JUDGMENT OF 9. 1. 1978 — CASE 104/77

conflicting provision of currentnational law but — in so far as theyare an integral part of, and takeprecedence in, the legal orderapplicable in the territory of each ofthe Member States — also precludethe valid adoption of new nationallegislative measures to the extent towhich they would be incompatiblewith Community provisions.

Any recognition that nationallegislative measures which encroachupon the field within which theCommunity exercises its legislativepower or which are otherwiseincompatible with the provisions ofCommunity law had any legal effectwould amount to a correspondingdenial of the effectiveness of obli­

gations undertaken unconditionallyand irrevocably by Member Statespursuant to the Treaty and wouldthus imperil the very foundations ofthe Community.

4. A national court which is called

upon, within the limits of itsjurisdiction, to apply provisions ofCommunity law is under a duty togive full effect to those provisions, ifnecessary refusing of its own motionto apply any conflicting provision ofnational legislation, even if adoptedsubsequently, and it is not necessaryfor the court to request or await theprior setting aside of such provisionsby legislative or other constitutionalmeans.

In Case 106/77

REFERENCE to the Court under Article 177 of the EEC Treaty by thePretore di Susa (Italy) for a preliminary ruling in the action pending beforethat court between

Amministrazione DELLE Finanze pello Stato (Italian FinanceAdministration)

and

Simmenthal S.p.A., having its registered office at Monza,

on the interpretation of Article 189 of the EEC Treaty and, in particular, onthe effects of the direct applicability of Community law if it is inconsistentwith any provisions of national law which may conflict with it.

THE COURT

composed of: H. Kutscher, President, M. Sørensen and G. Bosco(Presidents of Chambers), A. M. Donner, P. Pescatore, Lord MackenzieStuart and A. O'Keeffe, Judges,

Advocate General: G. Reischl

Registrar: A. Van Houtte

gives the following

630

AMMINISTRAZIONE DELLE FIΝAΝΖΕ DELLO STATO v SIMMENTHAI.

JUDGMENT

Facts and Issues

The facts of the case, the course of theprocedure and the written observationssubmitted pursuant to Article 20 of theProtocol on the Statute of the Court of

Justice of the EEC may be summarizedas follows:

I — Facts and procedure

On 26 July 1973 Simmenthal S.p.A., acompany having its registered office inMonza, imported from France viaModane a consignment of beef forhuman consumption.A fee of Lit 581 480 was charged forthe veterinary and public healthinspection of the imported beef.Ths inspection is prescribed by Anide32 of the Italian consolidated health

laws (Royal Decree No 1265/34 of 27July 1934; Gazzetta Ufficiale No 186 of9 August 1934) The implementingprovisions of this article are laid downin Anide 45 of the regulation onveterinary health inspections (DecreeNo 320 of 8 February 1954 of thePresident of the Republic, GazzettaUfficiale No 142 of 24 June 1954). Thescale of fees chargeable in 1973 wasfixed by Law No 1239/70 of 30December 1970 (Gazzetta Ufficiale No26 of 1 February 1971).As Simmenthal was of the opinion thatthe veterinary and public healthinspections of the beef when it crossedthe frontier and the fees charged forsuch inspections were obstacles to thefree movement of goods and as suchforbidden under Community law, itbrought an action before the Pretore diSusa on 13 March 1976 for repaymentof the fees which in its view it had paidwithout any legal justification.

During the proceedings in Simmenthal'saction the Pretore di Susa felt it

necessary by order of 6 April 1976 torefer certain questions to the Court ofJustice for a preliminary ruling pursuantto Article 177 of the EEC Treaty. Thisreference led to the Court's judgment of15 December 1976 in Case 35/76

(Simmenthal S.p.A. v Italian Minuter ofFinance[1976] ECR 1871.

The Court of Justice held in theoperative pan of that judgment thatveterinary and public health inspectionsat the frontier, whether carried outsystematically or not, on the occasion ofthe importation of animals or meatintended for human consumptionconstitute measures having an effectequivalent to quantitative restrictionswithin the meaning of Article 30 of theTreaty and that pecuniary chargesimposed by reason of veterinary orpublic health inspections of products onthe occasion of their crossing thefrontier are to be regarded in principleas charges having an effect equivalent tocustoms duties.

In view of that judgment the Pretore diSusa by an order of 24 January 1977ordered the Amministrazione delle

Finanze dello Stato to repay the feesillegally charged, together with interest.The Amministrazione appealed on23 February 1977 against the order torepay.

In view of the arguments put forwardby the Amministrazione the Pretore diSusa found that the issue before him

was the incompatibility of certain rulesof Community law with a subsequentnational law, in this case Law No1239/70.

631

JUDGMENT OF 9. J. 1978 — CASE 106/77

According to recently decided cases ofthe Corte Costituzionale (the ItalianConstitutional Court), with specialreference to Judgment No 232 of 30October 1975, Judgment No 205 of28 July 1976 and Order No 206 of thesame date. It is necessary for thedetermination of this issue that thequestion whether Law 1239/70 isunconstitutional having regard toArticle 11 of the Constitution bereferred to the Constitutional Courtitself. On the other hand the well­established case-law of the Court ofJustice on the applicability ofCommunity law in the national legalsystems of the Member States cannot bedisregarded: according to this case-lawdirectly applicable Communityprovisions produce direct effect and assuch confer upon individuals rightswhich national courts must protect; noaction can be taken by any official bodywhich might jeopardize or delay theirfull, complete and uniform applicationin the Member States.

It is therefore impossible to underes­timate the disadvantages arising from asituation in which the trial judge,instead of declaring that the subsequentlaw impeding the implementation ofCommunity law is directly inapplicable,must each time raise the questionwhether it is unconstitutional with the

result that, until the ConstitutionalCourt delivers judgment, Communitylaw cannot have full effect and fur­

thermore, since the judgment of theConstitutional Court takes effect ex

nunc, it is even impossible to make goodretroactively the State's failure to fulfilits international obligations or toguarantee the absolute protection of thesubjective rights of the individualcreated by Community provisions andgoverned by them.It is therefore logical to deal first of allwith the question of the interpretationof Community law relating to the actualscope of the concept provisions whichare directly applicable.

Accordingly the Pretore di Susa byorder of 28 July 1977 decided pusuantto Article 177 of the EEC Treaty to staythe proceedings until the Court ofJustice has given its preliminary rulingon the following questions:"(a) Since, in accordance with Article

189 of the EEC Treaty and theestablished case-law of the Court

of Justice of the EuropeanCommunities, directly applicableCommunity provisions must,notwithstanding any internal ruleor practice whatsoever of theMember States, have full, completeand uniform effect in their legalsystems in order to protectsubjective legal rights created infavour of individuals, is the scopeof the said provisions to beinterpreted to the effect that anysubsequent national measureswhich conflict with those

provisions must be forthwith disre­garded without waiting until thosemeasures have been eliminated byaction on the pan of the nationallegislature concerned (repeal) or ofother constitutional authorities(declaration that they areunconstitutional) especially, in thecase of the latter alternative,where, since the national lawcontinues to be fully effectivepending such declaration, it isimpossible to apply the Com­munity provisions and, inconsequence, to ensure that theyare fully, completely and uniformlyapplied and to protect the legalrights created in favour ofindividuals?

(b) Arising out of the previousquestion, in circumstances whereCommunity law recognizes thatthe protection of subjective legalrights created as a result of'directly aplicable' Communityprovisions may be suspended untilany conflicting national measuresare actually repealed by the

632

AMMINISTRAZIONE DELLE FINANZE DELLO STATO v SIMMENTHAL

competent national authorities, issuch repeal in all cases to have awholly retroactive effen so as toavoid any adverse effects on thosesubjective legal rights?"

The order of the Pretore di Susa wasreceived at the Court Registry on2 December 1976.

Pursuant to Article 20 of the Protocol

on the Statute of the Court of Justice ofthe EEC written observadora were

submitted on 28 October 1977 by theCommision of the EuropeanCommunities, on 16 November 1977 bySimmenthal, the defendant in the mainaction, and on 25 November 1977 bythe Government of the Iulian Republic.Upon hearing the repon of the Judg-Rapporteur and the views of theAdvocate General, the Court dicided toopen the oral procedure without anypreparatory inquiry.

II — Written observations sub­mitted to the Court

Simmenthal, the defendant in the mainaction, considers first of all the problemof the relationship between theCommunity legal order and the nationallegal order from the standpoint of anItalian lawyer. It explains how thecase-law of the Iulian Constitutional

Court has developed in this field withspecial reference to Judgment No 183of 27 December 1973, Judgment No232 of 1975 and Judgment No 205 andOrder No 206 of 1976; if there is aconflict of legislation there are in factonly two alternatives, the repeal bylegislative means of the national rulewhich is incompatible with the earlierCommunity provisions or a declarationby the Constitutional Court that it isunconstitutional. Judgment No 232 of1975 brought to a standstill and gave adefinite form to the development of thecase-law with a solution which was

strictly circumscribed as regards form

and procedure, offered no prospects oralternatives and was encumbered, in thepurely domestic field, with disad­vantages and consequences which werein many respects negative: more timetaken by the proceedings, an increase oflegal costs and proliferation of judicalprocedures, a backlog of references tothe Constitutional Court, interventionof the latter court in actions raising fewproblems or none, devaluation of theduties of the Constitutional Court.

Given the actual context of this

reference for a preliminary ruling itmust essentially lead the Court todetermine the actual scope of a directlyapplicable Community provision withreference to subsequent nationalprovisions in conflict with it; the secondquestion is supplementary and its aim isto ascertain the minimum guaranteeswhich the individual to whom

Community rules are intended to applymust be able to invoke in order to be

able to be genuinely governed by theCommunity legal order.

Since the judgment of 5 February 1963(Case 26/62, N. V. Algemene Transport­en Expeditie Onderneming van Gend &Loos v Nederlandse Administratie derBelastingen [1963] ECR 1) the decidedcases of the Court of Justice havedefined step by step the principal aspectsand features of the concept of the"direct applicability" of Communitylaw. The foundations of this jurispru­dential policy are as follows:

The Community legal system constitutesa new legal order of international law,the subjects of which comprise not onlythe Member States but also their

nationals; it is a legal system in its ownright which forms pan of the legalsystem of the Member States and mustbe recognized by their courts.Community law is mandatory andabsolute; this means that the competentnational authorities are automaticallyforbidden to apply a national provisionfound to be incompatible with the

633

JUDGMENT OF 9. 3. 1978 — CASE 106/77

Treaty, and must, where necessary, takeall appropriate steps which help toensure that Community law is given fullforce and effect The rules ofCommunity law must be automaticallyapplied, at the same time and withidentical effect throughout the entireterritory of the Community. They mustbe accorded absolute precedence overthe domestic law of Member States,even over a subsequent legislativemeasure; the Member States cannotargue that there are derogations fromCommunity law which derive from theirlegislature or judicial systems, even if aconstitutional system or provisions areconcerned. Community law producesdirect effect and as such is capable ofcreating individual rights which nationalcourts must protect.

The solution prescribed in Italy by theConstitutional Court has, in the light ofthe principles laid down by the case-lawof the Court of Justice, very seriousdisadvantages.

On the most favourable presumptions itjustifies the application of national lawsincompatible with Community law untilthe date of the decision of the

Constitutional Court declaring that suchlaws are unconstitutional.

Furthermore the retroactive effect of thedeclaration that the Italian laws are

unconstitutional is only partial: it doesnot attach to legal relations which aresaid to be "exhausted", that is to say tothose which appear to have been finallyand irrevocably determined pursuant toacts or events which in fact precludecompletely any change in such relations(res judicata, limitation, forfeiture or lossof rights, administrative measuresagainst which there is no longer anyappeal, simple contracts of a substantivenature); since the provision declared tobe unconstitutional has in fact formed

part of the national legal system, it mayhave had effects which are irreversible.Thus the decision of the ConstitutionalCourt cannot in every case result in a

complete revival of the subjective rightconferred upon individuals by theCommunity provision.Moreover, since only the Italian law isapplicable until it is declared to beunconstitutional the ordinary courtscannot avail themselves of the

procedure provided for by Article 177of the EEC Treaty.These findings also apply to "re­enacting" laws which, disregarding thedirect and immediate applicability ofCommunity regulations, reproduce theirprovisions in whole or in part.The solution imposed by the Con­stitutional Court has particularly seriousimplications for the protection ofindividuals: the latter would be unableto secure complete and immediateprotection of the rights conferred uponthem by Community provisions untilthere had been a decision of the Con­

stitutional Court in their favour; theywould be discouraged from embarkingupon legal proceedings by cumbersomeand complex legal machinery; the publicservices would not be encouraged toapply Community law punctiliously andin its entirety to Italian traden or thenationals of other Member States.

Thus the following principles would bedisregarded: the principle of theprecedence of Community law, sincethe latter would have to yield to sub­sequent national law, the principle thatit must be applied uniformly and in itsentirety, since, for the time being at anyrate, its effects would be paralysed inone Member Sute, and the principle ofdirect effect, since individuals could notderive any benefit from the rightscreated for them by Communityprovisions and national courts could notprotect such rights.The Constitutional Court itself acknowl­

edged that diese disadvantages exist:since it considers that it cannot itselfremove them, it has specifically invitedthe Italian legislature to take thenecessary action to repeal those

634

AMMINISTRAZIONE DELLE FINANZE DELLO STATO v SIMMENTHAL

provisions which are incompatible withCommunity law and in future not toprejudice the unrestricted application ofthat law.

However a solution complying with theprinciples laid down by the Court ofJustice is possible: all that need be doneis to give the ordinary courts, as in theother Member States, the power not toapply domestic provisions which areincompatible with Community law.The Government of the Italian Republiccalls in question the relevance of thequestions referred to the Court for a pre­liminary ruling and accordingly theapplicability of Article 177 in this case;the court making the reference appearsitself to concede that it does not have

jurisdiction to deal with the claim whichis the subject-matter of the disputebetween the parties to the main action;in these circumstances the answers to

the questions referred to the Courtcannot be regarded as "necessary" forthe delivery of a judgment on thesubstance of the case.

In any event the same questions havealready been referred to the Court.Thus in its judgment of 3 February 1977(Case 52/76, Luigi Benedetti v MunanF.lli s.a.s. [1977] ECR 163) the latter,after stating that it is not for the Courtof Justice within the framework ofproceedings under Article 177 tointerpret questions of national law, heldthat "The purpose of a preliminaryruling is to decide a question of law andthat ruling is binding on the nationalcourt as to the interpretation of theCommunity provisions and acts inquestion"; this principle is the pre­requisite of, but also the limit of therelevance which under the Communitylegal order, may be attributed to, thequestions referred to the Court in thepresent case.

When the national court determines a

dispute it clearly cannot apply domesticlegal rules which it considers conflict orare incompatible with Community law,

especially if the prior interpretation bythe Court of Justice of the Communitylaw leaves no room to doubt that the

later national provision is incompatiblewith it. It is obvious that the

effectiveness of directly applicableCommunity provisions which conferupon individuals rights which the courtsmust protect cannot either be imperilledor impeded by contrary provisions ofdomestic law.

Nevertheless, as far as the way ofensuring the non-application of theconflicting provision of domestic law isconcerned, since the issue is one ofdomestic law, the specific solution canonly depend on the differentconstitutional systems of the MemberStates; any inconsistency between thenational rule and the Communityprovisions must be eliminated by themeans available under each of the

national legal systems.

Such a conflict can moreover only arisein the case of national legal rulesenacted after the Community provisionswere adopted: previously enactednational rules, which conflict withCommunity law are by implicationrepealed by the conflicting Communitylaw adopted afterwards. As far asconcerns later national legal provisionsany conflict may in practice be removedby applying the principle of interpre­tation that Community law is rationemateriae a special law. If any suchconflict of laws cannot be determined or

resolved in this way the supremacy ofCommunity law mun be guaranteed;such a guarantee can only be secured bythe means available under the con­

stitutional system of the variousMember Sutes.

The Constitutional Court confirmed in

its judgment No 232 of 1975 that theIulian legal order does not allow acourt "not to apply" a legal rule; thisruling is in accordance with theprinciple of the separation of powers.

635

JUDGMENT OF 9. 3. 1978 — CASE 106/77

A legislative provision, even if it iscontrary to the principles set out in theconstitution, must, if it is not to beapplied, be repealed or declared to beunconstitutional by the competentconstitutional authority. This legalprocedure appears to be effective andalso suitable for eliminating andresolving any conflict between rules ofnational law and Community law, sincethe Constitutional Court has

acknowledged in its Judgment No 183of 1973 that national rules of law which

re-enact Community provisions andconflict or are incompatible withCommunity law are unconstitutional.The fact that a rule of national lawdeclared to be unconstitutional because

it is inconsistent with Community law"ceases to apply on the day followingthat on which the decision is published"cannot be an obstacle to the protectionof rights conferred upon individuals byCommunity rules: this criterion doesnot prevent individuals invoking thedirect applicability of Community rules;a declaration of unconstitutionality alsoallows an individual who had not pre­viously paid attention to the matter tosafeguard his rights under Communitylaw, the only limits applicable in such acase being prescription and neglect inthe pursuit of one's rights which, as theCourt of Justice has specifically held,constitute under the Community legalsystem a bar to proceeding with anaction.

A declaration that a rule of law isunconstitutional in fact has retroactive

effect and applies to the rule ab initio,eliminating it ex tunc from the legalsystem as from the date on which itentered into force if it is subsequent tothe date when the constitution enteredinto force or from the date when theconstitution entered into force in thecase of an earlier rule.

The solution available under the Italian

legal system has considerable advan­tages because it is better able to secure

the uniform application of Communitylaw.

If the national court is acknowledged tohave the power not to apply a nationallaw which is incompatible withCommunity law that is tantamount toguaranteeing the application of theCommunity legal rule only in the caseactually before that court and protectingthe specific right claimed in that case;but the national provision remains inforce and is in fact exclusivelyapplicable if there has not been asubmission to the court that there mayhave been a breach of the rightsconferred upon individuals by Com­munity rules. Whenever the incom­patibility of the national legal rule withCommunity law has been overlooked bythe national legislature it would have tobe made good by the complexprocedure specified in Article 169 of theEEC Treaty which would merely resultin bringing to the notice of the MemberState in question the need to amend thenational rule of law inconsistent with

Community law.

A declaration that a legislative provisionis unconstitutional is clearly moreeffective and more significant: it is asuitable way of guaranteeing observanceof Community law in concreto, ergaomnes, and therefore more extensivelythan is the case when only a singleCourt refrains from applying it.

The incompatibility of a national legalprovision with Community rules, even ifthe Community rule has already beeninterpreted by the Court of Justice, mayturn out to be open to question, becausethe appraisal and any review of thenational legal rule are not within thejurisdiction of the Court of Justice inthe giving of preliminary rulings by wayof interpretation; to acknowledge thatin such circumstances each national

court has the power not to apply anational legal provision is tantamount tomaking observance of Community lawdependent on the inconsistent and

636

AMMINISTRAZIONE DELLE FINANZE DELLO STATO v SIMMENTHAL

fortuitous judgments of each nationalcourt and on the different grades ofjurisdiction and there will still be noeffective guarantee that Community lawwill be applied uniformly.On the other hand a declaration of

unconstitutionality, which is alonecapable of expunging from national lawthe national legal provision conflictingwith Community law and of doing so insuch a conclusive way that even "non-application" by the court of lastinstance cannot lead to the same result,clearly determines the issue.

These considerations apply to cases inwhich the effect of the relevant interpre­tation of the Community rule is to givethe national court the task of ascer­

taining whether the national legal rulemight have consequences inconsistentwith Community law; they apply evenmore clearly in those cases in which thejudgment given by the Court of Justiceon the question whether certain nationalrules may be compatible withCommunity law invokes the concepu of"reasonableness" and "proportionality".To acknowledge that the nationalcourts are entitled in such circumstances

to determine whether a national legalrule is to be applied or not is tanta­mount to leaving such questions tosubjective and inconsistent individualjudgments. The principle of legalcertainty would thereby be called inquestion; the national legal rule wouldbe considered to be compatible or notwith the Community rule according toeach national court's view of the

possible consequences which thenational legal rule might have and ofthe reasonableness and proportionalityof those consequences: in the end —and it would be for the parties to takethe initiative — there would have to bea decision of the court of last instance;this solution would entail a court

application in each case in order toprotect rights conferred upon indi­viduals.

Such disadvantages, and especially theconsiderable amount of time required tobe able to succeed in barring irreversiblythe application of a national rule of lawwhich is incompatible with Communitylaw, are avoided in those legal systems,such as the Italian legal system, whichdo not empower their national courtsnot to apply the law. In such caseswhich require a prior consideration ofthe actual constitutionality of thenational rule, an assessment of itscompatibility with Community law and­its reasonableness and proportionality,which is reserved to the national courts

and is subject to conditions laid downby Community rules as interpreted bythe Court of Justice, culminates in asingle decision which applies erga omnesand helps to secure a definitive anduniform application of Community law.The Court should therefore rule that

national courts cannot apply nationallegal rules which conflict withCommunity law and that theelimination of this incompatibility mustbe effected by the means and inaccordance with the procedures laiddown by national legal systems.

The Commission points out that, in thematter of conflicts between national and

Community law, in Italy the mostserious problems have been caused bythe many laws re-enacting Communityrules having direct effect. Although theyare open to criticism on technicalgrounds most of them only re-enactCommunity rules with a view to intro­ducing lawful implementing measures;they can and must be interpreted insuch a way as not to preclude theprinciple of direct applicability. Thenational court must in the first placeseek the interpretation which willcomply with Community law; that is thenormal situation in a Sute which appliesthe principle "pacta sunt servanda" andwhich has also assumed the obligationsarising under the Treaty and especiallyunder Article 5 thereof.

637

JUDGMENT OF 9. 3. 1978 — CASE 106/77

Italian legal theory and case-law havehad no difficulty in acknowledging thatCommunity law having direct effectprevails over conflicting national lawwhich has been previously enacted.

As far as concerns subsequentconflicting national law the ItalianConstitutional Court in its JudgmentNo 14 of 7 March 1964 held that the

EEC Treaty, made enforceable in Italyby an ordinary law, does not have anygreater effect than the latter; thereforewhen confronted with a subsequent lawwhich is incompatible with the Treatythe principle "lex posterior derogatpriori" must be applied. The only wayof remedying this breach of inter­national law is by fresh action on thepart of the legislature. Since thatjudgment the case-law of theConstitutional Court has developed; thisis borne out for example by JudgmentNo 183 of 1973 and in particular byJudgment No 232 of 1975. Accordingto the latter judgment a breach ofCommunity law having direct effect bya subsequent national law attracts aparticularly serious penalty undernational law, namely a declaration thatthe latter law is unconstitutional by theConstitutional Court before which the

court hearing the main action hasbrought the matter.

This specific acknowledgment of thesupremacy of Community law isnevertheless subject to one limitation:the national court before which the

matter is brought is not itselfempowered to set aside the subsequentlaw which is incompatible with theCommunity rule; it must first refer thequestion to the Constitutional Courtand wait until the latter court has madea declaration that the law is uncon­stitutional.

Compared with the previous situationthese decided cases represent asignificant advance. The declaration ofconstitutional illegality is not bindingonly upon the national court which has

brought the matter before theConstitutional Court and does not applytherefore only inter partes in the case tobe decided, it binds all national courtsand applies erga omnes. From the pointof view of the time factor theintervention at an advanced suge of theonly Court with jurisdiction in mattersof constitutional law may offer anadvantage. Article 136 of theConstitution, which provides that alegislative provision which is declaredunconstitutional ceases to have effect asfrom the day following the day whenthe judgment is published, is interpretedas meaning that as from that date theprovision in question must be treated asno longer forming part of the legislativesystem in force; the national court musttherefore no longer apply it in relationto the past either, and this is tantamountto its becoming inapplicable ex tunc; it isonly those matters which have beendefinitively settled in accordance withthat law which cannot be re-opened.

Nevertheless the fact that the national

court is forbidden to apply theCommunity rule until the subsequentconflicting law has been set aside by theConstitutional Court cannot be

reconciled with the principle of theprecedence of Community law which isof the essence of the Community legalorder.

This principle of the precedence ofCommunity law does not spring fromthe various constitutions of the MemberStates, which would involve cleardanger that the solutions would varyaccording to the wording of thoseconstitutions, but from Community lawitself. The principles of the precedenceand of the direct effect of Communitylaw imply that inconsistent national lawscan ipso jure not be set up against itwithout its being necessary to awaittheir repeal by the national legislatureor their annulment by a ConstitutionalCourt.

638

AMMINISTRAZIONE DELLE FINANZE DELLO STATO v SIMMENTHAL

A law conflicting with Community lawcannot be set up against the latter; sucha law is not an obstacle which it is

essential to remove first of all byrepealing it or by declaring itunconstitutional.

Forbidding the national court to applyCommunity law before the declarationof unconstitutionality, which is unac­ceptable as a matter of principle, wouldin practice make the procedureunnecessarily cumbersome in all caseswhere it is obvious that a national law is

incompatible with Community law. It isfor the Court of Justice to interpretCommunity law; once the Court hasgiven its ruling under Article 177 thesole discretion left to be exercised bythe national authorities is a review of

the national law for the purpose ofchecking whether it is in conformitywith the Community rule thusinterpreted. In general this discretion isvery limited; it ceases to exist if theCourt of Justice has already found thatthere -has been a breach of the

Community rule under Article 169. Insuch circumstances a lengthy stay ofproceedings while awaiting the judg­ment of the Constitutional Court would

not be justified by any advantage interms of legal certainty. Since fur­thermore the declaration of unconsti­

tutionality is to all intents and purposesautomatic, the very rôle of theConstitutional Court would thereby bedevalued.

The new procedure available in Italy forsetting aside national laws which areincompatible with Community law,namely a declaration of unconsti­tutionality, may be regarded asequivalent to strengthening Communitylaw and prove to be useful in certaincomplex cases capable of giving rise tolengthy, multiple proceedings; but itcannot,. by becoming mandatory, bemade a substitute for the direct methodwhich the court hearing the main actionmust adopt in every other case andwhich consists in applying the

Community rule and not the conflictingnational rule. The question whetherthese concurrent solutions areadmissible under the Italian

constitutional system is not relevant tothe present case.As far as concerns the second questionreferred to the Court it is evident thatif, for example, the national court, inorder to be able to apply Communitylaw having direct effect, were obliged towait for the setting aside of theconflicting law, the latter must haveretroactive effect as from the date when

the Community rule entered into force;otherwise there could be no remedy forpan breaches of subjective rights basedon that rule.

The requirement of retroactive effectcannot however be absolute; it must bereconciled with the fundamental prin­ciple of legal certainty, which is the jus­tification for fixing periods of limitationand time-limits for initiatingproceedings and also for the prohibitionon calling in question judgments whichhave acquired the force of res judicata.The questions referred to the Court bythe Pretore di Susa may be answered asfollows:

Community provisions having directeffect cannot be affected by conflictingnational legislative provisions, whetherprior or subsequent to them. The factthat the legislature may repeal theconflicting law or a constitutional courtmay dedare that it is unconstitutionalmay help to ensure observance ofCommunity law but it cannot take awayfrom the national court the power toapply Community provisions havingdirect effect notwithstanding theexistence of such legislative provisions.Subjective rights created by Communityprovisions having direct effect must beprotected as from the entrance into

orce of those provisions. Whatevermeans the national court adopts to putan end to the application of nationallaws which are incompatible with

639

JUDGMENT OF 9. 3. 1978 — CASE 106/77

Community provisions it must ensurethat the latter are observed as from theirentrance into force, that is to say inrespect of the past as well, save only inthe case of rights affected by limitation,by effluxion of time or by the force ofres judicata.

III — Oral procedure

Simmenthal, the defendant in the mainaction, represented by Emilio Cappelliof the Rome Bar, the Government ofthe Italian Republic, represented byArturo Marzano, Avvocato dello Stato,and the Commission of the EuropeanCommunities, represented by GiancarloOlmi, Assistant Director General of itsLegal Department, submitted oral obser­vations and answered the questions putby the Court at the hearing on26 January 1978.The Government of the Italian Republicstressed the fan that the questions

raised by the Pretore di Susa had ceasedto have any relevance during theproceedings, since Law No 889 of14 November 1977 (Gazzetta UfficialeNo 337 of 12 December 1977) providesthat "fees for veterinary and publichealth inspection fixed under the scaleannexed to Law No 1239 are not

payable in respect of products coveredby the common organization of agri­cultural markets" and the Constitutional

Court has by its Judgment No 163 of29 December 1977 declared that thesole article of Law No 1239 as well asthe scale annexed thereto of fees

relating to veterinary and public healthinspections on the import into Italy ofanimals for slaughter, meats, productsand skins of animal origin isunconstitutional.

The Advocate General delivered his

opinion at the hearing on 16 February1978.

Decision

1 By an order of 28 July 1977, received at the Court on 29 August 1977, thePretore di Susa referred to the Court for a ruling pursuant to Article 177 ofthe EEC Treaty, two questions relating to the principle of the directapplicability of Community law as set out in Article 189 of the Treaty forthe purpose of determining the effects of that principle when a rule ofCommunity law conflicts with a subsequent provision of national law.

2 It is appropriate to draw attention to the fact that at a previous stage of theproceedings the Pretore referred to the Court for a preliminary rulingquestions designed to enable him to determine whether veterinary andpublic health fees levied on imports of beef and veal under the consolidatedtext of the Italien veterinary and public health laws, the rate of which waslast fixed by the scale annexed to Law No 1239 of 30 December 1970(Gazzeta Ufficiale No 26 of 1 February 1971), were compatible with theTreaty and with certain regulations — in particular Regulation (EEC) No805/68 of the Council of 27 June 1968 on the common organization of the

640

AMMINISTRAZIONE DELLE FINANZE DELLO STATO v SIMMENTHAL

market in beef and veal (Official Journal, English Special Edition 1968 (I),p. 187).

3 Having regard to the answers given by the Court in its judgment of15 December 1976 in Case 35/76 (Simmenthal S.p.A. v Italian Minuter forFinance [1976] ECR 1871) the Pretore held that the levying of the fees inquestion was incompatible with the provisions of Community law andordered the Amministrazione delle Finanze dello Stato (Italian FinanceAdministration) to repay the fees unlawfully charged, together with interest.

4 The Amministrazione appealed against that order.

5 The Pretore, taking into account the arguments put forward by the partiesduring the proceedings arising out of this appeal, held that the issue beforehim involved a conflict between certain rules of Community law and a sub­sequent national law, namely the said Law No 1239/70.

6 He pointed out that to resolve an issue of this kind, according to recentlydecided cases of the Italian Constitutional Court (judgments No 232/75and No 205/76 and Order No 206/76), the question whether the law inquestion was unconstitutional under Article 11 of the Constitution must bereferred to the Constitutional Court itself.

7 The Pretore, having regard, on the one hand, to the well-establishedcase-law of the Court of Justice relating to the applicability of Communitylaw in the legal systems of the Member States and, on the other hand, tothe disadvantages which might arise if the national court, instead ofdeclaring of its own motion that a law impeding the full force and effect ofCommunity law was inapplicable, were required to raise the issue ofconstitutionality, referred to the Court two questions framed as follows:

(a) Since, in accordance with Article 189 of the EEC Treaty and theestablished case-law of the Court of Justice of the EuropeanCommunities, directly applicable Community provisions must,notwithstanding any internal rule or practice whatsoever of the MemberStates, have full, complete and uniform effect in their legal systems inorder to protect subjective legal rights created in favour of individuals,is the scope of the said provisions to be interpreted to the effect that anysubsequent national measures which conflict with those provisions mustbe forthwith disregarded without waiting until those measures have beeneliminated by action on the part of the national legislature concerned

641

JUDGMENT OF 9. 3. 1978 — CASE 106/77

(repeal) or of other constitutional authorities (declaration that they areunconstitutional) especially, in the case of the latter alternative, where,since the national law continues to be fully effective pending suchdeclaration, it is impossible to apply the Community provisions and, inconsequence, to ensure that they are fully, completely and uniformlyapplied and to protect the legal rights created in favour of individuals?

(b) Arising out of the previous question, in circumstances whereCommunity law recognizes that the protection of subjective legal rightscreated as a result of "directly applicable" Community provisions maybe suspended until any conflicting national measures are actuallyrepealed by the competent national authorities, is such repeal in all casesto have a wholly retroactive effect so as to avoid any adverse effects onthose subjective legal rights?

The reference to the Court

8 The Agent of the Italian Government in his oral observations drew theattention of the Court to a judgment of the Italian Constitutional Court No163/77 of 22 December 1977 delivered in answer to questions of consti­tutionality raised by the courts of Milan und Rome, which declared thatcertain of the provisions of Law No 1239 of 30 December 1970 includingthose at issue in the action pending before the Pretore di Susa, wereunconstitutional.

9 It was suggested that since the disputed provisions have been set aside bythe declaration that they are unconstitutional, the questions raised by thePretore no longer have relevance so that it is no longer necessary to answerthem.

10 On this issue it should be borne in mind that in accordance with its

unvarying practice the Court of Justice considers a reference for a pre­liminary ruling, pursuant to Article 177 of the Treaty, as having been validlybrought before it so long as the reference has not been withdrawn by thecourt from which it emanates or has not been quashed on appeal by asuperior court.

11 The judgment referred to, which was delivered in proceedings in no wayconnected with the action giving rise to the reference to this Court, cannothave such a result and the Court cannot determine its effect on third parties.

642

AMMINISTRAZIONE DELLE FINANZE DELLO STATO v SIMMENTHAL

12 The preliminary objection raised by the Italian Government must thereforebe overruled.

The substance of the case

13 The main purpose of the first question is to ascertain what consequencesflow from the direct applicability of a provision of Community law in theevent of incompatibility with a subsequent legislative provision of a MemberSute.

14 Direct applicability in such circumstances means that rules of Communitylaw must be fully and uniformly applied in all the Member States from thedate of their entry into force and for so long as they continue in force.

15 These provisions are therefore a direct source of rights and duties for allthose affected thereby, whether Member States or individuals, who areparties to legal relationships under Community law.

16 This consequence also concerns any national court whose task it is as anorgan of a Member Sute to protect, in a case within its jurisdiction, therights conferred upon individuals by Community law.

17 Furthermore, in accordance with the principle of the precedence ofCommunity law, the relationship between provisions of the Treaty anddirectly applicable measures of the institutions on the one hand and thenational law of the Member States on the other is such that those provisionsand measures not only by their entry into force render automatically inap­plicable any conflicting provision of current national law but — in so far asthey are an integral part of, and take precedence in, the legal orderapplicable in the territory of each of the Member States — also preclude thevalid adoption of new national legislative measures to the extent to whichthey would be incompatible with Community provisions.

18 Indeed any recognition that national legislative measures which encroachupon the field within which the Community exercises its legislative power orwhich are otherwise incompatible with the provisions of Community lawhad any legal effect would amount to a corresponding denial of theeffectiveness of obligations undertaken unconditionally and irrevocably byMember States pursuant to the Treaty and would thus imperil the very foun­dations of the Community.

643

JUDGMENT OF 9. 3. 1978 — CASE 106/77

19 The same conclusion emerges from the structure of Article 177 of theTreaty which provides that any court or tribunal of a Member State isentitled to make a reference to the Court whenever it considers that a pre­liminary ruling on a question of interpretation or validity relating toCommunity law is necessary to enable it to give judgment.

20 The effectiveness of that provision would be impaired if the national courtwere prevented from forthwith applying Community law in accordance withthe decision or the case-law of the Court.

21 It follows from the foregoing that every national court must, in a casewithin its jurisdiction, apply Community law in its entirety and protectrights which the latter confers on individuals and must accordingly set asideany provision of national law which may conflict with it, whether prior orsubsequent to the Community rule.

22 Accordingly any provision of a national legal system and any legislative,administrative or judicial practice which might impair the effectiveness ofCommunity law by withholding from the national court having jurisdictionto apply such law the power to do everything necessary at the moment of itsapplication to set aside national legislative provisions which might preventCommunity rules from having full force and effect are incompatible withthose requirements which are the very essence of Community law.

23 This would be the case in the event of a conflict between a provision ofCommunity law and a subsequent national law if the solution of the conflictwere to be reserved for an authority with a discretion of its own, other thanthe court called upon to apply Community law, even if such an impedimentto the full effectiveness of Community law were only temporary.

24 The first question should therefore be answered to the effect that a nationalcourt which is called upon, within the limits of its jurisdiction, to applyprovisions of Community law is under a duty to give full effect to thoseprovisions, if necessary refusing of its own motion to apply any conflictingprovision of national legislation, even if adopted subsequently, and it is notnecessary for the court to request or await the prior setting aside of suchprovision by legislative or other constitutional means.

25 The essential point of the second question is whether — assuming it to beaccepted that the protection of rights conferred by provisions of Community

644

AMMINISTRAZIONE DELLE FINANZE DELLO STATO v SIMMENTHAL

law can be suspended until any national provisions which might conflictwith them have been in fact set aside by the competent national authorities— such setting aside must in every case have unrestricted retroactive effectso as to prevent the rights in question from being in any way adverselyaffected.

26 It follows from the answer to the first question that national courts mustprotect rights conferred by provisions of the Community legal order andthat it is not necessary for such courts to request or await the actual settingaside by the national authorities empowered so to act of any nationalmeasures which might impede the direct and immediate application ofCommunity rules.

27 The second question therefore appears to have no purpose.

Costs

28 The costs incurred by the Government of the Italian Republic and by theCommission of the European Communities which have submitted obser­vations to the Court are not recoverable.

29 As these proceedings are, in so far as the parties to the main action areconcerned, in the nature of a step in the action pending before the Pretoredi Susa, the decision on costs is a matter for that court.

On those grounds

THE COURT,

in answer to the questions referred to it by the Pretore di Susa by order of28 July 1977, hereby rules:

A national court which is called upon, within the limits of itsjurisdiction, to apply provisions of Community law is under a duty togive full effect to those provisions, if necessary refusing of its ownmotion to apply any conflicting provision of national legislation, even ifadopted subsequently, and it is not necessary for the court to request or

645

OPINION OF MR REISCHL — CASE 106/77

await the prior setting aside of such provisions by legislative or otherconstitutional means.

Kutscher Serensen Bosco

Donner Pescatore Mackenzie Stuart O'Keeffe

Delivered in open court in Luxembourg on 9 March 1978.

A. Van Houtte

Registrar

H. Kutscher

President

OPINION OF MR ADVOCATE GENERAL REISCHLDELIVERED ON 16 FEBRUARY 1978 <appnote>1</appnote>

Aír President,Members ofthe Court,

In July 1973 the defendant in the mainaction imported some beef for humanconsumption into Italy from France. Atthe frontier it underwent a veterinaryand public health inspection in accord­ance with an Italian law dating back to1934. Fees had to be paid for theinspection at the scale in force at thedate of importation which had been laiddown under a law of 30 December1970.

The Simmenthal company takes theview that this is incompatible withCommunity provisions on the freemovement of goods and for that reasonhas brought an action before thePretore di Susa for repayment of thefees. During these proceedings anapplication was made for a preliminary

ruling (Case 35/76, Simmenthal S.p.A. νItalian Minister for Finance [1976] ECR1871 et seq.) and in the operative part ofits judgment of 15 December 1976 theCourt ruled as follows:

"1. (a) — Veterinary and public healthinspections at the frontier,whether carried out systemat­

ically or not, on the occasionof the importation of animalsor meat intended for humanconsumption constitutemeasures having an effectequivalent to quantitativerestrictions within the meaningof Article 30 of the Treaty,which arc prohibited by thatprovision, subject to theexceptions laid down byCommunity law and inparticular by Article 36 of theTreaty.

1 — Translated from the German.

646