Under EU Council Regulation 1234/2007 “butter” cannot be used in respect of a product with over 16% water content. So the permitted marketing of “Butter Spread” in the Czech Republic when it was up to 58% water was challenged. Thomas Spanyol reports the ultimate CJEU verdict.
Who: Czech Republic, European Commission
Where: Court of Justice of the European Union ('CJEU')
When: 18 October 2012
Law stated as at: 18 October 2012
Following in the historic footsteps of the well-reported EU 'Butter Mountain' saga, this month dairy-related matters have brought the economic union into the (legal) news again with the handing down of the CJEU's ruling in European Commission v Czech Republic (C-37/11).
Marketing butter in the EU
The facts behind this case date back to 2007 and concern the marketing of a popular and well-known type of spread in the Czech Republic called Pomazánkove máslo ('butter spread'). This product fell foul of EU Regulation 1234/2007 (the 'Regulation'), which sets specific standards relating to use of the designation 'butter' in the marketing of fats. The Regulation specifies that only fat products with:
- a milk-fat content of between 80 and 90%,
- a maximum water content of 16% and
- a maximum dry non-milk-fat material content of 2% can be designated as 'butter', subject to an exception for fat products 'the exact nature of which is clear from traditional usage and/or when the designations are clearly used to describe a characteristic quality of the product' as listed on a list of exceptions drawn up by the Commission in Annex I of Regulation EC 445/2007 ('Annex I').
The EU believes it's not butter
Pomazánkove máslo's vital statistics fall well short of the requirements for butter, containing as it does:
- a minimum fat content of 31% by weight,
- a water content of up to 58% and
- a minimum dry material content of 42%.
Under the Regulation, this product should be described in Czech as Mléčná pomazánka X% ('dairy spread', indicating the percentage of dairy product). However, the existing Czech legislation allowed this product to be marketed as butter spread, and the Czech Republic did not alter this to take account of the Regulation. As such the Commission brought an action before the CJEU against the Czech Republic for non-compliance.
Why did the Czechs not comply?
In their case before the CJEU, the Czechs relied on the following arguments:
1. the Czechs had failed to get Pomazánkove máslo included in Annex I when it was being drawn up. They blamed this on procedural error on the part of the EU. As such, by trying to enforce the Regulation against the Czech Republic the Commission was relying on its own default, and the action was therefore inadmissible and unlawful;
2. the Czechs also argued that the exception in the Regulation in fact applied to any product 'the exact nature of which is clear from traditional usage and/or when the designations are clearly used to describe a characteristic quality of the product', not just products in Annex I. Running this argument, the Czechs were in effect saying that consumers were well aware that butter spread was not the same thing as butter, and/or that consumers were aware that the 'butter' portion of the name of the spread described a quality of the product.
What did the CJEU think?
The CJEU was not impressed with either argument. Its judgement made clear that the issue causing the present action was the Czech Republic not complying with the Regulation. There was nothing in the Treaty that allowed Member States to challenge procedural adequacy in this way as a defence to non-compliance with a Regulation. The only exception to this would be if the Regulation itself could be shown to be so manifestly flawed it could be categorised as 'a non-existent act'.
If the Czechs wished to challenge the lawfulness of the Commission's decision not to include Pomazánkove máslo in Annex I, they would need to do this separately through the correct procedure. They had not done so, so even if the decision not to include it had been a procedural error, this would not call into question the present existence of the Regulation or Pomazánkove máslo's present absence from Annex I.
The CJEU gave equally short shrift to the argument that products not on Annex I but satisfying the criteria in the Regulation could be marketed as butter. It was not for individual Member States to decide what would and would not qualify – the list of exceptions had been drawn up for a purpose. It is possible for Member States to apply to the Commission to add products to Annex I; the Czechs had done so, but the application had twice been rejected.
The Czechs therefore lost on both counts, had to pay the Commission's costs and (presumably) instruct all Pomazánkove máslo producers to undertake a rebranding exercise.
Why this matters:
The United Kingdom currently has a handful of items on the exception list in Annex I. Those looking forward to Christmas or their next birthday cake will be pleased to know that these include 'Brandy butter’, ‘Sherry butter’ or ‘Rum butter’: for a sweetened, alcoholic product with a minimum milk-fat content of 20% and ‘Buttercream’: for a sweetened product with a minimum milk-fat content of 22.5%.
However Czech Republic v Commission underlines that the Commission has strictly limited the use of the term 'butter' in the marketing of fats to products that either comply with the specification in the Regulation or are in Annex I, and is not afraid to go after Member States to ensure compliance.
Some may view this approach as making butter mountains out of molehills, but manufacturers of spreads featuring the word 'butter' sold in the UK should nonetheless be aware of this ruling and take steps to ensure that their marketing is not likely to raise eyebrows in Brussels.