EU Law and National Law: Supremacy, Direct Effect, Indirect Effect and State Liability

Question 1

Van Gend en Loos

Answer 1

Facts: Van Gend en Loos imported urea formaldehyde from West Germany in 1960. Changes to the classification of the product resulted in the duty payable being increased from 3% to 8%. This was in contravention of Article 12 EEC.

Ratio: EEC Treaty created a new legal order for the benefit of which Member States agreed to limit their sovereign rights and it conferred rights on individuals which had to be protected by national courts. Treaty articles can have direct effect.

Question 2

Costa v ENEL

Answer 2

Facts: Costa was a shareholder in an Italian electricity company which had been nationalised by the Italian State and its assets transferred to ENEL which became responsible for producing and distributing electricity in Italy. Costa refused to pay his bill. When sued he argued that the Nationalisation legislation was contrary to EU law.

Ratio: The principle of Supremacy of EU law over national law. Court reiterated that the Treaty had created a new legal order in which Member States had limited their sovereign rights.

Question 3

Handelsgesellschaft v Einfuhr und Voranstelle fur Getreide und Futtermittel

Answer 3

Ratio: EU law takes precedence over national constitutional law of MS, including fundamental rights provided by that constitution.

Question 4

Amministrazione delle Finanze dello Stato v Simmenthal SpA

Answer 4

Ratio: A national court must not wait for a national measure which conflicted with EU law to be set aside by a national authority.

Question 5

Van Gend en Loos criteria for direct effect

Answer 5

1. Provision must be sufficiently clear and precise

2. Provision must be unconditional

Question 6

Cooperativa Agricola Zootecnica S. Antonio v Amministrazione delle finanze dello Stato

Answer 6

Ratio: Defines terms of Van Gend en Loos criteria for Direct Effect.

A community provision is unconditional where it sets forth an obligation which is not qualified by any condition, or subject, in its implementation or effects, to the taking of any measure either by the Community institutions or by the Member States.

A provision is sufficiently precise where it sets out an obligation in unequivocal terms.

Question 7

Van Duyn v Home Office

Answer 7

Ratio: Direct effect will not be precluded by the mere fact that the provision raises questions of interpretation which can be resolved by a court.

Question 8

Francovich and Bonifaci v Italian Republic

Answer 8

Ratio: Direct effect will not be precluded by the Member State being able to choose among several possible means of achieving the result required by the directive.

Question 9

Defrenne v SABENA

Answer 9

Facts: Defrenne was an air hostile who claimed she had suffered sex discrimination as a female worker in terms of pay as compared with male cabin stewards. She asserted that this infringed Article 119 EEC. Airline accepted discrimination but refused that Article 119 conferred any legal right which could be enforced in a national court. Court held that certain parts of the article were sufficiently clear and precise to have direct effect whilst others are not.

Ratio:

1. Example of Van Gend en Loos Criteria for direct effect: must be unconditional and sufficiently clear and precise.
2. Treaty articles can have horizontal direct effect (i.e. against private individuals and companies).

Question 10

Von Colson & Kamann v Land Nordrhein-Westalfen

Answer 10

Facts: Two female social workers had been rejected for jobs in a West German male prison on grounds relating to their sex. Under West German law, they were found to have been discriminated against but the only compensation available was their travel expenses. Court made a preliminary reference to Court of Justice asking whether it was required by Equal Treatment Directive to order the prison to employ the women. Court held that the directive did not include an unconditional and sufficiently clear and precise obligation to provide a specific sanction for discrimination.

Ratio: Example of Van Gend en Loos Criteria for direct effect: must be unconditional and sufficiently clear and precise.

Question 11

Francovich and Bonifaci v Italian Republic

Answer 11

Facts: Court had to consider Directive 80/987 which sought to ensure that in the event of bankruptcy of a company its employees would be able to claim their outstanding wages from a guarantee institution established by the Member States. Italy had not implemented the Directive and there was no national law covering the area. Francovich and Bonifaci attempted to rely on the unimplemented directive. However, the Court held that although the identity of the persons entitles to the guarantee and the content of that guarantee were both sufficiently clear and precise, the identity of the person liable to provide the guarantee in the event that no guarantee institution was established was not clear. Thus, the Directive did not have direct effect.

Ratio: Example of Van Gend en Loos Criteria for direct effect: must be unconditional and sufficiently clear and precise.

Question 12

Alfons Lutticke GmbH v Hauptzollamt Saarlouis

Answer 12

Facts: Case concerned the Scope of Article 110 which prohibits Member States from introducing internal taxation measures which discriminate agains the goods of other Member States. Included a positive obligation to remove, by 1st January 1962, any existing measures which had a discriminatory effect. Court held there was no discretion to give effect to the positive obligation once the deadline had passed. At this point the provision became directly effective.

Ratio: Positive obligations can have direct effect.

Question 13

Franz Grad v Finanzamt Traunstein

Answer 13

Ratio: Regulations and decisions are capable of direct effect

Question 14

Politi s.a.s. v Ministry for Finance of the Italian Republic

Answer 14

Ratio: Regulations are capable of direct effect.

Question 15

Antonio Munoz y Cia SA v Frumer Ltd

Answer 15

Ratio: Regulations can have vertical and horizontal direct effect.

Question 16

Azienda Agricola Monte Across Srl v Regione Autonoma della Sardegna

Answer 16

Ratio: To have direct effect, regulations must comply with Van Gend en Loos criteria.

Question 17

Carp Snc di L. Moleri e V. Corsi v Ecorad Srl

Answer 17

Ratio: Decisions can only have direct effect against the party to whom the decision was addressed.

Question 18

Grimaldi v Fonds des Maladies

Answer 18

Ratio: Recommendations and opinions are not binding forms of EU law and, as such, cannot have direct effect.

Question 19

Van Duyn v Home Office - Directives

Answer 19

Facts: A Dutch Scientologist offered work as a secretary at the Church of Scientology HQ in London was refused entry to the UK. She sought to rely on Article 3 of Directive 64/221 (now Directive 2004/38) in her claim against the Home Office.

Ratio: Directives can have direct effect as long as they satisfy Van Gend en Loos Criteria. It would be incompatible with the binding effect of directives to exclude direct effect and the useful effect of an obligation being imposed on a competent authority by a directive would be weakened if individuals were prevented from relying on it before their national courts.

Question 20

Pubblico Ministero v Ratti

Answer 20

Facts: Ratti was the head of a company whose director who had decided to package its solvents in conformity with Directive 73/173 and to apply Directive 77/728 to its varnishes. There directives had not yet been implemented into Italian law and he was prosecuted because Italian law was more stringent than the directives. Court found the Directives had direct effect because the implementation date had passed.

Ratio:

1. A Member State cannot rely against individuals on its own failure to perform the obligations that the Directive entails.
2. A Directive can only have direct effect once the deadline for implementation has passed.

Question 21

VNO v Inspecteur der Invoerrechten en Accijnzen

Answer 21

Ratio: A directive can have direct effect where a MS has only partially or incorrectly implemented it.

Question 22

Marks and Spencer plc v Commissioners of Customs and Excise

Answer 22

Ratio: A directive may be relied upon in a national court even if it has been correctly implemented but has not been applied in such a way as to bring about the result sought by it.

Question 23

Marshall v Southampton and South West Area Health Authority (Teaching) (No.1)

Answer 23

Facts: Female dietician was dismissed on the grounds she had passed compulsory retirement age. The compulsory retirement age was lower for women than for men and she sought to rely on Directive 76/207 which prohibited discrimination in working conditions on the grounds of sex.

Ratio:

1. A directive cannot have horizontal direct effect (i.e. against a private entity).
2. A person can rely upon a directive against the State regardless of the capacity the State was acting in.

Question 24

Becker v Finanzamt Munster-Innenstadt

Answer 24

Ratio: Tax authorities are an emanation of the State.

Question 25

Fratelli Costanzo Spa v Comune di Milano

Answer 25

Ratio: Local or regional authorities are emanations of the State

Question 26

Johnston v Chief Constable of the RUC

Answer 26

Ratio: A constitutionally independent police force responsible for maintenance of public order and safety is an emanation of the State.

Question 27

Foster v British Gas

Answer 27

Facts: Six women had been forced to retire at 60 in a accordance with British Gas’s policy. This was five years earlier than their male counterparts. Applicants sought to rely on Directive 76/207. At the time of their dismissal, British Gas was a nationalised industry although it had subsequently been privatised.
It was necessary to determine the definition of an emanation of the State to ascertain whether the Directive could be relied upon.
The Court introduced the bipartite and tripartite tests for determining emanations of the State.

Ratio: The tripartite test should be applied to determine whether an entity is an emanation of the State.

Question 28

Bipartite Test for an Emanation of the State

Answer 28

Organisations or bodies which:
Were subject to the authority or control of the State; or had special powers beyond those which result from the normal rules applicable to relations between individuals.

Question 29

Tripartite Test for an Emanation of the State

Answer 29

A body which has:
Been made responsible, pursuant to a measure adopted by the state for providing a public service, under the control of the State and has for that purpose special powers beyond those which result from the normal rules applicable in relations between individuals.

Question 30

Foster v British Gas (No. 2)

Answer 30

Facts: British Gas was held to be an emanation of the State as it satisfied the tripartite test.