eu law - recent developments 2012

LLB Recent developments 2012

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Recent developments 2012 LA3024 EU law

Current edition of the subject guide

The current edition of the subject guide was published in 2011.

The Treaty of Lisbon has now been in force for two years and the many changes made there, as described in the Subject Guide, are now beginning to work their way through the system. The new functions of President of the European Council and High Representative have become better defined. The continuing crisis concerning the euro has occasioned a number of summit meetings to be organised by the President of the European Council, and setting up of the diplomatic service by the High Representative has continued. Below follows a brief summary of the situation concerning the euro crisis, before setting out a small selection of the most important case law dealt with by the Court of Justice of the European Union (CJEU; both Court of Justice and General Court). Although knowledge about the debt crisis is only required in general terms in the context of the material covered by the subject guide, it is still necessary to summarise the most important developments briefly as it was the most important recent political development and will produce a new treaty between member states of the Eurozone. The treaty is still unclear in its scope but it will also have an impact on non-Eurozone Member States and have great importance for future developments in progress towards integration in the European Union.

The Sovereign Debt Crisis

The future of the Eurozone was thrown into doubt by a sovereign debt crisis that started at the end of 2009 and worsened in 2010 and 2011. Sovereign bond market pressures brought into focus the perilous condition of the finances of several member states. The European Financial Stability Facility (‘EFSF’) was set up in 2010 by the 27 member states to provide assistance to Eurozone states in difficulty. Bailouts were organised by the EU in conjunction with the IMF for Greece (May 2010), Ireland (November 2010), and Portugal (May 2011). Greece, for example, was struggling with a budget deficit of 10.5 per cent of GDP in 2010 and a total debt of 142.8 per cent and would not be able to refinance its bonds when they became due and, therefore, a bailout was necessary. The respective figures in 2010 for Portugal were: deficit 9.1 per cent and debt 93 per cent; and for Ireland deficit 32.4 per cent and debt 96.2 per cent.

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Worries of contagion caused the bond yields of Italy (2010 deficit 4.6 per cent, debt 119 per cent) and Spain (deficit 9.2 per cent, debt 60.1 per cent) to approach the 7 per cent level in November 2011, considered to be the point at which the situation would become impossible without a bailout. Political upheavals caused by the economic turmoil led to Technocrats being appointed to lead both the Greek and Italian governments.

The EFSF did not have enough money to bail out all of the Eurozone states in danger, and there was no agreement forthcoming on how to increase its size. Germany was steadfastly opposed to allowing the ECB to use its potentially unlimited firepower to purchase the bonds of member states in sufficient quantities to stabilise the markets.

The continuing lack of a solution caused a global stock market crisis in the second half of 2011. There was also a general crisis in confidence and the global economy appeared to be heading for another recession. After several initiatives and various meetings during 2011 that achieved very little in the way of market stabilisation, it was widely anticipated that a solution would finally be found at a meeting of the European Council in December 2011. In the event, a proposal for a Fiscal Compact was adopted whereby participating member states would submit to a requirement for national budgets to be in balance or surplus, and to a system for surveillance with penalties for states in breach. The precise terms of the Fiscal Compact are due to be ready for the European Council meeting in March 2012 at the latest, and will be made legally binding by an international agreement. The United Kingdom had vetoed a proposal for a new EU treaty and will not participate in the Fiscal Compact, and Sweden, the Czech Republic and Hungary need to consult their national parliaments. At the time of writing financial market confidence has still not been restored and it is not clear what the outcome to the sovereign debt crisis will be.

The following developments should be noted

Chapter 1: Introduction

1.2 Readings

New editions of some of the recommended readings have published since the subject guide was produced. The following is a list of these new editions, along with notes on new editions expected in 2012.

Legal documents and statute books

A new edition of Foster has published. The most current edition is:

Foster, N. (ed.) Blackstone’s EU treaties and legislation 2011/2012. (Oxford: Oxford University Press, 2011) [ISBN 978199692521].

Textbooks

The textbook by Margot Horspool and Matthew Humphreys is:

Horspool, M. and M. Humphreys European Union law. (Oxford: Oxford University Press, 2010) sixth edition [ISBN 978199575343].


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However, please note that there is a new seventh edition of this textbook forthcoming in August 2012.

A new edition of Craig and de Búrca has published. The current edition is:

Craig, P. and G. de Búrca EU law text, cases and materials. (Oxford: Clarendon Press, 2011) fifth edition [ISBN 9780199576999].

Updated page references for readings from this textbook listed in the subject guide are noted after the recent developments below.

There will also be a new edition, as of June 2012, of:

Foster, N. EU law directions (Oxford: Oxford University Press, 2010) second edition [ISBN 978199581597].

Useful further reading

A new edition of Wyatt and Dashwood’s European Union law has been published since the subject guide was produced. The current edition is:

Arnull, A., A. Dashwood, M.G. Ross, M. Dougan, M. Ross, E. Spaventa and D, Wyatt, Wyatt and Dashwood’s European Union law. (London: Sweet and Maxwell, 2011) sixth edition [ISBN 9781849461269].

On competition

A new edition of Competition law has been published since the subject guide was produced. The current edition is:

Whish, R. and D. Bailey Competition law. (London: Butterworths, 2012) seventh edition [ISBN 978199586551].

The following is a selection of cases to be noted with reference to specific chapters in the Subject Guide.

Chapter 5

5.3.4 The Charter of Fundamental Rights

A number of cases have been heard concerning access to documents. This principle of EU law, contained in Article 15 TFEU (ex Article 255 EC) has been strengthened by the fact that the Charter of Fundamental Rights, in which it is included, has become binding under the Lisbon Treaty

In:

Case C-28/08 P Commission v Bavarian Lager (2010 ECR I-6055),

the Court considered the relationship between Regulation (EC) No 1049/2001 and Regulation (EC) No 45/2001. Regulation (EC) No 1049/2001 lays down as a general rule that the public may have access to the documents of the institutions, but provides for exceptions, including where disclosure would undermine the protection of privacy and the integrity of the individual in accordance with European Union legislation regarding the protection of personal data. In this case, the Court annulled the decision by the General Court that access to all the documentation concerning a meeting should have been granted.

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Bavarian Lager had not demonstrated sufficiently its interest in having disclosure of the names of five participants in a meeting.

Joined Cases C-514/07 P, C-528/07 P and C-532/07 P Sweden v API et Commission (judgment of 21 September 2010).

This case concerned access to pleadings lodged before it by an institution in court proceedings. According to the Court, such pleadings display quite specific characteristics since they are inherently part of the judicial activities of the Court: they are drafted exclusively for the purposes of the court proceedings, in which they play the key role. Judicial activities are as such excluded from the scope, established by the European Union rules, of the right of access to documents. The protection of court proceedings implies, in particular, that compliance with the principles of equality of arms and the sound administration of justice must be ensured. If the content of the institution’s pleadings were to be open to public debate, there would be a danger that the criticism levelled against them might influence the position defended by the institution. The restricted access was further justified in the light of the need to ensure that, throughout the court proceedings, the exchange of argument by the parties and the deliberations take place in an atmosphere of total serenity.

On the other hand, where the judicial activities of the Court have come to an end, there are no longer grounds for presuming that disclosure of the pleadings would undermine those activities, and a specific examination of the documents to which access is requested is then necessary to establish whether their disclosure may be refused on the basis of the second indent of Article 4(2) of Regulation (EC) No 1049/2001.

Chapter 8

8.4 Enforcement: Article 260 TFEU

Failure of a Member State to fulfil obligations. Payment of penalties

Case C-407/09 European Commission v Hellenic Republic (judgment of 31 March 2011, First Chamber).

This case concerned a failure on the part of the Greek government to comply with a previous judgment of the Court, in which the Court had upheld a complaint from the Commission that Greece had failed to transpose Directive 2004/80 (which concerned compensation for crime victims) into domestic law within the prescribed time period. Greece did not comply with that judgment. In consequence, the Commission brought an action under Article 228(1) EC (now Article 260(1) TFEU), seeking the imposition of a penalty payment on Greece. The Greek Government contended in its defence that its had failed to meet its compliance obligation only because its national elections were called early, and that it had had difficulty in finding the necessary money as a result of the domestic economic crisis.

The Court ruled that Greece was in breach of its compliance obligation, and reiterated that a Member State could not rely on the nature of the practices prevailing in its domestic legal order to justify a breach of its


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obligations under EU law. The Court held that all relevant factors should be considered in determining the level of financial penalties to be imposed, although such penalties had to be both appropriate and proportionate. It took into account the substantial delays on the part of the Greek authorities in replying to the Commission’s communications and the long duration of the infringement of a fundamental freedom (namely the free movement of persons in the area of freedom, security and justice). Although the Court found that the imposition of a lump sum payment was both appropriate and proportionate, it fixed the sum due at €3 million plus costs, which hardly appears to be a substantial amount if one compares this with previous penalty payments imposed by the Court.

Chapter 10

10.4.7 Drawing the line on the scope of Article 34 TFEU (ex Article 28 EC) – the Keck judgment

Free Movement of Goods

Case 108/09 Ker-Optika bt v ÀNTSZ Dél-dunántúli Regionális Intézete (judgment of 2 December 2010, Third Chamber).

This preliminary reference from the Hungarian courts sought to clarify the application of the e-commerce Directive (2000/31) as well as case law on restrictions on methods of sale (see Keck and Mithouard, C-267/91 and C-268/91). The applicant sold contact lenses through its website until the public authorities took a decision prohibiting it from doing so. The relevant national legislation required that contact lenses be sold only by specialised optical shops. The applicant challenged the rule, both with respect to the EU rules on e-commerce and the general principle of free movement.

The Court held that it was possible to separate the selling of contact lenses from the need to obtain medical advice in regard to the purchase of such lenses, because a medical examination did not need to take place at the same time as the sale. The Court held that the legislation should be examined in order to determine whether it imposed a restriction on the free movement of goods according to Articles 34 and 36 TFEU. The Court examined the case law on Article 34 TFEU. It found that the national measure, the effect of which was to prohibit online sales, did constitute a measure having equivalent effect to a quantitative restriction. It then examined whether this could be justified on public health grounds. While admitting that certain controls were justifiable to protect the health of patients, the Court considered that these objectives could be met through less restrictive measures than those found in the Hungarian legislation (the proportionality argument). As such it considered that the measures were not justified.

Arguably the Court is very keen to focus on expanding the potential for market access through the internet due to the potential benefits this has for consumers. Proportionality analyses are likely to be harsh for the foreseeable future so as to send a message to Member States (see also Doc Morris C-322/01 (precluding advertising for the sale by mail

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order of medicines on the basis of the alleged need for a pharmacist to be physically present)).

Chapter 11

11.4 Article 102 TFEU (ex Article 82 EC)

Competition

In:

Case C-109 and 110/10P Solvay (judgment of 25 October 2010),

the Court of Justice set aside judgments of the General Court and annulled the Commission Decisions imposing large fines on Solvay for its anti-competitive conduct on the soda ash market. The Commission had adopted decisions in 2000 fining the Belgian company, Solvay SA, €20 million for abuse of its dominant position and €3 million for its participation in a pricing agreement with one of its competitors. Those decisions were substantially identical in content to decisions adopted by the Commission in 1990

which had been annulled by the General

Court – by rulings subsequently upheld by the Court of Justice – on the ground that they had not been properly authenticated in that the detailed rules for their definitive adoption by the College of Commissioners had not been followed.

Solvay brought two separate actions before the General Court for annulment of the new decisions adopted by the Commission in 2000, or for reduction of the fines imposed on it. Solvay pleaded, in particular, breach of its right of access to the file since it had not been sent all the documents on which the Commission based its allegation of an infringement. The Commission admitted that it had mislaid some files and that it was unable to draw up the list of the documents which they contained, because, it explained, the indexes to those binders could not be found either. In addition, Solvay submitted that the Commission had adopted the new decisions without opening a new administrative proceeding and, accordingly, without first giving Solvay a hearing.

In December 2009 the General Court dismissed those actions. It held that the fact that Solvay had not had access to all the documents covered by the investigation had not prevented it from defending itself. As regards the hearing of Solvay, the General Court pointed out that the new Commission decisions were framed in terms substantively identical to those of the 1990 decisions and that, accordingly, the Commission was not required to hear Solvay again. Nevertheless, the General Court decided to reduce the fine from €20 million to €19 million since the Commission had erroneously taken certain repeated infringements into account by way of aggravating circumstances. The General Court also reduced the second fine from €3 million to €2.25 million on the ground that the Commission had incorrectly assessed the duration of the infringement. Solvay appealed both judgments of the General Court before the Court of Justice (‘the Court’).

The Court noted, first, that the right of access to the file means that the Commission must provide the undertaking concerned with the opportunity to examine all the documents in the investigation file that


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might be relevant for its defence. Infringement of this right of access to the file during the procedure prior to adoption of a decision could, in principle, cause the decision to be annulled if the rights of the defence had been infringed. In the Court's view it could not be excluded that Solvay could have found in the missing sub-files evidence originating from other undertakings which would have enabled it to offer an interpretation of the facts different from the interpretation adopted by the Commission, which could have been of use for its defence. It was not just a matter of a few missing documents, the content of which could have been reconstructed from other sources, but of whole sub-files which could have contained essential documents relating to the procedure before the Commission which might have been relevant to Solvay’s defence. Accordingly, the Court held that the General Court erred in law in concluding that the fact that Solvay had not had access to all the documents in the file did not constitute an infringement of the rights of the defence.

As regards the hearing of the undertaking concerned before the Commission adopts a decision, the Court stated that this forms part of the rights of the defence and that it must therefore be examined in relation to the specific circumstances of each particular case. It was correct to say that if the Commission adopts a new decision with substantially the same content as the one taken before, it is not necessary to conduct a new hearing. However, in this case the Court found that the question of the hearing of Solvay could not be separated from the issue of access to the file. In that connection, the Court pointed out that, during the administrative proceeding which led to the adoption of the first decisions in 1990, the Commission had not granted Solvay access to all the documents in its file. Yet, despite those circumstances and notwithstanding the importance placed by the case law of the Court of Justice and the General Court on access to the file, the Commission proceeded to adopt decisions which were the same as those which had been annulled owing to the lack of proper authentication, without opening a new administrative proceeding in which it would have had to hear Solvay after granting it access to the file.

The Court ruled that the General Court erred in law in holding that it was unnecessary, for the purposes of adopting fresh decisions, for the Commission to give Solvay a hearing. Therefore, the Court set aside the judgments of the General Court and annulled the decisions of the Commission.

Chapter 12

12.5.5 Rights of residence

Free Movement of Workers

Judgment in:

Case C-34/09 Gerardo Ruiz Zambrano v Office national de l’emploi (judgment of 8 March 2011, Grand Chamber).

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Free movement – Dependent EU children’s rights – Third country national parents

After the failure of their asylum application in Belgium, a husband and wife, both Columbian nationals, had children born in Belgium who acquired Belgian nationality. The husband worked, despite not having a work permit, and when told he had to stop working, unsuccessfully claimed unemployment benefit. The husband and wife claimed they were entitled to reside and work in Belgium as ascendants of minor Belgian children. The Belgian authorities rejected this claim. The Brussels Employment Tribunal asked whether EU law was applicable to Mr Ruiz Zambrano, even though his children had never exercised their right to free movement within the Member States.

The Court ruled that Article 20 TFEU precludes national measures which have the effect of depriving EU citizens of the genuine enjoyment of the substance of the rights conferred by virtue of their status as EU citizens. Both a refusal to grant a right of residence to a third country national with dependent minor children in the Member State where those children are nationals and reside, and a refusal to grant such a person a work permit, produce such an effect. Such a decision would lead to a situation where the children would have to leave the EU to accompany their parents and accordingly would not be able to exercise their rights as citizens.

The Court took a different view, however, in the following case, which perhaps indicates the limits of how far the Court is prepared to go in its wide interpretation of the citizenship Directive.

In:

Case C-434/09 Shirley McCarthy v Secretary of State for the Home Department (judgment of 5 May 2011, Third Chamber),

Mrs McCarthy had dual UK and Irish nationality. She was born and had always lived in the UK, and had never argued that she was a worker, self-employed person or self-sufficient person. She was in receipt of state benefits. In November 2002 she married a Jamaican national who did not have leave to remain in the UK. Following her marriage, she applied for and obtained an Irish passport for the first time. In 2004 she and her husband applied to the Secretary of State for a residence permit and residence document under EU law as, respectively, a Union citizen and the spouse of a Union citizen. The Secretary of State refused their applications on the ground that she was not a ‘qualified person’ (essentially, a worker, self-employed person or self-sufficient person) and, accordingly, that Mr McCarthy was not the spouse of a ‘qualified person’.

The Court ruled that Directive 2004/38 is not applicable to a Union citizen who has never exercised his right of free movement, who has always resided in a Member State of which he is a national and who is also a national of another Member State. It held, further, that Article 21 TFEU is not applicable either, provided that the situation of that citizen does not include the application of measures by a Member State that would have the effect of depriving him of the genuine enjoyment of the substance of the rights conferred by virtue of his status as a


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Union citizen or of impeding the exercise of his right of free movement and residence within the territory of the Member States.

Case C-162/09 Secretary of State for Work and Pensions v Taous Lassal (judgment of 7 October 2010).

Article 16 of Directive 2004/38 on the right of EU citizens to move and reside freely within Member States entitles EU citizens to acquire the right of permanent residence in a Member State after a period of five years residence there. Under Article 16(4) the right is then lost after an absence from that Member State of two consecutive years. The deadline for transposition of the Directive into national law was 30 April 2006. The applicant was a French national who lived and worked in the UK for over five years. In 2005 she returned to France for ten months before returning to the UK. She later applied for income support in the UK but this was refused on the grounds that she had no right to reside in the UK. The English Court of Appeal asked the Court whether a five-year period of residence which ended before the transposition date of the Directive should be taken into account.

The Court first examined whether a continuous period of five years’ residence completed before the Directive’s transposition date should entitle someone to the right of permanent residence granted by Article 16. It was acknowledged such a right did not feature in any EU legal texts prior to the Directive. The Court found, however, that periods of residence completed before 30 April 2006 could not be disregarded as this interpretation would be contrary to the objectives and effectiveness of the Directive. The Court also referred to case law, which states that provisions on EU citizenship should be applied to situations which have arisen previously. Following from this conclusion, the Court examined whether these temporary absences had any effect on a citizen’s right to permanent residence under Article 16(1) and ruled that it did. Therefore, an absence of less than two consecutive years between the five years of residence and 30 April 2006 would not negate an individual’s right to permanent residence.

In:

Case C-325/09 Secretary of State for Work and Pensions v Maria Dias (judgment 21 July 2011),

the Court held that possession of a valid residence permit does not in itself confer a right of permanent residence. Ms Dias, a Portuguese national, had previously acquired a residence permit in the UK under Directive 68/360 (now replaced by Directive 2004/38) and lived there according to its conditions for a period of five consecutive years. However, this period ended before the transposition of the Citizenship Directive in the UK in 2006. Subsequently, for a period in 2003–2004, Ms Dias became voluntarily unemployed and not self-sufficient, thereby breaking the conditions of her residence. The question referred was whether Ms Dias could still acquire a permanent right of residence. The Court first held that periods of residence based on a permit issued before the transposition of Directive 2004/38 and which do not satisfy the conditions for entitlement to a right of residence cannot be considered sufficient so as to acquire permanent residence under Directive 2004/38. However, the Court also held that a right of

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permanent residence could be acquired if a person has legally resided in another Member State for five years prior to the transposition of the Directive, provided that any periods during which the person no longer met the requirements for the acquisition of a right of residence was less than two consecutive years.

12.5.6 Grounds for refusal of entry or residence

Free movement of Persons

Case C-145/09 Land Baden-Württemberg v Panagiotis Tsakouridis (judgment of 23 November 2010).

This case concerned Article 28(2) and (3) of Directive 2004/38. Under Article 28(2), a Member State cannot expel an EU citizen with a right of permanent residence ‘except on serious grounds of public policy or public security.’ Where an EU citizen has been resident in the host Member State for 10 years prior to expulsion, Article 28(3) applies and expulsion is only possible on ‘imperative grounds of public security, as defined by Member States’. The German court asked whether Article 28(3) meant that only irrefutable threats to the external or internal security of a Member State could justify expulsion. It asked under what conditions the right to enhanced protection against expulsion could be lost and whether the condition for the loss of the right of permanent residence laid down in Article 16(4) is to be applied mutatis mutandis in that context. Article 16(4) provides that the right will be lost if an individual is absent from the host Member State for a period exceeding two consecutive years. If so, the court asks whether the enhanced protection could be lost by lapse of time alone, irrespective of the reasons for the absence, and whether an enforced return to the host Member State during criminal proceedings before expiry of this two-year period resulted in maintaining the right to enhanced protection.

The Court held that national authorities should look at all relevant factors in deciding whether an individual has lost enhanced protection under Article 28(3). In particular, they should consider the length and frequency of individual absences from the host Member State, the combined duration of absences and any reasons for the absences. The reasons may establish whether the absences involve the transfer of the individual’s centre of personal, family or occupational interests. A forced return to serve a prison sentence and the time spent in prison could be taken into account when considering whether the individual’s integration into the host Member State had been broken. The Court concluded that the fight against crime in connection with narcotics dealing was capable of falling within Article 28(2) and (3). In the context of Article 28(3) the threat to public security must be exceptionally serious and a Member State’s response to it must be proportionate. Proportionality should be assessed according to: the seriousness of the offence; the time since it was committed and the individual’s conduct in the interim; the duration of the individual’s residence in the host Member State; and the extent of the individual’s social, cultural and family ties with the host Member State. Where an individual has spent most or all of his childhood in the host Member State, there must be a very good reason for expulsion. The threat caused by the individual’s conduct should be assessed by reference to


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the possible penalties and sentences imposed, the degree of involvement in the criminal activity and, if appropriate, the risk of reoffending. This threat must be balanced against the risk of compromising an individual’s social rehabilitation into a Member State in which he has become genuinely integrated. Factors to be taken into account include the sentence passed and the individual’s fundamental rights, and particularly the rights to respect private and family life.

Another interpretation of public policy:

Case C-208/09 Ilonka Sayn-Wittgenstein v Landeshauptmann von Wien (judgment of 22 December 2010, Second Chamber).

An Austrian citizen was adopted by a German national whose surname indicated membership of the nobility. The Austrian citizen’s new surname had been registered in Austria, but subsequently corrected to remove the parts of the name indicating nobility as, under Austrian law, it is not permissible for a title of nobility to be used as part of a surname. The Austrian national brought a case contesting the decision to alter her name in an official register. The preliminary reference from the Austrian courts asked whether the national legislation accorded with the right to freedom of movement and residence for EU citizens (Article 21 TFEU, ex-Article 18 EC).

The Court held that the national law in question did restrict the right to freedom of movement under Article 21 TFEU. It confirmed that a name was part of a person’s private life and of his identity. Case law had established that making a citizen use a different surname in the Member State where he was a national from the one given and registered in his Member State of birth could hamper the exercise of the right to freedom of movement. The applicant had lived in Germany under her previous surname for a long time and under German law the nobility element was a constituent part of her surname. The change was likely to cause confusion and inconvenience. Nonetheless, the Court concluded that the restriction could be justified on the basis of public policy. The Austrian Government claimed the national law reflected the principle of equality. The Court considered it was not disproportionate to refuse to recognise the noble element of the surname. The Austrian Government had not gone further than was necessary to attain the objective of equality.

Chapter 13

13.2.8 Directive 2005/36 on the recognition of professional qualifications

Establishment

Cases C-47/08 Commission v Belgium; C-50/08 Commission v France; C-51/08 Commission v Luxembourg; C-52/08 Commission v Portugal; C-53/08 Commission v Austria; C-54/08 Commission v Germany and C-61/08 Commission v Greece (judgment of 24 May 2011, Grand Chamber).

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Notaries – Restriction on grounds of nationality – Scope of Article 51 TFEU exemption for activities connected with the exercise of official authority

Rules in force in Belgium, France, Luxembourg, Germany, Austria and Greece restricted entry to the notary profession to persons possessing home nationality. The Commission brought a series of actions against these Member States on the grounds that the restrictions on the notary profession amounted to a breach of their obligations under Article 43 EC, which provides for freedom of establishment. It also alleged that the Member States in question had failed to transpose Directive 89/48 on mutual recognition of professional qualifications into national law in respect of the notary profession.

The Member States concerned defended their nationality requirements on the ground that Article 45 EC (Now Article 51 TFEU) exempted from the requirements of Article 43 EC activities connected with the exercise of official authority.

The Court agreed with the submissions of the Commission, and held that the countries concerned were indeed in breach of EU law in prohibiting non-nationals from becoming notaries and dismissed the arguments of the States concerned as to the exemption under Article 43 EC. It held that the activities of a notary were not directly and specifically connected with the exercise of official authority, as the notary cannot unilaterally alter a document agreed by two parties, can only undertake certain activities, such as compulsory sale of property (for example) following a court order and, in cooperation with the court, may only collect taxes on behalf of a third party. The requirement by law of authentication by a notary did not change this, nor does the fact that a notary’s activities provided legal certainty and so are carried out in the public interest. However, the Court rejected the Commission’s second submission concerning non-transposition of Directive 89/48 on the basis that, at the relevant time, the Directive did not contain a sufficiently clear obligation for the Member States to transpose that directive with regard to the notarial profession.

In the following cases the Court of Justice went into further detail on what constitutes ‘professional experience’ under Directive 89/48.

Judgments in:

Vasiliki Stylianou Vandorou v Ipourgos Ethnikis Pedias kai Thriskevmaton (C-422/09), Vasilios Alexandrou Giankoulis v Ipourgos Ethnikis Pedias kai Thriskevmaton (C-425/09) and Ioannis Georgiou Askoxilakis v Ipourgos Ethnikis Pedias kai Thriskevmaton (C-426/09).

These cases all concern the question of recognition of professional qualifications under Directive 89/48 on a general system for the recognition of higher-education diplomas awarded on completion of professional education and training of at least three years’ duration (replaced by Directive 2005/36 on recognition of professional qualifications). The Directive allows supplementary requirements to be imposed in order to cover any substantive differences found. The Greek court sought clarification on what experience could be taken into


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account when assessing ‘professional experience’ in the context of a regulated profession.

The Court stated that for the purposes of the Directive, ‘professional experience’ constituted the pursuit of a regulated professional activity, insofar as the taking-up or pursuit of this activity is generally subject to possession of a specific diploma. The Court held that any experience gained by the appellants before obtaining the relevant diploma did not amount to such a pursuit. It also held that, even if a diploma is held in one Member State, work performed in another Member State where authorisation to pursue the profession had not yet been acquired could not generally be regarded as the pursuit of regulated professional activities. The Court highlighted, however, that measures taken should comply with the principle of proportionality. Furthermore, the freedom of movement of workers and freedom of establishment enshrined in the TFEU should not be hindered by disregarding relevant knowledge and qualifications acquired by an applicant in another Member State. Activities carried out in the host Member State under the control of a qualified professional were also of considerable value. The Court therefore found that when deciding whether to enforce supplementary requirements, competent national authorities should examine all knowledge acquired by the worker in the course of any practical experience undertaken.

Joined Cases C-570/07 and C-571/07 Blanco Pérez and Chao Gómez (2010 ECR I-4629).

Spanish legislation required prior administrative authorisation to be obtained for the opening of new pharmacies in a given area. More specifically, grant of such a licence was tied to conditions relating to population density and the minimum distance between pharmacies in the area concerned. The Court held that Article 49 TFEU does not preclude such legislation in principle. According to the Court, a Member State might see a risk that some parts of its territory will be left with too few pharmacies and that, as a consequence, the provision of medicinal products might well not be reliable and of good quality.

13.3.7 The new Services Directive: Directive 2006/123

Services

The Services Directive was adopted by the European Parliament and the Council in 2006 and the deadline full implementation was 28 December 2009. In the Commission communication ‘towards a better functioning Single Market for services – building on the results of the mutual evaluation process of the Services Directive’ in 20111 the main results of the ‘mutual evaluation’ process are presented and a work programme is set out. In this work programme, the Commission states that:

It will launch a ‘performance check’ of the Single Market for services in 2011. The results, along with proposed further measures, will be presented in a report in 2012.

1 http://ec.europa.eu/internal_market/services/docs/services-dir/implementation/20110127_COM_en.pdf

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It will also conduct:

an assessment of the issue of reserves of activity (focusing in particular on areas where the link with the professional qualification required warrants further discussion);

an assessment to better understand the manner in which restrictions on capital ownership and legal form affect certain services sectors;

an examination of the difficulties for cross-border service providers resulting from insurance requirements with a view to finding practical solutions.

On the basis of the above assessments the Commission will decide on possible specific initiatives by the end of 2012.

13.3.4 Illegal and ‘immoral’ services

Gambling

Cases C-203/58 and C-258/08 The Sporting Exchange Ltd, trading as Betfair v Minister van Justitie and Ladbrokes Betting & Gaming Ltd, Ladbrokes International Ltd v Stichting de Nationale Sporttotalisator (ECR 2010 I-4757)

Free movement of services – Gaming – Licensing – Adequate tendering

The Netherlands prohibit the organisation of gambling unless the organiser has been licensed by the state. It also limits the number of persons that can carry out such activity to one per each type of game. Betfair wished to market its online gambling services actively in the Netherlands. It was however refused licences to conduct sports-betting activities. The company challenged the decision as well as the decisions to renew the exclusive licences of existing operators as it had not had an opportunity to compete for them.

In both cases, the Court confirmed that it was legitimate for a Member State to restrict the ability of operators to organise gambling and that it was permissible for the state to issue exclusive rights to do so. While it constitutes a restriction of free movement rights, this could be justified for public order and consumer protection reasons. The Court went on to find that allowing operators to advertise and create new games was not necessarily contrary to the objective of preventing addiction to gambling. Controlled expansion could help to ensure consumers use regulated rather than unlicensed providers.

Nonetheless it found that in the present case, the renewal of a licence without any competitive tendering procedure was proportionate and could be justified. The Court found that the Netherlands was not obliged under the principle of mutual recognition to recognise the licences to operate granted in other Member States, given the necessity to protect national consumers. The Court’s reasoning contrasted ‘controlled expansion’ with the dangers of gambling. Proportionality comes into play.

This line of reasoning is in contrast to the more strict approach taken by the court regarding alcohol monopolies and the need therein for access for producers


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13.3.6 Healthcare services

Healthcare

In:

Case C-512/08 Commission v France (judgment of 5 October 2010),

the Court held that a Member State whose national legislation requires – except in special situations relating, in particular, to the insured person’s state of health or to the urgency of the treatment needed – prior authorisation in order for the competent institution to be responsible for payment, in accordance with the rules governing cover in force in the Member State to which it belongs, for treatment planned in another Member State and involving the use of major medical equipment outside hospital infrastructures did not fail to fulfil its obligations under Article 49 EC. According to the Court, having regard to the dangers to the organisation of public health policy and to the financial balance of the social security system, such a requirement would appear, as European Union law now stands, to be a justified restriction. See Kohll (C-158/96) and contrasted with its joint case Decker (C-120/95) where ‘… refusal to reimburse at a flat rate the cost of spectacles purchased in another Member State could not be justified, since it had no real effect on the financing or balance of the Luxembourg social security system.’ Here it must be possible for major medical equipment to be the subject of planning policy, with particular regard to quantity and geographical distribution, in order to help ensure throughout national territory a rationalised, stable, balanced and accessible supply of up-to-date treatment.

On the other hand, the Court held in Case C-173/09 Elchinov (judgment of 5 October 2010) that legislation of a Member State which is interpreted as excluding, in all cases, reimbursement in respect of hospital treatment given in another Member State without prior authorisation is not consistent with Article 49 EC.

Chapter 14

14.2 Equal treatment

A Directive which is generating a substantial amount of case law is Directive 2004/13 of 13 December 2004 implementing the principle of equal treatment between men and women in the access to and supply of goods and services. The Directive does not apply to employment or self-employment which is covered by other legislation. Its effect is illustrated below.

Social Policy/Sex Discrimination

The following case has become known in the UK as ‘Sheila’s Wheels’ after an insurance company which exclusively insures women car drivers. The Court’s ruling clearly indicates that the practice of insuring women at lower premiums as, statistically, they are safer drivers and have fewer accidents, is not in accordance with EU law.

Judgment in:

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Case C-236/09 Association Belge des Consommateurs Test-Achats and Others (judgment of 1 March 2011, Grand Chamber).

Belgian law permits insurers to make use of sex as a factor in the calculation of premiums and benefits. It does so on the basis of a derogation contained in Article 5(2) of Directive 2004/113. The claimants contended that the Belgian law which makes use of this derogation was contrary to the principle of equality between men and women. The Belgian Constitutional Court asked the Court whether Article 5(2) of Directive 2004/113 was compatible with the principle of equality and non-discrimination guaranteed by Article 6(2) EU.

The Court first set out the provisions of EU law which established the principle of equal treatment for men and women. It recalled that the use of actuarial factors related to sex was widespread in the provision of insurance services when the Directive was adopted, so a transitional period was appropriate. Whilst Article 5(1) of the Directive provided that the differences in premiums and benefits arising from the use of sex as a factor in the calculation thereof must be abolished by 21 December 2007, Article 5(2) allowed some Member States indefinitely to permit proportionate differences in individuals’ premiums and benefits where the use of sex is a determining factor in the assessment of risks based on relevant and accurate actuarial and statistical data.

The Council had expressed doubts as to whether the respective situations of men and women policyholders could be comparable, given that the levels of insured risk (which are based on statistics) may be different for men and for women. The Court dismissed this argument, stating that the Directive is based on the premise that, for the purposes of applying the principle of equal treatment for men and women, the respective situations of men and women with regard to insurance premiums and benefits contracted by them are comparable. Accordingly, the Court found that there was a risk that Article 5(2) might permit the derogation from the equal treatment of men and women to persist indefinitely. Such a provision works against the achievement of the objective of equal treatment between men and women. It accordingly took the view that Article 5(2) must be considered to be invalid upon the expiry of an appropriate transitional period; in this case from 21 December 2012.


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Essential reading Page references to the 2011 edition of the Craig and de Búrca textbook are now provided for the readings given in the subject guide.

Chapter1: Introduction

1.2 Readings

Textbooks

Craig, P. and G. de Búrca EU law text, cases and materials. (Oxford: Clarendon Press, 2011) fifth edition [ISBN 9780199576999].

Chapter 2: The Treaties and their significance

2.1 Background to the establishment of the European Economic Community (EEC)

Essential reading

Craig and de Búrca, Chapter 1: ‘The development of European integration’, Sections 1–4.

2.2 The European Economic Community established by the Treaty of Rome 1957

Essential reading

Craig and de Búrca, Chapter 1: ‘The development of European integration’, Sections 3 and 4.

2.3 The development of the EU legal order in subsequent treaties

Essential reading

Craig and de Búrca, Chapter 1: ‘The development of European integration’.

Chapter 3: The institutions of the European Union

3.1 The merging of the original institutions

Essential reading

Craig and de Búrca, Chapter 1: ‘The development of European integration’.

3.2 The European Council

Essential reading

Craig and de Búrca, Chapter 2: ‘The institutions’, Section 4 ‘The European Council’.

3.3 The European Parliament (EP)

Essential reading

Craig and de Búrca, Chapter 2: ‘The institutions’, Section 6 ‘European Parliament’.

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3.4 The Commission

Essential reading

Craig and de Búrca, Chapter 2: ‘The Institutions’, Section 2 ‘The Commission’.

3.5 The Council of the EU

Essential reading

Craig and de Búrca, Chapter 2: ‘The Institutions’, Section 3 ‘The Council’.

3.6 The Court of Justice of the European Union (comprising the Court of Justice, the General Court and specialised courts)

Essential reading

Craig and de Búrca, Chapter 2: ‘The Institutions’, Section 7 ‘Courts’.

3.7 The Court of Auditors

Essential reading

Craig and de Búrca, Chapter 2: ‘The Institutions’, Section 8 ‘The Court of Auditors’.

3.8 The European Central Bank (ECB)

Essential reading

Craig and de Búrca, Chapter 20: ‘Free movement of capital and economic and monetary union’, Section 6 ‘EMU: monetary union and the ECB’ part (c).

3.9 Advisory bodies

Essential reading

Craig and de Búrca, Chapter 2: ‘The Institutions’, Section 9 ‘EU advisory bodies.

Chapter 4: Sources of Union law, legislative acts and procedures

4.1 Sources of law

Essential reading

Craig and de Búrca, Chapter 3: ‘Competence’, Section 3 ‘Lisbon Strategy; and Section 4 ‘Exclusive competence’.

4.2 Legislative procedures

Essential reading

Craig and de Búrca, Chapter 5: ‘Legislation and decision-making’.

Chapter 5: The general principles of EU Law

Introduction

Essential reading

Craig and de Búrca, Chapter 11: ‘Human Rights in the EU’.


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Chapter 6: Union law and national law

Introduction

Essential reading

Craig and de Búrca, Chapter 7: ‘The nature and effect of EU law: direct effect and beyond’; Chapter 8: ‘The application of EU Law: remedies in national courts’; Chapter 9: ‘The relationship between EU law and national law: supremacy’.

6.1 The doctrine of direct effect

Essential reading

Craig and de Búrca, Chapter 7: ‘The nature and effect of EU law: direct effect and beyond’.

6.2 Indirect effect of Directives

Essential reading

Craig and de Búrca, Chapter 7: ‘The nature and effect of EU law: direct effect and beyond’, Section 6 ‘Directives: legal effects’, part (A).

6.3 Remedies for Union law rights

Essential reading

Craig and de Búrca, Chapter 8: ‘The application of EU law: remedies in national courts’.

6.4 Action for damages against a Member State for breach of Union law

Essential reading

Craig and de Búrca, Chapter 8: ‘The application of EU law: remedies in national courts’, Section 7 ‘The principle of (State) liability for breach of EC law’.

6.5 The supremacy of EU law

Essential reading

Craig and de Búrca, Chapter 9: ‘The relationship between EU law and national law: supremacy’.

6.6 EU law from the Member States’ perspective

Essential reading

Craig and de Búrca, Chapter 9: ‘The relationship between EU law and national law: supremacy’, Section 3 ‘Second Dimension: Supremacy from the Perspective of the Member States’.

Chapter 7: Article 267 TFEU The preliminary ruling jurisdiction

7.1 References by national courts for preliminary rulings

Essential reading

Craig and de Búrca, Chapter 13: ‘Preliminary rulings’. This is the main chapter. However, see also Chapter 14: ‘Review of legality: access’ and Chapter 15: ‘Review of legality: grounds of review’.

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Chapter 8: Article 258 TFEU Enforcement actions

8.2 Article 258 TFEU enforcement action

Essential reading

Craig and de Búrca, Chapter 12: ‘Enforcement actions against Member States’, Sections 1–7.

8.3 Defences

Essential reading

Craig and de Búrca, Chapter 12: ‘Enforcement actions against Member States’, Sections 1–7.

Chapter 9: Judicial review and the action for damages against Union institutions

9.1 Judicial review Article 263 TFEU

Essential reading

Craig and de Búrca, Chapter 14: ‘Review of legality: access’.

9.7 Action for damages

Essential reading

Craig and de Búrca, Chapter 16: ‘Damages Actions and Money Claims’.

Chapter 10: Free movement of goods

Introduction

Essential reading

Craig and de Búrca, Chapter 18: ‘Free movement of goods: duties, charges, and taxes’; Chapter 19: ‘Free movement of goods: quantitative restrictions’.

10.1 The legal basis of the single market

Essential reading

Craig and de Búrca, Chapter 17: ‘The Single Market’.

10.3 Article 110 TFEU (ex Article 90 EC) discriminatory taxation

Essential reading

Craig and de Búrca, Chapter 18: ‘Free movement of goods: duties, charges and taxes’, Sections 3–5.

10.4 Articles 34–36 TFEU (ex Articles 28–30 EC) quantitative restrictions

Essential reading

Craig and de Búrca, Chapter 19: ‘Free movement of goods: quantitative restrictions’.


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Chapter 11: Competition policy

Introduction

Essential reading

Craig and de Búrca, Chapter 26: ‘Competition law: Article 101’; Chapter 27: ‘Competition law: Article 102’.


Essential reading

Craig and de Búrca, Chapter 26: ‘Competition Law: Article 101’.

11.2.5 Concerted practice

Essential reading

Craig and de Búrca, Chapter 26: ‘Competition Law: Article 101’, part (b) ‘Concerted practice’.

11.2.7 ‘Object or effect of preventing, restricting or distorting competition’

Essential reading

Craig and de Búrca, Chapter 26: ‘Competition Law: Article 101’, Section 6 ‘Article 101(1): Object or effect of preventing, restricting, or distorting competition’.

11.2.10 Exemption under Article 101 TFEU(3) (ex Article 81(3) EC)

Essential reading

Craig and de Búrca, Chapter 26: ‘Competition Law: Article 101’, Sections 8–11.

11.3 Enforcement

Essential reading

Craig and de Búrca, Chapter 26: ‘Competition Law: Article 101’, Section 12 ‘Competition law: enforcement’.


Essential reading

Craig and de Búrca, Chapter 27: ‘Competition law: Article102’.

Chapter 12: Free movement of persons

Introduction

Essential reading

Craig and de Búrca, Chapter 21: ‘Free movement of workers and beyond’; Chapter 23: ‘Citizenship of the European Union’.

12.1 Scope of the rights to free movement

Essential reading

Craig and de Búrca, Chapter 21: ‘Free movement of workers and beyond’, Sections 1–3.

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12.1.3 The impact of EU citizenship

Essential reading

Craig and de Búrca, Chapter 23: ‘Citizenship of the European Union’.

12.3 Equal treatment for workers and their families

Essential reading

Craig and de Búrca, Chapter 21: ‘Free movement of workers and beyond’, Section 6 ‘Directive 2004/38: the right of entry and residence of workers and their families’; Chapter 23: ‘Citizenship of the European Union’, Section 5 ‘Directive 2004/38 on the rights of free movement and residence for EU Citizens and their families’.

12.3.9 Access to education and training

Essential reading

Craig and de Búrca, Chapter 21: ‘Free movement of workers and beyond’, Section 7 ‘Regulation 1612/68: Substantive rights and social advantages’.

12.4 Grounds for refusal of entry or residence

Essential reading

Craig and de Búrca, Chapter 21: ‘Free movement of workers’.

12.5 Rights of free movement for non-economically active persons

Essential reading

Craig and de Búrca, Chapter 23: ‘Citizenship of the European Union’.

12.6 A purely internal situation

Essential reading

Craig and de Búrca, Chapter 21: ‘Free movement of workers’, Section 4, part (d): ‘Internal situations’.

12.6.3 Fundamental human rights

Essential reading

Craig and de Búrca, Chapter 11: ‘Human rights in the EU’.

Chapter 13: Establishment and services

Introduction

Essential reading

Craig and de Búrca, Chapter 22: ‘Freedom of establishment and to provide services’

13.1 The distinction between services and establishment

Essential reading

Craig and de Búrca, Chapter 22: ‘Freedom of establishment and to provide services’, Section 2, part (a) ‘Comparing the Treaty chapters’.


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13.2 Establishment

Essential reading

Craig and de Búrca, Chapter 22: ‘Freedom of establishment and to provide services’, Section 3 ‘The right of establishment’.

13.2.4 Primary and secondary establishment of companies

Secondary establishment

Craig and de Búrca note (Chapter 22: ‘Freedom of establishment and to provide services’ p.782) that ‘this outcome caused considerable surprise’.

13.2.6 Exceptions

Essential reading

Craig and de Búrca, Chapter 22: ‘Freedom of establishment and to provide services’, pp.776 and Section 4 ‘Free movement of services’, part (c).

13.2.7 Mutual recognition of qualifications

Essential reading

Craig and de Búrca, Chapter 22: ‘Freedom of establishment and to provide services’, Section 3 ‘The right of establishment’, parts (a) and (b), and Section 5 ‘General legislation to facilitate establishment and services: recognition of professional qualifications’, parts (b)–(d).

13.3 Services

Essential reading

Craig and de Búrca, Chapter 22: ‘Freedom of establishment and to provide services’, Section 4 ‘Free movement of services’.

Chapter 14: Freedom from discrimination

14.1 Article 157 TFEU (ex Article 141 EC) – equal pay for equal work

Essential reading

Craig and de Búrca, Chapter 24: ‘Equal treatment and non-discrimination’.

14.2 Equal treatment

Essential reading

Craig and de Búrca, Chapter 24: ‘Equal treatment and non-discrimination’, Section 5 Article 19 TFEU and Article 19 Directives’.

eu law - recent developments 2012

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