79
UDC: 366.54:347.72
 366.6
Janja Hojnik
*
Our First: Legality of Public Measures  
to Enhance Consumer Ethnocentrism  
from the EU and WTO Perspective
1. Introduction
T rade liberalisation contributes to better allocation of resources, economic prosperity 
and a higher standard of living. Hence, it is perceived as a positive development by most 
countries of the world that are members of the World Trade Organization (WTO).
1
 
However, domestic producers call for governmental support, and governments often 
embrace economic protectionism to this end, thereby restraining free trade. The cur-
rent post-crisis period is no exception in this respect. In the present circumstances and 
despite general globalisation trends, product nationality is becoming one of the crucial 
marketing, legal and macro-economic policy aspects. In such circumstances, consumer 
ethnocentrism is a highly desired behaviour on the (domestic) market. To enhance its 
economic advantages, commercial entities, their associations and state authorities take 
advantage of available mechanisms to boost it. In this respect, various advertising tech-
niques are used which rely on consumer patriotism, such as buy domestic and buy local 
campaigns, as well as quality marks assigned to products of domestic origin to attract 
the attention of consumers. Such campaigns and quality marks imply that domestic 
products are generally of better quality than imported ones and should thus be preferred 
by the consumers, without corresponding tests that would prove this to the consumers. 
* 
Dr. iur., Professor of Law at the University of Maribor Faculty of Law; janja.hojnik@um.si.
1
 See e.g. Perišin, Free Movement of Goods and Limits of Regulatory Autonomy in the EU 
and WTO (2008), pp. 1–2.
4

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Zbornik znanstvenih razprav – LXXIX. letnik, 2019, Perspektive prava Evropske unije
The consumers’ support of domestic products in supermarkets will, in turn, improve 
their own position as workers, guaranteeing them jobs and prosperity. These campaigns 
and quality marks result in the establishment of two classes of products—domestic and 
foreign—and are hence openly discriminatory since they indirectly refer to the high 
(domestic) and low quality (imported) of products.
But how does the above come into line with free trade agreements signed by most of 
the contemporary states? The WTO General Agreement on Tariffs and Trade (GATT) 
provides that products of the territory of one Member State that are imported into the 
territory of any other Member State must be accorded treatment that is no less favoura-
ble than that accorded to like products of national origin (Article III:4 GATT). Do the 
buy domestic campaigns not place imported products at a disadvantage prohibited by this 
very provision? Furthermore, Article 18 of the T reaty on Functioning of the EU (TFEU) 
states that any discrimination on the grounds of nationality is prohibited within the EU. 
Further, Article 21 TFEU proclaims that it is an aim of the EU to establish and ensure 
the functioning of the internal market, which is defined as an area without internal 
frontiers in which free movement of goods, persons, services and capital is ensured. If 
one or several EU Member States promote the purchase of domestic products, is it still 
possible to claim that there are no internal frontiers on the “single” market? What about 
European Commission’s promotion campaigns of European and local?
The article discusses the consistency of publicly sponsored buy domestic campaigns 
that have widely spread in the past years, with the WTO and EU legal principles that 
have been adopted by the respective governments. These campaigns are in many aspects 
discriminatory. Furthermore, the promotion of negative stereotypes concerning foreign 
goods does not differ very much from discrimination or even racism against individuals 
who do not possess the nationality of a particular country. The purpose of the article is 
to assess the legality of this form of discrimination concerning two multilateral economic 
treaties: GATT and the TFEU.
2. Product Nationality and Consumer Ethnocentrism
The functions of product nationality (or country of origin) and the nationality of 
individuals are quite similar. While the authorities learn about individuals by inspecting 
their passports, consumers similarly learn about product nationality from product label-
ling, advertisements, word-of-mouth and based on their own experiences with particular 
product categories.
2
 In the field of marketing science, various theories have been deve-
loped assessing the significance of this information, such as the categorisation theory 
2
 Dmitrovic, Vida, Consumer Behaviour Induced by Product Nationality: The Evolution of the Field 
and Its Theoretical Antecedents (2010), pp. 145, 151.

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Janja Hojnik – Our First: Legality of Public Measures to Enhance Consumer 
Ethnocentrism from the EU and WTO Perspective
and the halo effect theory.
3
 Evaluations based on product nationality are often driven by 
consumers’ stereotypes about a product category. Consumers make use of such genera-
lisations to simplify their efforts in the selection procedure or when they are unable to 
get sufficient information about the quality of the product prior to purchasing. Product 
nationality thus serves as a concept that represents the consumers’ accumulated knowled-
ge of the brands from that country.
4
 Bruning argued that providing consumers with 
information about a product’s nationality invokes specific socio-psychological processes 
that stem from various consumer ideologies.
5
 As found by Askegaard and Ger, consumer 
knowledge of the nationality of the product may evoke powerful imagery of the country, 
its people, their culture, etc.—images that may positively or negatively influence their 
purchasing attitude.
6
 Individuals’ identification with their social “in-group” (family, na-
tion, etc.) and their emotional attachment to it often results in discriminatory behaviour 
towards the “out-group”.
7
 Consumer rejection of products from a specific country may 
be the result of some negative historical experiences (e.g. wars), political relations, etc., 
irrespective of the quality judgements attributed to its products. Such rejection may also 
be the result of general public opinion that domestic/imported products are of superior/
inferior quality. Positive stereotypes about domestic products and negative stereotypes 
about foreign products are usually referred to as “consumer ethnocentrism”.
Ethnocentrism reflects a belief that an individual’s ethnic group is centrally impor-
tant and all other groups are measured by the standards of their own culture.
8
 The term 
ethnocentrism was introduced by the American sociologist Sumner who defined it as 
“the technical name for (the) view of things in which one’s own group is the centre of 
everything, and all others are scaled and rated with reference to it”.
9
 He further chara-
cterised it as often leading to pride, vanity, beliefs of one’s own group’s superiority and 
contempt of outsiders. In the research of consumer opinion towards foreign products a 
concept of consumer ethnocentrism evolved, describing the latter as “beliefs accepted 
from the consumer about the appropriateness, that is, morality of the purchase of foreign 
3
 Starting with E Dicher, ‘World Customes’ (1962) 40 Harvard Business Review 113. For a 
literature overview see  Dmitrovic, Vida, Consumer Behaviour Induced by Product Nationality: 
The Evolution of the Field and Its Theoretical Antecedents (2010).
4
 See e.g. Dinnie, Country-of-Origin 1965-2004: A Literature Review (2004), p. 165; Ahmed and 
others, Does Country of Origin Matter for Low‐involvement Products? (2004), p. 102.
5
 Bruning, Country of Origin, National Loyalty and Product Choice: The Case of International Air 
T ravel (1997), p. 59.
6
 Askegaard, Ger, Product-Country Images: Towards a Contextualized Approach (1998).
7
 Dmitrovic, Vida, Consumer Behaviour Induced by Product Nationality: The Evolution of the Field 
and Its Theoretical Antecedents (2010), p. 154.
8
 Andersen, T aylor, Sociology (2008), p. 67 et seq.
9
 Sumner, Folkways – A Study Of The Sociological Importance Of Usages, Manners, 
Customs, Mores And Morals (2013), p. 13.

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products”.
10
 Shimp defines consumer ethnocentrism as a concept under which consu-
mers believe in
“the superiority of their own countries’ products. This perception is postulated to 
transcend mere economic and functional considerations, and, instead, to have a 
more noble foundation rooted in morality. That is, consumer ethnocentrism is in-
tended to capture the notion that some consumers believe it is somehow wrong to 
purchase foreign-made products, because it will hurt the domestic economy, cause 
the loss of jobs, and, in short, because, from their view, it is plainly unpatriotic”.
11
It is for these reasons that consumer ethnocentrism negatively influences the appraisal 
of foreign products and willingness to buy them.
Although the concept of consumer ethnocentrism was introduced and used for the 
first time in studies relating to American consumers, it was later revealed that it is by 
no means limited to a single culture or single scientific discipline. It was researched 
according to the size of individual markets (small versus large markets), the gender of 
the consumers, their degree of education, etc.
12
 Additionally, consumer ethnocentrism is 
rapidly taking centre stage in the field of market law research. In contrast with marketing 
research, legal research does not concentrate on positive stereotypes about domestic go-
ods that are the result of consumers’ direct cognitive processes and their past experience 
with domestic goods, nor on experiences which are the result of consumers’ general social 
opinion, but rather on consumer ethnocentrism that is the result of domestic compani-
es’, trade associations’ and state authorities’ promotional campaigns emphasising positi-
ve attributes of domestic goods, thereby building positive stereotypes among domestic 
consumers. In this respect, one must foremost distinguish between private and public 
campaigns. In the recent economic crisis, both forms were considerably widespread.
10
 Shimp, Consumer Ethnocentrism: The Concept and a Preliminary Empirical Test (1984), p. 285.
11
 Ibid.
12
 See e.g. Chasin, Holzmuller, Jaffe, Stereotyping, Buyer Familiarity and Ethnocentrism: A Cross-
Cultural Analysis (1989), p. 9; Han, The Role of Consumer Patriotism in the Choice of Domestic 
versus Foreign Products (1988), p. 25; Klein, Us versus Them, or Us versus Everyone? Delineating 
Consumer Aversion to Foreign Goods (2002), p. 345; Küçükemiroğlu, Market Segmentation by 
Using Consumer Lifestyle Dimensions and Ethnocentrism (1999), p. 470; Moon, The Roles of 
Consumer Ethnocentricity and Attitude toward a Foreign Culture in Processing Foreign Country-
of-Origin Advertisements (1996); Supphellen, Rittenburg, Consumer Ethnocentrism When 
Foreign Products Are Better (2001), p. 907; Watson, Wright, Consumer Ethnocentrism and 
Attitudes toward Domestic and Foreign Products (2000), p. 1149.

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Janja Hojnik – Our First: Legality of Public Measures to Enhance Consumer 
Ethnocentrism from the EU and WTO Perspective
3. Campaigns Promoting the Purchase of Domestic Goods
3.1. Private Campaigns Promoting Consumer Ethnocentrism
In almost any state, one can find private campaigns, run by workers’ or companies’ 
associations encouraging consumer ethnocentrism. They all share very similar reasoning.
In 1977, when unemployment rates in Canada were the highest since the 1930s, 
workers across the country pressed the government to lend a helping hand. Using radio 
programmes, textile workers in Quebec were convinced that at the heart of the ma-
tter was buying Canadian—claiming that Canadians must help one another by buying 
goods made by their neighbours.
13
 In 2008, when the latest economic crisis evolved, an 
association Buy Canadian First was established. Its mission was to promote Canadian 
companies, their services and products. Although the associations’ goal was initially to 
create a website informing consumers which products are made in Canada and whe-
re they can be purchased, nowadays the company has evolved into a Marketing and 
Advertising agency specialising in  Made in Canada campaign. In addition to emphasi-
sing the positive effects of buying Canadian for the Canadian economy, environment, 
health, labour standards and the community, the movement also stresses:
“Love of Country shouldn’t stop at flying a flag or wearing red and white. We 
have every reason to be proud of our country, including the wonderful products 
we make here. Some consumers buy Canadian over foreign-made as a matter of 
principle alone. We see a ‘Made in Canada’ label as a badge of honour; one we’re 
proud to contribute to and want others to know about. Buying products made in 
Canada makes us proud!”
14
In Ireland, a company Guaranteed Irish is presently conducting a campaign “to in-
crease awareness of, and demand for, Irish products and services”. The explicit goal of 
the campaign is to maximise employment and prosperity in Ireland. The campaign is 
run by “like-minded business people as a non-profit organisation to educate, network, 
innovate and support our members and consumers”. At the same time, it is trying to bo-
ost consumer interest, awareness and passion for the Guaranteed Irish ethos and symbol 
and consequently assist their members in increasing their market share. The campaign 
emphasises that Irish consumers
“feel good about buying Irish and the Guaranteed Irish symbol helps them to do 
this while regular PR and Advertising campaigns remind them. Through schools 
we are hoping a whole new generation of consumers who are proud to buy Irish.”
15
13
 See URL: http://archives.cbc.ca/economy_business/consumer_goods/topics/3692/. 
14
 See Why Buy Canadian First?, URL: http://www.buycanadianfirst.ca/why-buy-canadian-first.
15
 Guaranteed Irish, URL: http://www.guaranteedirish.ie; see also: Guide to Enterprise in Dublin 
City – Guaranteed Irish, URL: http://www.dcebenterpriseguide.com/directory/Guaranteed-Irish. 

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Zbornik znanstvenih razprav – LXXIX. letnik, 2019, Perspektive prava Evropske unije
Since 2008, the Slovenian Chamber of Agricultural and Food Enterprises has been 
conducting a campaign I buy Slovenian. The purpose of the campaign is to
“remind Slovenian consumers of the possibility to choose when standing before the 
supermarket shelves and of the importance of buying domestic, Slovenian produ-
cts for growth and stability of the domestic economy.”
The campaign is founded on five main pillars: quality, safety, taste, tradition and job 
preservation. The Chamber emphasises that Slovenian consumers and companies must 
be aware of the fact that a successful and stable domestic economy is a conditio sine qua 
non for operations on the global market; this, among other things, requires the preser-
vation of jobs and purchasing power—“a consumer must first earn to spend”, they say. 
Additionally, the Chamber points out that encouragement to buy Slovenian food is also 
important for the preservation of certain Slovenian values, customs and traditions, but 
foremost for the preservation of the Slovenian national identity.
16
3.2. Public Campaigns to Promote Consumer Ethnocentrism
From the perspective of market law, ethnocentric consumer campaigns that can be 
ascribed to public authorities are of much greater importance than the private ones. 
For centuries, states have intervened in cross-border exchange to limit import and bo-
ost export to gain trade surplus.
17
 They intervene on the market to optimise the in-
come section of their respective national budgets. States hold various direct and indirect 
tools to increase domestic demand. The most common way for public authorities to 
protect domestic production is through protectionist public procurement legislation 
and/or practice. In this respect, states themselves behave in an ethnocentric manner 
when playing the role of the purchaser on the market. Two such examples are the Buy 
American Act
18
 passed in 1933 by Congress and signed by President Roosevelt, which 
required the United States government to give preference to the U.S.-made products 
in its purchases. More recently, “Buy American” provisions have been included in the 
American Recovery and Reinvestment Act of 2009. Section 1605 of Title XVI provides 
that unless one of three listed exceptions applies (non-availability, unreasonable cost, and 
inconsistency with public interest) and a waiver is granted accordingly, none of the funds 
appropriated or otherwise made available by the Act may be used for a project for the 
Likewise, e.g. Danish furniture is promoted by a campaign “Buy Danish”, URL: http://www.
buydanish.dk/.
16
 More in Hojnik, Promotion of Agricultural and Food Products in Slovenia: Enhancing Consumer 
Ethnocentrism (2011), p. 269.
17
 Appleyard, Field, International Economics (2016), pp. 19–26.
18
 BAA - 41 U.S.C. §§ 10a–10d.

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Janja Hojnik – Our First: Legality of Public Measures to Enhance Consumer 
Ethnocentrism from the EU and WTO Perspective
construction, alteration, maintenance, or repair of a public building or public work un-
less all the iron, steel, and manufactured goods used are produced in the United States.
19
Furthermore, even when governments are not buying goods or services directly, they 
can influence private entities to purchase in an ethnocentric manner. Such influence 
can be either formal or informal. Formal influence is portrayed as a legal requirement 
to purchase certain domestic goods. The EU Court case-law provides an example of 
the Irish minister for industry and energy, who demanded, under powers conferred to 
him under the Fuels Act, that any importer of any of the various petroleum products to 
purchase a certain proportion of its requirements of petroleum products from the INPC 
at a price to be determined by the minister. The share capital of the INPC was owned by 
the Irish state who was, in turn, the sole owner of the only refinery in Ireland.
20
 Another 
form of formal (coercive) encouragement to buy domestic goods is a legal requirement 
for the goods on the domestic market to hold a country of origin label. As the EU Court 
held in the UK “made in” case:
21
“It has to be recognized that the purpose of indications of origin or origin-marking 
is to enable consumers to distinguish between domestic and imported products and 
that this enables them to assert any prejudices which they may have against foreign 
products. […] Within (the common) market, the origin-marking requirement not 
only makes the marketing in a Member State of goods produced in other Member 
States in the sectors in question more difficult; it also has the effect of slowing down 
economic interpenetration in the Community by handicapping the sale of goods 
produced as the result of a division of labour between Member States.”
On the other hand, informal (non-coercive) influence on consumers includes recommen-
dations (rather than obligations) of domestic purchase using various ethnocentric mar-
ket campaigns. State measures to encourage consumer ethnocentrism are particularly 
widespread in harsh economic times when states abjure their free-trade commitments.
In this respect, the U.S. Department of Agriculture (USDA) has launched the Know 
Your Farmer, Know Your Food initiative. Its agenda is to give local foods more promi-
nence on the dinner plates of American citizens in line with the then President Obama’s 
commitment to strengthen local and regional food systems.
22
 In this regard, farm to 
school programmes were launched in 48 states while agricultural branding programmes, 
such as Jersey Fresh, Simply Kansas, or Local First Utah, were introduced in all the U.S. 
50 states. The campaign Local First Utah, for instance, emphasises that “when you buy 
locally in your Utah community, more of your dollar remains in that local community, 
making it more sustainable, diverse, and dynamic”.
23
More recently, the current U.S. President Donald Trump launched a booming cam-
paign America First, where it has been pointed out that “the President understands how 
critical it is to put American workers and businesses first when it comes to trade” and 
23
 See Local First, URL: http://www.localfirst.com.

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Zbornik znanstvenih razprav – LXXIX. letnik, 2019, Perspektive prava Evropske unije
that “by fighting for fair but tough trade deals, we can bring jobs back to America’s sho-
res, increase wages, and support U.S. manufacturing.”
24
 This policy was supplemented 
with Buy American policy, thereby signing a Buy American, Hire American executive or-
der aimed at cracking down on skilled worker visa abuse and forcing the US government 
agencies to buy more domestically produced products. The order calls for the federal 
government to strengthen its various Buy American provisions that give preference to 
domestically produced products.
25
Several measures and campaigns to promote domestic production can also be found 
throughout Europe, although they have not been as booming as the American ones. 
Information provision and promotion measures for agricultural products on the EU 
internal market and in third countries are regulated by a special Council Regulation 
No. 3/2008.
26
 Based on this Regulation, the EU co-finances promotional campaigns that 
highlight the quality, nutritional value and safety of the EU farm products and food. The 
campaigns can be run inside the EU or beyond its borders to open up new markets for 
the EU farmers. Even though the Regulation prohibits the promotion of products based 
on their (national or regional) origin,
27
 in its 2011 Green Paper on promotion measures 
for agricultural products, the Commission emphasised that:
“Regional and local markets are an essential meeting place for producers and 
consumers. They enable the former to receive the rewards for their labours more 
efficiently and the latter to contribute to the development of their local areas, redu-
ce the environmental impact of their consumption habits and access a wide variety 
of products rooted in their traditions and ways of life.”
28
The Commission stressed that the quality of Europe’s agricultural and agri-food 
products is widely acknowledged, emphasising that as a result of tradition, know-how 
and innovative abilities of producers, the European model is also the legacy of a strong 
Common Agricultural Policy and of standards of production unmatched anywhere in 
the world. It furthermore added that the EU has a culinary heritage of great diversity that 
24
 America First Foreign Policy, URL: https://www.whitehouse.gov/america-first-foreign-policy.
25
 Waldmeir, Donnan, Donald T rump Signs ‘Buy American, Hire American’ Order, URL: https://
www.ft.com/content/fa3f6cc4-246e-11e7-8691-d5f7e0cd0a16. 
26
 Council Regulation (EC) No 3/2008 on information provision and promotion measures for 
agricultural products on the internal market and in third countries, OJ 2008 L3/1.
27
 See Article 1(2) of the Council Regulation (EC) No  3/2008 on information provision and promotion 
measures for agricultural products on the internal market and in third countries, OJ 2008 L3/1 
and Article 4(2) of the Commission Regulation (EC) No 501/2008 laying down detailed rules for 
the application of Council Regulation (EC) No 3/2008 on information provision and promotion 
measures for agricultural products on the internal market and in third countries, OJ 2008 L147/3.
28
 European Commission, Green Paper on promotion measures and information provision for 
agricultural products: a reinforced value-added European strategy for promoting the tastes of 
Europe (2011), para. 3.1.

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Ethnocentrism from the EU and WTO Perspective
should be exploited to the full. Taking into consideration, on the one hand, that these 
advantages of the EU products have not yet been sufficiently promoted and the surfa-
cing of new competitors in the traditional EU and emerging markets on the other, the 
Commission endorsed a new promotion and information strategy to promote Europe’s 
agriculture sector “which delivers food security, a sustainable use of natural resources 
and more dynamic rural areas”. Because buy domestic campaigns are conducted in the 
EU trading partners, the EU does not want to fall behind. It is thus the Commission’s 
responsibility to strengthen the EU agricultural production on the global market:
“Consumption of European products needs to be encouraged, on the one hand, 
by promoting the image of the products and, on the other, by raising awareness 
of Europe’s quality systems among consumers and among producers […] Europe 
must use all of its energy to promote its specialities and its production methods 
in the same way as its main trade partners (United States, Australia, Canada, etc.) 
are doing”.
29
Moreover, in 2016, The Commission launched Enjoy, it’s from Europe promotion 
programme, offering funds to support promotion of European products on international 
markets.
30
 The Commission presents it as a promotion policy that helps producers sell 
their EU farm products in an increasingly competitive global marketplace, at the same 
time as delivering jobs and growth at home.
31
 Although the EU internally promotes the 
“single market having the characteristics of a domestic market”,
32
 boosting consumer 
ethnocentrism is still a considerably widespread practice in the EU Member States. The 
most famous campaign in the EU territory was that of the Irish Government, run thirty 
years ago, which established the Irish Goods Council responsible for the encouragement 
of all classes of purchasers within Ireland to choose Irish products over the imported 
ones. In this respect, a wide-ranging advertising campaign was conducted, in which 
purchasers were encouraged to give preference to goods bearing the Guaranteed Irish la-
bel. Around the same time, the Greek government also launched a Buy Greek campaign. 
Its aim was to cut down the flow of luxury imports, thereby reducing unemployment 
and a huge trade deficit. A press and television campaign launched by the Greek Goods 
Promotional Board was followed by special discount offers in stores selling Greek-made 
consumer goods.
Based on the German law on the creation of a central fund for the promotion of 
German agricultural, forestry and foods sector (Absatzfondsgesetz – AFG), a central body 
(Centrale Marketing-Gesellschaft – CMA) adopted a special quality label (Markenqualität 
29
 Ibid., para. 3.2.1. and 4.1.
30
 European Commission – Press release, “Enjoy, It’s from Europe”: Over €100 Million to Promote 
European Agriculture in 2016, URL: http://europa.eu/rapid/press-release_IP-15-5804_en.htm.
31
 See Promotion of EU farm products, URL: https://ec.europa.eu/info/food-farming/promotion_en. 
32
 Case C-207/83, Commission v United Kingdom, ECLI:EU:C:1985:161, para. 17.

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Zbornik znanstvenih razprav – LXXIX. letnik, 2019, Perspektive prava Evropske unije
aus deutschen Landen) in 1993, the use of which was reserved for products which were 
produced in Germany. Similarly, the Austrian Agrarmarkt Marketing GmbH (known as 
AMA Marketing), established by the Austrian Ministry for Agriculture, nowadays issues 
a quality seal AMA-Gütesiegel – Geprüfte Qualität Austria, which guarantees that the 
food was produced in Austria. Similar state-sponsored quality marks can also be fou-
nd in Hungary (Kiváló Magyar Élelmiszer – KME, Quality Food from Hungary) and in 
the Czech Republic (KLASA značka). Last but not least, in March 2011 the Slovenian 
Parliament adopted a special statute on the promotion of agricultural and food produ-
cts.
33
 The Slovenian minister for agriculture explained that the Act strives to achieve four 
aims:
“[A] buyer, who buys Slovenian food gives work to our farmer and worker; this 
way the state budget is being filled; high food safety is being guaranteed, and an 
important step towards climate change prevention is being done.”
34
Enhanced promotion of local agricultural and food products is expected to lead to 
greater consumption of the promoted categories of products, thereby indirectly posi-
tively affecting the development of domestic agriculture and food industry, as well as 
the eating habits of the population. Moreover, the Slovenian government introduced 
traditional Slovenian breakfast to children in kindergartens and primary schools, consi-
sting exclusively of Slovenian food—in this way, children learn about the importance of 
healthy eating, as well as about the significance of domestic food.
35
Because none of these campaigns, private or public, have any binding effects for the 
consumers, but “merely” endeavour to convince the consumers to buy domestic produ-
cts, it is usually believed that they do not breach legal principles protecting free trade. 
Nevertheless, it must be recognised that even though the buy domestic campaigns are 
voluntary, they genuinely interfere with free trade—that is, in fact, their explicit purpose. 
Although the objective of restricting import is not always accomplished, neither states 
nor private associations would invest money in such campaigns without expecting restra-
ined selling of imported goods and consequently protected domestic production. The 
sections below investigate the correlations between the WTO and the EU rules on free 
movement of goods, buy domestic campaigns and quality marks based on product origin 
of private and public entities.
33
 Promotion of Agricultural and Food Product Act (ZPKŽP), Official Gazette of the Republic of 
Slovenia, No. 26/11 and 57/12.
34
 See Svet za promocijo kmetijskih in živilskih proizvodov na svoji ustanovni seji, URL: http://www.
mkgp.gov.si/nc/si/splosno/cns/novica/article//6589/.
35
 See T radicionalni slovenski zajtrk, URL: http://tradicionalni-zajtrk.si/.

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4. WTO Law Perspective: National Treatment Rule for Imported Goods
The WTO is a worldwide organisation for the liberalisation of trade. According to 
2016 data, the WTO has 164 members, including all the countries that have been men-
tioned above in the context of buy domestic campaigns, such as the U.S. and Canada. The 
EU as an international organisation is per se a WTO member, and the 28 EU Member 
States are the WTO members in their own right, although the European Commission 
speaks for all the EU Member States at almost all WTO meetings.
4.1. National T reatment Rule—The Applicable T est
Article III of the General Agreement on Tariffs and Trade (GATT) requires that the 
WTO Members provide national treatment to all other Members. Trade measures that 
have an impact on competitive conditions of imported products on the internal market 
are prohibited.
36
 The provision of Article III:4 is known as the national treatment rule. 
In the Korea – Various Measures on Beef decision, the Appellate Body explained the three 
elements of a violation of Article III:4, which must also be ascertained when deciding on 
the legitimacy of buy domestic campaigns:
“For a violation of Article III:4 to be established, three elements must be satisfi-
ed: that the imported and domestic products at issue are ‘like products’; that the 
measure at issue is a ‘law, regulation, or requirement affecting their internal sale, 
offering for sale, purchase, transportation, distribution, or use’; and that the im-
ported products are accorded ‘less favourable’ treatment than that accorded to like 
domestic products.”
37
4.2. Applicability of The T est to Buy Domestic Campaigns
4.2.1 First element: The Likeness of Products
In  the EC – Asbestos case, the Appellate Body explained that in endeavouring to 
ensure ‘equality of competitive conditions’, the general principle in Article III seeks to 
prevent Members from applying internal taxes and regulations in a manner which affects 
the competitive relationship in the marketplace between the domestic and imported 
36
 Paragraph 4 of Article III of GATT (hereinafter Article III:4) provides: “The products of the 
territory of any contracting party imported into the territory of any other contracting party shall 
be accorded treatment no less favourable than that accorded to like products of national origin 
in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, 
purchase, transportation, distribution or use”.
37
 Korea – Various Measures on Beef: Panel Report, Korea – Measures Affecting Imports of Fresh, 
Chilled and Frozen Beef, WT/DS161/R, WT/DS169/R, 2000, adopted as modified by Appellate 
Body 10 January 2001. DSR 2001:I, 59, para. 133.

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Zbornik znanstvenih razprav – LXXIX. letnik, 2019, Perspektive prava Evropske unije
products involved “so as to afford protection to domestic production”. It continued by 
stating that “a determination of ‘likeness’ under Article III:4 is, fundamentally, a deter-
mination about the nature and extent of a competitive relationship between and among 
products.”
38
 Following from this, the Appellate Body acknowledged that its interpretati-
on resulted in giving Article III:4 “a relatively broad product scope”. Buy domestic cam-
paigns interfere with competitive conditions of the like domestic and imported products: 
presenting products of domestic origin as products of a generally higher quality harms 
like products of foreign origin. From the perspective of buy domestic campaigns, it should 
furthermore be pointed out that in the India – Autos case the Panel declared that when 
the origin is the sole distinguishing criterion, it is correct to treat products as “alike” 
within the meaning of Article III:4.
39
4.2.2. Second Element: Requirements Affecting Competitive Conditions  
on the Market
When considering the “laws, regulations or requirements” condition of the national 
treatment rule, first, it should be emphasised that in the  India – Autos case the Panel re-
called that GATT jurisprudence suggests two distinct situations, which satisfy the term 
‘requirement’ under Article III:4: (i) obligations which an enterprise is ‘legally bound to 
carry out’; and (ii) obligations which an enterprise voluntarily accepts in order to obtain 
an advantage from the government.
40
 From the buy domestic campaigns perspective, it 
is of particular importance what the Panel stated in the  Japan – Film case
41
 that even 
non-binding actions “can potentially have adverse effects on competitive conditions of 
market access”:
38
 European Communities – Measures Affecting Asbestos and Asbestos-Containing Products 
– Appellate Body Report and Panel Report – Action by the Dispute Settlement Body, WT/
DS135/12, 11 April 2001.
39
 India – Autos, Dispute DS146: Panel Report, India — Measures Affecting the Automotive Sector, 
WT/DS146/R, WT/DS175/R, 2001, adopted 5 April 2002. DSR 2002:V, 1827, para. 7.174. 
The Panel in the Canada – Wheat Exports and Grain Imports case confirmed this jurisprudence – 
Panel Report, Canada – Measures Relating to Exports of Wheat and T reatment of Imported Grain, 
WT/DS276/R, 2004, adopted as upheld by Appellate Body 27 September 2004. DSR 2004:VI, 
2887.
40
 India – Autos, Dispute DS146: Panel Report, India — Measures Affecting the Automotive Sector, 
WT/DS146/R, WT/DS175/R, 2001, adopted 5 April 2002. DSR 2002:V, 1827, para. 7.190–
7.191.
41
 Japan – Measures Affecting Consumer Photographic Film and Paper – Panel Report – Action by 
the Dispute Settlement Body, WT/DS44/5, 23 April 1998, para. 10.49.

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“[A] government policy or action need not necessarily have a substantially binding 
or compulsory nature for it to entail a likelihood of compliance by private actors in 
a way so as to nullify or impair legitimately expected benefits […]”.
42
Furthermore, in the  Canada – Autos case, the Panel took a broad approach to the 
question of whether the action of private parties was subject to Article III:4. It examined 
the compatibility of commitments undertaken by Canadian motor vehicle manufactu-
rers in their letters addressed to the Canadian Government, referring to the increase of 
Canadian value-added in the production of motor vehicles, with GATT, and found that
“[n]either legal enforceability [n]or the existence of a link between a private action 
and an advantage conferred by a government is a necessary condition in order for 
an action by a private party to constitute a ‘requirement’.”
43
Nevertheless, purely private campaigns cannot be considered to fall within the scope 
of Article III:4 GATT when there is no subsequent governmental measure to protect 
domestic producers. As the Panel noted in the Japan – Film case, the WTO Agreement 
is an international agreement signed by national governments and the prohibition of re-
strictive measures “refers only to policies or actions of governments, not those of private 
parties”.
44
 It follows that only publicly sponsored buy domestic campaigns should further 
be assessed under Article III:4.
In this respect, next one must establish the causal link between a campaign and inter-
nal sales conditions for the imported goods. The former must “affect” the latter. In this 
regard, the Panel in the Canada – Autos case interpreted the term “affecting” as having a 
broad scope of application and as referring to measures that have an effect on imported 
goods:
“The word ‘affecting’ in Article III:4 of the GATT has been interpreted to cover not 
only laws and regulations which directly govern the conditions of sale or purchase 
but also any laws or regulations which might adversely modify the conditions of 
competition between domestic and imported products”.
45
42
 See also Panel Report on Canada – Autos: Appellate Body Report, Canada – Certain 
Measures Affecting the Automotive Industry, WT/DS139/AB/R,WT/DS142/AB/R, adopted 
19 June 2000, DSR 2000:VI, 2995, para. 10.73.
43
 Ibid., para. 10.106–10.107.
44
 Japan – Measures Affecting Consumer Photographic Film and Paper – Panel Report – Action by 
the Dispute Settlement Body, WT/DS44/5, 23 April 1998, para. 10.52.
45
 Panel Report on Canada – Autos: Appellate Body Report, Canada – Certain Measures Affecting 
the Automotive Industry, WT/DS139/AB/R,WT/DS142/AB/R, adopted 19 June 2000, 
DSR 2000:VI, 2995, para. 12, referring to the Appellate Body Report on EC – Bananas III, 
Appellate Body Report, European Communities – Regime for the Importation, Sale and 
Distribution of Bananas, WT/DS27/AB/R, adopted 25 September 1997, DSR 1997:II, 591, 
para. 220.

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Boosting consumer ethnocentrism on domestic markets indeed modifies the conditi-
ons of sale in a way that is condemned by importers, even though the share of consumers 
that will respond to the campaign is uncertain.
4.2.3. Third Element: Less Favourable T reatment
Finally, Article III:4 GATT prohibits only measures that generate less favourable 
treatment of imported products. The panel report on the US – Section 337 explains this 
condition in the following terms:
“The words ‘treatment no less favourable’ in paragraph 4 call for effective equality 
of opportunities for imported products in respect of the application of laws, re-
gulations and requirements affecting the internal sale, offering for sale, purchase 
transportation, distribution or use of products. This clearly sets a minimum per-
missible standard as a basis”.
46
Although buy domestic campaigns certainly do not grant equal opportunities to im-
ported products, proving (econometrically) that such campaigns cause actual damage to 
imported products on the export market can be quite a challenge. In the US – FSC case, 
the Appellate Body declared that the examination of whether a measure involves “less 
favourable treatment” of imported products within the meaning of Article III:4 cannot 
rest on a simple assertion, but must be founded on a careful analysis of the contested 
measure and of its implications in the marketplace.
47
 Even so, in the Korea – Various 
Measures on Beef case, the Panel held that:
“Any regulatory distinction that is based exclusively on criteria relating to the na-
tionality or the origin of the products is incompatible with Article III and this 
conclusion can be reached even in the absence of any imports (as hypothetical 
imports can be used to reach this conclusion) confirming that there is no need to 
demonstrate the actual and specific trade effects of a measure for it to be found in 
violation of Article III. The object of Article III:4 is, thus, to guarantee effective 
market access to imported products and to ensure that the latter are offered the 
same market opportunities as domestic products.”
48
This finding effectively supports the view that publicly sponsored campaigns that 
promote consumer ethnocentrism give an unfair advantage to domestic products by 
generally presenting them as being of a higher quality and by implicating that their 
46
 US – Section 337: Panel Report, United States – Section 337 of the Tariff Act of 1930, BISD 
36S/345 (1990), adopted 7 November 1989, para. 5.11.
47
 Appellate Body Report, US – FSC, Panel Report, United States – Tax T reatment for “Foreign Sales 
Corporations”, WT/DS108/R, 1999, adopted as modified by Appellate Body 20 March 2000. 
DSR 2000:IV, 1675, para. 215.
48
 Korea – Various Measures on Beef: Panel Report, Korea – Measures Affecting Imports of Fresh, 
Chilled and Frozen Beef, WT/DS161/R, WT/DS169/R, 2000, adopted as modified by Appellate 
Body 10 January 2001. DSR 2001:I, 59, para. 627.

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purchase is a morally correct one. Consequently, such publicly sponsored campaigns, 
due to their protectionist nature, breach the national treatment rule.
4.3. Exceptions to the National Treatment Rule
Although national treatment is a fundamental principle under GATT , the latter pro-
vides for certain exceptions that justify trade restrictions. The general exceptions are 
described in Article XX GATT and include inter alia measures that are necessary to 
protect public morals, human, animal or plant life or health, measures required to secure 
compliance with laws or regulations in fields such as protection of patents, trademarks 
and copyrights, and the prevention of deceptive practices, as well as those that are related 
to the conservation of exhaustible natural resources. These measures are interpreted wi-
dely (e.g., public morals could be interpreted as covering anything that benefits the com-
munity). Furthermore, legitimate regulatory purposes can also be assessed within Article 
III, either within the “likeness” analysis or as an independent element of Article III.
49
Nevertheless, as a matter of principle, the exceptions are only acceptable provided 
they are not applied in a manner that would constitute a means of unjustifiable discri-
mination or a disguised restriction. As held by the Appellate Body in the US – Gasoline 
case, the latter has been worded to prevent the abuse of the exceptions under Article XX. 
Furthermore, in the US – Shrimp case, the Appellate Body found that “a balance must 
be struck between the right of a Member to invoke an exception under Article XX and 
the duty of that same Member to respect the treaty rights of the other Members”.
50
Concerning the buy domestic campaigns, it is essential to point out that consumer 
protection that is often claimed to be the rationale behind the campaigns is generally 
accepted as a legitimate exception under the measures “necessary to secure compliance 
with laws or regulations”.
51
 Consumer protection has also been evoked by the U.S. in the 
country of origin labelling case.
52
 The U.S. argued that providing information about the 
origin of products and thereby preventing consumer confusion are legitimate objectives 
and that there is furthermore strong evidence about the existence of the U.S. consumers 
demand for the country of origin information of the kind covered by the stated objecti-
ve. The U.S. also claimed that leading consumer organisations have expressed support 
for the country of origin labelling for consumer information purposes and as a means of 
49
 Perišin, Free Movement of Goods and Limits of Regulatory Autonomy in the EU and 
WTO (2008), p. 193.
50
 US – Gasoline: Appellate Body Report, United States – Standards for Reformulated and 
Conventional Gasoline, WT/DS2/AB/R, adopted 20 May 1996, DSR 1996:I, 3, in para. 156.
51
 Article XX:1(b).
52
 US – Certain Country of Origin Labelling (COOL) Requirements, DS384, United States – Certain 
Country of Origin Labelling (COOL) Requirements – Communication from the European Union  
WT/DS384/39,WT/DS386/40, 11 December 2015, Panel Report, para. 7.651.

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preventing consumer confusion. The Panel referred to the Panel’s statement in the Korea 
– Various Measures on Beef case that
“there can be good reasons – apart from any protectionist motives – why a WTO 
Member might want information to be provided as to the origin of products, and 
particularly meat products, at the retail level”.
53
Based on this, the Panel concluded that “providing consumer information on ori-
gin is a legitimate objective”.
54
 By contrast, Canada submitted that the intent of the 
COOL measure was to protect the U.S. ranchers from foreign competition by recaptu-
ring the market share for the U.S. cattle. Mexico also highlighted statements by Members 
of the the U.S. Congress in the context of the 2002 Farm Bill allegedly showing pro-
tectionist intent, such as: “U.S. origin labelling is important because it will allow consu-
mers to vote with their wallets to support U.S. farmers, ranchers, and fishermen” or 
that “Country of Origin Labelling for fresh meats, fruits, vegetables and fish will help 
Oregon’s producers”. Although the Panel did not grant much importance to such state-
ments, it agreed with the complainants that the country of origin labels under the U.S. 
COOL measure can provide consumers with inaccurate or misleading information and 
concluded that “the mandatory labelling scheme under the COOL measure falls short 
of providing consumers with information on the country of origin of meat products in 
an accurate and clear manner”, which is why the measure did not fulfil the identified 
objective of consumer information.
One may conclude that buy domestic campaigns are even less justified by consumer 
protection goals than the country of origin labelling requirements, taking into account 
their general nature with regard to the products that are promoted, lack of any quality 
criteria and explicit protectionist objectives that stem from the majority of buy dome-
stic campaigns. Protection is extended to domestic producers and not the consumers. 
Consequently, it is difficult to imagine how such campaigns could be justified based on 
the legitimate exceptions provided in Article XX GATT.
On the other hand, however, Article III:8(a) GATT permits governments to purchase 
domestic products preferentially, making government procurement one of the exceptions 
to the national treatment rule. This exception is tolerated because the WTO Members 
recognised the role of government procurement in national policy, i.e. it is legitima-
te to develop and purchase products domestically for security reasons or to use gover-
nment procurement as a policy tool to promote smaller businesses, local industry or 
advanced technologies. Although the recently re-negotiated Agreement on Government 
Procurement mandates signatories to offer national treatment in their government pro-
53
 Korea – Various Measures on Beef: Panel Report, Korea – Measures Affecting Imports of Fresh, 
Chilled and Frozen Beef, WT/DS161/R, WT/DS169/R, 2000, adopted as modified by Appellate 
Body 10 January 2001. DSR 2001:I, 59, para. 655.
54
 US – Certain Country of Origin Labelling (COOL) Requirements, para. 7.651.

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curement and provides for market access opportunities, the WTO Members are under 
no obligation to join the Agreement.
55
 Therefore, in the context of government procure-
ment, the national treatment rule applies only to those Members who have acceded to 
the Agreement, while for the rest the traditional exception is still in force. In this respect, 
it is a fortiori difficult to imagine that the WTO Members would initiate disputes against 
each other concerning the non-binding campaigns promoting consumer ethnocentrism, 
which considerably less intensively and only indirectly hinder foreign trade, claiming a 
breach of the Members’ obligations under the WTO Agreements.
It follows that challenging the buy domestic campaigns sponsored by public authoriti-
es (be it state or supranational authorities, such as the EU) as a breach of GATT national 
treatment rule is rather problematic, since no decisions of the WTO Dispute Settlement 
Body have so far been adopted that would enable predictability with regard to the result 
of such a challenge. Even though there are other cases, with which one could draw pa-
rallels and conclude on their basis that protectionist campaigns breach Article III:4 of 
GATT, and even though all the elements of the national treatment rule, as interpreted 
by the WTO panels and the Appellate Body, are met, a problem which arises from the 
perspective of legal certainty is that GATT does not contain an exhaustive list of justifi-
cations through which national measures might be upheld. Any non-protectionist aims 
(economic or non-economic) could thus be invoked to save the challenged measure. A 
further hardship is that engaging panels and the Appellate Body in an analysis of the 
proportionality of national measures would be overly intrusive concerning national regu-
latory autonomy and is hence left up to the contracting parties of the WTO Agreements. 
It can hardly be expected that the latter will consider buy domestic campaigns a dispro-
portional barrier to free trade, considering some other legitimate aims that may, within 
the WTO, be of an either economic or a non-economic nature. Finally, one must take 
into account the toothless nature of the WTO dispute settlement system: a fundamental 
problem is that the remedy that tends to be proposed by the panel is vague and does not 
involve any compensation for the loss incurred by a firm or industry. The government 
that is found to be in violation is simply ordered to bring its measures into compliance 
with the WTO rules
56
 and the complainants need to use threat and/or imposition of 
countermeasures to induce compliance. As Pascal Lamy, the former EU Commissioner 
responsible for international trade issues, illustrated: “As long as you pay the penalties, 
55
 At present, the Agreement has 19 parties and 29 observers – see: Agreement on Government 
Procurement – Parties, Observers and Accessions, URL: https://www.wto.org/english/tratop_e/
gproc_e/gp_gpa_e.htm.
56
 Reimbursement of paid duties – i.e. a limited form of financial compensation – has only been 
recommended in the case of a few antidumping related cases prior to the creation of the WTO. See 
Palmeter, Mavroidis, Dispute Settlement in the World Trade Organization: Practice 
and Procedure (2004).

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you can go on as you are”.
57
 Until the WTO Members see profits in any protectionist 
measure they will thus continue to apply them.
5. The EU Law Perspective
In contrast to the WTO system, the legality of buy domestic campaigns is conside-
rably more straightforward within the EU, primarily due to the homogeneity of the EU 
Member States’ legal systems and the established internal market, which the EU instituti-
ons prefer to consider as a market of a single state. The following section analyses the way 
certain ethnocentrism boosting campaigns contravene the principles of the EU internal 
market. In this respect, Article 34 TFEU plays a vital role, prohibiting quantitative restri-
ctions on imports and all measures having equivalent effects between the Member States.
5.1. Prohibition of Measures Having an Equivalent Effect to Quantitative 
Restrictions
Article 34 TFEU has been interpreted in numerous decisions of the EU Court of 
Justice. Among the most important ones is the decision in the famous Dassonville case, 
where the Court declared the following definition of measures having an equivalent 
effect to quantitative restrictions:
“All trading rules enacted by Member States which are capable of hindering, di-
rectly or indirectly, actually or potentially, intra-Community trade are to be consi-
dered as measures having an effect equivalent to quantitative restrictions.”
58
5.1.1. All T rading Rules Enacted by the Member States
For a measure to be prohibited by Article 34 TFEU as a barrier to the free movement 
of goods, it must foremost be attributed to the state. The sponsor of buy domestic cam-
paigns is thus just as important and an equally distinguishing feature under Article 34 
TFEU as it is under Article III:4 GATT . According to the Dassonville formula, it is only 
state campaigns designed to enhance consumer ethnocentrism that are caught by Article 
34 TFEU—including campaigns by central (e.g. ministries) and regional authorities.
59
 
In the before-mentioned Buy Irish campaign from the 1980s, the EU Court supported 
the opinion of the Commission, who was suing Ireland because of the campaign, clai-
ming that ethnocentric motions of private entities are also caught by Article 34 TFEU, 
provided they can be attributed to the state—be it because they were established by 
57
 Pascal Lamy, Press and Communication Service Brussels, No 3036, 2000.
58
 Case C-8/74, Procureur du Roi v Benoît and Gustave Dassonville, ECLI:EU:C:1974:82, para. 5.
59
 See Case C-45/87, Commission v Ireland, ECLI:EU:C:1988:453 and Case C-1/90, Aragonesa de 
Publicidad v Departamento de Sanidad, ECLI:EU:C:1991:327.

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the state, financed mainly by the government or through obligatory contribution of 
companies in specific sectors, and/or have members that are appointed or controlled by 
public authorities.
60
 For this reason, the campaign of the Irish Goods Council, a private 
company promoting Irish goods, was found to be in breach of Article 34 TFEU, as it was 
financed by the Irish government. A fortiori, the actions of the German Fund for quality 
marking were also found to be in breach of Article 34 TFEU.
61
 In more recent case law, 
the Court went as far as to declare that states are responsible for public statements of 
their officials which reflect the state’s official point of view, regardless of whether they 
have a binding effect or not.
62
 Understandably, ethnocentric market campaigns are full 
of such public statements.
By contrast, entirely privately owned entities escape the grasp of Article 34 TFEU 
(ex 28 EC).
63
 In this respect, the Court in Sapod Audic
64
 held that a contractual obli-
gation to label packages with a Green Dot logo does not constitute a barrier to free 
trade as guaranteed by Article 34 TFEU (ex 28 EC), as this obligation was not imposed 
by the state, but agreed between private contractual parties. It should nevertheless be 
highlighted that in Commission v France, the Court held the State responsible for activi-
ties of private individuals (farmers) as it had not “manifestly and persistently abstained 
from adopting appropriate and adequate measures” to assure free movement of goods.
65
 
Although the EU Court held that the Member States are obliged “to take all necessa-
ry and appropriate measures to ensure that that fundamental freedom is respected on 
their territory”
66 
it nevertheless recognised that Member States “unquestionably enjoy 
a margin of discretion in determining what measures are most appropriate to eliminate 
barriers to the importation of products in a given situation”.
67
 As the issue of severity of 
private actions and the appropriateness of national response to such measures can only 
be judged on a case-by-case basis, one can only wonder whether the EU Court or a nati-
onal court applying EU law would hold Ireland’s government responsible for the recent 
Guaranteed Irish campaign conducted by private entities or for that matter any other 
Member State for tolerating private buy domestic or buy local campaigns. As the Court 
does not recognise horizontal direct effect of Article 34 TFEU, promotional campaigns 
60
 Case C-249/81, Commission v Ireland, ECLI:EU:C:1982:402.
61
 Case C-325/00, Commission v Germany, ECLI:EU:C:2002:633; for a case note see Jarvis, Case 
C-325/00, Commission v. Germany, Judgment of the Court of Justice of 5 November 2002. Full 
Court (2003). 
62
 Case C-470/03, A.G.M.-COS.MET Srl v Suomen valtio in T armo Lehtinen, ECLI:EU:C:2007:213.
63
 For a comment see Cruz, Free Movement and Private Autonomy (1999), p. 608.
64
 Case C-159/00, Sapod Audic v Eco-Emballages SA, ECLI:EU:C:2002:343, para 74.
65
 Case C-265/95, Commission v France, ECLI:EU:C:1997:595, para. 65.
66
 Ibid., para. 32.
67
 Ibid., para. 33, see also Report from the Commission to the Council and the European Parliament 
on the application of Regulation (EC) No 2679/98, COM (2001) 160 final.

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sponsored by private entities, such as the Guaranteed Irish initiative, have never actually 
appeared before the Court.
When applying Article 34 TFEU, it is thus not insignificant, whether it is the 
Slovenian Parliament, who adopts an act to promote Slovenian goods, or an Austrian 
limited company (GmbH) established by the Ministry for Agriculture promoting qu-
ality labels or an association of Irish businessmen and workers promoting Guaranteed 
Irish, or a British TV reality show star wearing a Buy British T-shirt. In legal terms, we 
are speaking of vertical and horizontal direct effects of Article 34 TFEU. Polemics aro-
und this issue arose precisely around buy domestic and quality label cases. As a matter 
of principle, Article 34 TFEU only prohibits state measures that limit free movement 
of goods between Member States.
68
 Hence, only state campaigns designed to enhance 
consumer ethnocentrism are caught by Article 34 TFEU. Understandably, these also 
include campaigns by central (e.g. ministries) and regional authorities. When the Buy 
Irish case came before the Court it was, therefore, not surprising that Advocate General 
Capotorti found that:
“it would be going too far if, through the inclusion in the concept ‘measures’ of 
initiatives taken at a level not involving the exercise of public authority, an indi-
rect link with the State were recognized in addition to the potential and indirect 
nature of the obstacle to imports resulting from advertising in favour of domestic 
products.”
69
By contrast, the Court took a different stance and as a result ethnocentric motions 
of private entities are also caught by Article 34 TFEU, provided they can be attributed 
to the state—be it because they were established by the state, primarily financed by the 
government or through obligatory contribution of companies in specific sectors, and/or 
have members that are appointed or controlled by public authorities.
70
 For this reason, 
the campaign of the Irish Goods Council, a private company promoting Irish goods, was 
found to be in breach of Article 34 TFEU, as it was financed by the Irish government. A 
fortiori, the actions of the German Fund for quality marking were also bound by Article 
34 TFEU.
71
 In a more recent case law, the Court went as far as to declare that states are 
responsible for public statements of their officials which reflect the state’s official point 
of view, regardless of whether they have a binding effect or not.
72
 Ethnocentric market 
campaigns are full of such public statements.
68
 Case C-8/74, Procureur du Roi v Dassonville, ECLI:EU:C:1974:82.
69
 Case C-249/81, Commission v Ireland, ECLI:EU:C:1982:402.
70
 See e.g. Case C-227/06, Commission v Belgium, ECLI:EU:C:2008:160. Similar to this was also a 
WTO panel’s finding in the case Japan – Film (WT/DS44/R, 1998, para 10.56).
71
 Case C-325/00, Commission v Germany, ECLI:EU:C:2002:633, para 18.
72
 Case C-470/03, A.G.M.-COS.MET Srl v Suomen valtio in T armo Lehtinen, ECLI:EU:C:2007:213.

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5.1.2. Capable of Hindering, Directly or Indirectly, Actually or Potentially, Intra-
Community T rade
In 1982, when the Commission brought an action against Ireland before the EU 
Court, the latter held that the implementation of a programme defined by the gover-
nment of a Member State, affecting national economy as a whole by intending to control 
the flow of trade between the Member States by encouraging the purchase of domestic 
products, was to be regarded as a measure having an effect equivalent to quantitative 
restrictions.
73
 The Court condemned the campaign because it reflected the Irish gover-
nment’s desire to achieve “the substitution of domestic products for imported products 
and was liable to affect the volume of trade between Member States”.
74
 Even though the 
sale of domestic products dropped by six per cent during the campaign, this did not 
convince the EU Court to change its decision about the campaign breaching Article 34 
TFEU. The decision in the Buy Irish case should be distinguished from the decision in the 
Apple and Pear Development Council case,
75
 from which one may conclude that state-spon-
sored promotion of national goods is generally illegitimate if merely the national origin 
of goods is highlighted, while on the other hand, the promotion of specific goods having 
distinctive qualities besides those of national origin, is permissible.
76
 The line delimitating 
the two types of promotion is a very fine one. T o clarify questions, the Commission issued 
in 1986 Guidelines for Member States’ involvement in the promotion of agricultural and 
fisheries products. In this document, the Commission emphasised that:
“[The] references to national origin should be subsidiary to the main message put 
over to consumers by the campaign and not constitute the principal reason why 
consumers are being advised to buy the product”.
77
The Commission added that references to quality control should only be made when 
products are subject to a genuine and objective system of quality control.
These principles were toughened by the EU Court in 2002 when ruling about the 
before-mentioned German quality label for domestic agricultural produce. The Court 
found that the contested scheme had, at least potentially, restrictive effects on the free 
movement of goods between the Member States.
“Such a scheme, set up in order to promote the distribution of agricultural and 
food products made in Germany and for which the advertising message underlines 
73
 Case C-249/81, Commission v Ireland, ECLI:EU:C:1982:402, para. 29.
74
 Ibid., para. 25.
75
 Case C-222/82, Apple and Pear Development Council v K.J. Lewis Ltd, ECLI:EU:C:1983:370.
76
 Barnard, The Substantive Law of the EU: The Four Freedoms (2013), p. 83; Gormley , EU 
Law of Free Movement of Goods and Customs Union (2009), p. 420; Oliver , Oliver on Free 
Movement of Goods in the European Union (2010), p. 168.
77
 Commission communication concerning State involvement in the promotion of agricultural and 
fisheries products, OJ C 272, 28.10.1986, p. 3–5, para. 2.3.1.

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the German origin of the relevant products, may encourage consumers to buy the 
products with the CMA label to the exclusion of imported products”,
ruled the Court, adding that “(t)he fact that the use of that quality label is optional 
does not mean that it ceases to be an unjustified obstacle to trade”.
78
 This ruling is in line 
with the Court’s decision in the Commission v UK (made in case)
79
 in which it was held 
that national legislation requiring indication of origin is in practice and by its nature in-
tended to enable the consumer to distinguish between domestic and imported products, 
which may prompt him to give his preference to national products, holding that “no 
imperative reason relating to consumer protection justifies such legislation”. The Court 
pointed out that
“the purpose of indications of origin or origin-marking is to enable consumers to 
distinguish between domestic and imported products and that this enables them to 
assert any prejudices which they may have against foreign products”.
Moreover, it stated that within a single market having the characteristics of a dome-
stic market, which is set as the goal of the EU,
“the origin-marking requirement not only makes the marketing in a Member State 
of goods produced in other member states in the sectors in question more di-
fficult; it also has the effect of slowing down economic interpenetration in the 
Community by handicapping the sale of goods produced as the result of a division 
of labour between Member States.”
80
Origin marking is therefore considered by the Court with severe suspicion and affor-
ded no tolerance unless affecting the actual quality of the goods.
5.2. Justifying State Campaigns That Enhance Consumer Ethnocentrism
Similarly to the GATT provisions, national measures that prima facie hinder free 
movement may nevertheless be justified under the EU internal market rules, thereby pre-
vailing over free movement of goods, as long as they serve important interests recognised 
by the EU and are proportionate. Nevertheless, in its case law regarding campaigns that 
boost consumer ethnocentrism, the Court did not consider the possibilities that could 
justify such campaigns in depth. In the Buy Irish case, the Court entirely overlooked 
this possibility, finding only that the Goods Council measures were caught by Article 
34 TFEU and were indeed measures having an equivalent effect to quantitative restri-
ctions. In the German Quality Label case, this approach had not changed significantly. 
The Court did not show much hesitation when dismissing the German Government’s 
78
 Case C-325/00, Commission v Germany, ECLI:EU:C:2002:633, para. 23-24; thereby referring to 
Case C-13/78, Eggers, ECLI:EU:C:1978:182, para. 26.
79
 Case C-207/83, Commission v UK, ECLI:EU:C:1985:161.
80
 Ibid., para. 17.

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argument that the quality label constituted an exception within the meaning of Article 
36 TFEU for the protection of industrial and commercial property in so far as it con-
stituted a geographical indication of provenance. In that regard, the Court reasoned 
that since the quality label defined the provenance as the extent of the German territory 
and applied to all agricultural and food products fulfilling certain quality requirements 
alike, it could not be considered as a geographic indication capable of justification under 
Article 36 TFEU.
81
Promoters of campaigns and quality marks in the Member States offer numerous 
policy reasons as a way of their justification: filling the national budget, job preservation, 
consumer protection, national tradition and culture, food self-sufficiency and aversion 
of hunger, environmental protection etc. Considering the established case law of the EU 
Court, it is reasonable to expect that in potential actions against such campaigns, the EU 
Court would not accept any of them. That being said, it should be emphasised that the 
consumer protection goal has been accepted as a “mandatory requirement” capable of 
justifying barriers to free trade already in 1979 in the Cassis de Dijon case. Consequently, 
the majority of national campaigns rely on the quality of goods, to which consumers are 
entitled to, as a means of their justification. An impartial observer may find, however, 
that these campaigns, in fact, promote the country of origin. In this way, sponsors of 
campaigns count on consumers’ ethnocentric sentiments to ensure the purchase of do-
mestic goods. It may well be that Austrian meat is of excellent quality, but is it possible 
that meat of such same quality is not to be found anywhere else in the EU?! If the answer 
is negative, why can this particular meat also not get the Austrian label of quality for 
Austrian consumers to recognise that although it is of, e.g. Slovenian or British origin, 
it is of the same quality as the domestic one? Promoters probably rely on the fact that 
consumers will not give such questions much thought. This suggests that the motives of 
campaigns run deeper than purely providing quality information. As H.E. Beaudeaulais 
found in relation to the Buy Canadian slogan from 1961, buying domestic is “a plea made 
to us, and not a reason given to us as to why to favour Canadian products.” Undoubtedly, 
the consumers want quality goods, but quality cannot merely be guaranteed by a product 
originating from a specific state, much the same as inferiority cannot be ascribed to pro-
ducts originating from another state. What sponsors of campaigns rely upon is the fact 
that consumers are also workers and entrepreneurs and that ethnocentric campaigns will 
aid in development of their negative stereotypes towards foreign goods.
6. Conclusions
Buy domestic campaigns, as a formula to protect and isolate a respective economy, 
seem very straightforward: raising consumer ethnocentrism increases consumption of 
81
 Case C-325/00, Commission v Germany, para. 27.

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domestic goods, preserves domestic jobs and fills the state budget; it additionally gives 
incentive to domestic farmers to produce domestic food and limits long-distance tran-
sport of goods from other parts of the world, protecting the environment and assuring 
food self-sufficiency in the process. Nevertheless, this formula is based on two important 
assumptions, i.e. that consumers respond to the campaigns and that the state manages to 
conceal this win-win formula from the other states, thus keeping export markets open. 
The first assumption is dependent upon the awareness of the domestic brands among the 
consumers (if Americans believe that LEGO bricks are of American origin, when they 
are in fact Danish, Buy American slogans actually benefit the importers) and upon their 
(positive) general opinion of the quality of domestic production. As an (obviously non-
-patriotic) Greek financial economist stated in respect of the 1985 campaign Buy Greek:
“This effort to brainwash Greeks into buying local goods simply won’t work be-
cause, on the whole, goods imported from the West are cheaper and of superior 
quality to locally manufactured products.”
82
Surely not all consumers are this xenomanic, but if domestic production had not 
convinced the consumers about its quality and competitive prices before the buy dome-
stic campaigns even started, the latter might well be money poorly spent. In times of 
globalisation, it is difficult to expect consumers to turn their backs to specialisation of 
labour and the economies of scale—the two most important advantages of free trade. 
Additionally, it is unreasonable for governments to believe that they are the ones who 
have invented protectionist campaigns and that the thought had crossed no other go-
vernment’s mind. Consequently, it hardly seems realistic that this double jeu—closing 
the domestic market for imports while counting on export markets to stay open—can 
be played for a very long time. The recent U.S. Buy American policy, which instantly led 
to some of the U.S. major trading partners to consider adopting similar policies, clearly 
demonstrates that it cannot.
This paper points out that by encouraging consumers to behave ethnocentrically, go-
vernments in fact withdraw from their free trade commitments (either under the WTO 
Agreements, the EU Treaties or other regional trade agreements). The WTO and the 
EU have quite similar provisions concerning non-pecuniary restrictions on the free mo-
vement of goods, a form of which are also buy domestic campaigns. These provisions, 
however, have been interpreted in a very different way in each system. The relevant 
WTO provisions, therefore, affect the national regulatory autonomy to a much lesser 
extent than their EU counterparts. The two systems’ differences reflect in the terms of 
their aims, structure, homogeneity, etc.—despite the ever increasing convergence betwe-
82
 ‘Buy Greek’ Campaign Launched to Cut Down Flow of Luxury Imports, URL: http://articles.
latimes.com/1985-01-28/business/fi-10296_1_greek-market. 

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Ethnocentrism from the EU and WTO Perspective
en the two systems.
83
 Regardless of the differences in the two systems, however, they both 
share a common denominator—prevention of protectionism. Even though the purpose 
of Article 34 TFEU is much more complex than simply removing protectionism, the 
latter is nevertheless seen as the most severe form of trade barriers and is as such prohi-
bited. Within GATT, on the other hand, Article III must primarily be interpreted as an 
instrument preventing measures with protectionist intent. The more or less direct and 
evident protectionist purpose of buy domestic campaigns thus contravenes the WTO and 
EU principles prohibiting non-pecuniary obstacles to free trade. Even so, both trade 
liberalisation systems contain certain shortcomings that prevent the effective removal of 
consumer ethnocentrism promotion campaigns as a means of economic protectionism. 
Within the WTO system, these drawbacks are legal uncertainty concerning legitimate 
exceptions to the national treatment rule and a rather robust dispute settlement system.
On the other hand, the EU Court judgments, confirming that buy domestic campa-
igns and national quality marks contravene free movement principles, and a relatively 
efficient enforcement system, enable not only other Member States and the European 
Commission to bring actions before the EU Court against the protectionist Member 
State, but also private individuals and companies (e.g. importers), placed at a disadvan-
tage by measures encouraging the purchase of domestic products, to bring an action 
for breach of EU law before the national courts and tribunals. Nevertheless, in recent 
years, markets have witnessed numerous cases of consumer ethnocentrism boosting in 
contravention with EU law. However, the European Commission has not brought any 
action against the violating Member States. Quite to the contrary, the Commission itself 
is encouraging the shortening of distribution channels and openly showing support for 
the marketing of local products in the form of financing basic services for the creation of 
commercial centres, local shops or multi-purpose convenience stores, building of covered 
and uncovered markets, etc.
84
 With these measures, the Commission is changing the 
traditional principles on which the EU internal market is founded as well as supporting 
the closure of local markets for imported products.
Regardless of the legal principles on free trade, potential judgments or legal sanctions, 
authorities boosting consumer ethnocentrism should carefully consider whether these 
campaigns are truly to their benefit. Because a single state cannot conceal such cam-
paigns from its trading partners, protectionism is like a rolling snowball shattering the 
advantages of free trade that have proved to benefit the consumers.
83
 Perišin, Free Movement of Goods and Limits of Regulatory Autonomy in the EU and 
WTO (2008), p. 3.
84
 European Commission, Green Paper on promotion measures and information provision for 
agricultural products: a reinforced value-added European strategy for promoting the tastes of 
Europe (2011), para. 3.1.2.

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LXXIX. letnik, 2019, Perspektive prava Evropske unije, strani 79–106
Janja Hojnik
Najprej naše: zakonitost javnih ukrepov za krepitev potrošniškega etnocentrizma z 
vidika EU in STO
Članek razkriva, ali so različne javne kampanje in pravila, ki krepijo potrošniški etnocen-
trizem, na nacionalni ravni ali ravni EU, skladna s prostotrgovinskimi sporazumi. Pri 
tem razpravlja o skladnosti javnih kampanj »kupuj domače«, ki jih podpirajo države, 
vključene v Svetovno trgovinsko organizacijo (STO), in načelom prostega pretoka blaga 
v EU. T e kampanje pogosto podpirajo državni organi in so v številnih pogledih diskrimi-
natorne. Poleg tega je podpihovanje negativnih stereotipov o tujem blagu zelo podobno 
diskriminaciji tujcev. Svetovna trgovinska organizacija in EU imata podobne določbe o 
nefinančnih omejitvah prostega pretoka blaga. Med te spadajo tudi kampanje »kupuj 
domače«. Vendar pa te določbe Sodišče EU in mehanizmi reševanja sporov v STO razu-
mejo drugače. T o vodi v zelo različno razumevanje zakonitosti ukrepov »kupuj domače«.
Ključne besede: EU, Svetovna trgovinska organizacija, potrošništvo, etnocentrizem.

221
Sinopsisi / SynopSeS
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LXXIX. letnik, 2019, Perspectives on European Union Law, pp. 79–106
Janja Hojnik 
Our First: Legality of Public Measures to Enhance Consumer Ethnocentrism from 
the EU and WTO Perspective
Post-crisis economy on both sides of the Atlantic faces various protectionist strains. The 
paper investigates how various public campaigns and rules that boost consumer ethno-
centrism, both at the national and EU level, come into line with free trade agreements 
signed by most of the contemporary states. The paper discusses the consistency of buy 
domestic campaigns supported by the states with the World T rade Organisation (WTO) 
and European Union (EU) legal principles on free movement of goods. These campaigns, 
especially when sponsored by public authorities, are in many aspects discriminatory. 
Furthermore, the promotion of negative stereotypes with respect to foreign goods does 
not differ very much from discrimination of foreigners. The paper finds that the WTO 
and the EU have quite similar provisions with respect to non-pecuniary restrictions on 
the free movement of goods, a form of which are also buy domestic campaigns. These 
provisions, however, have been interpreted in a very different manner by the EU Court 
and WTO dispute settlement bodies that leads to important differences in respect of the 
legality of publicly supported buy domestic campaigns under the respective legal systems.
Keywords: EU, World T rade Organisation, consumerism, ethnocentrism.