European Court says retail is a service, and planning restrictions must be proportional

(Content provided by EuroCommerce) In a long-awaited ruling in the Visser case last week, the Court of Justice confirmed that distributive trade (retail & wholesale) is to be considered a service activity within the meaning of the Directive.

Directive applies to all cases

It also said that the Directive applies to all cases, even when no cross-border element is present. In this case, the Court concluded that the Dutch municipality of Appingedam included a territorial restriction requirement (Services Directive, Art. 15(2) a) in its zoning plan. It rules that such restrictions needed to be non-discriminatory, justified by an overriding reason of public interest, and proportionate (Art. 15(3)). In this particular case, the Appingendam municipality laid down rules “in a zoning plan, pursuant to which certain geographical zones situated outside the city centre are exclusively designated for retail trade in bulky goods.”

Based on this, a retailer was prohibited from opening a clothing and shoe store outside the city centre. Appingedam argued that the ‘requirement’ was justified to maintain the viability of the city centre and to avoid there being vacant premises in the city, in the interest of good town and country planning. The Court of Justice recognised this could constitute a valid overriding reason of public interest, but left it to the High Supreme Court of the Netherlands to make a proportionality assessment of such restrictive requirements.