Assignment Title: Discuss how and why the Court of Justice has developed and built upon the doctrine of direct effect since its decision in Case 26/62 Van Gend en Loos. PDF

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Assignment Title: Discuss how and why the Court of Justice has developed and built upon the doctrine of direct effect since its decision in Case 26/62 Van Gend en Loos....

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Word Count: 2499 Assignment Title: Discuss how and why the Court of Justice has developed and built upon the doctrine of direct effect since its decision in Case 26/62 Van Gend en Loos.

The principle of direct effect enables individuals to enforce particular European provisions in national and European courts in their favour. To be capable of direct effect a provision must satisfy several principles established by the court. The criteria that initially set out direct effect were recognised in (26/62) Van Gend en Loos. Yet throughout the years the European Court of Justice (CJEU) has expanded on the principle of direct effect, ensuring the rights of individuals are protected even when national law does not. Direct effect has now evolved to be both horizontal and vertical and it is no longer only treaty articles that are capable of direct effect. This essay shall analyse how and why the doctrine of direct effect has been built upon by the CJEU since the decision made in (26/62) Van Gend en Loos.

The principle of direct effect was not precisely stated in the treaties of the European Union (EU)1 and was established in (26/62) Van Gend en Loos. It was held that treaty articles were capable of having vertical direct effect amongst “member states and their citizens”2 as “Community constitutes a new legal order of international law for the benefit of which the states have limited their sovereign rights…the subjects of which comprise not only Member States but also their nationals.”3 Vertical direct effect allows an individual to invoke European provisions against a member state, though the European provisions must satisfy the criteria established by the CJEU in (26/62) Van Gend en Loos. The provisions are required to be sufficiently clear, adequately precise, unconditional and may not entail implementing measures.4 If the criteria are met, individuals may use the rights created by treaties in their favour and have the ability to invoke European provisions in European and national court as these rights “become part of their legal heritage”. Many scholars such as Joseph Weiler acknowledge the revolutionary effects of (26/62) Van Gend en Loos and the impact had on the rights of individuals5. While being one of the earliest fundamental rulings of the CJEU that shaped the growth of legal security for individuals6, (26/62) Van Gend en Loos failed to bring certainty over all aspects of direct effect. One issue that remained unresolved was whether treaty articles could have horizontal direct effect.7 1 Paul Craig and Gráinne De búrca, EU Law: Text, Cases, and Materials UK Version (7th edn, OUP 2020) 227. 2 (26/62) Van Gend en Loos, pages 113-114. 3 Ibid. 4 Ibid. 5 JHH Weiler, 'Van Gend en Loos: The individual as subject and object and the dilemma of European legitimacy'[2014] 12(1) International Journal of Constitutional Law 94,97. 6 Damian Chalmers and Luis Barroso, 'What Van Gend en Loos stands for' [2014] 12(1) International Journal of Constitutional Law 105, 105 -107. 7 Ibid (n2).

Horizontal direct effect gives individuals the ability to invoke European provisions against an alternative individual. While (26/62) Van Gend en Loos did not make it apparent if treaty articles could have horizontal direct effect, it was later confirmed in (43/75) Defrenne v Sabena that they could. In (43/75) Defrenne the court upheld the rights of a female airhostess in relation to equal pay under now 157 TFEU against her employer who had discriminated between genders8. The court clearly stated that treaty articles had the ability to have horizontal direct effect and be invoked against other individuals such as employers, in addition to the state.9 The CJEU aimed to make clear that individuals and their rights were protected against the actions of individuals as well as public bodies. Since the court’s decision in (43/75) Defrenne various treaty articles such as the internal market provisions have been ruled to have both horizontal and vertical direct effect. In addition to resolving the unanswered question in (26/62) Van Gend en Loos, (43/75) Defrenne allowed the CJEU to develop and extend the span of direct effect by simplifying and easing an individual’s ability to call upon EU provisions to guard their rights.10 While both (26/62) Van Gend en Loos and (43/75) Defrenne intend to protect rights that individuals hold, the development of case law as seen in (43/75) Defrenne allowed the CJEU to develop upon the doctrine of direct effect to safeguarding the rights of individuals in relation to the provisions of treaty articles.

Directives contrary to treaty articles were initially sought not to have direct effect as they were addressed to member states and not their citizens. Furthermore, Article 288(3) TFEU stated that as Directives are binding, a member state shall be able to select the form and method to which a Directive will be implemented. Nevertheless, the case of (41/74) Van Duyn v Home Office changed this view when the CJEU held that Directives had the capability to have vertical direct effect. The CJEU ruled that despite the UK not having implemented a Directive through national legislation as well as the transposition deadline having expired, it was still feasible to rely on the directive.11 It would otherwise be unjust to prohibit citizens from relying on rights set out in Directives due to their member states failure to transpose the Directive. The CJEU further identified how “the useful effect of such an act would be weakened if individuals were prevented from relying on it before their national 8 (43/75) Defrenne v Sabena. 9 Ibid. 10 Ibid. 11 (41/74) Van Duyn v Home Office.

courts.”12 Additionally, the fact that domestic courts can raise questions concerning EU measures to the CJEU under Article 267 TFEU, suggests these provisions can be called on by individuals.

Nonetheless, the CJEU states “It is necessary to examine, in every case, whether the nature… and wording of the provision in question are capable of having direct effects.”13 Emphasising that not every Directive will necessarily have direct effect. (41/74) Van Duyn established that for Directives to have direct effect they must be unconditional, sufficiently precise and the member state must not have transposed the Directive by the deadline or did not transpose it correctly.14 This was highlighted in the joint case of (6/90 and 9/90) Francovich and Bonifaci v Italy which held that a Directive did not have direct effect since it was found not to be sufficiently precise due to it not stating who should have to guarantee the insolvency protection scheme.15 In the case of (148/78) Ratti the CJEU gave an argument of estoppel stating that a member state cannot escape its obligations by depending “on its own failure to perform the obligations which the Directive entails”16 as this would be unjust. Additionally, the member state cannot bypass the aims of a Directive by not implementing the Directive. Nor can an individual try to call upon a Directive against their member state if the transposition date has not passed which was stressed in the case of (129/96) InterEnvironnement Wallonie. The case of (129/96) Inter-Environnement Wallonie further held that member states cannot pass laws that frustrate the aims of the Directive after its issued as the effectiveness of a Directive would be abolished17. The CJEU have enormously expanded on the concept of vertical direct effect of Directives and have ultimately distance from the belief that Directives were not at all capable of direct effect. The development made by the CJEU through case law such as (41/74) Van Duyn has consequently given individuals the ability to depend on rights set out in Directive to protect themselves against a member state. Nevertheless, cases such as (148/78) Ratti and (129/96) Inter-Environnement Wallonie the CJEU have set out logical limitations on the vertical direct effect of a Directive which rationalized when and how much direct effect a Directive can have.

12 Ibid, para 12. 13 Ibid. 14 Ibid (n11). 15 (6/90 and 9/90) Francovich and Bonifaci v Italy. 16 (148/78) Pubblico Ministero v Rat, para 2. 17 (129/96) Inter-Environnement Wallonie v Region Wallonne.

The case of (152/84) Marshall v Southampton Area Health Authority fundamentally differentiated vertical and horizontal directed effect of Directives.18 It additionally held that Directives did not have the ability to have horizontal direct effect due to them not being addressed to individuals. Advocate General Slynn advised that allowing Directives to have horizontal direct effect would critically blur the differences among regulations and Directives.19 The CJEU later held that “the binding nature of a Directive…exists only in relation to ‘each Member State to which it is addressed.”20 The CJEU reinstated this judgement in the case of (91/92) Faccini Dori21 despite Advocate General Lenz arguing in favour of horizontal direct effect in regards to Directives.22 The court then made it apparent in (152/84) Marshall, you cannot depend on direct effect to oppose a private individual, but you can against ‘emanations of the state’23. Academics such as Albors-Llorens state that the reasoning the court gave in (152/84) Marshall was heavily criticised and unconvincing24. Many individuals criticised the reasoning as it allowed individuals that were employed by the state to call upon their rights to oppose their employer, yet individuals employed by a private company could not. Many took this to be unjust.

The CJEU attempted to resolve the unfairness in following cases such as (188/89) Foster v British Gas where the court offers an alternative though still upholding the rule that Directives were not capable of horizontal direct effect. (188/89) Foster broadened the range of vertical direct effect of Directives by expanding the definition of an ‘emanations of the state.’25 In (188/89) Foster the court established a test to accurately determine what is meant by ‘emanations of the state’ and held it to be “a body…which has been made responsible…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 relation between individuals.”26 The test developed in (188/89) Foster allowed for greater levels of protection for the rights of individuals throughout the member states as it expanded the 18 Michael Dougan, 'The "Disguised" Vertical Direct Effect of Directives?' [2000] 58(3) The Cambridge Law Journal 586, 587. 19 (152/84) Marshall v Southampton Area Health Authority, para 24. 20Ibid, para 48. 21 (91/92) Faccini Dori v Recreb Srl. 22 Elspeth Berry, Matthew J Homewood and Barbara Bogusz, Complete EU Law: Text, Cases, and Materials (4th edn, OUP 2019) 140. 23 Ibid (n19). 24 Albors Llorens, 'The direct effect of EU directives: Fresh controversy or a storm in a teacup?' [2014] 39(1) European Law Review 850. 25 (188/89) Foster and others v British Gas plc. 26 Ibid, para 20.

definition of who can be classified as ‘emanations of the state.’ It now includes a greater scope of companies therefore increasing the amount of security that more individuals have on their rights. The criteria established in (188/89) Foster has been applied to several subsequent cases such as (8/81) Becker v Finanzamt, (103/88) Fratelli Costanzo v commune de Milano and (22/84) Marguerite Johnston v RUC. Even though the scope of horizontal direct effect of Directives was not significantly expanded, the case of (152/84) Marshall has considerably developed the vertical direct effect of Directives by allowing individuals to invoke Directives against someone who isn’t technically the state. Now (188/89) Foster has furthermore broadened the range that vertical direct effect is capable of by expanding on ‘emanations of the state.’

Nonetheless, the broadening of the term ‘emanations of the state’ and vertical direct effect itself has been thought to have blurred the ability to distinguish between horizontal and vertical direct effect.27 28 (188/89) Foster clearly displays the extent to which the court has expanded the range of vertical direct effect where an individual company can be deemed accountable for the state’s failure to implement a Directive. This could be thought to compromise the estoppel argument. Conversely, even after (188/89) Foster there still remains arguments in favour of Directives having horizontal direct effect. Advocate General Lenz states this is due to “a drive to do justice by the beneficiary of a provision which the Community legislator intended to be binding.”29 Yet the CJEU in (91/92) Faccini Dori gave several reasons to why Directives should not have direct effect including one being that the distinction amongst Directives and regulations would be unclear.30 However, the distinction would be apparent as member states are permitted to select the form and method of how Directives are implemented.

Even though (91/92) Faccini Dori reaffirmed that Directives could not have horizontal direct effect, many people question if this remains the case after (144/04) Mangold and (555/07) Kücükdeveci. In (144/04) Mangold the court found that the principle of non-discrimination (in terms of age) was a general principle of EU law.31 Even though Directives generally cannot have direct effect before the transposition deadline has expired, nor can they have 27 Ibid (n21), para 23-25. 28 (282/10) Dominguez v Centre Informatique du Centre Ouest Atlantique. 29 Ibid (n21), para 48. 30 Ibid (n21). 31 (144/04) Werner Mangold v Rudiger Helm.

horizontal direct effect, it was held that a general principle could. The national court was made to uphold the general principle of non-discrimination and therefore dismiss the opposing national law despite the transposition deadline for the Directive not having passed32. Nevertheless, (144/04) Mangold was criticized by Advocate General Sharpston for reducing legal certainty by allowing a Directive to have direct effect before the transposition deadline has passed in as well as being used horizontally.33 Despite this, the case of (555/07) Kücükdeveci reaffirmed it was possible to rely on a directive that mirrored the general principles even between two individuals34. Both (144/04) Mangold and (555/07) Kücükdeveci emphasise the length to which the CJEU have developed the doctrine of direct effect by reducing the limitation on horizontal direct effect of Directives that include a general principle. This allows for a wider range of rights to be protected. Yet Directives in general still severely lack horizontal direct effect meaning all rights are not secure.

To conclude, it is apparent the great length to which the CJEU have developed on the doctrine of direct effect through its evolutionary numbers of case law since its initial decision in (26/62) Van Gend en Loos. Through the expansion of judgments made by the CJEU, the protection of the rights received by individuals in the EU have increased drastically since (26/62) Van Gend en Loos. Previously, induvial did not have the ability to rely on EU law against other individuals, restricting them of their own rights. Whereas now the CJEU have completely reduced these horizontal limitations on the grounds of treaty articles and Directives that give rise to general principles of law. Nonetheless, the direct effect of general Directives is still heavily limited and therefore weakens the CJEUs aims to guard the rights of individuals in the EU. The EU could benefit from Directives being capable of horizontal direct effect as it would increase equality and fairness within the law, as well as reducing the uncertainty and confliction created in more recent cases such as (144/04) Mangold. Nevertheless, this itself does not come without its own problems and we can only wait to see if the CJEU decides to continue the expansion of the doctrine of direct effect. Bibliography Primary Legislation Legislation

32 Ibid. 33 (427/06) Birgit Bartsch v Bosch und Siemens Hausgerate. 34 (555/07) Seda Kücükdeveci v Swedex.

The Treaty on the Functioning of the European Union 1957. Table of cases (427/06) Birgit Bartsch v Bosch und Siemens Hausgerate (43/75) Defrenne v Sabena (282/10) Dominguez v Centre Informatique du Centre Ouest Atlantique (91/92) Faccini Dori v Recreb Srl (188/89) Foster and others v British Gas plc (6/90 and 9/90) Francovich and Bonifaci v Italy (129/96) Inter-Environnement Wallonie v Region Wallonne (152/84) Marshall v Southampton Area Health Authority (148/78) Pubblico Ministero v Ratti (555/07) Seda Kücükdeveci v Swedex (41/74) Van Duyn v Home Office (26/62) Van Gend en Loos (144/04) Werner Mangold v Rudiger Helm

Secondary Sources Books Craig P and De búrca G, EU Law: Text, Cases, and Materials UK Version (7th edn, OUP 2020) Berry E, Homewood M and Bogusz B, Complete EU Law: Text, Cases, and Materials (4th edn, OUP 2019) 140

Articles Weiler JHH, 'Van Gend en Loos: The individual as subject and object and the dilemma of European legitimacy'[2014] 12(1) International Journal of Constitutional Law 94. Chalmers D and Barroso L, 'What Van Gend en Loos stands for' [2014] 12(1) International Journal of Constitutional Law 105. Dougan M, 'The "Disguised" Vertical Direct Effect of Directives?' [2000] 58(3) The Cambridge Law Journal 586. Llorens A, 'The direct effect of EU directives: Fresh controversy or a storm in a teacup?' [2014] 39(1) European Law Review 850....