Introduction to Law

from this deal. The second seller will not sell his car and will therefore not be stimulated to

build more cars.

If the buyer and the second seller are in the same country, while the first seller is in a

different country and for that reason is prohibited to sell the car to the potential buyer, the

buyer must pay€1,000 “too much.” Moreover, the expensive car builder will be stimulated

to continue building cars, even if he cannot do so efficiently. Free trade stimulates the

creation of products by those who can do so most efficiently, and promotes that consumers

do not have to pay more than what is necessary. The money they save can used to buy

something else, thereby stimulating the economy even more.

Preservation of Peace Secondly, if there is intensive trade between two countries
that benefits the inhabitants of both countries—and we have seen above that it
does—it is less likely that the two countries will wage war against each other. Both
reasons are good reasons to have a single internal market within the EU, where
potential traders are not hindered by boundaries between countries.

Four Freedoms To stimulate this single internal market, the EU has proclaimed
the “four freedoms,” the free movement of

1. goods,


2. persons,


3. services, and


4. capital.

10.5.2 Free Movement of Goods

Quantitative RestrictionsThe EU uses several approaches to encourage the free
movement of goods. One of them is to prohibit quantitative restrictions on trade
or—in general—movement of goods between EU Member States:

Quantitative restrictions on imports and all measures having equivalent effect shall be

prohibited between Member States (Article 34 TFEU).

Taxes Another one is prohibition of taxes, in a broad sense, on the transportation
of goods from one Member State to another. Article 28, Section 1 TFEU states it as
follows:

The Union shall comprise a customs union which shall cover all trade in goods, and which
shall involve the prohibition between Member States of customs duties on imports and
exports and of all charges having equivalent effect, and the adoption of a common customs
tariff in their relations with third countries.
If the movement of a good from one country to another country is taxed, this
raises the price of this good in the country to which it is moved. As a consequence,
similar products that did not have to be imported can be relatively cheaper. This
hampers trade between the two countries and therefore is forbidden.

Van Gend & Loos, (CJEU Case C-26/62)

TheVan Gend & Looscase, which has become famous for other reasons (see Sec-

tion10.6.4), can illustrate this point. The Van Gend & Loos company imported a chemical

10 The Law of Europe 223