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European Union Law, Right procedure Protection 

    Legal ways and means available to a private corporate entity, which (in its view) has been unlawfully treated by a governmental agency of a Member State, which in turn acted on the basis of a EC regulation contrary (in the entity's view) to the EC Treaty.

The goal of that article is pointing out the measures available to private corporate entity, where it right guarantee by the European Law are breached. The issues of that article will be inter alia responsibility of a Member State- the definition of governmental agency of Member State, the main topic will be the available ways in which such entity could claim under Community Law and national law. The emphasis will be put down to Enforcement by the European Court of Justice (Hereinafter the ECJ, or Court of Justice, or Court), and the Enforcement through the national courts. The last topic will be concern the State Liability and the joint Liability.

Why that matter is so important?

The essence of above mentioned issues is the enforcement of law. This is the basic of legal system. Without enforceability of law provisions, the right which are guarantee, probably will be the dead words. The Member States as the whole, and the domestic authorities will be unpunished, could arbitrary -given right- in every moment give back. Its obvious that it must be some whip which protect the entity, the established Internal Marker, and functioning the Four Freedoms. Official of Member States meet often the foreign companies, their services and goods which was puts on the market, and sometimes cautiously or even unwillingly caused harm and losses, while breaching the law. ECJ stated in Simmenthall SpA1 that the Community law 'must be fully and uniformly applied in all the Member States from the date of their entry into force and so long as they continue in force '. The drafters of Treaties envisaged that infringement could happened and guarantee the measures in EEC.

Enforcement by the ECJ : Articles 226-228 EC

One of the methods for such entity is set out in Article 226 EC. This provides as follows:

'If the Commission considers that a Member State has failed to fulfill an obligation under this Treaty, it shall deliver reasoned opinion on the matter after giving the State concerned the opportunity to submit it observation.

If the State concerned does not comply with the opinion within the period laid down by the Commission the latter may bring the matter before the Court of Justice.'

Further next article said about situation where the Member State considers that another Member State has failed to fulfill an obligation under this Treaty may bring the matter before the court of Justice.

But for purposes of that article it is irrelevant.2

In opinion of scholar like Jan Harden3 provision laid down in that Article has played the leading role in the 'centralized enforcement of EU Law' The jurisprudence split the Art 226 proceeding to two main elements, known as the administrative stage and the judicial stage. The usual process is that the Commission initiates matters with an informal letter to the Member State government in which the Commission sets out the reason it suspects an infringement. . The Member State government is invited to reply and to supply further information. This will be followed by the formal request to the Member State to submit the observation known as the 'letter of notice'. The main goal of that stage is to negotiate the agreement. Only if there is no agreement the Commission reach the final stage of that stage and delivered the reasoned opinion. Only if in the opinion of the Commission the Member State fail to comply the matter will be referred to ECJ. Thus the scholars called the administrative process, with the judicial proceeding as the backdrop to structure the negotiations between the Commission and the Member States.

The main disadvantage of that procedure is the discretion of the Commission which is non reviewable. The discretion of the Commission related to the possibility of suing and the terms. That was stated in case Lutticke v Commission4 Lutticke complained to the Commission that Germany had violated Community law in respect of a particular tax regime it had adopted. The Commission investigated the complaint and came to the view that Germany had not infringed Community Law, and decided not to take further action. Lutticke sought judicial review of the Commission decision. The ECJ court held inter alia that 'No measure taken by Commission during this stage has any biding force. In Commission v United Kingdom ECJ held that the motives in commencing infringement proceedings was not the issue that a Member State could challenge by way of judicial review.5

In other vein the ECJ hold that the reasoned opinion must contain a sufficiently ' coherent exposition of the reasons which led the Commission to the conviction that the State concerned failed to fulfill an obligation under the Treaty.'6

The most emphatically opinion about that Procedure the ECJ delivered in case Commission v Netherlands7. In paragraph 18 its laid down that 'an action for failure to fulfill obligation the purpose of the pre-litigation procedure is to give the Member State concerned an opportunity ..., to avail itself of its right to defend itself against the charges formulated by the Commission.' And further (in 20 ) that proceeding is 'delimited by the pre-litigation procedure governed by that provision.. The Commission reasoned opinion cannot examine a ground of complaint which was not formulated in the reasoned opinion.

The ECJ express that time to respond must be sufficient to the views which are set out in reasoned opinion. In case Commission v France8 (relating ' mad cow disease') The Commission initially gave France five working days to respond to its reasoned opinion. At France request this was extended to two weeks (albeit the two-week period included Christmas break). The ECJ states that in paragraph 65 that the time must be 'reasonable to reply to letters of formal notice and to comply with reasoned opinion..., or to prepare the defense.

The above mentioned disadvantage of the discretion was very good illustrated in case Star Fruit v Commission9.

The fact of that case are as follows: the Belgian banana trader alleged that it had been prejudiced by the organization of the French banana market which it believed was contrary to EC law. The trader complained but the letter did not commence proceeding against France. Star Fruit sought to take the Commission to court for failure to act(under Article 232 EC). The court ruled that the action was inadmissible:

[11]. It is clear from the scheme of Article of the Treaty that the Commission is not bound to commence the proceeding provided for in that provision but in this regal has a discretion which excludes the right for individuals to require to adopt a specific position..

[14]. Consequently, the applicant cannot be entitled to raise the objection that the Commission failed to commence proceeding against the French Republic pursuant to Article [226] of the treaty.

This discretion has been widely criticized in academic literature as diminishing the effectiveness of EC law. The European Ombudsman also join to that vices. His observation puts for example in 'Own-initiative Inquiry into the Commission's Administrative Procedures for Dealing with Complaints under Article [226] where he emphasize that 'Commission in dealing with complaints lodged by private citizens concerning Member States' failure to fulfill their Community law obligation... The allegation ... concerned in particular, excessive time taken to process complaints, lack of information about the ongoing treatment of the complaints and not receiving any reasoning as to how the Commission had reached a conclusion that there was no infringement.

Commission in response to that allegation undertakes to consider the matter within twelve months and to keep the complainant informed of the steps taken and the outcome. Of course it bring transparency to the process, but the second important matter the decision of initiation the process is still in full discretion.

Scope of responsibility.

Subsequent the next question which arise is the matter of scope of responsibility. Here the Court of Justice in long line of case law point out that the central government of a Member State is responsible for the acts and omissions of all state agencies ‘even in the case of a constitutionally independent institution10 Thus the central government is responsible not only for all of its own action, but also for those regional and local government. In ‘Spanish Strawberries’11 case Court held that the State is also indirectly responsible for the action of private parties. The fact of the case are:

[2] The Commission states that for more than one decade it has regularly received complaints concerning the passivity of the French authorities in face of violent acts committed by private and by protest movements of French farmers directed against agricultural products from other Member States.

[4] …tomatoes from Belgium were treated in the same way.

[8] … the French Government replied that it had always strongly condemned the acts of vandalism committed by French farmers,

[10] … In that opinion it stated that, by failing to take all necessary and proportionate measures in order to prevent the free movement of fruit and vegetables from being obstructed by action by private individuals, the French Republic had failed to fulfill its obligations under the common organizations of the markets in agricultural products and Article [s] [28] and [10] EC.

The aftermath of that case was wide. The extension of responsibility in case above was significant. State and its force must behave their very best to prevent such action.

The important problem to the States is the constitutional independence which prevent the central government from intervening to the local and regional authorities to curtail the breach, especially in federal country where central government haven’t measures to discipline the independent body. The last problem is the responsible the central government from the acts of judiciary which in all Member States is independent. That difficult problem was firstly treated ambivalent by the Commission. Advocate General Warner suggested in delivered opinion in Bouchereau12 that Article 226 could not be used in cases of simple judicial error but would be available in circumstances where a national court deliberately disregarded or ignored EC law. Further where the problems of judicial errors arose the ECJ decided to work out that problem (that case further below.)

Sanction: Pecuniary Penalty under 228 Article.

Originally Article 228 of EC Treaty was provides that: ‘If the Court of Justice finds that e Member State has failed to fulfill an obligation under this Treaty, the State shall be required to take the necessary measures to comply with the judgment of the Court of Justice’. Legal Commentators like e.g. Szyszczak argued that even if the outcome of an Article 226 process is ‘successful’, there is no genuine sanction against a Member State which refuse to abide by the Court ruling.’ That situation changed in 2002 where the treaty on European Union introduced the institution of Pecuniary Penalty. It was intended to give teeth to the infringement procedure, and to provide a sharper incentive for Member States to comply with the ECJ ruling against them. Now the Article stated that:

[228]…. If the Member State concerned fails to take the necessary measures to comply with the Court’s judgment within the time- limit laid down by the Commission, the latter may bring the case before the Court of Justice. It doing so it shall specify the amount of the lump sum or penalty payments to be paid by the Member State … IF the Court of Justice finds that the Member State concerned has not complied with it may impose a lump sum or penalty payment on it.’

C. Harlow And R. Rawling13 regarding to the case Commission v Greece. Initiated on the basis of five years on non- implementation of non- compliance with an ECJ ruling convening a toxic waste dump at Kouroupitos in Crete, it ended in the imposition of a daily penalty payment of €20,000 coupled with an order to close the dump…. Six months later when Greece began payment under threat that Commission would otherwise withhold its aid payments, nothing had been done to remove the offending dump that was the subject of the proceedings. Six months later again, when the European Parliament’s Environment Committee met in Brussels it heard that Greece, which by now owed €4,2 million, had paid off € 2.98 million, though otherwise the position had not changed; the fines were now remitted with a promise of rehabilitation… finally press notice announced new Article 226 proceedings against Greece.

That penalty sanction sharpened and improved the Commission centralize enforcement of EU Law. The penalty imposed can be significant. The basis fine is €500 per day. This is the minimum. To calculate the applicable fine, this minimum is multiplied by e series of coefficients:

  1. a coefficient on a scale of 1 to 20 to mark the seriousness of the infringement

  2. a coefficient on a scale of 1 to 3 for the duration of the infringement

  3. a coefficient reflecting the Member State’s ability to pay, ranging from 1 for Luxemburg to 26,7 for Germany.

Thus the largest sum involve Germany, and would come 801,000 euros over day of around € 292 million per year..

It seems that Court started to wield its power to impose payment against Member States quite aggressively. The Commission v France14 was remarkable case. It regards the ‘ persistent and possibly deliberate violation’ by France of EU fisheries policy on drift-net trawling. The court ruled that

[75] To punish the failure to comply with the judgment in Case c-64/88 Commission v France, the Commission suggested that the Court should impose a daily penalty payment on the French Republic from delivery of the present judgment until the day on which the breach of obligations is brought to an end. In light on particular features of the breach that has been established, the Court considers that it should examine in addition whether imposition of lump sum could constitute an appropriate measure

[80] The procedure laid down in Article 228 [2] EC has the objective of inducing a defaulting Member State to comply with the judgment establishing a breach of obligations and thereby of ensuring that Community law is in fat applied. The measures provided for by that provision, namely a lump sum and a penalty payment, are both intended to achieve this objective.

Court Justice broadly followed the methodology suggested by the Commission, and France was ordered to make penalty payments of €57,761,250 for each six month period of future non-compliance and- in the light of ‘the public and private interests in issue’- a lump sum payment of €20,000,000.

Conclusion of Article 226 procedure

The record of cases shows that that procedure could be a sufficient way to protect private entity but some problems underlined above must be solve. Firstly and the most important the discretion of Commissions for compliance, the other is the discretion of administrative procedure. The scholars commented that the Court has done very little to seek to advance the procedural protections accorded to private parties who complain to the Commission, notwithstanding the Commission’s self-confessed reliance on such compliance.

Furthermore the Penalties which could be impose cause that Commission ‘now possesses a formidable set of tools under Articles 226 to 228 EC to tackle infringements Community law effectively15

Enforcement through the national courts

This is the second way to private entity to protect its own right. In ECJ opinion from the earliest case law until the present day, the Court has engaged in a prolonged and radical program that has resulted in the judicial creation of a series of ways in which national courts, rather than the Court of Justice, are expected to play the lead role in the enforcement of community Law against the Member States national authorities and even private parties. Three principal means have been established:

  1. the creation and subsequent expansion of the law of direct effect (Van Gend en Loos and its progeny)

  2. the creation and subsequent expansion of the duty of consistent interpretation (also known as ‘indirect effect’)

  3. the creation and subsequent expansion of the principle of state liability.

Establishment of direct effect.

The first case where the Court invent the term ;direct effect’ was case Van Gend en Loos. The question in this case was whether as a matter of Community law an importer could plead before a Dutch national court that Article 25 EC had been infringed, and more specifically whether the importer could as a matter of Community law claim the protection of rights conferred on it by national law claim the protection of rights conferred on it by Community law, rights which the national court was under a duty to protect. The Dutch Court referred these question to the Court of Justice under Article 234 EC. That landmark case involved somehow all the Member States, three intervened in the proceedings, all other submitting arguments against the importer In opinion of Dutch and Belgian governments Court of Justice did not have the jurisdiction to answer the questions referred to it. In their view the enforcement of Article 25 was a matter of Community law governed by Article 226- and in result it was a question of Commission. If the Commission considered that Dutch authorities had failed adequately or properly implement the aspects of the free movement of goods which were required by Article 25m than it could bring infringement proceeding before the Court of Justice. Advocate general Roemer agreed with tenor of these submissions, but fortunately (to the private entity) the Court chose not to follow his advice. It rejected out of hand the submission that it lacked of jurisdiction, stating that, the above arguments had ‘no legal foundation’. The Court found that while the EC Treaty contained no specific textual authority in support of the view that provisions of Community law could be directly effective, authority for such a view could nonetheless be gleaned from ‘the spirit, the general scheme and the wording’ of the Treaty. Having established that the notion of direct effect was recognized in Community law, the Court then proceeded to consider whether Article 25 was sufficiently ‘clear and unconditional’ to be capable of bearing the direct effect.

Further extension of direct effect.

The condition pointing in Van Gend en Loos were restrictive. Court of Justice decided to relax it. It remarkable case Defrenne v Sabena16 ruled it. Under Belgian law, female air stewards were required to retire at the age of forty, unlike their male counterparts. Ms. Defrenne had been forced to retire from the Belgian national carrier, Sabena, on the ground in 1968. she brought an action claiming that the lower pension payments this entailed breached the principle in Article 141 EC that ‘ each Member State shall ensure and maintain the principle that men and women should receive equal pay for work of equal value.’ Further it appeared there was a number of obstacles to Article 141 being directly effective. The principle seemed to be neither clear nor unconditional, as complete implementation of the principle would required elaboration of further criteria.

In ruling Court held [23] As is shown by the very finding of the judgment making the reference, in such a situation the court is in position to establish all the facts which enable it to decide whether a woman worker is receiving lower pay than a male worker performing the same tasks. [24] In such situation at least , Article [14] is directly [effective] and may thus give rise to individual rights which the court must protect.

In that case Court brought the strict criteria set out in Van Gend en Loos and replaced it by more flexible test, whether the provision was sufficiently precise and unconditional to be invoked in national courts. In the eyes of judge, the invocability of EC Treaty provisions had been reduced to a simple question of justifiability.17

Significant in that case was also the fact that unlike in Van Gend en Loos case where trader claim the Dutch customs authorities- part of Dutch State. Defrenne, by contrast was taking an action against the private company- the Belgian airlines- Sabena. The importance in that ruling was that Treaty provision such as Article 141 were capable of bearing both vertical and horizontal direct effect; that is, they may invoked, relied on and be enforced in domestic legal proceedings hwther the party proceeded against is the state of a private party.

Direct ‘effect of Directives.'

That matter is more difficult . The principle provides that [Article 249 EC] directive shall be binding, as to the result to be achieved , upon each Member State to which it is addressed, but shall leave to the national authorities the choice of form and methods. A number of objectives were posited to the notion that Directives could be capable of direct effect.

It was stated three things firstly that the discretion of form of implementation resulted in individuals being able to derive rights only from the executory acts of national authorities, and not from the directive themselves. Secondly outlined that direct effect of ‘directive could blur the distinction between Directives and Regulations, a distinction which was so clearly spelt out in Article 249. Lastly that such effect could allow the EC in effect to legislate through the back door in areas that the Treaty had not permitted through the front.

Notwithstanding the above arguments the Court ruled in remarkable Case Van Duyn v Home Office18 that the Directive in certain circumstances could bear the direct effect. Van Duyn was refused leave to enter the United Kingdom I order to take up an offer of a secretarial post at the Church of Scientology, as the UK government imposed a ban on foreign scientologic entering the United Kingdom. Ms van Duyn challenged the ban on the ground, inter alia , that it breached Directive 64/221/EEC, which required that any ban be based upon the personal conduct of the individual. The Court of Justice considered that her association with the church of Scientology met the requirements of the directive.

In paragraph 12 held that ‘… by Directive, imposed on Member States the obligation to pursue a particular course of conduct the useful effect of such an act would be weakened if individuals were prevented from relying on it before their national courts and if the latter were prevented from taking it courts to refer to the Court questions concerning the validity and interpretation of all acts of the Community institution, without distinction, implies furthermore that these acts may be invoked by individuals in the national courts. It is necessary to examine, in every case, whether the nature, general scheme and wording of the provisions in question are capable of having direct effects on the relations between Member States and Individual.

That case cause broad (In France and Germany) counter –reaction in national courts. P Figueroa Regueiro19 highlight that the ‘reasoning of [ the French Conceil d’Etat and the German Bundesfinanzhof ran along similar lines. They considers that Article [249] expressly distinguished Regulations from Directives and , a only the former were described as ‘ directly applicable’ the latter seemed to be intended to take effect within the national order only via national implementing measures. The development of the doctrine o direct effect of Directives was considered by the national courts to push the Treaty too far. The Court of Justice realized that the fact that its arguments were perceived by national courts to be an implausible interpretation of the treaty could undermine the co-operation of national courts, so a new argument was introduced in support of direct effect of Directives … the so-called ‘estoppels’ argument.’


The ‘Estoppel’ was adopted firstly to justify the extension of direct effect to Directives, in case Ratii20 It runs that Directives impose a duty upon Member States rely upon and gain advantage through their failure to carry out this obligation; they are thus ‘estopped’ or prevented from denying the direct effect of Directives once the time limit for their limit.

That argument has one very important implication, as the direct effect of Directives is predicated on the ‘fault’ of the Member State in failing to implement the Directive, it follows that parties may invoke and rely on the terms of such Directives in national legal proceedings against the state. The significant limitation is that, that argument may be used t justify the vertical direct effect of Directives, but not the horizontal direct effect.

Extension of the State

The other topic which is the most significant is the scope of reliance the Central Government. Good illustration was held by Court of Justice in Case Foster v British Gas.21 Ms Foster was forced to retire at sixty, whereas men could continue working until sixty-five. She and women evoked the Equal treatment Directive against her former employer, British gas. The latter was at the time a nationalized industry- the board members were appointed by a minister in the UK government, who could also issue to the board various direction and instruments. The Court held:

[18] On the basis of those considerations, the Court has held in a series of cases that unconditional and sufficiently precise provisions of a Directive could be relied on against organizations or bodies which were subject to the authority or control of the State of had special powers beyond those which result from the national rules applicable to relation between individuals.

[19] The Court has accordingly held that provisions of a Directive could be relied on against tax authorities… local or regional authorities… constitutionally independent authorities responsible for the maintenance of public order and safety… and public authorities providing public health services…

[20] It follows… that a body, whatever its legal form, 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, is included… among the goodies against which the provisions of a Directive capable of having direct effect may be relied upon.

To precise the Court judgment contain no formal definition as such of ‘the state’, of ‘organs of the state’ or of ‘emanation of the state’. Rather the Court has preferred to leave it to the national courts to determine, on a case-by-case basis, whether the general approach outlines in Foster applies or not.

Consistent interpretation

That principle is created in Case Von Colson and Kamaan22 they sought employment in a German prison which was administered by the Land Nordhein- Westfalen. The prison catered exclusively for male prisoners. Ladies were refused employment on the ground, it appears, of their sex. They sued in the German labor court relying on the German law which had purported to implement the terms of Directive 76/207/EC, the Equal Treatment Directive. Under the national law, the German court could order by way o remedy that Von Colson and Kamaan be compensated only for such losses as they had suffered as a result of applying for the positions which had been denied them. No broader compensation or damages for discrimination were permitted. The national court ask whether such a restriction in the availability of compensation was compatible with Community law. Ladies cannot relied before the German court on Directive because its terms were insufficiently clear and unconditional to satisfy the test for direct effect. Court noted:

[23] Although … full implementation of the Directive does not require any specific form of sanction for unlawful discrimination, it does entail that that sanction be such as to guarantee real and effective judicial protection. Moreover it must also have a real deterrent effect on the employer. It follows that where a Member State chooses to penalize the breach of the prohibition of discrimination b the award of compensation must in any event be adequate in relation to the damage sustained…

[24] In consequence it appears that national provisions limiting the right to compensation of person who have been discriminated against as regards access to employment to a purely nominal amount, such as, for example, the reimbursement of expenses incurred by item in submitting their application, would not satisfy the requirements of an effective transposition of the Directive…

[26] The Member States’ obligation arising from a Directive to achieve the result envisage by the Directive and their duty under Article [10 EC] to take all appropriate measures whether general or particular, to ensure the fulfillment of that obligation, is binding on all the authorities of Member States including, for matters within their jurisdiction, the courts. It follows, that in applying the national law and in particular the provisions of national law specifically introduced in order to implement Directive 76/207, national courts are required to interpret their national law in the light of the wording and purpose of the Directive…

[28] It is for the national court to interpret and apply the legislation adopted for the implementation of the Directive of the Directive in conformity with the requirements of Community law, insofar as it is given a discretion to do so under national law.

The two sources of indirect effect: Article 6 of Directive 76/207/EC and Article 10 EC. Article 6 [of Directive] provides that ‘Member States shall introduce into their national legal systems such measures as are necessary to enable all persons who consider themselves wronged by failure to apply to them the principle of equal treatment within the meaning of [Directive] to pursue their claims by judicial process’.

Measures that national courts must take into account

The concept of indirect effect was established as a free- standing principle in its own right. In Grimaldi23, the Court of Justice held that national courts were to take into account not just of ‘hard law’ (treaty provisions, Regulations, Decisions, Directives) but also of legally non-binding recommendation. Further in Case Pupino24 Court extended indirect effect to the third pillar of the European Unions. That case arouse out of a dispute relating to the interpretation by an Italian criminal court of Council Framework Decision 2001/220/JHA, concerning the safeguards afforded to vulnerable victims when they appear as witnesses in criminal proceedings. The Framework decision was adopted under Article 34(2) TEU, which provides that’ Framework Decision shall be binding upon Member States as to the result to be achieved but shall leave to the national authorities the choice of form and methods. They shall not entail direct effect’. During the record; [39] In support of their position, the Italian and UK Governments argue that, unlike the EC Treaty, the Treaty of European Union contains no obligation similar laid down in the Article 10 EC, on which the case law of the Court of Justice partially relied in order to justify the obligation to interpret national law in conformity with Community law.’. The answer of Court was simple [40] That argument must be rejected. To justify that opinion they quoting the Article 1 of the Treaty on European Union which ‘provide that that Treaty marks a new stage in the process of creating an ever closer union amongst the peoples of Europe and that the task of the Union, which is founded in the European Communities, supplemented by the policies and forms of co-operation established by that treaty, shall be to organize, in a manner demonstrating consistency and solidarity, relations between their people. It would be difficult for the Union to carry out its task effectively if the principle of loyal co-operation, requiring in particular that Member States take all appropriate measures whether general or particular, to ensure fulfillment of their obligations under European Union law, were not also binding in the area of police and judicial co-operation In criminal matters, which is moreover entirely based on co-operation between the Member States and the institutions.

Commentators noted the twofold significance of the at decision. First, there is no equivalent in the treaty on European Union of Article 10 EC, the one provision of the EC Treaty on which the Court of Justice had expressly relied in support of its creation of the duty in Von Colson, As indicated in Pfeifer, the duty now seen but Court as one which, as direct effect has always been, requires no textual justification. It is rater, a duty that inheres ‘within the system’ of the Treaties. Secondly, the judgment is significant for its decoupling of indirect effect. Article 34 TUE makes it plain that Framework Decisions under third pillar cannot entail direct effect, yet Pupino shows that, despite this, they can be indirectly effect.

State Liability

The principle of State liability is had its origin in cases in 1970, when it was established. In Case Reve- Zentralfinanz 25. The court stated that ‘it is for domestic legal system of each Member State to designate the courts having jurisdiction and to determine the procedural conditions governing actions at law intended t ensure the protection of the right which citizens have from the direct effect of Community law. Jurisprudence split that principle into two condition, known as the condition of equivalence and the condition of effectiveness. The first states that procedural circumstances required by national law will not less favorable in the context of the enforcement od Community norms than they are with regard to norms deriving from domestic law. The second states that procedural circumstances required by national law will not be applicable if their effect is to make it impossible in practice to exercise the rights derived from Community law which national courts are obliged to enforce.

In beginning of 1990s, Court decided to extraordinary cases which caused the national procedural autonomy t obey substantially rewritten. The first is Factortame26 and the second is Franchovich27. That to cases established that doctrine of state liability. The facts of the case in Factortame concerned the British Merchant Shipping act 1988. Factortame in that case argued that the provisions of the Act were contrary to Community law in that they effectively prevented several Spanish- Owned fishing vessels from fishing against the United Kingdom’s quota under the terms of the common fisheries policy, contrary to Article 43 EC. .Meantime the Factortame sought the interim order from the national court, the effect of which would have been order the UK government to suspend the operation of the relevant provision of the Act. In proceeding before the English court House of Lords found that the applicants would suffer irreparable damage if the interim relief which they sought was not granted. The House of Lords granted that English courts had no grant such relief, as the remedy sought was barred by statute. Firstly the court remind the case Simmenthall SpA and those provisions that ‘directly applicable rules of Community law ‘must be fully and uniformly applied in all the Member States from the date of their entry into force and for so long as they continue in force’ (paragraph 140 and that ‘in accordance with the principle of the precedence of Community law, the relationship between provisions of the treaty and directly applicable measures of the institutions on the one hand and the national law of the Member States on the other is such that those provisions and measures… by their entry into force render automatically inapplicable and conflicting provisions of …national law’ (paragraph 17) and further in Paragraph 20 held that ‘ any provision of a national legal system and any legislative administrative of judicial practice which might impair the effectiveness of Community law by withholding from the national court having jurisdiction to apply such law the power to do everything necessary at the moment o its application to set aside national legislative provisions which might prevent even temporarily, /community rules from having full force and effect are incompatible with those requirements, which are the very essence of Community law.’ And add in paragraph [22] that interpretation is reinforced by the system established by

Article [234 EC] whose effectiveness would be impaired if a national court, having stayed proceedings pending the reply by the Court of Justice to the question referred to it for a preliminary ruling, were not able to grant interim relief until it delivered its judgment following the reply given by the Court of Justice.

As we see at the heart of Factortame lies the same principle the motivated the Court of Justice in Von Colson: the notion of effective judicial protection.

Establishment of state liability

The case was the State liability was well- establish was landmark Francovich28. The case concerned Italy persistent failure in implementation the terms of Directive 80/987/EC., which guarantee to employees a minimum level of protection under Community law in the event of the insolvency of their employer. The Directive provided guarantees of payment of unpaid wage claims. The Court of Justice found that the terms of this directive were not in their entirety sufficiently precise an unconditional for it to be directly effectives. Citing the [Simmenthall] Court reminded that the ‘courts whose task it is to apply the provisions of Community law in areas within their jurisdiction must ensure that those rules take full effect and must protect the rights which they confer on individuals. ‘ Further emphasize that ‘[35] it follows that principle whereby a State must be liable for loss and damage caused to individuals as a result of breaches of Community law for which the State can be held responsible is inherent in the system of the treaty.’ And add [36] ‘ a further basis of for the obligation of Member State’ are found… in Article, under which member states are required to take all appropriate measures, whether general or particular, to ensure fulfillment of their obligations under Community law. Among these is the obligation to nullify the unlawful consequences of a breach of Community law.’ And finally statute the three condition' [40] the first of those conditions is that the result prescribed but the directive should entail the grant of right to individuals. The second condition is that it should be possible to identify the content of those right on the basis of the provision is that it should be possible to identify the content of those rights on the basis of the provisions of the Directive. Finally, the third condition is the existence of a casual link between the breach of the State’s obligation and the loss and damage suffered by the injured parties. And lastly [42] …it is for the internal legal order of each member state to designate the competent courts and lay down the detailed procedural rules for legal proceeding intended fully to safeguards the rights which individuals derive from Community law.’ And finally ‘ … the substantive and procedural conditions for reparation of loss and damage laid down by the national law o the Member States must not be less favorable than those relating to similar domestic claims and must not be so framed as to make it virtually impossible or excessively difficult to obtain reparations.’

Condition for, and expansion of state liability

The two other joined case Brasserie du Pecheur v Germany and R v Secretary of State for Transport ex parte Factortame29. Basserie du PEcheur, a French firm, had been forced to discontinue exports of beer to Germany in 1981. This was due to a German ‘purity law’ which did not allow beer lawfully marketed according to different rules in other Member States to enjoy the designation ‘Bier’ and did not allow the marketing of beer which contained additives. This law was declared illegal in 1987 on the ground that it contravened Article 28 EC, the provision outlawing quantitive restriction or measures having equivalent effect on the free movement of goods. Brasserie du Pecheur sought compensation of Dm 1,800,000 for the loss of sales between 1981 and 1987. The background of case for Factoretame was described above. After the system of registration contained in the unites Kingdom’s Merchant Shipping

Act 1988 had been declared illegal, the applicants claimed for damages against British government. Firstly Court remind what earlier called in Francovich and add that [35]…, according to national rules, the breach complained of is attributable to the legislature cannot affect the requirements inherent in the protection of the rights of individuals who rely on Community law and, in this instance, the right to obtain redress in the national courts for damage caused by that breach…’ Later it adds that [41] Article [288 EC] refers as regards the non- contractual liability of the Community,, to the general principles common to the laws of the Member States, from which, in the absence of written rules, the Court also draws inspiration in other areas of Community law. [42] Second, the conditions under which the State may incur liability for damage caused to individuals by a breach of Community law cannot, in the absence of particular justification, differ from those governing the liability of the Community in like circumstances. The protection of the rights which individuals derive from Community law cannot vary depending on whether a national authority of a Community authority is responsible for the damage…. And later [50] Consequently , in each case the German and United Kingdom legislatures were faced with situation involving choices comparable to those made by the Community institutions when they adopt legislative measures pursuant to a Community policy. [51] In such circumstances, Community law confers a right to reparation where three conditions are met; the rule f law infringed must be intended to confer rights on individuals;; the breach must be sufficiently serious; and there must be a direct casual link between the parties. Finally it stated that[55]… as regards both Community law the decisive test for finding that a breach of Community law is sufficiently serious is whether the Member State or, the Community institution concerned manifestly and gravely disregarded the limits of its discretion. The conclusion of the ruling is the ‘for consequences of the loss and damage caused in accordance with the domestic rules in liability, provided that the conditions for reparation of loss and damage laid down by national law must not be less favorable than those relating to similar domestic claims and must not be such as in practice to make it impossible of excessively difficult to obtain reparation. [82] reparation for loss of damage caused to individuals as a result of breaches of Community law must be commensurate with the loss of damage sustained so as to ensure the effective protection for their rights. [83] In the absence of relevant Community provisions, it is for the domestic legal system of each ‘Member State to set the criteria for determining the extent of reparation. However, those criteria must not be less favorable than those applying to similar claims based o domestic law and must no be such as in practice to make it impossible of excessively difficult to obtain reparation.’

Hence the judgment held three condition to be meet: Firstly where the rule of law infringed is ‘ intended to confer rights on individuals ‘, where the breach is ‘ sufficiently serious’, and where there is a ‘direct causal link’ between the breach of the obligation resting on the state and the damage sustained by the injured parties. The case also established is that such liability may arise even in the context of national legislation.

As the Court established the liability arouse only where the breach is ‘ sufficiently serious’. There are cases which highlight that not every breach of Community law will be sufficiently serious to give rise to liability. The latitude of the Court’s approach is illustrated by the following case, in which the Court ruled that the UK government had misconstrued a Directive and had, thereby, failed to transpose it adequately into national law. The Court went on hold, however, that as the United Kingdom’s interpretation was both plausible and in good faith, its breach of Community law was not sufficiently serious to merit liability.30 In paragraph [40] Those same conditions must be applicable to the situations… in which a Member State incorrectly transposes a Community Directive into national law. A restrictive approach to State liability is justified in such a situation, for the reasons already given by the Court to justify the strict approach to non- contractual liability of Community institutions of Member States where exercising legislative functions in areas covered by Community law where the institution of State has a wide discretion: in particular, the concern to ensure that the exercise of legislative functions is not hindered by the prospect of actions for damages whenever the general interest requires the institutions or Member States to adopt measures which may adversely affect individual interests… And further to express more fully add [41] whilst it is in principle for the national courts to verify whether or not the conditions governing State liability for a breach of Community law are fulfilled, in the present case the Court has all the necessary information o assess whether the facts amount to a sufficiently serious of Community law.[42] According to the case law of the Court, a breach is sufficiently serious where, in the exercise of its legislative powers, an institution or a Member State has manifestly and gravely disregarded the limits on the exercise of its powers… Factors which the competent court may take into consideration include the clarity and precision of the rule breached. [43] In the present case, is imprecisely worded and was reasonably capable of bearing, as well as the construction applied to it by the Court in this judgment, the interpretation given to it by the United Kingdom in good faith and on the basis of arguments which are not entirely devoid of substance… That interpretation, which was also shared by other Member States, was not manifestly contrary to the wording of the Directive or to the objective pursued t it.

Since Pecheur/ Factortame III the most significant expansion of state liability occurred in Kobler v Austria31. In that controversial ruling stated, that state under special circumstances is also liable for damages in respect of rulings by national courts that were in breach of Community law. Kobler was a professor employed in an Austrian University. Part of his salary was based on length of service, but periods of employment in universities in Member States other than Austria did not count towards this aspects of his salary. When the Austrian court held this to be compatible with Community law, Kobler brought as action in damages, arguing that the state was liable in respect of the court’s ruling.

Firstly Court emphasis that [34]... a court in last instance is by definition the last judicial body before which individuals may assert the rights conferred on then by Community law. Since an infringement of those rights by a final decision of such a court cannot thereafter normally be corrected, individuals cannot be deprived of the possibility of renderings the State liable in order in that way to obtain legal protection of their rights. Seeing important Court also regards to the problem of res judicata. [38[ In that regards the importance of the principle res judicata cannot be disputed… In order to ensure both stability of the law and legal relations and the sound administration of justice, it is important that judicial decisions which have become definitive after all rights of appeal have been exhausted or after expiry of the time limits provided for in that connection can no longer be called in question.. [40] It follows that the principle of res judicata does not preclude recognition of the principle of State liability for the decision of a court adjudicating at last instance.[43] As to the argument based on the risk of a diminution of the authority of a court adjudicating at last instance owing to the fact that its final decisions could by implication be called in question in processing in which the State may be rendered liable for such decisions, the existence of a right of action that afford , under certain conditions, reparation f the injurious effects of an erroneous judicial decision could also be regarded as enhancing the quality of a legal system and thus in the long run the authority of the judiciary. [45] In that connection, given that, for reason essentially connected with the need to secure for individuals protection of the rights conferred on them by Community rules, the principle of State liability inherent in the Community legal order must apply in regard to decisions of a national court adjudicating at last instance, it is for the Member States to enable those affected to rely on then principle by affording them an appropriate right of action Application of that principle cannot be compromised by the absence of a competent court. [54] In order to determine whether the condition is satisfied, the national court bearing a claim for reparation must take account of all the factors which characterize the situation put before it.[55] Those factors include, in particular, the degree of clarity and precision of the rule infringed, whether the infringement was intentional, whether the error of law was excusable of inexcusable the position taken, where applicable, by a Community institution and non-compliance by the court in question which its obligation to make a reference for a preliminary ruling under the third paragraph of Article 234 EC.


Above the all main way of enforce the EU law was described. The efficiency of that principles is the key issue. Without enforcement the acting new right will be without bigger sense. The measures described above could satisfied private corporate entity where their right are infringed.


European Union Law, Damian Chalmers, Christos Hadjiemmanuil [Cambridge]

Eu Law, Text, Cases and Materials Fourth Edition Paul Craig, Graine de Burca [Oxford]

1C 106/77

2Firstly because its not the subject of that article and second because using in practice is very rare, States prefer to leave its to do the Commission to take the action rather than institute legal provision themselves.

3See: I Harden 'What Future for the Centralized Enforcement of Community Law?' 2002

4Case 48/65

5Case 416/85

6Case 7/61

7Case 350/02

8 Case -1/00

9Case 247/87

10 See Case 77/69 Commission v Belgium [1970]

11 Case C 265/95

12 Case 30/77

13 In ‘accountability and Law Enforcement: the Centralized EU Infringement Procedure’.

14 Case c-304/02

15 Weneras argues in case against Ireland

16 Case 43/75

17 P. Pescatore, ‘The doctrine of „direct effect” an Infant Disease of Community Law’

18 Case 41/74

19 In ‘Invocability of Substitution and Invocability of Exclusion; Briging Legal Realism to the current development of the Case Law of Horizontal Direct Effect of Directives. Jean Monnet Working Paper 7/02

20 Case 148/07

21 Case c-188/89

22 Case 14/84

23 Case 322/88

24 Case C-105/06

25 Case 39/73


Case C-213/89

27 Joined casus c-6 and 9/90 Francovich and Bonifacy v Italy


29 Coined casus c 46 and 48/93

30 Case C 392/39 R v HM Treasury ex parte British Telecommunications plc

31 Case C-224-01

Praktyka w Kancelarii Ius Europae

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