On October 6, 2017, the City of Amsterdam issued a so-called preparatory decision to curb the large number of "tourist stores" in its city center (zip code area 1012). It prohibits stores from transforming themselves in such a way as to target day trippers and/or tourists.
Soon the question arose "whether this could just be done. The Administrative Law Division answered that question on Dec. 19, 2018(ECLI:NL:RVS:2018:4173): the Amsterdam approach is allowed, but the cheese store that started these proceedings remains open.
What was going on?
During October 2017, the Cheese Company opened a new cheese store on the Damrak. The municipality of Amsterdam believes that the opening of this store violates its rules established in early October 2017, which put a stop to the expansion of tourist stores in the city center. The municipality is therefore taking enforcement action against the Cheese Company.
Restriction contrary to European law
In these proceedings, the Cheese Company argues that it was not possible for the municipality of Amsterdam to set rules prohibiting it from opening a cheese store. It argues that this is contrary to European regulations (the Services Directive) and a judgment of the Court of Justice of January 30, 2018(ECLI:EU:C:2018:44) on the 'Woonplein Appingedam', which is now well known in legal practice.
It follows from the Court's ruling that such restrictions can only be imposed if they are non-discriminatory, necessary and proportionate. Proportionality means that a measure must be appropriate to achieve an objective, but also that a measure must not go beyond what is necessary. According to the Cheese Company, the required conditions are not met.
Approach to tourist stores allowed
The Division does not go along with the Cheese Company's argument. In a nutshell, according to the Division, Amsterdam could consider the ban necessary for the livability of the city. The Division follows the municipality in its view that the approach to tourist stores is an appropriate method to achieve greater diversity in the retail offer. It also finds that the restriction does not go further than necessary.
Restriction no further than necessary
In particular, the question of whether a restriction does not go beyond what is necessary is often fodder for legal debate. In this case, the Division accepts this limitation for a number of reasons:
- The ban does not cover retail in general, but only tourist stores;
- The ban only freezes the existing supply of tourist stores; existing tourist stores will continue to exist;
- The municipal rules allow - in derogation of the rules - the new establishment of a tourist store.Since all legal requirements are met, the Division finds that the ban on establishment constitutes a "justified and proportionate restriction on the freedom to provide services."
Since all legal requirements are met, the Division finds that the ban on establishment constitutes a "justified and proportionate restriction on the freedom to provide services."
Approach allowed, but Cheese store may stay anyway
Although the Division concludes that Amsterdam's approach to tourist stores is permissible, the Cheese Company will keep its cheese store on the Damrak. Indeed, the Division finds enforcement action in this case unjustified.
Indeed, according to the Division, the Cheese Company is "disproportionately adversely affected" by the ban on new tourist stores, as it is disadvantaged more than other business owners in the area. A factor in this is that the Cheese Company had been in the process of starting up its store on the Damrak for a long time before the ban on new tourist stores was in place. For example, the Cheese Company had already signed a long-term lease, had already incurred high costs and began a short renovation immediately after completion. Furthermore, the city council was aware that the Cheese Company was working on a new storefront. Under these circumstances, the city council should not have applied the ban on new tourist stores to this Cheese Company branch.
Conclusion: critical test Department on retail restriction
In this ruling, the Division provides a very detailed justification as to why, in this particular "Amsterdam situation," clamping down on tourist stores is justified.
However, the ruling can be applied more broadly and provides a good tool for practitioners to assess whether a restriction in (retail) uses can stand a legal test. What is clear is that when a restriction is imposed, the Division will always critically assess whether it complies with European regulations, as, incidentally, is also evident from a ruling, also rendered on December 19, 2018, on the zoning plan "Bedrijventerreinen" of the municipality of Schijndel(ECLI:NL:RVS:2018:4196).
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