Environmental protection as a mandatory requirement
Despite the broadening of the scope for trade-restrictive national measures through the case law of the Court of Justice, there was still at the beginning of the 1980s no clear recognition of environmental protection as a mandatory requirement. It was only in the middle of that decade that the Court made clear that protection of the environment may take precedence over the free movement of goods.
In the ADBHU or Waste Oil case, the Court of Justice found in 1985 that protection of the environment is one of the (now) EU’s essential objectives.54 It was, however, the so-called Danish bottle case, decided in 1998, that came to be seen as the landmark case firmly establishing environmental protection as one of the legitimate grounds for taking trade-restrictive measures outside the scope of Article 36 TFEU.55
The case concerned Danish rules to the effect that the marketing of beer and soft drinks was authorised only in re-usable containers that had been approved by the National Agency for the Protection of the Environment. Approval of new kinds of container could be denied, inter alia, if they were considered not technically suitable for a system for returning containers. An amendment to the rules made it possible to use certain non-approved containers for the marketing of quantities not exceeding 300,000 litres a year per producer and for drinks which were sold by foreign producers in order to test the market. However, non-approved metallic containers were not accepted and anyone wanting to use other non-approved containers was required to establish a deposit-and-return system for them76
The Court of Justice found the obligation to establish a deposit-and-return system for empty containers an indispensable element of a system intended to ensure the re-use of containers and therefore necessary to achieve the aims pursued by the Danish rulesTh However, by restricting the quantity of beer and soft drinks which could be marketed by a single producer in non-approved containers    
Denmark had failed, as regards imports of those products from other Member States, to fulfil its obligations under what is now Article 34 TFEU.58 The Court of Justice’s main objection to the Danish system seems to have been that it allowed the Danish authorities to refuse approval to a foreign producer even if the producer was prepared to ensure that returned containers were re-used.59
As regards proportionality between the national measures and the aim pursued, the Court dealt with this separately for the deposit-and-return system and for the requirement only to use approved containers. As noted previously, the deposit-and- return system was found to be necessary to achieve the aims pursued by the contested rules. The restrictions which it imposed on the free movement of goods were therefore not regarded as disproportionate.60 With respect to the requirement that, with some exceptions, only authorised containers be used for the marketing of beer and soft drinks, Denmark had argued that the existing deposit-and-return system would not work if the number of approved containers were to exceed thirty or so.61 The Court of Justice conceded that the existing system for returning approved containers ensured ‘a maximum rate of re-use and therefore a very considerable degree of protection of the environment since empty containers can be returned to any retailer of beverages’,62 but came to the conclusion that also the system for returning non-approved containers was capable of protecting the environment—although assumedly achieving less than a maximum rate of re-use—and that it, as far as imports are concerned, affected ‘only limited quantities of beverages compared with the quantity of beverages consumed in Denmark owing to the restrictive effect which the requirement that containers should be returnable has on imports’^3 In light of these circumstances, the Court deemed the restriction of the quantity of products which could be marketed by importers as disproportionate to the objective.
The Court of Justice seems to have defined a level of environmental protection which it considered reasonable and thus found trade-restrictive national measures that pursued a higher level of protection not acceptable. The implication of this would be that the Court is the ultimate arbiter of what level of environmental protection a Member State may lawfully pursue. However, the Court’s reasoning in this part is not particularly clear and seems also to have developed in subsequent case law.