The Court of Justice of the EU Rules on the Labelling of Products Originating in the Occupied Territories by the State of Israel

In the judgement Organisation juive européenne and Vignoble Psagot v. Ministre de l’Économie et des Finances, delivered on 12 November 2019, the Grand Chamber of the Court of Justice of the European Union (CJEU) ruled on the interpretation of the EU Regulation in relation to foodstuffs produced in the territories occupied by the State of Israel since June 1967. The Court found that these products not only have to bear the indication of the territory of origin, but also specify if they come from an Israeli settlement within that territory, if that is the case.

The main proceedings from which the preliminary reference arose, concerned the legality of the Ministerial Notice implementing the 2015 European Commission’s Interpretative Notice on the indication of the origin of goods originating in the territories occupied by Israel since June 1967, according to which foodstuffs must be labeled with the indication in question. The two applicants brought an action before the Conseil d’État (France) asking for the annulment of the Ministerial Notice and arguing that this did not comply with the Regulation No 1169/2011, the primary piece of EU legislation relating to food information and labelling. The national court referred to the CJEU the question whether the Regulation requires the indication of the origin from the occupied territories and if it is likewise needed the specification that products come from an Israeli settlement, when this is the case. The importance of labelling in this case is due to the broader context of EU-Israel trade relations as products originating in Israeli settlements still have access to the EU market but do not enjoy the preferential tariffs treatment under the 2000 EC-Israel Association Agreement.

In the case at issue, the Grand Chamber established that under the EU Regulation, foodstuffs originating in the territories occupied by the State of Israel since June 1967 must bear both the clear indication of the “Occupied territory” and the specific indication of its provenance from an “Israeli settlement”. In other words, the Court identified an obligation on the Member States to accurately label the products at issue, which implies de facto upgrading the status of the 2015 Commission’s interpretative notice (which only provided non-binding guidance to Member States) into a binding source of EU law. Hence, since the CJEU case law is a primary source of EU law with binding effect on all courts in EU countries, any potential Member State’s non-compliance with it may further give raise to an infringement procedure.

Click here to read our analysis and implications of the Psagot case.

Photo: A hearing of the CJEU Grand Chamber (Source – Court of Justice of the European Union)