1.5.3. Suitability or Appropriateness

As part of t he proportionality test. Community law not only prohibits Member States

from going beyond a certain level of regulation, it equally requires Member States to

attain a given level of regulation. A national measure must at least be appropriate to

attain the aimed for protection. This requires, on the one hand, the existence of a

causal link between the measure and the protection envisaged,"' and on the other hand,

that the interest is protected with a certain consistency.1 1"' For instance, in its wellknown

judgment regarding the Cennan Reiuheitsgebot the Court held the German

law unlawful inter alia because human health could not be protected solely by prohibiting

certain additives in beer whilst allowing t h em in a range of other foodstuffs.""

A more recent example, also illustrating the relevance to private international law, can

be found in Centros.'"' Centros Ltd. was a company registered in the United Kingdom.

It did, however, not conduct any business there, nor anywhere else. When it applied

to have a branch registered in Denmark, the registration was refused. The Court held

the refusal to be an infringement of the freedom of movement guaranteed under

Article 43 and 48 EC. The Danish government had argued that the refusal was

nevertheless justified for the protection of public and private creditors against

(fraudulent) insolvencies of companies whose initial capitalisation was inadequate

(under Danish law). The Court did not accept this justification, in part because the

measure was 'not such as to attain the objective of protecting creditors which it

purports to pursue'. Denmark would have registered the branch if Centros Ltd had

done any business in the United Kingdom, even though creditors would be equally

exposed to risk."" an interest safeguarded by that Article within its own national territory . "s Conversely,

the Court has denied Member States the right to regulate matters on the grounds that

the interests were located in another Member State. In Gourmettcrie Van den Burg the

Court declared a Dutch law protecting niter alia the red grouse unlawful on the

grounds that that bird species did not naturally occur in the Netherlands but was

predominantly found in the United Kingdom ( S c o t l a n d ) . ' " Similarly, in Alpine

Investments the Court denied that the protection of 'consumers in other Member

States' could as such be regarded as a mandatory requirement of the public interest

for the Netherlands.

Member States are not entitled to take measures resulting in obstacles to trade in order

to protect an interest that is (entirely) foreign to that Member State and located in

another Member State. This limit on the regulatory jurisdiction of the Member States

under the law of the freedoms may, on the one hand, be regarded as a specific result

of t he broader proportionality test. As Advocate General Van Gerven pointed out in

Gounnetterie Van den Burg, while the level of protection of a foreign interest attained

is likely to be relatively small, the resultant burden on interstate trade will be considerable.

' " I t forces traders not only to ascertain whether the Member State where the

interest is located has enacted any measures, but whether any Member State has done

so; and, if that is the case, to adjust their transaction to the most restrictive measure

in order to ensure their transaction is legal and valid.1 '"

On the other hand, the restriction on the regulatory jurisdiction may be regarded as

an independent requirement under the law of the freedoms. According to Advocate

General Leger the taking of measures designed to protect interests located within

another Member State's territory is to ignore the limits of one's own and to infringe

upon each other's sphere of influence and 'responsibility1 . '' In particular, there is a

significant risk that not all interests involved are sufficiently taken account ot by the

regulating Member State, since foreign interests typically are undervalued in national

The requirement that a measure must be appropriate to attain the protection aimed

for is well established under Community law. •"' lust as Member States may be required

to consider the specific interest of a rule oflaw and whether it does not exceed the level

of what is necessary, they might also be required to review the consistency of their legal

rules. At the same time, as Basedow points out, legal systems do not develop linearly

but are dynamic. They evolve under the influence of continuously changing sociocultural,

economic and scientific views, which are only over time incorporated into

the law. Accordingly, the level ot consistency required leaves a margin of discretion,

or perhaps error, to the Member S t a t e s . 1 - Therefore, it i s submitted, not every inconsistency

will render national measures resulting in an obstacle to trade unjustifiable.

Only in cases of clear discrepancies between the possible effects of a measure and the

goal aimed for, should a measure be held unlawful on this ground.