LUXEMBOURG (CN) — EU member states cannot ban each other from advertising pharmaceuticals across borders, the European Union’s high court ruled Thursday.
A Dutch website selling medication to French consumers is allowed to advertise in France, despite protests from French pharmacies that the advertising methods violate French law, the Court of Justice of the European Union wrote in its decision.
“The member state of destination of a service for the online sale of medicinal products cannot, in principle, restrict the free movement of health services information society from another member state,” the five-judge panel found.
The Dutch company, identified in the ruling as Company A, is a licensed pharmacy in the Netherlands and sells, via its website, a number of medications that do not require a prescription. The company, in part, targets its products to French consumers.
As part of an advertising campaign, Company A distributed leaflets to French households, a practice known as asilage in France, and targets customers online via sponsored search engine links.
French pharmacy owners, collectively referred to in court documents as Daniel B and Others, complained about the advertising campaign, calling it “unworthy of the pharmacy profession” and arguing that Company A was circumventing French advertising regulations that restrict marketing of pharmaceuticals in France.
A series of French court rulings found that because Company A is located in the Netherlands it is not subject to French regulations. Eventually, the Paris Court of Appeals referred the matter to the Luxembourg-based EU high court, questioning whether one nation could impose regulations on a company headquartered in another.
Under French public health code, pharmacists cannot encourage customers to misuse medications, cannot be paid for recommending medications and cannot use discounts to encourage the overconsumption of medication.
While the French government argued that the restrictions on advertising were in the interest of public health, the EU high court found they would “restrict the possibility for a pharmacy established in another member state to make itself known to its potential customers in this first member state and to promote the online sales service that it offers to the latter.”
As such, a ban on advertising in France “restrict[ed] the free movement of information society services from another member state.” The 27-member political and economic union allows for freedom of movement of goods and services across national borders to create a common market.
The Dutch company did not score a complete victory, however. The high court also determined member states can place limits on advertising and restrict promotional offers and those regulations can apply regardless of where a company is located.
The case now returns to the Paris Court of Appeals for a final decision.