Import of 2nd-hand cars: Commission takes steps against MS

Publication date: 30 June 2006

The Commission has taken steps against Luxembourg, Czech Republic, Poland, Austria and Hungary, because these Members States make the import of second hand cars difficult. All five cases, which are at different stages of the infringement procedure, constitute impediments to the free movement of goods. For example, Luxembourg requires unnecessary documents on the dealer’s registration prior to the importation of cars. Other Member States require technical controls prior to the registration of imported used vehicles without imposing these conditions on vehicles in the same circumstances (vehicles of the same age, model or type), that have already been registered in the country before.

Commission Vice-President Günter Verheugen, responsible for Enterprise and Industry policy said: “Identical second-hand vehicles cannot be discriminated only because they were not purchased originally in the Member State concerned. The Commission had to act so that our consumers can reap the full benefits of the EU single market.”

1. Luxembourg
Importing a second-hand car purchased in another Member State is more complicated and requires more paperwork than to buy a similar car in Luxembourg. If the second-hand vehicle was bought from a professional dealer, an official document proving the dealer’s registration in his local commercial register must be presented. The requirement implies additional delays, costs and formalities, although the information sought can be obtained easily by the authorities themselves. Such a document is not usually required in respect of a second-hand car purchased in Luxembourg. In a reasoned opinion the Commission has asked Luxembourg to repeal such disproportionate requirements.

2. Czech Republic
Two similar second-hand cars (vehicles of the same age, model or type) being subject to registration are treated differently, depending on whether they are imported form another Member Sate or whether they have already been registered in the Czech Republic. The Czech legislation prohibits registration of imported vehicles, which are 5 or 8 years old depending on the type of the car and requires specific technical controls prior to registration of imported cars. In reply to a letter of formal notice sent by the Commission in March 2005, the Czech authorities replied that the measure can be justified on the grounds of protection of road safety, the life and health of humans and the environment.

However and without compromising these legitimate public interests, the Commission considers that the Czech Republic has failed to prove the necessity and proportionality of this discriminatory measure - similar testing requirements and restrictions are not applied to vehicles that have already been registered in the Czech Republic. The Czech authorities agreed to undertake appropriate measures. However over a year after receiving a letter of formal notice, the Czech legislation was still not compatible with the principle of free movement of goods.

3. Poland
The Polish legislation requires specific technical controls prior to the registration of imported used vehicles without imposing these conditions on identical vehicles that have already been registered in Poland (vehicles of the same age, model or type). The Commission takes the view that this constitutes an impediment to the free movement of goods, as long as the same conditions are not imposed on vehicles in the same circumstances, which have already been registered in Poland. While not contesting road safety and better environmental protection as such, the Commission considers that the Polish authorities have not justified the discriminatory measure. The Commission has sent a reasoned opinion to Poland for imposing obstacles on registration of imported used vehicles.

4. Austria
The Commission has received complaints about Austrian legislation which appears to prohibit the registration of imported second hand cars, which were registered for the first time in another Member State prior to the accession of Austria. However, it seems that vehicles of the same type that have already been registered in Austria can be re-registered without such problems. The Commission considers that this discriminatory approach may constitute a barrier to the free movement of goods, in violation of the Internal Market rules (Articles 28 to 30 of the EC Treaty). The Commission has sent a letter of formal notice to Austria requesting information concerning obstacles to the registration of imported second hand cars.

5. Hungary
Hungary is already at the second stage of the pre-trial infringement procedure as regards similar problems. According to the Commission’s reasoned opinion Hungarian legislation prohibits the import of second-hand cars, which were first registered prior to 1996 in another Member State. At the same time vehicles already registered in Hungary do not face a comparable prohibition but can be re-registered without problems. In the Commission’s view Hungary has not provided any explanation which could justify such a discriminatory approach. Hence the Commission considers that the Hungarian law violates Internal Market rules.

Background
The EC Treaty requires the Commission to ensure that EU law is correctly implemented. The Commission has been granted powers to do so under the infringement procedure laid down in Articles 226 and 228 of the Treaty. The main purpose of this procedure is not to bring infringement proceedings before the Court of Justice, but to bring the Member State back into line with EU law during a pre-litigation phase. The main steps of the pre-litigation procedure are:

1. Letter of formal notice
The letter of formal notice represents the first stage in the pre-litigation procedure, during which the Commission requests a Member State to submit its observations on an identified problem regarding the application of Community law within a given time limit. The Commission does not make an accusation but offers the Member State the opportunity to give its explanation regarding an alleged infringement. The Member States is given two months to reply.

2. Reasoned opinion
The reasoned opinion gives a detailed statement, based on the letter of formal notice, of the reasons that have led the Commission to conclude that the Member State concerned has failed to fulfil one or more of its obligations under the Treaty or other EU legislation. The Member State has two months to reply.

3. Decision to refer a case to the Court of Justice
Referral to the Court of Justice of the European Communities opens the litigation procedure.