ECJ: Goods from Israeli-occupied territories must be labeled

Guiding principle?

Foodstuffs from territories occupied by the State of Israel must indicate their area of origin and, if they come from an Israeli settlement in the area, this origin must also be indicated

In detail

In its judgment Organisation juive européenne and Vignoble Psagot (C-363/18) of November 12, 2019, on the interpretation of Regulation (EU) No. 1169/20111, the ECJ ruled that foodstuffs from territories occupied by the State of Israel must indicate their area of origin and, if they come from a locality or an assembly of localities that constitutes an Israeli settlement within that area, must additionally indicate that origin.

The main proceedings, in which the Organisation juive européenne and Vignoble Psagot Ltd, on the one hand, and the French Minister for Economic Affairs and Finance, on the other, were opposed, concerned the legality of a decree on the indication of the origin of goods from the territories occupied by the State of Israel since June 1967, which requires the indications in question to be given for those foodstuffs. The decree was issued following the publication of a European Commission interpretative communication on the designation of origin of goods from these territories.

Findings of the ECJ

The Court held, first, that Articles 9 and 26 of Regulation No 1169/2011 require that the country of origin or place of provenance of a foodstuff be indicated where, in the absence of such indication, consumers might be misled because they would be led to believe that that foodstuff comes from a country or place other than its true country of origin or place of provenance. In addition, the indication of the country of origin or place of provenance on the food must not be such as to deceive the consumer.

Second, the Court explained how to interpret the terms “country of origin” and “country” and “territory” for the purposes of Regulation No. 1169/2011. In this respect, it stated that the concept of country of origin in Art. 2 para. 3 of the Regulation is defined by a reference to the Union Customs Code, according to which goods originating in a given “country” or “territory” are goods which have either been wholly obtained in that country or territory or have undergone there the last substantial transformation.

As regards the term ‘country’, which is often used as a synonym for ‘State’ in the EU and TFEU Treaties, the Court has held that, in order to ensure a coherent interpretation of Union law, it must be given the same meaning in the Union Customs Code and thus in Regulation No 1169/2011. The term “state,” in turn, refers to a sovereign entity that exercises within its geographical boundaries all the powers to which it is entitled under international law. With regard to the term “territory”, the Court stated that it is clear from the wording of the Union Customs Code that this term refers to entities other than “countries” and, consequently, other than “States”. In this context, the Court pointed out that consumers could be misled if foodstuffs indicated the State of Israel as the “country of origin” when in fact the foodstuffs originated in territories, each with its own status under international law distinct from that of the State of Israel, but occupied by that State and subject to limited jurisdiction of that State as an occupying power for purposes of international humanitarian law.

The decision

The Court therefore ruled that the indication of the region of origin of the foodstuffs in question is mandatory within the meaning of Regulation No. 1169/2011, in order to avoid consumers being misled as to the fact that the State of Israel is present in those territories as an occupying power and not as a sovereign entity.

As regards, thirdly and finally, the term ‘place of origin’, the Court considers that it must be understood as designating a specific geographical area in the country or region of origin of a foodstuff, with the exception of the address of the
food business. Therefore, an indication that a food product comes from an “Israeli settlement” in a “territory occupied by the State of Israel” may be considered an indication of a “place of origin” to the extent that the term “settlement” refers to a specific geographic location.

Moreover, on the question of whether the indication “Israeli settlement” is mandatory, the Court first noted that the settlements established in certain territories occupied by the State of Israel are characterized by the fact that they manifest a resettlement policy implemented by that State outside its territory in violation of the rules of international humanitarian law.

He then stated that without this indication, i.e. if only the area of origin is indicated, consumers could be misled. Indeed, consumers, in the absence of any information that could tell them about it, cannot know whether such food comes from a locality or a set of localities that constitute a settlement established in one of these areas in violation of the rules of international humanitarian law. However, according to Regulation
No. 1169/20118, the provision of information must enable consumers to make an informed choice, taking into account not only health, economic, environmental or social considerations, but also ethical considerations or those relating to respect for international law. In this regard, the Court has indicated that such considerations may influence consumers’ purchasing decisions.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.