LORDS DECISIONSLORDS DECISIONS >>LORDSLORD NICHOLLS OF BIRKENHEAD LORD HOFFMANN LORD HOPE OF CRAIGHEAD LORD CLYDE LORD SCOTT OF FOSCOTELORDS OF APPEAL FOR JUDGMENTLORD NICHOLLS OF BIRKENHEADLORDS,LORD HOFFMANN AND LORD SCOTT OF FOSCOTE. I AGREE THAT, IN ORDER TO DECIDE THIS APPEAL, IT IS NECESSARY FOR THE HOUSE TO REFER TO THE EUROPEAN COURTS OF JUSTICE A QUESTION TO THE EFFECT MENTIONED BY LORD HOFFMANN.LORD HOFFMANNLORDS,LORDSHIPS' HOUSE.JUSTICE. SECONDLY, THEY SAY THAT UPON ITS TRUE CONSTRUCTION, IT WAS NOT INTENDED TO CREATE RIGHTS AND DUTIES DIRECTLY ENFORCEABLE IN THE COURTS OF MEMBER STATES. THIRDLY, THEY SAY IT SHOULD NOT BE ENFORCED BECAUSE THE EXTENT OF THE PROTECTION AFFORDED TO THE PDO WAS NOT PRECISELY DEFINED, OR NOT SUFFICIENTLY PUBLICISED, OR BOTH. ARGUMENTS OF THIS KIND MIGHT, AS IT SEEMS TO ME, BE REGARDED AS OPERATING IN ONE OF TWO WAYS: EITHER IN AID OF CONSTRUCTION, TO SUPPORT THE ARGUMENT THAT THE REGULATION WAS NOT INTENDED TO HAVE DIRECT EFFECT, OR ALTERNATIVELY, AS SHOWING THAT, AS A REGULATION INTENDED TO HAVE DIRECT EFFECT, IT SHOULD BE TREATED AS INVALID. THE LATTER FORM OF ARGUMENT WOULD AGAIN REQUIRE A REFERENCE TO THE EUROPEAN COURT. I AM NOT SURE THAT MR GREEN, WHO APPEARED FOR THE RESPONDENTS, ACCEPTED THIS LAST PROPOSITION. HE SUGGESTED, I THINK, THAT A REGULATION MIGHT BE INTENDED TO CREATE DIRECTLY ENFORCEABLE RIGHTS BUT NOT CREATE THEM FOR ONE OR OTHER OF THE REASONS UPON WHICH HE RELIES AND YET SOMEHOW BE VALID. I SHALL RETURN TO THIS POINT IN DUE COURSE. FOURTHLY, THE RESPONDENTS SAY THAT WHILE THE PDO MAY CONFER A DEGREE OF PROTECTION WHICH REQUIRES HAM SOLD AS PROSCIUTTO DI PARMA TO HAVE BEEN MADE IN PARMA, IT DOES NOT EXTEND TO A REQUIREMENT THAT PACKAGES SHOULD BEAR A MARK WHICH HAS TO BE APPLIED IN PARMA. THIS ARGUMENT AGAIN TAKES DIFFERENT FORMS. ONE IS THAT THE REGULATION, UPON ITS TRUE CONSTRUCTION, READ WITH THE DOCUMENTS TO WHICH IT REFERS, DOES NOT CONFER THE WIDER PROTECTION. ALTERNATIVELY, IF IT SHOULD BE SO CONSTRUED, THE COMMISSION DID NOT HAVE POWER UNDER THE REGULATION (OR POSSIBLY EVEN UNDER THE EEC TREATY (TREATY OF ROME) (CMND 5179-II)) TO REGISTER A PDO PURPORTING TO CONFER THE WIDER PROTECTION. THE LATTER FORM OF ARGUMENT WOULD AGAIN REQUIRE A REFERENCE.LORDS, I THINK THAT THE BEST PLACE TO BEGIN IS BY CONSIDERING WHETHER, AS A MATTER OF CONSTRUCTION, THE REGULATION WAS INTENDED TO CONFER PROTECTION UPON A PDO WHICH IS DIRECTLY ENFORCEABLE IN THE COURTS OF MEMBER STATES. ONCE ONE HAS DECIDED THIS QUESTION, THE OTHER ARGUMENTS PUT BEFORE YOUR LORDSHIPS TEND TO FALL INTO PLACE.LORD SIMONDS ONCE CALLED A "PIOUS ASPIRATION". (CUTLER V WANDSWORTH STADIUM LTD [1949] AC 398, 407).JUSTICE SAID (IN PARAGRAPH 18, P 1331) THAT UPON THE REGISTRATION OF A PDO (IN THAT CASE, GORGONZOLA) NATIONAL RULES CEASED TO APPLY AND "ONLY THE LEGAL RULES LAID DOWN IN [THE REGULATION] ARE, TOGETHER WITH THE TREATY RULES, RELEVANT FOR THE PURPOSE OF ANSWERING THE QUESTIONS REFERRED [ABOUT THE SCOPE OF THE PROTECTION OF THE PDO]. THE WHOLE JUDGMENT (SEE, FOR EXAMPLE, PARAGRAPH 36) PROCEEDS ON THE ASSUMPTION THAT PROTECTION OF THE PDO IS NOW GUARANTEED BY COMMUNITY LAW.LORDSHIPS NEED BE CONCERNED ONLY WITH SECTIONS UNDER (G) (DETAILS OF INSPECTION STRUCTURES), (H) (LABELLING DETAILS) AND (I) (COMMUNITY AND NATIONAL REQUIREMENTS). PART H IS HEADED "SPECIFIC REQUIREMENTS CONCERNING THE PRESENTATION, IDENTIFICATION AND LABELLING OF PARMA HAM". IT REFERS TO AND SUMMARISES THE ITALIAN LEGISLATION TO WHICH I HAVE ALREADY REFERRED. PARAGRAPH H.2 SAYS:LORDS, IT IS NOTICEABLE THAT THE JUDGE DISCUSSES "SLICING AND PACKAGING" WITHOUT IN ANY WAY CONNECTING THESE OPERATIONS TO THE REASON WHY THE ITALIAN AUTHORITIES REQUIRE THEM TO BE CONTROLLED AND SUPERVISED, NAMELY, FOR THE PURPOSE OF ENSURING THAT THE AUTHENTICITY OF THE PRODUCT IN SLICED FORM CAN BE GUARANTEED TO THE CONSUMER BY AN AUTHENTIC LABEL. THE PURPOSE OF PROTECTION OF THE PDO, ACCORDING TO THE RECITALS TO THE REGULATION, IS TO ENABLE THE CONSUMER TO "PURCHASE HIGH QUALITY PRODUCTS WITH GUARANTEES AS TO THE METHOD OF PRODUCTION AND ORIGIN". THE PDO WILL "ENHANCE THE CREDIBILITY OF THE PRODUCTS IN THE CONSUMERS' EYES". ARTICLE 4.2(H) SPECIFICALLY REQUIRES THAT "ABELLING DETAILS" BE INCLUDED IN THE SPECIFICATION. I CAN THEREFORE SEE NO REASON WHY LABELLING REQUIREMENTS SHOULD NOT FORM A PART OF THE SPECIFICATION WITH WHICH ARTICLE 4.1 REQUIRES THE PRODUCT TO COMPLY. AS A MATTER OF PLAIN LANGUAGE, THE RULES IN SECTION H (WHICH INCORPORATE BY REFERENCE THE ITALIAN LAW AND REGULATIONS) ARE PART OF THE SPECIFICATION.LORDS, THE AUTHENTICITY OF PARMA HAM HAS TRADITIONALLY BEEN GUARANTEED BY THE BRAND ON THE HAM ITSELF. THE CONSUMER IN THE BUTCHER OR DELICATESSEN HAS BEEN ABLE TO SATISFY HIMSELF ON THIS POINT BY INSPECTING THE HAM FROM WHICH HIS ORDER WAS SLICED. BUT THE RETAIL REVOLUTION OF THE PAST 30 YEARS HAS MEANT THAT MUCH MORE HAM IS NOW SOLD PRE-PACKAGED IN SUPERMARKETS. IN THE ABSENCE OF CONTROL BY THE PRODUCERS OVER THE LABELLING OF SUCH PACKAGES, THE SUPERMARKET CONSUMER WOULD HAVE NO GUARANTEE OTHER THAN THE WORD OF THE RETAILER. HE WOULD HAVE TO TAKE ON TRUST THE CLAIM THAT THE PACKAGE CONTAINED GENUINE PARMA HAM. AND THE PRODUCERS IN PARMA WOULD HAVE NO CONVENIENT WAY TO PROTECT THEIR GOODWILL EXCEPT BY TESTING PACKAGES IN RETAIL OUTLETS ALL OVER THE COMMUNITY TO ESTABLISH, PERHAPS BY SOME FORM OF ANALYSIS, WHETHER THE PRODUCT SOLD AS PARMA HAM IS GENUINE OR NOT. IN THE PRESENT CASE, IT IS ACCEPTED THAT THE RESPONDENTS ARE HONEST TRADERS AND THAT THEIR PACKAGES CONTAIN THE AUTHENTIC PRODUCT. BUT THIS WILL NOT ALWAYS BE THE CASE. THE POINT OF THE LABELLING RULES, WHICH IN THE CASE OF PACKAGED PRODUCTS ARE INSEPARABLE FROM THE PACKAGING AND SLICING RULES, IS TO PROVIDE A RELIABLE AND EASY WAY TO DETECT INFRINGEMENT OF THE PDO. THEY COMPLEMENT THE INSPECTION PROCESS IN PARMA, WHICH OTHERWISE WOULD SERVE NO PURPOSE.LORDS, I DO NOT SEE HOW IT COULD BE MORE CLEARLY SPELLED OUT.LORDS, THE COURT OF APPEAL REGARDED THIS ARGUMENT AS SUPPORTING THEIR VIEW THAT THE REGULATION WAS NOT INTENDED TO BE DIRECTLY EFFECTIVE. BUT, IF YOUR LORDSHIPS AGREE THAT THE LANGUAGE AND PURPOSE OF THE REGULATION SHOWS BEYOND DOUBT THAT IT WAS INTENDED TO BE DIRECTLY EFFECTIVE, THEN THE ARGUMENT ON TRANSPARENCY BECOMES AN ATTACK ON THE VALIDITY OF THE DIRECTIVE, ON ITS COMPETENCE TO ACHIEVE ITS PURPOSE. MR GREEN IS SAYING THAT ALTHOUGH THE COUNCIL WHICH MADE THE REGULATION INTENDED IT TO BE DIRECTLY EFFECTIVE, IT WAS FOR THIS PURPOSE ULTRA VIRES BECAUSE THE METHOD OF LEGISLATION ADOPTED WAS NOT SUFFICIENTLY TRANSPARENT. FURTHERMORE, THE CRITICISMS WHICH ARE MADE OF THE LACK OF TRANSPARENCY OF THE PARMA HAM SPECIFICATION WOULD ALSO APPLY, ONE WOULD IMAGINE, TO EVERY OTHER SPECIFICATION BY REFERENCE TO WHICH A PDO OR PGI HAS BEEN REGISTERED. IT IS UNLIKELY THAT THE SPECIFICATION FOR BUXTON BLUE CHEESE IS MORE READILY AVAILABLE TO AN ITALIAN GROCER THAN THE SPECIFICATION FOR PARMA HAM TO AN ENGLISH ONE. THE REGULATION SPECIFICALLY CONTEMPLATES THAT REGISTRATION WILL BE BY REFERENCE TO A SPECIFICATION FOR WHICH NO PROVISION FOR PUBLICATION OR TRANSLATION IS MADE. SO THE ARGUMENT IS AN ATTACK ON THE VALIDITY OF THE ENTIRE SYSTEM OF PDO'S AND PGI'S CREATED BY THE REGULATION. IF YOUR LORDSHIPS REGARD SUCH A SUBMISSION AS ARGUABLE, IT WOULD HAVE TO BE REFERRED FOR DECISION TO THE EUROPEAN COURT. IN MY OPINION, HOWEVER, IT IS FOR A NUMBER OF REASONS NOT SO ARGUABLE.JUSTICE ARISING FROM THE DIFFICULTY OF OBTAINING A COPY OF THE SPECIFICATION. IF THE DEFENDANT NEEDED THE SPECIFICATION TO KNOW THAT THE GOODS INFRINGED AND COULD NOT REASONABLY HAVE BEEN EXPECTED TO OBTAIN A COPY, HE WOULD NOT BE LIABLE UNTIL THE RELEVANT PROVISIONS HAD BEEN COMMUNICATED TO HIM.JUSTICES WHICH MIGHT BE INFLICTED ON OTHER PEOPLE IF THE REGULATION WERE DIRECTLY ENFORCEABLE. I WOULD REJECT THIS ARGUMENT.LORDSHIPS THOUGHT THE POINT WAS ARGUABLE. BUT FOR MY PART, I DO NOT SEE HOW IT CAN BE.LORD SCOTT OF FOSCOTE. IN THE LIGHT OF HIS VIEWS, IT IS NOT POSSIBLE TO SAY THAT THE CONCLUSION WHICH I HAVE REACHED ON THE EFFECT OF THE REGULATION AND SPECIFICATION IS ACTE CLAIRE. SINCE THE CONCLUSION TURNS UPON THE CONSTRUCTION OF COMMUNITY INSTRUMENTS, IT IS THEREFORE NECESSARY FOR YOUR LORDSHIPS TO REFER THE QUESTION TO THE EUROPEAN COURT OF JUSTICE. I WOULD ADVISE YOUR LORDSHIPS TO REFER THE GENERAL QUESTION OF WHETHER, AS A MATTER OF COMMUNITY LAW, COUNCIL REGULATION (EEC) NO. 2081/92 READ WITH COMMISSION REGULATION (EC) NO 1107/96 AND THE SPECIFICATION FOR THE PDO "PROSCIUTTO DI PARMA" CREATE A VALID COMMUNITY RIGHT, DIRECTLY ENFORCEABLE IN THE COURT OF A MEMBER STATE, TO RESTRAIN THE RETAIL SALE AS "PARMA HAM" OF SLICED AND PACKAGED HAM DERIVED FROM HAMS DULY EXPORTED FROM PARMA IN COMPLIANCE WITH THE CONDITIONS OF THE PDO BUT WHICH HAVE NOT BEEN THEREAFTER SLICED, PACKAGED AND LABELLED IN ACCORDANCE WITH THE SPECIFICATION. A QUESTION FORMULATED IN SUCH TERMS SHOULD ENABLE THE RESPONDENTS TO PUT BEFORE THE COURT OF JUSTICE ALL THE GROUNDS UPON WHICH THEY SAY THAT NO SUCH COMMUNITY RIGHT EXISTS.LORD HOPE OF CRAIGHEADLORDS,LORD HOFFMANN. I AGREE WITH IT, BUT I ALSO AGREE THAT IT IS NOT POSSIBLE TO SAY THAT THE CONCLUSION WHICH HE HAS REACHED IS ACTE CLAIRE . I TOO WOULD REFER THE QUESTION WHICH HE HAS PROPOSED FOR A PRELIMINARY RULING BY THE EUROPEAN COURT OF JUSTICE.LORD CLYDELORDS,LORD HOFFMANN AND LORD SCOTT OF FOSCOTE I AGREE THAT IT IS NECESSARY FOR THIS HOUSE TO REFER A QUESTION ALONG THE LINES MENTIONED BY LORD HOFFMANN TO THE EUROPEAN COURT OF JUSTICE.LORD SCOTT OF FOSCOTELORDS,LORD HOFFMANN, HAS, IN HIS OPINION WHICH I HAVE HAD THE ADVANTAGE OF SEEING IN DRAFT, SET OUT MORE FULLY THE BACKGROUND TO THE CASE AND HAS DESCRIBED THE PURPOSE AND EFFECT OF COUNCIL REGULATION 2081/92. I NEED NOT REPEAT WHAT HE HAS SAID AND WILL CONFINE MYSELF TO REFERRING BRIEFLY TO THOSE MATTERS THAT SEEM TO ME OF PARTICULAR IMPORTANCE FOR THE PURPOSES OF THIS APPEAL.LORDSHIPS.LORD HOFFMANN WOULD GIVE, IS THAT THE PROHIBITION APPLIES UNTIL THE PRODUCT REACHES THE ULTIMATE CONSUMER. MY DIFFICULTY WITH THAT ANSWER IS THAT IT WOULD APPEAR TO PLACE RESTAURATEURS OR DELICATESSEN OWNERS IN BREACH OF THE PROHIBITION IN CIRCUMSTANCES TO WHICH, IN MY VIEW AT LEAST, THE PROHIBITION COULD NOT SENSIBLY HAVE BEEN INTENDED TO APPLY. ANOTHER POSSIBLE ANSWER IS THAT ONCE A PDO PRODUCT COMPLYING WITH ITS PRODUCT SPECIFICATION HAS BEEN MARKETED, ITS ELIGIBILITY TO HAVE THE PDO APPLIED TO IT IS ESTABLISHED ONCE AND FOR ALL AND IS NOT LOST BY A SUBSEQUENT RE-PACKAGING AND RE-MARKETING OF THE PRODUCT. OR THERE MAY BE SOME INTERMEDIATE LINE TO BE DRAWN.LORD HOFFMANN HAS ANALYSED THE ARGUMENT PRESENTED BY MR GREEN IN SUPPORT OF HIS CONTENTION THAT THE LAW BROUGHT INTO EFFECT BY A COMBINATION OF COUNCIL REGULATION 2081/92, COMMISSION REGULATION 1107/96 AND THE PARMA HAM PRODUCT SPECIFICATION IS INSUFFICIENTLY ACCESSIBLE AND TRANSPARENT. I RESPECTFULLY AGREE WITH HIS ANALYSIS AND NEED NOT REPEAT IT. I AM UNABLE HOWEVER, TO AGREE WITH MY NOBLE AND LEARNED FRIEND'S CONCLUSION.LORD HOFFMANN AT PAGE 32 OF HIS OPINION.