On 21 June 2016, the Grand Chamber of the Court of Justice of
the European Union (the "ECJ") handed down a judgment in
response to a request for a preliminary ruling from the Ghent
Commercial Court (the "Commercial Court") regarding the
compatibility with European law of the Flemish Decree of 19 July
1973 on the use of languages in relations between employers and
employees, as well as in company acts and documents required by law
and by regulations (Decreet van 19 juli 1973 tot regeling van
het gebruik van de talen voor de sociale betrekkingen tussen de
werkgevers en de werknemers, alsmede van de door de wet en de
verordeningen voorgeschreven akten en bescheiden van de
ondernemingen – the "Decree") (ECJ, Case
C-15/15, New Valmar BVBA v. Global Pharmacies Partner Health
In line with the Laws of 18 July 1966 on the use of languages in
administrative matters (Wetten van 18 juli 1966 op het gebruik
van de talen in bestuurszaken/Lois du 18 juillet 1966 sur
l'emploi des langues en matičre administrative),
the Decree provides that legal persons having a place of business
in Flanders must use Dutch for all "company acts and
documents", such as cross-border invoices. Failure to use the
prescribed language results in such documents being legally null
The reference for a preliminary ruling was made in proceedings
between New Valmar BVBA ("New Valmar"), a company
established in Flanders, and Global Pharmacies Partner Health Srl
("GPPH"), an Italian company which had been acting as New
Valmar's exclusive concession-holder in Italy. In accordance
with the contract between the two parties, which was governed by
Italian law, New Valmar had drafted its invoices to GPPH in
Italian. After New Valmar had terminated the concession agreement
prematurely, it brought an action before the Commercial Court
seeking an order requiring GPPH to pay a number of unpaid invoices.
GPPH defended itself by (i) lodging a counterclaim to obtain
compensation for the wrongful termination of the concession
agreement; and (ii) contending that New Valmar's invoices were
null and void on the ground that they were not in Dutch. While New
Valmar conceded that its invoices violated the Decree, it claimed
that the Belgian legislation is contrary to, inter alia,
the EU provisions on the free movement of goods. The Commercial
Court decided to stay the proceedings and refer a preliminary
question to the ECJ.
Slightly reframing the originally referred question, the ECJ
examined whether Article 35 of the Treaty on the Functioning of the
European Union ("TFEU"), which prohibits measures having
equivalent effect to quantitative restrictions on exports, must be
interpreted as precluding language legislation such as the Decree
in the case at hand.
In its judgment of 21 June 2016 the ECJ held that language
legislation such as the Decree deprives traders of the possibility
to freely choose a language for drawing up their invoices which
they are both able to understand, thus increasing the risk of
disputes as to the validity of invoices and the non-payment of
invoices. The potential nullity would, moreover, result in loss of
default interest for the issuer of the invoice, as the newly issued
invoice in Dutch would not include the interest that would have
accrued from the original null invoice. Further, the ECJ ruled that
the impact of the Belgian legislation is not too indirect or
uncertain to warrant preclusion by Article 35 TFEU. Invoices, it
stated, are often the only concrete manifestation of contractual
relations and language legislation such as the Decree in question
are therefore likely to have an impact on those relations.
As for the presence of legitimate objectives in the public
interest, the ECJ acknowledged two objectives justifying the
language restriction, namely (i) the promotion of the use of one of
the official languages of an EU Member State; and (ii) the need to
protect the effectiveness of fiscal supervision. However, the ECJ
found that the language legislation in the case at hand was not
proportionate since an altered version of the Decree would be less
prejudicial to the free movement of goods while retaining public
interest goals. In its altered form, the Decree would require
invoices to be drawn up in Dutch, but would permit the drawing-up
of an additional authentic version of such invoices in a language
known to both parties.
For these reasons, the ECJ concluded that the Decree in its
current iteration constituted a disproportionate restriction of the
principle of free movement of goods laid down in Article 35
In light of this judgment, the Flemish legislator will now have
to review the Decree. In addition, the judgment of the ECJ is not
only binding on the referring court, but also on other courts in
other proceedings relating to the language requirements set out in
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