LITIGATING EC LAW
Philippe Ruttley, EC Department, Clyde & Co LLP
Dubrovnik, Croatia,
4 June 2009
Contents

Part One: The nature of EC rights

Part Two: Types of measures giving effect to EC
Law
- Acts of Community Institutions
- Acts of Member States

Part Three: Litigating EC rights against Community
Institutions

Part Four: Enforcing EC rights against Member
States

Part Five: EC litigation against non-state parties

Part Six: Other procedures

Part Seven: Conclusion
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Part One:

THE NATURE OF EC RIGHTS
 Rights derived from the EC Treaty
 Rights derived from EC legislation
 “direct effect”
 Fundamental rights
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Nature of EC
rights
 Rights derived from EC Treaty
e.g. specific Treaty article giving citizens rights
- Establishment (Article 43)
- To provide services in other Member States
(Article 49)
 Rights arising by operation of law
- Contained in Regulations and Directives
- Decisions
- Directly effective rights arising from EC Treaty
articles
- Fundamental rights
- General principles of law
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“Direct Effect”

Doctrine elaborated by ECJ since 1963 Case 26/62 Van
Gend en Loos –v- Netherlands Customs Authority

Dutch trucking firm importing goods from Germany into
the Netherlands. Dutch customs duties imposed.

Duties challenged on the grounds that they infringed
Article 12 of the EEC Treaty:

“Member States shall refrain from introducing
between themselves any new customs duties on
imports or exports...”

Several Member States protested that this claim was
inadmissible: a Treaty article which has not yet been
transposed into the national laws of Member States
cannot create rights for citizens of these treaty
signatories.
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
In a revolutionary judgment, the European Court of
Justice ruled for the citizens and against the Member
States

Key conditions for “direct effect”

If EC Treaty Article or legislation creates a right
a) For benefit of an individual
b) Which is clear and precise
c)
Does not require further implementation into
national law
then the right is “directly effective” and can be enforced
by individuals against a Member State or a Community
Institution
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Examples

EC Treaty Article: Article 43 (ex 52) freedom of
establishment in another Member State

Article 81 (ex 85) prohibition against anti-competitive
agreements

EC Regulation: primary legislation applicable to about
27 Member States

EC Directive after deadline for implementation has
expired e.g. Joined Cases C-6 and 9/90 Francovich v
Italy directive on employee protection in cases of
insolvency
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Fundamental
rights

Article 220 EC: “The ECJ shall ensure that in the
interpretation and application of this Treaty the law is
observed”

“Law” are general principles of law accepted by
Member States’ legal traditions

Reflect common Roman/Christian heritage of EC
states

Examples:
- Equality
- Non-discrimination
- Proportionality
- Non-retroactivity of law
- Nulle poena sine lege
- Ne bis in idem

Rights enshrined in the European Convention on
Human Rights

all EC Member States are signatories to the ECHR
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Part Two

MEASURES APPLYING EC RIGHTS
 Community acts
 Measures taken by Member States
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A. Community
Acts
 Regulations
- Primary legislation adopted by Council or by
Council and the Parliament under the “codecision procedure”
- Immediately alters EC law and creates
obligations or rights
- e.g. Regulations in air sector creating
passenger rights (Reg. 261/2004 on
denied boarding or cancellations)
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Directives

Objective to be achieved by Member States
under national laws by a set date
e.g. by 1 January 2010 employees rights in
bankruptcies to be harmonised by all
Member States
 Member states given discretion on how to give
effect to the Directive’s objective e.g. how to
transpose the Directive’s objective into
national law
 directive on employee protection in cases of
insolvency of their employers
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Decisions
addressed to
specific
addresses
creating
objections or
rights to them
 Enforcement decisions by Commission
e.g. competition law decisions imposing fines
and prohibiting cartel practices
e.g. anti-dumping duties imposed by Council
Regulation
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B. Measures
taken by
Member States
to implement
EC law
Art 10: duty of Community
solidarity
“Member States shall take all appropriate measures … to
ensure fulfilment of the obligations arising out of this
Treaty resulting from action taken by the institutions of the
Community. They shall facilitate the achievement of the
Community’s tasks. They shall abstain from any measure
which could jeopardise the attainment of the objective of
this Treaty”.
 Obligations not to create or maintain state-sponsored
practices, breaching EC law e.g. Art 86 (i):
“In the case of public undertakings and undertakings to
which Member States grant special or exclusive rights,
Member States shall neither enact or maintain in force
any measure contrary to rules contained in this Treaty”.
 Transposing Directions into national law by set date
 Other EC duties e.g. customs/border controls
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Part Three:

LITIGATING AGAINST COMMUNITY
INSTITUTIONS
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1. Community
Acts

Community Institutions, especially the European
Commission, implement EC policies
 Agricultural policy decisions, including distributing
subsidies
 Enforcement of EC competition policy, (cartel
investigations or merger decisions)
 Application of external trade policy (e.g antidumping)

Commission has wide administrative discretion

Judicial review e.g. challenges to Decisions
before EC Courts is only permitted for
“Community Acts”

“Act” = measure which definitely alters the legal
situation of the addressee
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Case 60/81
IBM v
Commission
(1981)

“Statement of Objections” addressed in competition
proceedings, alleging IBM’s abuse of dominant
position

SO challenged by IBM as ill-founded on errors of fact
and law

ECJ dismissed the application: an S.O. is only a
statement of accusations, not a final act making a
finding of infringement

An S.O. is not an “act”. It is an opinion.

Only the Commission’s final Decision alters the legal
situation of the addressee and is an “Act” capable of
challenge in the Courts.
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Failure to act

Article 232

If a complaint to the Commission is not adopted or if
Council fails to adopt new law

Wide administrative discretion of EC institutions, EC
courts are usually very reluctant to interfere

Case 246/81 Lord Bethell v Commission
 EC aviation policy
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Causes of
action/grounds
for challenges
of Community
Acts/Decisions
“Direct Actions” : Article 230 EC
a)
Lack of competence (e.g. Commission must act
within scope of powers confirmed by Treaty or EC
Regulations)
b)
Infringement of essential procedural requirements
(e.g. must use correct Regulation)
c)
Infringement of the EC Treaty
d)
Infringement of a rule of law relating to the EC
Treaty application
e)
Misuse of powers
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Enforcement
of EC law

Pacta sunt servanda
 Article 228: Member State must take necessary
measures to comply with ECJ rulings and is subject
to fines by ECJ for failure (Art 228(2) fourth
paragraph)
 Article 233: Community Institutions must take
necessary actions to comply with ECJ Judgment
 Damages: against Community Institutions under
Article 288(2) “non-contractual” liability
 Damages against Member States, according to
national administrative law
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The Court of
First Instance
(“CFI”)

Established in 1989, situated in Luxembourg

Composition: 27 Judges (1 per Member State) with
6 year mandates

Sits in Chambers of 3 Judges (in 80% of cases) but
for cases raising issues of greater concern in
Chambers of 5, 13 (Grand Chamber) or Full Court
(27 Judges)

Jurisdiction:
a) Actions challenging decisions of Community Institutions
brought by individuals e.g against Commission
decisions enforcing competition rules
b) State aids and anti-dumping
c) Actions for damages against Community Institutions
d) Some other areas e.g. Community trade marks
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CFI

1989-2006: over 5200 cases heard and
ruled upon

Languages: any of the 23 official EC
languages but internal working language is
French
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Procedure of
the CFI

Mainly written procedure with one Hearing (apart
from purely procedural hearings)

Written procedure
a) Application for annulment of Community decision being
challenged
•
Article 230 EC
•
Within 2 months + 10 days of receipt of Act by the
applicant (Art. 230 EC + Article 102 CFI Rules of
Procedure)
•
Sets out grounds of appeal and supporting facts
b) Defence by the Commission
c) Reply to the Defence (by Applicant)
d) Rejoinder to the Reply (by Commission)
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Procedure of
the CFI

Commission has the last word

Length of Written Procedure: about 12-18
months

Language: in language determined as
language of the case, e.g. English, French,
German etc.
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Interventions
by third
parties

Interveners must show interest in outcome of the
case (not simply acting pro bono publico or out of
academic interest)

If Court grants leave to intervene, intervener can
submit “observations” in support of Applicants or
Defendants, having been supplied with copies of
written pleadings. But cannot plead new arguments.

Useful for Applicants to have sympathetic Intervener
who can then comment on Commission’s Rejoinder
to the Reply and therefore have the last word!
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Oral procedure  Hearing before Judges of the Chamber

Speaking time is limited (about 1 hour)
followed by questions from Judges

No cross-examination of witnesses under
oath etc. Judges can ask questions of
parties’ representatives

Length of hearings: 1 day normal
 Oral pleadings in case language(s)
 Oral hearing usually 6-12 months after close
of written pleadings
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Post-hearing
procedure

Judges of the Chamber deliberate in camera

Written ruling produced by the Court, anonymously,
no dissenting Minority opinions

CFI has plenary Jurisdiction and can
a) Uphold contested Act/Decision
b) Annual part of Decision or entirely
c) Award costs
d) Award damages (in specific procedures permitting this)

Judgment usually 6-12 months after Hearing

Total length of appeal process from original
contested Decision: 2-3 years

“Expedition” e.g. accelerated hearing can be
granted in exceptional cases

Appeals against CFI Ruling to the European Court
of Justice

Within two months

On points of law only
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Interim
proceedings

Appeals do not suspend the operation of a contested
act or decision

Applicants can, however, obtain Order from
President of CFI to suspend a Decision if this
application is
 Well founded
 Suspension is urgently needed and Applicant would
suffer irreparable harm without it
 The balance of interest between this applicant and
the public interest is in favour of suspension
 Suspension orders are very rarely granted
 Example: Commission decisions of 1994 against
liner shipping conference tariffs. Commission
decisions were suspended until outcome of CFI
appeals process and the CFI President ruled that
the balance of convenience lay in preserving the
Liner Conference system - See Case T-395/94 R
Order of 11 March 1995; Case C-149/95 P (R)
Commission v Atlantic Container Line & Others
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The European
Court of
Justice (ECJ)
 Established 1957, situated in Luxembourg
 Composition: 27 Judges (1 per Member State) with
6 year mandates
 8 Advocates-General
 Sits in Chambers of 3 or 5 Judges, but sometimes
on Grand Chamber of 13 Judges or Full Court of 27
 Full court for cases of exceptional importance
 Grand Chamber if requested by Member State or
Community Institution requests or if case is
particularly complex
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AdvocatesGeneral
 French tradition of “Commissaire du
Governement” in the Conseil d’Etat
 AG acts as “advisor” to the Court producing an
opinion on facts and legal issues raised by the
case
 AG opinion are usually influential but ECJ
Judges can rule differently than as
recommended
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PART FOUR:

ENFORCING EC RIGHTS AGAINST
MEMBER STATES
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Enforcing EC 
law against
Member States 
Enforcement of EC law by individuals against the
state
Member state duty to give full effect to EC rights
 Art 10EC
 Art 86: cannot maintain/create conditions contrary
to competition rules

Directives: determine an objective to be achieved by
Member State by a set date e.g. harmonise disability
benefits by 1 Jan 2010

Member states are free to decide how to transpose
EC objective into their national laws
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Enforcing EC 
law against

Member States
Exercise of their discretion is difficult to challenge
After deadline for implementation, citizens can
enforce Directive

Joined Cases C-6 and 9/90 Francovich v Italy
directive on employee protection in cases of
insolvency

“Vertical enforcement of Directives”
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References

National Courts asking the ECJ to interpret
EC law (Article 234 EC)

Procedure whereby national
courts/tribunals can refer questions of EC
law to ECJ for interpretative rulings

ECJ Interpretation of EC law is binding on
national Courts - guarantees uniform
interpretation throughout EC Member
States

Not available to arbitration panels
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References

Any court can make References, final court
must refer

Questions can raise questions of law,
interpretation of EC law, validity of
community law

Not for theoretical questions or
“manufactured” disputes to test EC law

Case C-244/90 Foglia v Novello
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Procedure
 National court drafts questions in order for reference (with
submissions of parties’ lawyers)
 Each party submits written observations on the questions
referred to ECJ
 Member States and Community Institutions (Council,
Parliament or Commission) can intervene
 Advocate – general produces opinion
 ECJ rules on questions referred
 ECJ ruling (answers) sent to national court for application
in national proceedings
 The Factortame saga – (Spanish fisherman fishing in
British waters using UK based companies to fish under
national quotas
 Created 3 references
Case C-213/89 R v Sec. of State for Transport ex parte
Factortame Ltd and Others
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Part Five:

LITIGATING EC RIGHTS AGAINST
OTHER CITIZENS
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Actions for
damages
 Civil damages for breach of employment
rights, competition law infringements
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Private actions
 Victims of cartels or state interference with EC rights can
take private actions before national courts
 Member state national courts must apply EC law
- Art 10 EC, duty of Community solidarity
- Art 6, Reg 1/2003, national courts power to apply EC
Competition rules
- EC law (including procedural rules) overrides inflicting
national laws
- Case 199/82 Italian Treasury v SpA San Giorgio: full
effect to EC law/rights
 Right to damages ECJ: Case C-453/99 Courage v Crehan
and Cases C-295 and 298/04 Manfredi v Lloyd Adriatico
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Arbitrations
 Arbitrators must apply EC law
- Case C-126/97 Eco Swiss v Benetton (1999)
- But cannot refer questions to ECJ as they
are not “courts” or “tribunals” as defined in
Art 234 EC
- ECJ: Case 102/81 Nordsee
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Part six:

OTHER PROCEDURES
a) Action by Commission against Member
States for breach of EC Treaty: Article 226
(ex 169)
b) Actions by one Member State against
another for breach of EC Treaty: Article 227
(ex 170)
c) Opinions of European Court of Justice e.g.
on validity of Treaties under Article 300 (6)
EC – e.g. Op. 1/94 WTO Agreement
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Conclusions
1.
EC law is a dynamic, evolving law
2.
EC courts strongly supports integration, usually supports
Community Institutions against Member States on
questions of jurisdiction and competence
3.
EC courts are vigilant in promoting individual rights,
particularly regarding enforcement of rights derived from
EC law
4.
Procedures strongly influenced by civil law tradition, but
Anglo Saxon style oral procedures are increasingly
important
5.
By contrast to other systems, efficient and quick, rulings of
a high standard
6.
Defects: complex interaction between EC and national law
makes for lengthy litigation from national courts. Direct
actions in EC court are a quicker way to enforce EC rights.
Review of Community decisions by EC Courts is arguably
too deferential, but there is an increasing trend for
Commission Decisions to be annulled or revised
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