodstuffs at affordable prices (see, to that effect, judgment of 12 September 2024, SPAR Magyarország, C‑557/23, EU:C:2024:737, paragraph 42).
38 In those circumstances, a Member State may invoke the objective of combating inflation or the protection of disadvantaged consumers in order to justify measures, such as those provided for by Decree 162/2023, which undermine the system of formation of prices in conditions of effective competition, on which Regulation No 1308/2013 is based (see, to that effect, judgment of 12 September 2024, SPAR Magyarország, C‑557/23, EU:C:2024:737, paragraph 43).
39 That said, measures such as those referred to in Decree 162/2023, which require, for a specific period, certain price reductions and the obligation to always have minimum quantities of certain foodstuffs in stock, must satisfy the conditions laid down in the case-law of the Court as regards proportionality, that is to say, they must be appropriate for attaining the objective pursued and must not go beyond what is necessary to attain that objective. In that regard, the issue of proportionality must be examined by taking into consideration the objectives of the CAP and the proper functioning of the CMO, which necessitates that those objectives be weighed against those pursued by that decree (see, to that effect, judgment of 12 September 2024, SPAR Magyarország, C‑557/23, EU:C:2024:737, paragraph 44 and the case-law cited).
40 As regards the question whether the measures at issue are appropriate for securing the achievement of the objectives pursued, it should be noted that, in accordance with settled case-law, national legislation is appropriate for securing attainment of the objective pursued only if it genuinely reflects a concern to secure the attainment of that objective in a consistent and systematic manner (judgment of 12 September 2024, SPAR Magyarország, C‑557/23, EU:C:2024:737, paragraph 45 and the case-law cited).
41 In that regard, first, as the Advocate General observed, in essence, in point 36 of his Opinion, the fixing of a maximum price for certain products at retail level does not pursue the objectives of combating inflation and protecting disadvantaged consumers in a coherent and systematic manner, in so far as it covers only traders engaged in the activity of retailing foodstuffs with an annual turnover in excess of HUF 1000 million (approximately EUR 2 500 000), which, as is apparent from the order for reference, are generally located in urban areas, rather than in rural areas.
42 Thus, it follows from that characteristic of the measures at issue in the main proceedings that a substantial part of the foodstuffs placed on the market in the Member State concerned are sold by traders that fall outside the scope of those measures and that a significant proportion of disadvantaged consumers will, in practice, have difficulty accessing the foodstuffs whose prices are to be reduced under those measures.
43 Second, the obligation to maintain a stock of minimum quantities of certain products is also not appropriate for ensuring attainment of the objectives set out, in so far as that measure also applies to the same limited group of traders.
44 In the light of all the foregoing considerations, the answer to the second question is that Regulation No 1308/2013 must be interpreted as precluding legislation of a Member State which, having regard to a situation of emergency, obliges traders engaged in the activity of retailing foodstuffs with an annual turnover in excess of EUR 2 500 000, on pain of a fine, first, to apply, in respect of certain categories of products falling within the scope of that regulation, for a specified period of time, a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price they have applied in the preceding 30 days and, second, to always have minimum quantities of certain products in stock during that period.
The first question
45 As a preliminary point, it is important to recall that, in the procedure laid down by Article 267 TFEU providing for cooperation between national courts and the Court, it is for the latter to provide the national court with an answer which will be of use to it and enable it to decide the case before it. To that end, the Court should, where necessary, reformulate the questions referred to it and consider provisions of EU law which the national court has not referred to in its question (judgment of 30 January 2025, Trenitalia, C‑510/23, EU:C:2025:41, paragraph 28 and the case-law cited).
46 It is necessary to do so in the context of the present reference for a preliminary ruling.
47 In that regard, it should be noted, in the first place, that Directive 2006/123 applies to the case in the main proceedings because the activity of retail trade in goods constitutes a ‘service’ within the meaning of Article 4(1) of that directive (see, to that effect, judgment of 30 January 2018, X and Visser, C‑360/15 and C‑31/16, EU:C:2018:44, paragraph 97).
48 In the second place, as the Advocate General observed in point 41 of his Opinion, the present case does not concern the fields of activity excluded from the scope of Directive 2006/123 by virtue of Article 1(1) to (7) thereof.
49 In the third place, as the Advocate General also observed in point 42 of his Opinion, it must be held that the applicability of Regulation No 1308/2013 to the dispute in the main proceedings does not preclude the simultaneous applicability of Directive 2006/123 to that dispute. That regulation does not contain rules governing specific aspects of access to or exercise of a service activity in specific sectors or for specific professions, within the meaning of Article 3 of that directive, with the result that that regulation does not fall within the scope of Article 3 and does not conflict with that directive.
50 In the fourth place, it must be stated that the relevant provisions applicable to the case in the main proceedings are Articles 14 and 15 of Directive 2006/123, which concern the freedom of establishment which is the subject of Chapter III of that directive, and not Article 16 thereof, which concerns the freedom to provide services and appears in Chapter IV of that directive.
51 In that regard, the question whether a situation falls within the scope of the provisions of that directive devoted to the freedom to provide services or those relating to freedom of establishment depends on the degree of stability of an operator’s establishment in the Member State concerned, as is apparent from Article 4(5) of Directive 2006/123. In the present case, it is sufficient to note that it is apparent from the file submitted to the Court that Penny Market, set up by the German food retail group REWE, has been present on the Hungarian market since 1996 and carries out, in an effective, stable and continuous manner, an economic activity as referred to in Article 49 TFEU, that is to say, the activity of retail trade, for the purposes of Article 4(5) of Directive 2006/123.
52 Consequently, it must be held that, by its first question, the referring court asks, in essence, whether Article 14(1) and Article 15 of Directive 2006/123 must be interpreted as precluding legislation of a Member State which, having regard to a situation of emergency, obliges traders engaged in the activity of retailing foodstuffs with an annual turnover in excess of EUR 2 500 000, on pain of a fine, first, to apply, in respect of certain categories of products, for a specified period of time, a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price they have applied in the preceding 30 days and, second, to always have minimum quantities of certain products in stock during that period.
53 As regards, more specifically, Article 14 of Directive 2006/123, that provision contains an absolute prohibition on laying down discriminatory requirements.
54 Thus, it is apparent from Article 14(1) that Member States may not make access to, or the exercise of, a service activity in their territory subject to compliance with discriminatory requirements based directly or indirectly on nationality or, in the case of companies, the location of their registered office.
55 It follows that that article prohibits not only overt discrimination based on the location of the seat of companies, but also all covert forms of discrimination which, by the application of other criteria of differentiation, lead in fact to the same result (see, to that effect, judgment of 3 March 2020, Tesco-Global Áruházak, C‑323/18, EU:C:2020:140, paragraph 62 and the case-law cited).
56 Furthermore, the Court has already held that it follows both from the wording of Article 14 of Directive 2006/123 and from the general scheme of the directive that no justification can be given for the requirements listed in that article (judgment of 23 February 2016, Commission v Hungary, C‑179/14, EU:C:2016:108, paragraph 45 and the case-law cited).
57 The Court has stressed, in particular, in that regard that such a prohibition, with no possibility of justification, seeks to ensure the systematic and swift removal of certain restrictions on the freedom of establishment, which are regarded by the EU legislature and the case-law of the Court as adversely affecting the proper functioning of the internal market, and thus pursues an aim which is consistent with the FEU Treaty (judgment of 23 February 2016, Commission v Hungary, C‑179/14, EU:C:2016:108, paragraph 46 and the case-law cited).
58 While it is true that it is for the referring court to determine whether the measures referred to in Decree 162/2023 constitute indirect discrimination against companies established outside Hungary, the Court may, however, in order to provide that court with a useful answer, provide guidance based on the documents relating to the main proceedings and on the written and oral observations which have been submitted to it, in order to enable the national court to give judgment (see, to that effect, judgment of 1 October 2015, Trijber and Harmsen, C‑340/14 and C‑341/14, EU:C:2015:641, paragraph 55 and the case-law cited).
59 In the present case, it is apparent from the order for reference that all commercial companies engaged in the retailing of foodstuffs with a net turnover of less than HUF 1000 million (approximately EUR 2 500 000), which do not fall within the scope of Paragraph 1(2)(2) of Decree 162/2023, were commercial companies owned by Hungarian persons, whereas all traders owned by persons who are not Hungarian are covered by that provision.
60 It should be pointed out that the fact that such measures mainly affect companies owned by persons who are not Hungarian cannot, first, establish that those measures are not based on a neutral and relevant criterion and, second, constitute discrimination on its own (see, to that effect, judgment of 3 March 2020, Tesco-Global Áruházak, C‑323/18, EU:C:2020:140, paragraphs 70 and 72).
61 That said, the Commission stated, in the course of the proceedings before the Court, that Hungarian retail companies with a large turnover are, in practice, exempt from the application of the legislation at issue in the main proceedings, since, first, those companies operate a franchise network whose turnover is not aggregated for the purpose of determining whether the threshold set out in that legislation is exceeded and, second, that legislation applies exclusively to traders falling under a specific code of the statistical classification of economic activities, whereas two of those companies which constitute the main retail chains owned by Hungarian persons carry on their activity under a different code of that classification.
62 The fact that a group of stores with an overall turnover in excess of the threshold laid down in Decree 162/2023 is operated in the form of a franchise network or carries out its food retail business under a different code of that classification than that covered by that decree does not mean that that group is not in a situation comparable, in the light of the objectives pursued by that decree, to that of a group of stores operated centrally or operating under the code of the same classification referred to in that decree.
63 Therefore, if it were to be confirmed that the evidence put forward by the Commission does in fact correspond to the situation at issue in the main proceedings, which it is for the referring court to ascertain, it would have to be held that the measures covered by Decree 162/2023 constitute indirect discrimination prohibited by Article 14 of Directive 2006/123.
64 In any event, even if the referring court were ultimately to find that the legislation at issue in the main proceedings is not discriminatory, such legislation would then have to be regarded as containing a requirement to be evaluated, in accordance with Article 15(2)(g) of that directive, which means that it could be implemented only if it fulfils the conditions set out in Article 15(3) thereof.
65 Under point (c) of that provision, a national measure may comply with those conditions only in so far as, inter alia, it is appropriate for securing the attainment of the objective which it pursues. Therefore, as the Advocate General observed, in essence, in point 58 of his Opinion, it follows from the considerations set out in paragraphs 43 to 45 of the present judgment that legislation such as that at issue in the main proceedings is incompatible with that directive.
66 In the light of the foregoing considerations, the answer to the first question is that Article 14(1) and Article 15 of Directive 2006/123 must be interpreted as precluding legislation of a Member State which, having regard to a situation of emergency, obliges traders engaged in the activity of retailing foodstuffs with an annual turnover in excess of EUR 2 500 000, on pain of a fine, first, to apply, in respect of certain categories of products, for a specified period of time, a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price they have applied in the preceding 30 days and, second, to always have minimum quantities of certain products in stock during that period.
Costs
67 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the referring 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.
On those grounds, the Court (Third Chamber) hereby rules:
1. Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007, as amended by Regulation (EU) 2021/2117 of the European Parliament and of the Council of 2 December 2021,
must be interpreted as precluding legislation of a Member State which, having regard to a situation of emergency, obliges traders engaged in the activity of retailing foodstuffs with an annual turnover in excess of EUR 2 500 000, on pain of a fine, first, to apply, in respect of certain categories of products falling within the scope of that regulation, for a specified period of time, a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price they have applied in the preceding 30 days and, second, to always have minimum quantities of certain products in stock during that period.
2. Article 14(1) and Article 15 of Directive 2006/123/EC of the European Parliament and of the Council of 12 December 2006 on services in the internal market
must be interpreted as precluding legislation of a Member State which, having regard to a situation of emergency, obliges traders engaged in the activity of retailing foodstuffs with an annual turnover in excess of EUR 2 500 000, on pain of a fine, first, to apply, in respect of certain categories of products, for a specified period of time, a gross retail sale price lower, by at least 15%, than the lowest gross retail sale price they have applied in the preceding 30 days and, second, to always have minimum quantities of certain products in stock during that period.
[Signatures]
* Language of the case: Hungarian.
Wondering how this text applies to your situation?
Free consultation, no commitment
Describe your situation. Our team will contact you by email about your consultation.
Continue your research in ChatGPT or Claude
Connect Omnilex to search the legal corpus from your AI assistant.