Direct Effect

• Direct effect – does a provision of EU law confer a right on individuals which are enforceable in national courts.

• Van Gend en Loos [1963]

  • Held that Dutch govt. could be sued in their national court for implementing a law that was contrary to the treaties.

  • EU constitutes “a new legal order” the subjects of are both Member States and nationals.

• Conditions for Direct Effect

  • Clear and Precise: Provision must give rise to identifiable rights that are set out unequivocally (Van Gend en Loos; Reyners v Belgium; Coop Agricola Zootecnica)

  • Unconditional: the provision does not depend on other measures and the state has no discretion as to implementation (Van Gend en Loos; Coop Agricola Zootecnica)

• Article 288 TFEU: Direct Effect of EU Law

  • Regualtions: It shall be binding in its entirety and directly applicable in all Member States

  • Decisions: A decision which specifies those to whom it is addressed shall be binding only on them.

  • Treaty Articles

    • Horizontal direct effect (i.e. can be enforced against other individuals - Defrenne v Sabena)

    • Vertical direct effect (i.e. can be enforced against the state – Van Gen den Loos)

  • Recommendations cannot have direct effect as they are not binding (Grimaldi)

Direct Effect and Directives

• Art 288 TFEU: “A 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 time deadline is usually c. 2 years.

• Note a member state cannot adopt contrary legislation before the deadline has expired (Adenler)

  • Directives therefore give rise to an immediate positive duty by MSs

• Conditions for DE of Directives:

  • 1) Sufficiently Clear, Precise and unconditional (Van Gen den Loos; Van Duyn)

  • 2) Incorrectly implemented (Ratti)

    • a) Not implemented at all (Ratti)

    • b) Implemented partially or incorrectly (VNO v Inspecteur)

    • c) Correctly implemented but incorrectly applied by national authorities so it fails to achieve its purpose (M&S v Commissioner)

  • 3) Implementation date must have passed (Ratti)

  • 4) The action must be against the state or an emanation of the state (Marshall v Southampton AHA; Doughty v Rolls Royce)

• Flexible interpretation of these conditions

  • The mere fact that the provision raises questions of interpretation which can be resolved by a court does not prevent DE (Van Duyn)

  • Just because the Member State is able to choose among several possible means of achieving the result required by the Directive does not prevent DE (Francovich)

• Directives only have vertical direct effect (Van Duyn) not horizontal direct effect (Faccini; Marshall)

• This principle of direct effect thereby makes every single citizen an enforcer of EU law.

  • Hence the twin with supremacy.

• French national courts initially reluctant to admit DE for directives and refused to hear cases (1980 - Cohn-Bendi). Since reversed by Boisdet [1991].

• Cases:

  • Van Duyn [1974]

    • Dutch citizen who wanted to move to the UK to work for the Church of Scientology. UK government considered working for Church of Scientology as against public policy which triggered exception to free movement of persons.

    • Van Duyn held that there was a directive that set out the criteria for such restrictions that the UK was ignoring.

    • ECJ held that individuals could invoke directives in domestic courts for three reasons

      • Effectiveness – they are not effective if they cannot be invoked.

      • Article 288 does not rule out direct effect for directives.

      • The provision of the treaty about preliminary references does not rule out directives.

    • Van Duyn could invoke the directive was because the UK had failed in its duty to implement the directive. She should have been able to invoke domestic law had it been properly applied by parliament and bought into domestic legislation.

    • NB Van Duyn lost the case as directive held to support UK’s case.

  • Ratti [1979]

    • Italy failed to implement a directive and Ratti was prosecuted under the harsher Italian law.

    • Held that to satisfy ‘unconditional’ the Directives implementation date must have passed. and to have DE the Directive must not have been implemented.

  • VNO v Inspecteur [1977]

    • Partial and incorrect implementation of a D in Netherlands

    • Following Ratti, partially implemented is incorrectly implemented.

  • M&S v Commissioners [2002]

    • UK legislation retroactively narrowed the period within which VAT collected in breach of a Directive could be claimed.

    • Following Ratti and VNO D can have DE where a national law is not applied to achieve its intended aim.

  • Doughty v Rolls Royce [1992]

    • Sex discrimination claim re employee at Rolls. Rolls, which was nationalised at the time, was held not to be an emanation of the state.

  • Marshall [1986]

    • Sex discrimination claim relating to retirement age.

    • Directives cannot have horizontal DE, they may only be invoked against states or emanations of the state. Ds only intended to impose duties on MSs per a.288 not duties on individuals.

    • AG Lenz had three critiques of this judgement

      • Regarding legal relations: Those employed by the state may invoke directives against their employers. Those employed by private companies may not invoke directives

      • Regarding effectiveness: Directives are not that effective if the entire scope does not apply to all relations between individuals.

      • Regarding uncertainty: What is the state – how to define the state

    • Faccini Dori [1994]

      • Court would be under a duty to interpret national law, as far as possible in line with the Directive's purpose.

      • But not horizontal DE. AG Lenz again argued for DE or directives.

Horizontal Effect of Directives

• 1) The Scope of ‘Emanations of the State’ was broad.

  • Foster & British Gas [1990]

    • Provided two tests. Doesn’t care about the name of the body only its function.

    • Tripartite test:

      • 1) The body provides a public service.

      • 2) The service is under the control of the state.

      • 3) The body has special powers granted for this...

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