Direct Effect

Question 1

What are Direct Effects?

Answer 1

• ‘Direct effects’ is the term given to judicial enforcement of rights arising from provisions of EU law that can be upheld in favour of individuals in the courts of the MS.
• In other words, provided that certain criteria are satisfied, an EU law provision will give rise to a right that is enforceable by individuals in the national courts.
• With supremacy, direct effect is another major element in ensuring the application of EU law in the MS.
• It must be distinguished from direct applicability – Article 288 TFEU refers to certain EU measures being either generally applicable or directly applicable.

Question 2

3 Distinguished:
What is General Applicability?

Answer 2

Means that the measure applied throughout the whole EU (so it would apply to a regulation but not to a decision).

Question 3

What is Direct Applicability?

Answer 3

Means that the measure becomes part of national law without need for further enactment (so it would apply to a regulation and not a directive)

Question 4

What is Direct Effect?

Answer 4

Means that the measure creates rights and obligations which are enforceable in the national courts as well as the ECJ (so it could easily apply to Treaty Articles and regulations but is more problematic when applied to directives.)

Question 5

What are the basic requirements for direct effect?

Answer 5

The principle was first accepted by the ECJ in Van Gend En Loos 26/62:
o ‘[EU] law not only imposes obligations on individuals, but it is also intended to confer upon them rights which become part of their legal heritage.’

• These rights are granted not only where they are expressly granted by the Treaty, but also by reason of obligations which the Treaty imposes in a clearly defined way upon individuals and upon MS and the institutions of the EU.
• So, the ECJ accepted that since the treaty was clearly intended to affect individuals as well as MS, it must be capable of creating rights which were enforceable by individuals.
• The ECJ held that since Art 25 (Now Art 30 TFEU) ‘contains a clear and unconditional prohibition it [is] ideally adapted to produce direct effects between MS and their subjects’

Question 6

Vertical and Horizontal Direct Effect

Answer 6

• The ECJ has also been responsible for helping to identify the principles of vertical and horizontal direct effect and clarifying the distinction between them.
• The distinction can be critical in determining whether a person can enforce EU law in a national court.

Question 7

What is Vertical Direct Effect?

Answer 7

• Vertical direct effect concerns the relationship between the EU law and national law:
  o Measures of EU law create obligations on the state
  o So, failure to honour such obligations would normally result in Art 258 actions.
  o But it can also mean that an individual can rely on the measures in an action against the state.
  o This was the case in both Ven Gend and Ratti 148/78 which were both fought against gov departments.
  o The concept has been extended to include bodies that are ‘emanations of the state’ (public bodies) and so may extend rights to certain individuals.

Question 8

What is Horizontal Direct Effect?

Answer 8

• Horizontal Direct Effect on the other hand, is precisely about the relationship between individuals, so concerned rights enforceable in national courts.
• That is asserting an EU measure (law) against an individual (as opposed to against a MS) is known as horizontal direct effect.

Question 9

Direct effect and Treaty articles

Answer 9

• Direct effect was first accepted in Van Gend en Loos
• However, the principal test for application now is that laid down in Reyners v Belgium 2/74 and subsequent cases which are the provisions must:
  o Be clear and precise
  o Be unconditional (e.g., as to the limits)
  o Not require implementing measures to be taken by MS or Community (now Union) institutions.
  o Not leave any discretion to member states or community institutions.

Question 10

Direct effect and regulations

Answer 10

• Regulations create obligations without need for further enactment because they are of ‘general application’ and ‘directly applicable’.
• So, they will usually be directly effective, subject to Reyners test.
• But a regulation may not be directly effective if too vague.

Question 11

Direct effect and directives:
Art 288?

Answer 11

By virtue of Art 288, directives are ‘binding as to the result to be achieved’:
o So, they are seen as creating an obligation on MS to pass law to achieve the objective
o but not as automatically creating substantive rights for citizens to enforce, because they fail the Van Gend en Loos test – they are dependent.

The ECJ was prepared to overlook this limitation in Van Dyne v Home Office:
o Because ‘it would be incompatible with the binding effect attributed to a directive by (Art 288) to exclude, in principle, the possibility that the obligation which it imposes may be invoked by those concerned…’

Question 12

So, when can a directive be enforced?

Answer 12

• So, a directive can be enforced (but only vertically) provided that the criteria for direct effect are met (except the non-dependency rule)
• But only when the time limit for implementation has passed (Ratti 148/78)

Question 13

IS there an exception to the rule that an individual cannot seek to rely on a directive before the date for implementation has passed?

Answer 13

There is.
As stated in Case C-144/04, Mangold v Helm (2005):
o ‘During the period prescribed for transposition of a directive, the MS must refrain from taking any measures seriously to compromise the attainment of the result prescribed by that directive.’

• For that reason, in Mangold, Germany could not prevent the plaintiff from invoking the directive’s guarantees of non-implementation had not passed.

Question 14

Can directives be invoked against private parties?

Answer 14

• Directives can also be vertically directly effective but never horizontally directly effective – Marshall v Southampton and Southwest Hampshire AHA (Teaching) (No.1) 152/84:
  o The court pointed out that the express wording of Art 189 (Now art 288) provides that directives are binding ‘upon each MS to which it is addressed’.
  o Therefore, directives could not be binding upon individuals, because the Treaty did not say so.
• The court has stuck to its original ruling against direct effect, despite pressure from various Advocates General to rule in favour of the horizontal direct effect of directives.
• However, the court has developed other doctrines, such as:
  1. Giving a broad definition to what constitutes an emanation (organ) of the state.
  2. Indirect effect, and
  3. Damage actions against a MS for the failure to implement a directive.
• These judicially created doctrines have minimised the impact of a lack of direct effect.

Question 15

Other Doctrines developed by the courts:
Organ of the state?

Answer 15

• Ms Marshall succeeded in her action in the COJ, despite the Court’s ruling that the directive she sought to rely upon lacked horizontal direct effect. How was that possible?
• The court concluded that her employer the Health Authority could be regarded as an organ of the state, and that Ms Marshall could therefore rely upon the established vertical direct effect of directives.

Question 16

What is an organ of the state?

Answer 16

The court provided further clarification of which bodies constituted an organ of the state in Case C-188/89, Foster v British Gas [1990]
- The claimants in Foster wanted to rely upon the Equal Treatment Directive to challenge unequal retirement ages for men and women in British Gas.
- However, British Gas had been privatised, although it was still a monopoly provider of gas in the UK and a nationalised industry.

Question 17

What did the court state in providing more detail on what would constitute an organ of the state?

Answer 17

‘A body, whatever its legal form, which has been responsible, pursuant to a measure adopted by the state, for providing a public service under the control of the state and has for the purpose special powers beyond those which result from the normal rules applicable in relations between individuals, is included in any event among the bodies against which the provisions of a directive capable of having direct effect may be relied upon’.

Question 18

What must we consider in considering whether a body is an organ of the state?

Answer 18

o Whether it is charged by law
o To provide a public service; and
o Whether it has special powers beyond those applicable in relations between private individuals.

Question 19

What has the ECJ ruled that directives can be relied upon against?

Answer 19

• The ECJ has ruled that directives can be relied upon against:
  o Tax authorities (Case 8/81, Becker)
  o The police (Case 224/84, Johnson v Chief Constable of the RUC)
  o Local authorities (Case 103/88, Castanzo)
  o As well as public health services (Marshall)
  o A public hospital was deemed to be an organ of the state in Case C-53/04, Marrosu

Question 20

Van Gend En Loos case?

Answer 20

• Here a private firm sought to invoke community law against Dutch custom authorities in proceedings before a Dutch tribunal.
• A preliminary reference was made to the ECJ.
• The Dutch government argued that an infringement of the treaty did not give an individual the right to bring an action.
• Actions could only be brought against the government of a MS by the commission.
  It was held that the treaty created a new legal order and created rights for individuals which became part of their legal heritage.
• This case is an example of what is known as vertical direct effect. The obligation rested on an organ of the state and there was a corresponding right on individuals
• This case is the authority for Direct effect.

Question 21

Defrenne v Sabena (No.2) 1976?

Answer 21

 It was held in this case that treaty obligations could be imposed on individuals as well as MS.
 This is called horizontal direct effect.
 In this case the applicant was an air stewardess, employed by Sabena.
 She brought an action against them based on Art 141 EC which provides that men and women shall receive equal pay for equal work.
 The applicant claimed that male air stewards earned more money for performing exactly the same tasks as stewardesses and this was in breach of Article 141
 Sabena argued that treaty obligations could not be imposed on private persons as well as the state.
 The ECJ rejected this argument.
 This case is the authority for horizontal direct effect.

Question 22

Van Dyne v Home Office

Answer 22

• In this case the British Gov considered the activities of the church of scientology to be contrary to public policy and adopted a rule that any foreign national seeking to enter the UK to work in it would be refused entry. My dyne was a member of the church in the Netherlands and sought to enter the UK to take up work with the church at its college in Sussex.
• She brought an action in the British high court relying on art 48 EC which guaranteed the free movement of workers and directive 64\221 which concerned the rights of member states to exclude foreign nationals based on public policy
• This issue was whether the treaty article and the directive could have direct effect.
• The UK eventually dropped its argument that treaty article 48 lacked direct effect.
• The issue remained was whether Directive 64/221 could have direct effect. It concluded that it could.

Question 23

Ratti 148/78

Answer 23

• An Italian company began labelling its products according to the requirements of a pair of EU directives. However, the Italian government had failed to implement those directives.
• The deadline for implementation had not expired with respect to one of the deadlines.
• The Italian law contained its own requirements for the labelling of the products and provided for criminal penalties for non-compliance.
• Ratti was prosecuted for violation of the Italian law.
• In his defence, he invoked the EU directives- in other words he sought to rely on the direct effect of directives.
• The Italian court made a preliminary reference on the issue of whether Ratti could invoke the non-implemented directive in national court

Question 24

Marshall v Southampton and Southwest Hampshire AHA (Teaching) (No.1) 152/84?

Answer 24

• In this case a dietitian employed by the British health authority was dismissed at the age of 62 on the ground that she had passed the pensionable age which was, at that time, 60 years for a woman.
• Men could not have been dismissed at that age as they did not receive their pensions until 65.
• Marshall had no redress (legal basis to bring the action) as British law excluded contractual conditions relating to retirement from equal opportunities law.
• She claimed a breach of the equal treatment directive, which provided for equal treatment for men and women, concerning all terms and conditions of dismissal including when this occurred because the employee had reached pensionable age.
• The Health Authority opposed Ms Marshall. It argued that it was not a MS and that therefore the directive could not be invoked against it.
• The ECJ ruled in favour of the Health Authority, stating that a directive may not itself impose obligations on an individual, and a provision of a directive may not be relied upon against such a person,