The Influence of the EU in Rights and Responsibilities

With reference to the case law of the European Court of Justice, discuss the rights and responsibilities (if any) under European Union Law of Sunita, HikeTop, MountainPeak and the UK Government.

The rights and responsibilities of each of the actors in this problem must be under stood within the context of political, economic, sociological and socio-legal being influenced by the EU. The growing importance of this influence is contextualised by Springer (1994): ‘The decade of the 1990s opened in the European Community (EC) on a wave of optimism. Few were even aware of impending crises. The 1992 program to create the internal market was on schedule, and economic indicators were promising. The EC served as a magnet attracting the newly freed countries of Eastern Europe toward democracy and liberal capitalism. The formerly aloof members of the European Free Trade Association signalled an interest in closer relations with the EC. The EC took its place as an equal participant along with the United States and Japan in the triad which was to shape the new global economy…^[1]’.

In line with the system of devolution of increasingly potent powers and economic leverage to the European Commission and the other institutions of the EU which is described above, the UK government are required by the doctrine of supremacy to transpose directives into UK law within a period of seven years^[2]. Failure to transpose directives into UK law will result in the imposition of sanctions from the European Court of Justice, and the European Commission.

Under Article 226 of the EC Treaty the European Commission is first empowered to bring action against the government of a member state where they have failed to implement a particular directive into the domestic law of the member state^[3], or where their implementation or transposition of the directive is not adequate^[4]. This sanction is known as the issuing of a reasoned opinion.

Where the member state fails to take notice of these sanctions, the matter is referred to the European Court of Justice. Ultimately, failure to implement a directive into the domestic law of a member state will result in what are referred to as ‘infringement’ proceedings being brought by the European Commission^[5].

The rights and responsibilities of the UK Government, in this context have attracted some debate, not least since the recession of the stoic influences of Thatcherite Conservatism. The arguments that such proceedings are counter-productive, in light of the amount of bureaucracy and expense they can create are still being made. Yet, these arguments have not influenced the growing powers of the EU to hold Member States to account for not co-operating with the transition of powers from the Member States to EU institutions. This process is particularly notable where the powers of the ECJ and the European Commission are considered.

These powers have evolved through the doctrine of supremacy and through the decisions of the European Court of Justice whose interpretation of the doctrine of supremacy has given the institutions of the European Union more authority to influence social policy. This process can be seen to manifest itself in the doctrines of direct effect, indirect effect and judicial review. These processes will be explained below, in the context of the problem question.

In Member States, directives have what is known as ‘direct effect’^[6], which means that individuals can, in certain circumstances, rely on the rights which are provided for in directives, regardless of the fact that they have not been implemented at all or adequately into the national law of the member state. Therefore where the European Union set out legislation in the form of a directive, the period (known as the transposition period) of adjustment which the EU affords member states is seven years. After the expiration of this period, there are only exceptional circumstances whereby the member state can request that the legislation should not apply to them^[7]. These exceptions circumstances can arise where the member state chooses to derogate from the legislation. However, derogations are quite rare occurrences and the general expectation is that the member state will conform with the implementation of the directive.

The rights which the principle of direct effect affords to an individual in these circumstances is complex, however, individuals can only rely on the principle of direct effect against what is referrred to as an ‘emanation of the state’^[8].

Therefore, Sunita will not be able to sue Mountainpeak under the principle of direct effect, since they are a privately owned company and not an emanation of the state. Sunita however, may be able to bring a claim for damages against the UK government for failure to implement the directive in time^[9].

The principle which provides that this is possible is known as the Francovitch principle, which was established following the decision of the European Court of Justice in Francovitch^[10]. There are certain qualifying preconditions which must be satisfied before a claim may be brought under the Francovitch principle^[11].

These are that the legal rule infringed must have been intended to give rights to individuals; the breach must be ‘sufficiently serious’ and there must be a direct casual link between the breach of the obligation to transpose the directive and the damage caused to the injured person/party^[12]. On the face of the facts in this problem, it appears likely that the directive intended to confer rights on individuals. It is obvious the where there has been a complete failure of the government to implement the terms of the directive, this may well constitute a ‘sufficiently serious’ breach, and the damage sustained by Sunita will be independently verifiable with medical evidence relating to her injuries and the fact that she lost earnings through being off work.

Another potential remedy for Sunita in these circumstances would be a challenge a failure to transpose a directive into UK law. This may be done by judicial review^[13]. This action may force the government to act by implementing the directive^[14], however in relation to the facts as they stand the best course of action for Sunita, given her injuries is to sue the UK government under the Francovitch principle.

Turning to the position of Hiketop, the Council should be advised that this action opens the government up to potential litigation in regards to any person who has an accident whilst mountain biking. Therefore their choice of the lowest price for the delivery of mountain bike services is a false economy, given that this will allow individuals to sue the government if they become injured as a result of mountain bike activities. Therefore they should be advised to strongly reconsider their position relating to the acceptance of bids of this nature from companies who have not implemented the directive.

To conclude therefore this problem has assessed the rights and responsibilities of the various actors in light of the changing structures of power which are being experienced at EU level and at the level of the member state. It is clear that Sunita would have more rights, had the directive been implemented. Yet, it is clear however, the European institutions have in many senses anticipated the difficulties that will arise in relation to the enforcement of rights, and to the individual reliance upon EU rights within the transitional periods where the rights relied upon may not be effective for many reasons. In the answer to the problem we have seen extrapolated the many reasons why this may be the case, such as inadequate implementation or simply no implementation on the part of the member state.This anticipation on the part of the EU, therefore has involved the fixing of responsibility for non-co-operation firmly at the doorstep of the member state, who will be required to compensate individual citizens for any losses arising though non co-operation, or non-implementation of the directives which give rise to these rights.

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Part Two

Before the writer addresses the specific questions in the below sections, it may be useful to do a brief overview of the principle of the free movement of goods within the EU. This will be useful, as this discussion will be relevant to each of the questions to be addressed below and it will save repetition of points that are relevant in answer to each part of the question.

The free movement of goods throughout Europe has had a chequered history. It has in many ways been the cornerstone of the processes which have given rise to the many developments in fiscal and social policy in the EU. However, paradoxically, it has also given rise to much conflict between individual member states who have different economic agendas and different views on how much power should be left in the hands of European actors. Springer (1994) illustrates the paradoxical nature of economic progress well: ‘…economic conditions were not good during the ratification period; however, poor economic conditions do not necessarily threaten integration. Indeed, they were a factor in revitalizing interest in integration in the 1980s. The ratification of the Maastricht Treaty, however, took place within an environment combining poor economic conditions with public suspicion of Brussels. In the 1980s, the public did not blame Brussels for the bad economy, but many people did in the 1990s. Political conditions were also not conducive to integration…^[15]’.

The free movement of good within the EU and the degree to which the principle influences and pervades the individual member states has been contingent upon the various treaty agreements which have been agreed between the member states. Each Treaty has farmed the principle of the free movement of goods in a different way, with the ultimate progress being towards a combination of influences within the economic and social spheres of the running of each member state.

The Single European Act, passed in 1986 set a goal of achieving an internal market by December 1992^[16], and this was followed by the Maastricht Treaty in 1992, which changed the name of the EC, to the EU, the European Union^[17]. Both of these treaties had major implications economically for each member state, and required domestic overhaul over many legal and administrative structures^[18].

The Treaty on European Union gave the EU more influence in socio-economic matters^[19] and this has greatly affected the interpretation of the principles of the free movement of goods^[20]. Whereas, previously the affiliations between the member states has solely been motivated by and denominated in reference to these issues^[21], the 1992 Treaty changed these parameters fundamentally.

The 1997 Amsterdam Treaty further reinforced economic integration and strengthened the position of the EU in relation to both social and economic integration^[22]. These developments within the EU have influenced the fiscal and economic backbone of the EU.

A famous illustration of these points relating to the free movement of goods principles can be found in the Procureur du Roi v. Dassonville^[23], case where a trader imported whiskey which had been produced in England. Belgian laws required a certificate of origin to be produced, and it transpired that this certificate was only available in England. The trader argued that the requirement for a certificate violated the free movement of goods principle because it had an effect similar to a trade restriction. The European Court of Justice agreed and held that this was a violation of the free movement of goods principles.

The above mentioned discussion has highlighted the importance of the principle of the free movement of goods within the EU, and it will assist the understanding of the below-mentioned issues which require such an understanding. Therefore, more targeted discussion of the individual issues will take place below in the next section, in answer to the various propositions in the problem.

The Government of Member State A of the European Union decides to take the following measures as part of its child protection policy:

i)a ban on confectionery, salted snacks and soft drinks being advertised or sold within the immediate vicinity of shop tills in supermarkets;

One of the founding principles of EU law is the free movement of goods between the member states. This principle is designed so that economic activities between each of the member states is actively encouraged throughout the EU. The function of these requirements is to encourage greater efficiency in production and trade between member states. Therefore, it is the aim of the EU to remove all barriers to trade between each of the member states.

However, it is likely that the above mentioned provisions will not be deemed to be contrary to the free movement of goods in Europe, as similar provisions have very recently come into effect in Latvia^[24].

ii) a ban on the sale of soft sugary drinks in school premises;

It is likely that the above mentioned provisions will not be deemed to be contrary to the free movement of goods in Europe, as similar provisions have very recently come into effect in Latvia^[25].

iii) a requirement that a health warning triangle be placed on all snack food items containing a high sugar, salt and/or fat content as well as a health advice label providing consumers with information on maximum recommended daily consumption of such food products for children and adults; and

This potentially could infringe the free movement of goods within the EU. It may be argued that it indirectly affects the poorer countries, creating more onerous pre-conditions to trade, which may be inconsistent with the free movement of goods principles.

However, the European Commission are in the process of a consultation involving the inclusion of health warnings with alcoholic drinks. It appears likely that alcoholic drinks sold in Britain will carry a health warning in future. In view of the fact that this will not infringe the free movement of goods principle, it does not appear likely that the above-mentioned provisions will fall foul of the free moment of goods requirements in the EU, although there is a potential that this might happen.

iv) the introduction of a tax on electronic games available to consumers under the age of 18. The revenue from the tax will be used to fund the promotion of sports projects in Member State A. Over 90% of electronic games sold in Member State A are produced in Member State B of the EU.

It is likely that this tax, would infringe the principles of free movement of goods between member states in the European Union and accordingly they would be very likely to be prohibited.

It is the position of the EU that these barriers create discriminatory restrictions between member states and accordingly should be thwarted^[26]. EU member states are required to refrain from the imposition of import taxes and duties which would have the effect of creating barriers to trade between each member state. The various treaty revisions have changed the meaning and the importance of the principle of the free movement of goods within the EU, making the principle as a whole more important within each member state. Barriers to trade mainly fall into three categories- physical, fiscal and technical barriers. This tax would therefore fit into the criteria of a barrier to trade and would likely be prohibited under the free movement of goods principles.

Bibliography

Books

Cuthbert, M. (2000) European Union Law. Publisher: Sweet and Maxwell: Place of Publication: London.

Craig, P. and De Burca, G. (2003) EU Law. Publisher: Oxford University Press. Place of Publication: Oxford.

Lasok, D and Stone, P. (1987) Conflict of Laws in the European Community. Publisher: Abington

Roberts, I. and Springer, B. (2001) Social Policy in the European Union: Between Harmonization and National Autonomy. Publisher: Lynne Rienner. Place of Publication: Boulder, CO.

Springer, B. (1994) The European Union and Its Citizens: The Social Agenda. Publisher: Greenwood Press. Place of Publication: Westport, CT. Publication Year: 1994.

Articles

Siems, M. (2002) Convergence, Competition, Centros and Conflicts of Law: European Company Law in the 21st Century. 27 E.L. Rev. 47-59.

1

Footnotes

^[1] (Springer (1994) 5).

^[2] (Cuthbert, M. (2000) 1-10) (Craig, P. and De Burca, G. (2003) Chapters 1-5).

^[3] (Roberts, I. and Springer, B. (2001) Chapters 1-5) (Springer, B. (1994) 1-10) (Siems, M. (2002) 1-6),

^[4] (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).

^[5] (Cuthbert, M. (2000) 1-10) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (http://europa.eu/).

^[6] (Roberts, I. and Springer, B. (2001) Chapters 1-5) (Springer, B. (1994) 1-10) (Siems, M. (2002) 1-6)

^[7] (Cuthbert, M. (2000) 1-10) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).

^[8] (R v. Attorney General for Northern Ireland ex p. Burns [1999] IRLR 315) (http://europa.eu/) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).

^[9] (R v. Attorney General for Northern Ireland ex p. Burns [1999] IRLR 315) (Roberts, I. and Springer, B. (2001) Chapters 1-5) (Springer, B. (1994) 1-10) (http://europa.eu/) (Siems, M. (2002) 1-6).

^[10] (C-6,9/90 [1992] IRLR 84).

^[11] (Cuthbert, M. (2000) 1-10) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).

^[12] (Roberts, I. and Springer, B. (2001) Chapters 1-5) (http://europa.eu/) (Springer, B. (1994) 1-10) (Siems, M. (2002) 1-6).

^[13] (R v Secretary of State ex p. BECTU [2001] IRLR 559).

^[14] (http://europa.eu/) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).

^[15] (Springer (1994) 38)

^[16] (Cuthbert, M. (2000) 1-10) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).

^[17] (Cuthbert, M. (2000) 1-10) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).

^[18] (Cuthbert, M. (2000) 1-10) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).

^[19] (Roberts, I. and Springer, B. (2001) Chapters 1-5) (Springer, B. (1994) 1-10) (Siems, M. (2002) 1-6).

^[20] (Roberts, I. and Springer, B. (2001) Chapters 1-5) (Springer, B. (1994) 1-10) (Siems, M. (2002) 1-6).

^[21] (Roberts, I. and Springer, B. (2001) Chapters 1-5) (Springer, B. (1994) 1-10) (Siems, M. (2002) 1-6).

^[22] (Springer, B. (1994) 1-10) (Siems, M. (2002) 1-6).

^[23] [1974] ECR 837

^[24] (http://europa.eu/).

^[25] (http://europa.eu/).

^[26] (Cuthbert, M. (2000) 1-10) (Craig, P. and De Burca, G. (2003) Chapters 1-5) (Lasok, D and Stone, P. (1987) 1-20).