On 5 October 2005 the Court of First Instance' ruled on the admissibility of the so called 'Upper Austrian Law banning genetic engineering' It was the the first decision of an EU-Court to deal with the issue of co-existence between the cultivation of GMO and GMO free plants, the establishment of GMO-free areas and securing biodiversity.2 There is a fierce battle going on between some EU Member States reluctant to use GMOs and the European Commission,3 which is responsible for ensuring the proper implementation of the Community acquis relating to GMOs. As the trade partners of the EU are pointing to their obligations under international trade law,4 the judgment tackles also a controversial issue of international trade law. The Court upheld the contested decision of the Commission which had rejected the notified Austrian rules.5 Apart from considerations on the GMO issue the ruling is also important as it sets out clear limits concerning the derogation from EU harmonisation measures generally. Both the Commission and the Court found that the conditions for derogation under Article 95(5) EC Treaty were not fulfilled. Even though the Commission and the Court under the current state of Community law6 did not have any other option than to reject the Upper Austrian draft Law, the reasoning behind this finding was in many respects not very convincing.