Important judgment by the Court of Justice of the EU on retail zoning.

Article 3.1.2 of the Dutch Spatial Planning Decree states that to achieve good spatial planning a zoning plan may contain rules with regard to the zoning of retail and hospitality premises. Examples include furniture shops and DIY stores which, if specified in the zoning plan, are not allowed in city centres because their customers usually visit the shops by car, want to park in front of them and often want to buy large-sized products.

The European Services Directive states that governments must not erect barriers to trade. There must, in principle, be free movement of services. Until recently, the Services Directive did not relate to the retail sector, or at least did not provide any clarity in this regard. In light of this, the Administrative Jurisdiction Division of the Council of State submitted questions to the Court of Justice of the EU (CJEU) for a preliminary ruling on 30 January 2016.

The CJEU has now determined in its judgment of 30 January 2018 in the matter of Visser Vastgoedbeleggingen BV vs the municipality of Appingedam (CJEU 30 January 2018, ECLI:EU:C:2018:44) that the retail sector must be classified as a “service”. This means that the Services Directive also applies to the retail sector, even if all the relevant aspects are at play within a single member state. The result is that competent authorities, e.g. municipalities, must not include barriers to trade for the retail sector in zoning plans.

What does this mean for the regulations that permit this retail zoning? What does this mean for a zoning plan that lays down a specific form of retail zoning? Have they ceased to be binding? Can they be discarded?

No. The CJEU does consider retail zoning permissible if there are urgent reasons of public interest. A territorial restriction is acceptable, provided that the requirements for non-discrimination, necessity and proportionality, as defined in Article 15 (3) of the Services Directive, have been satisfied. For example, it may be necessary to include retail zoning regulations in a zoning plan in order to preserve the liveability of a town centre and prevent vacant buildings in inner-city areas.

Does this judgment change much?

Before the judgment, it was already laid down in existing legislation that retail zoning was only permitted to ensure good spatial planning. In other words, retail zoning can remain in place if there are good reasons for this. These good reasons must not relate to the regulation of competitive conditions.

In practice, this will not involve a zoning plan being declared non-binding any time soon. After all, the standard of “good spatial planning” largely covers the requirements of non-discrimination, necessity and proportionality. In addition, the establishment of a zoning plan pursuant to Section 3:47 of the General Administrative Law Act must always be accompanied by a statement of reasons. However, if there are not overriding reasons, this could still result in a zoning plan contravening the Services Directive and having to be declared non-binding.

More information
Do you have any questions about this subject? Would you like more information? If so, please contact Herm Lamers, lawyer in the Administrative Law team and spatial planning expert. You can of course also contact one of the other lawyers in our Administrative Law team

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