EUROPEAN

UNION LAW

Private Law Tutor Publishing

 European Union Law

Private Law Tutor Publishing

Contents

1. The Treaties and the Historical Development of the EU

2. Constitutional Principles and the Institutions

3. Sources of EU Law

4. EU Law and National Law: Supremacy

5. Direct Effect, Indirect Effect and State Liability

6. Administrative Law of the EU

7. Fundamental Rights and Other Principles of EU Law

8. Free Movement of Goods I: Articles 28–30, 110 TFEU

9. Free Movement of Goods II: Articles 34-36 TFEU

10. Free Movement of workers: Article 45 TFEU

11. Citizenship of the Union

12. Freedom of Establishment: Articles 49–55 TFEU

13. Freedom to Provide Services: Articles 56–62 TFEU

14. Competition Law: Article 101 and 102 TFEU

2
 Welcome/Introduction/Overview

This book provides you with basic information as a basis for you
to form your own critical opinions on this area of law. Once you
have mastered the basics, you will be inspired to question EU
principles in your essays and apply them in mock client advisory
scenarios. Again, for your convenience, we have also published a
Q&A book providing you with examples of how to answer such
questions and how to apply your knowledge as effectively as
possible to help you get the best possible marks.

This aid is a fully-fledged source of basic information, which tries

to give the student comprehensive understanding for this module.
However, it is recommended that you compliment it with the
further reading suggestions provided at the end of each topic, as
well as read the cases themselves for more in-depth information.
The book provides an analysis of the basic principles of modern
European Union Law. The following is a summary of the book
content:

 An introduction to the historical evolution of the

integration of the European Union;
 The sources of EU Law;
 The relationship between EU Law and national Law;
 The internal principles of EU Law ;
 The main rights enshrined by EU Law;

The aim of this book is to:

● Provide an introduction to anyone studying or interested in

studying Law to the key principles and concepts that exist
in EU Law.
● To provide a framework to consider EU Law within the
context of examinations.
● Provide a detailed learning resource in order for legal
written examination skills to be developed.
● Facilitate the development of written and Independent
Critical Thought skills.
● Promote the practice of problem solving skills.
● To establish a platform for students to gain a solid

3
 understanding of the basic principles and concepts of EU
Law, this can then be expanded upon through confident
independent learning.

Through this book, students will be able to demonstrate the ability

to:
 Demonstrate an awareness of the core principles of EU
Law.
 Critically assess challenging mock factual scenarios and
be able to pick out legal issues in the various areas of EU
Law.
 Apply their knowledge when writing a formal assessment.
 Present a reasoned argument and make a judgment on
competing viewpoints.
 Make use of technical legalistic vocabulary in the
appropriate manner.
 Be responsible for their learning process and work in an
adaptable and flexible way.

Studying EU Law

EU law governs approximately 80% of the economic Law of its

member-states. Therefore, it is vital that a student successfully
pass this subject to become a lawyer. Even after Brexit, the UK
will still count on the EU as one of its closer commercial partner.
Hence, a good knowledge of EU Law remains needed for a British
lawyer.

The primary method by which your understanding of the EU Law

will develop is by understanding how to solve problem questions.
You will also be given essay questions in your examinations. The
methods by which these types of question should be approached
are somewhat different.

Tackling Problems and Essay Questions

There are various ways of approaching problem questions and

essay questions. We have provided students with an in-depth
analysis with suggested questions and answers at the end of each
chapter.

4
 Chapter 1 - The Treaties and the Historical
Development of the EU
The General Ideology

Why and how did the EU come about? This question points
precisely to the problem of definition and identity of the EU law
and of Europe generally. Functionalists embraced a federalist
concept based on two ideas in particular emerged as possible
solutions to the wars that had so long plagued Europe:

(1) building cooperation among countries through the

integration of one or more highly important economic
function shared by all of them (functionalism); and

(2) directly establishing a European political federation

(federalism). Both functionalist and federalist models,
therefore, came into play at the earliest stages of
discussion.

“The pooling of coal and steel production should immediately

provide for the setting up of common foundations for economic
development as a first step in the federation of Europe, and will
change the destinies of those regions which have long been
devoted to the manufacture of munitions of war, of which they
have been the most constant victims.” Schuman Declaration, 9
May 1950.

The European construction started just after WW2. It was initially

based on an intention to bring the countries of the old continent
together to avoid such atrocities from reoccurring. In Europe,
millions of people died during the WW2 because neighbouring
countries had been at war. Winston Churchill, speaking at Zurich
University in September 1946, said:

“We must build a kind of United States of Europe……freely joined

together for mutual convenience in a federal system. We must re-
create the European Family in a regional structure called, it may
be, the United States of Europe. Therefore I say to you: let Europe
arise!”

5
This echoed the voice of the neo-federalists. Few years later, the
declaration of the French Minister for Foreign Affairs Robert
Schuman (1950) was a turning point in the European integration. It
basically tells us that the political reconciliation of European
countries needs to be pragmatic and should result on an economic
cooperation. Consequently the European Coal and Steel
Community (ECSC) was established the next year. The idea is to
bind states to such a point that war becomes inconceivable. And it
will be made by regulating the commerce of the main resources
needed for a war: coal and steel. As Schuman put it “[t]he
solidarity in production thus established will make it plain that any
war between France and Germany becomes not merely
unthinkable, but materially impossible.” From then on, a
progressing economic collaboration became the solution to
maintain peace in Europe. But foreign countries also influenced
the economic collaboration. In this respect, George Marshall,
Secretary of State in the US, introduced the European Recovery
Programme, aiming “to achieve a common programme of
recovery”. The Marshall Plan required European states to
cooperate together to distribute the wealth and, even more
importantly, to progressively remove trade barriers between
themselves.

Nevertheless, in the aftermath of the Second World War, the

ECSC is not the only international organization to be established to
maintain peace. Slightly earlier, discussions started to rename the
League of Nations by the United Nations (24th of October 1945).
Closer in Europe, the Council of Europe was created in 1949, and
it is very important to distinguish it from the European Union. This
institution was created in response to Winston Churchill call for a
united Europe with a European Assembly and a Court of Human
Rights (Congress of Europe at The Hague, 1948). Indeed, the
Council of Europe is a completely separated international
organization with its own founding treaties and its own
institutions. The major difference with the EU is that it focuses
only on the promotion of Human Rights and the maintenance of
peace whereas the former has been further in the integration.
While the EU is geographically centralized in Wester-Europe with
its 28 member-states, the Council of Europe rationae loci is
broader with 47 members-states. It includes Russia or Turkey for

6
example. Moreover, these two institutions have two different
Courts that should not be confused the Council of Europe has the
European Court of Human Rights (ECtHR) while the Court of
Justice of the European Union (CJEU) is the main judicial organ of
the European Union.

Finally, there were other attempts by European countries to

develop economic harmonisation. The Benelux nations
(Netherlands, Belgium and Luxembourg) signed a customs
convention to remove internal trade barriers on 5 September 1944
and resulted in trade barriers between the states being removed by
1956.
Why does the EU keep Expanding?

The European Union is sui generis organization that has unique

features. It is very different from the traditional approach of
international organizations. Some theories are discussed below.

Intergovernmental

Intergovernmentalism is an alternative theory of political

integration, where power in international organizations is
possessed by the member-states and decisions are made by
unanimity. Independent appointees of the governments or elected
representatives have solely advisory or implementational
functions. Intergovernmentalism is used by most international
organizations today. An alternative method of decision-making in
international organizations is supranationalism.

Intergovernmentalism is also a theory on European integration

which rejects the idea of neo-functionalism. The theory, initially
proposed by Stanley Hoffmann and refined by Andrew Moravcsik
suggests that governments control the level and speed of European
integration. Any increase in power at supranational level, he
argues, results from a direct decision by governments. He believed
that integration, driven by national governments, was often based
on the domestic political and economic issues of the day. The
theory rejects the concept of the spill over effect that neo-
functionalism proposes. He also rejects the idea that supranational
organisations are on an equal level (in terms of political influence)
as national governments.

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Supranational

Supranationalism is a method of decision-making in political

communities, wherein power is held by independent appointed
officials or by representatives elected by the legislatures or people
of the member states. Member-state governments still have power,
but they must share this power with others. Because decisions are
taken by majority votes, it is possible for a member-state to be
forced by the other member-states to implement a decision. Unlike
a federal state, member states fully retain their sovereignty and
participate voluntarily, being subject to the supranational
government only while remaining members.

Neo-Functionalist

Neo-functionalists argue that the supranational institutions of the

European Union themselves have been a driving force behind
European integration; reinterpreting agreed results from
Intergovernmental Conferences in order to expand the mandate of
EU legislation into new and more diverse areas. The theory of neo-
functionalism is felt by some to be important as it may explain
much of the thinking behind the early proponents of the European
Union, such as Jean Monnet, who saw increased European
integration as the most important precursor to a peaceful Europe.
Neo-functionalism assumes a decline in importance of nationalism
and the nation-state; it sees the executive power and interest
groups within states to be pursuing a welfarist objective which is
best satisfied by integration of EU states. The thinking behind the
neo-functionalist theory can be best described by considering the
three mechanisms which neo-functionalists see as key to driving
the process of integration forwards. These are positive spill over,
the transfer of domestic allegiances and technocratic automaticity:

 Positive spill over is the concept that integration between

states in one economic sector will quickly create strong
incentives for integration in further sectors; in order to
fully capture the benefits of integration in the original
sector.

 The mechanism of a transfer in domestic allegiances can

be best understood by first noting that an important

8
 assumption within neo-functionalist thinking is of a
pluralistic society within the relevant nation states. Neo-
functionalists claim that, as the process of integration
gathers pace, interest groups and associations within the
pluralistic societies of the individual nation states will
transfer their allegiance away from national institutions
towards the supranational European institutions. They will
do this because they will, in theory, come to realise that
these newly formed institutions are a better conduit
through which to pursue their material interests than the
pre-existing national institutions.

 Finally, technocratic automaticity describes the way in

which, as integration hastens, the supranational institutions
set up to oversee that integration process will themselves
take the lead in sponsoring further integration as they
become more powerful and more autonomous of the
member states.

An historical overview of the European Treaties:

1951 ECSC: EUROPEAN COAL AND STEEL

COMMUNITY
Treaty of Paris

1957 EEC: EUROPEAN ECONOMIC COMMUNITY

Treaty of Rome

1957 EURATOM: EUROPEAN ATOMIC ENERGY

COMMUNITY
Treaty of Rome

1965 MERGER TREATY

Amalgamated institutions of the three
Communities (in force 1967)

1973 FIRST TREATY OF ACCESSION

UK, the Republic of Ireland, Denmark

1975 BUDGETARY TREATY

Increased power of the Parliament

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1979 SECOND TREATY OF ACCESSION
Greece

1986 THIRD TREATY OF ACCESSION

Spain, Portugal

1992 SINGLE INTERNAL MARKET

In force 1 Jan 1993 – A result of the Single
European Act 1986

1993 TREATY ON EUROPEAN UNION (TEU)

(Maastricht)
In force 1 Nov 1993

1994 FOURTH TREATY OF ACCESSION

Austria, Finland, Sweden

1997 THE TREATY OF AMSTERDAM (ToA)

In force 1 May 1999

2000 THE TREATY OF NICE

In force 1 February 2003

2005 TREATY ESTABLISHING A CONSTITUTION

FOR EUROPE
rejected by France and the Netherlands by
referendum

2005 FIFTH ACCESSION TREATY

Ten new members

2007 Accession of Romania & Bulgaria

2007 THE TREATY OF LISBON

Signed 13 December 2007
Ratified by 24 Member States (at the time of
writing)

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The treaties establishing the European Communities

In the 1950s the creation of three European Communities marked

the birth of the European Union’s predecessor. The European
Communities refer to the ESCS, the EEC and EURATOM.

 The European Coal and Steel Community (ECSC):

established by the Treaty of Paris (1951).
The ESCS owes its origins in the Schuman declaration. However,
if the declaration has been made by Robert Schuman, his main
collaborator on the “Schuman Plan”, Jean Monnet (a French
economist and statesman) is usually forgotten. The idea, placing
economic cooperation as its core, included to remove these vital
wartime industries from the control of the national governments to
confer them to a supranational entity, in the hope of providing a
sounder foundation for peace and stability in Europe. The pioneers
thought that opening a common market between European
countries on the two wartime necessities would prevent the rise of
new wars between them. Another reason of this political
reconciliation lies on a wish to limit the development of
communism in Western Europe (very strong at the time in France
and Italy).

Initially, the pioneers only envisaged France and West Germany,

but Schuman invited their close neighbours to join. As a result,
France, West Germany, Italy and the three countries members of
the Benelux signed the Paris Treaty and became the 6 founding
members of the ESCS. The UK was invited for the negotiations
but quickly left the negotiating table. This example shows that,
from the beginning of the European construction, the UK was
reluctant to participate.

To achieve its objective, the 6 founding members established

several institutions. The High Authority, a sort of ancestor of the
committee of ministers representing the member-states and taking
the main decisions, was accompanied of an Assembly and a Court
of Justice in charge of reviewing the legality of the acts of the
High Authority. At that time, having such integrated institutions
was a great progress in terms of development of international
organizations.

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The main concrete measure was achieved by 1954, which marked
the removal of all trade barriers in coal and steel. The ESCS
expired in 2002, after the ending of a 50 years term.

 The European Economic Community (EEC): created by

the Treaty of Rome (1957).

The Treaty of Rome, officially the Treaty establishing the

European Economic Community (TEEC), came into force on 1
January 1958. One of its instigators is the Belgium prime minister
delivering a famous speech in Messina (1956). The idea was to
focus on a greater harmonisation of the economy, above the mere
areas of coal and steel. The 6 states agreed to integrate their
economies, first by becoming a customs union to progressively
move to a common market.

 The European Atomic energy community (EURATOM):

established by Treaty signed in 1957.
This third Treaty dealt with cooperation in the domain of atomic
energy. France strongly insisted for its conclusion. Even if
EURATOM focused on an important but very specific industry,
the EEC had a much broader scope.

If the three communities were provided with independent

institutions to which different degrees of sovereign power was
ceded by the Member States, it was agreed that the Assembly and
the Court of Justice (initially established by the EEC) would be
common to all three. However, each community had its own
Commission and its own Council of Ministers. But this system
changed for a greater centralisation with the conclusion of the
Merger Treaty (1965) that provided for a single Commission and a
single Council of Ministers to be shared by the communities.

More importantly in terms of Treaties deeper amendment of the

European Communities; the Single European Act (SEA) was
signed in 1986. The SEA increased the material scope of the EEC
and laid the foundation for an internal market. In addition to this, it
brought democratic and institutional changes to strengthen the
accountability of the communities. The Assembly was renamed
European Parliament as a symbolic progress towards integration.

12
Finally, a Court of First Instance was established to relieve an
overwhelmed Court of Justice.

The birth of the European Union

The European Union officially replaced the European

Communities in 1993, date of the entry into force of the well-
known Treaty of Maastricht (1992). The so-called Treaty on the
European Union (TUE) sought to enlarge the scope of
intergovernmental cooperation beyond the economic sphere. The
intention of the Member States was clearly to find a common
political agenda. For that purpose, they established the three pillars
of the EU:

 Pillar I was constituted by the European Community; a

single institution regrouping the former EEC, ESCS and
Euratom.

 Pillar II established the Common foreign and security

policy (CFSP); an intergovernmental collaboration of
police and border services.

 Pillar III provided a framework for cooperation in justice

or home affairs.

13
 1992/93
1957/ 1965/ 2007/
1948 1951/ Maastr 1997/99 2001/
58 67 1986/87 09
Bruss 52 icht Amster 03
Rom Bruss SEA Lisbo
els Paris (founde dam Nice
e els n
d EU)

European
Atomic
Energy
Community
(EURATOM)
European
Coal and Steel
Community
(ECSC)
European
Economic
Community European
(EEC) Community
(EC)
↑European →
Communities↑ Justic
e& Europ
P
Home Police & ean
I
Affair Judicial co- Union
L operation in (EU)
s
L Criminal
(JHA
A Matters
)
R (PJCC)
S
Europea Common Foreign &
→
n Security Policy
Political (CFSP)
Coopera
tion
(EPC)

Western European Union (WEU)

14
More importantly, the TUE created a monetary union between the
Member States by the introduction of the euro as the common
currency monitored by a European Central Bank (ECB).
Nevertheless, it also marked the first concession for Member
States to break the integration process with the “opt-out clauses”.
Indeed, the first ones to use it, The UK and Denmark, decided to
keep their respective currencies while remaining in the EU.
Finally, the Treaty of Maastricht also established a “social chapter”
which dealt with workers’ rights and other social issues. Once
again, the UK managed to negotiate an opt-out exception.

The progressive amendments of the European Union

 The Treaty of Amsterdam (1997) resulted in two principal

reforms. Firstly, it tried to make the existing structure of
the Treaties more comprehensible. To that end, it
completely renumbered the EC Treaty and the TEU.
Secondly, the Treaty of Amsterdam reorganized the 1st and
3rd Pillars for a deeper cooperation in criminal matters.

 The main concern of the Treaty of Nice (2001) was to

prepare the enlargement of the EU to more than ten
members. The candidates were mainly from Eastern and
Central Europe. This extension went ahead three years
later.

 The Treaty of Lisbon (signed in 2007) entered into force in

2009. It is certainly the most important Treaty for the EU
in terms of fundamental changes. The debate started with a
declaration of the European Council (EU’s institution)
stating that along with an increasing integration and more
sovereign powers attributed to the EU by its Member
States; the organization needed to be more democratic,
more transparent and more efficient. The Council even
mentioned that it would have to come along with the
adoption of a Treaty of a constitutional nature.
Consequently, the Convention on the future of Europe,
chaired by the former French president (Valéry Giscard

15
 d'Estaing), was established. The Convention was
composed of members of national parliaments and
governments but also representatives from the EU
(Commission and Parliament). The meeting resulted on the
draft of a Treaty Establishing a Constitution for Europe
that was supposed to replace the existing Treaties. It was
signed by the Member States in 2003 but the ratification
process was never completed. Perhaps too ambitious at the
time, the Constitutional Treaty was rejected in France and
the Netherlands, and the project was later abandoned.

 Nevertheless, the Member States thought that there was

still a pressing need of reform. In order to reassure the
nationalists worried about the rise of a European State, the
word Constitution has been removed and the existing
Treaties were not replaced. Instead, the EC Treaty was
renamed Treaty on the Functioning of the European Union
(TFEU), and the Euratom incorporated in the Treaty of
Lisbon. Finally, the Treaty of Lisbon merged the three
pillars into a single structure, abolished the EC as a
separate entity bust most importantly consolidated the
distribution of the competences between the Member
States and the EU in favour of the latter.

Accessions and evolution of the list of EU members

In order to become member of the EU, States have historically

concluded accessions treaties between them and the EU. However
membership is subjected to several conditions called acquis
communautaires that States have generally to comply with, unless
arrangements for a transition period are made. For example, a
candidate State will have to present an economic, judicial and
political system able to be integrated with those of the existing
Member States.

However, if membership is usually enshrined by an accession

Treaty, it is not always the case. For instance, East Germany
automatically joined the EU after the reunification of Germany in
1990. Since the three initial communities of the 19950s were
formed by France, West Germany, Italy, the Netherlands, Belgium

16
and Luxembourg the following countries have also joined:

o The United Kingdom, Ireland and Denmark in

1973; the EU was then composed of 9 Member
States.

o Greece in 1981; the EU was then composed of 10

Member States.

o Spain and Portugal in 1986; the EU was then

composed of 12 Member States.

o Austria, Sweden and Finland in 1995; the EU was

then composed of 15 Member States.

o The Czech Republic, Slovakia, Slovenia, Poland,

Lithuania, Latvia, Estonia, Hungary, Cyprus and
Malta in 2004; the EU was then composed of 25
Member States.

o Bulgaria and Romania in January 2007; the EU

was then composed of 27 Member States.

o Croatia in July 2013; The EU is now comprised of

28 Member States.

Nevertheless, in 2017, can we say that the EU is still comprised of

28 Member States, or does the recent Brexit change the counting?

Some territories have decided to withdraw from the European

Communities in the past. This was the case of Algeria, in 1962,
right after having gained independence. Algeria was part of the
European Communities because it was at that time a French
colony. The rationae loci of the Communities have always
automatically integrated the overseas territories of the Members.

In addition to this, the other principal territory to withdraw was

Greenland that is part of Denmark and therefore joined the
Communities in 1973 when the latter got member. After having
been granted significant autonomy to make its own choices, the
Greenland People decided to not be part of the European

17
Communities anymore in a referendum. They withdrew in 1985
after a negotiating process with the Member States. However,
these few examples occurred in the era of the European
Communities, is it that simple with Brexit?

Brexit

As we have seen it before, the relationship between the UK and the

EU was special from the beginning. Throughout its membership,
many politicians, the media or the wider public expressed
scepticism or even hostility towards the EU. The first referendum
on whether or not to stay a member was held in 1975. At this time,
a majority of British citizens voted in favour to remain.

In 2013, the UK Prime Minister, David Cameron, promised

another referendum on the EU issue if he was re-elected. After
having been victorious in 2015, Cameron had to act in accordance
to his commitment and started re-negotiating with the EU to
achieve certain reforms. However, unsatisfied by the concessions
made by the EU, the Prime Mister held a referendum on June 23rd
last year. This time, a majority of 52% voted to leave. Even though
the referendum was not legally binding in itself, it put political
pressure on the UK executive to trigger article 50(2) of the TEU. It
is the formal requirement that compels a Member State to
officially inform the European Council of a wish to withdraw from
the Treaties. This operation has been ordered by the new Prime
Minister, Theresa May, in March 2017.

However, even though article 50 has been triggered by the UK, it

remains a Member for now. Thus, the EU is still comprised of 28
Member States. Article 50 stipulates that the parties have to find an
agreement for the withdrawal under negotiations that have to last
at least 24 months, if no agreement is concluded before, and that
can be extended by the parties.

The issue of the UK membership to the Council of Europe is not

legally affected by Brexit. However, withdrawing from the
Council of Europe is part of the Conservative political agenda.
Actually, it was announced by Theresa May in 2016 while
campaigning. Fortunately for the protection of Human Rights in
the UK, the Conservative manifesto released few weeks ago,

18
declared that they would be too busy with Brexit and would
remain in the Council of Europe for the next legislature.

EU Law’s major influence on UK Law after Brexit

Walker (Appellant) v Innospec Limited and others

(Respondents) [2017] UKSC 47
Facts: John Walker, the appellant in these proceedings worked for
the respondent, Innospec Ltd, from 1980 until his retirement in
2003. In 2006 Mr Walker asked Innospec to confirm that, in the
event of his death, they would pay the spouse’s pension, which the
scheme provides for, to his civil partner. Innospec refused, because
his service predated 5 December 2005, the date that civil
partnerships were introduced in the UK, and any discriminatory
treatment is therefore permitted under paragraph 18 of Schedule 9
to the Equality Act 2010. If Mr Walker was married to a woman
(or indeed if he married a woman in the future) she would be
entitled on his death to a “spouse’s pension” of about £45,700 per
annum. As things stand at present, Mr Walker’s husband will be
entitled to a pension of about £1,000 per annum (the statutory
guaranteed minimum).
Preliminary question before the Court: Does paragraph 18 of
Schedule 9 to the Equality Act 2010, permitting an employer to
discriminate against employees based on their sexual orientation
while attributing a survivor’s pension, is compatible with EU Law?
Preliminary Ruling: According to the judgement gave by Lord
Kerr, the UK provision is incompatible and EU Law should
prevail: “paragraph 18 of Schedule 9 to the Equality Act 2010 is
incompatible with EU law and must be dis-applied and (ii) Mr
Walker’s husband is entitled on his death to a spouse’s pension,
provided they remain married.”
Application: This case underlines several major principles of EU
Law in its relation with national Law such as supremacy or direct
effect. In addition to this, the UK government just declared that
after Brexit it would repeal the current national legislation on
discrimination based on sexual activity to upgrade it to EU
standards of protection. This demonstrates that even after Brexit,
some parts of EU Law will still remain guidance for the UK
courts.

19
 Chapter 3: EU Law and National Law:
Supremacy.
Supranationalism and the origins of supremacy

Supremacy is a legal principle involving that, in areas where EU

Law is relevant to a case that presents a conflict of norms; EU Law
should prevail over national Law. It is one of the key principles
created by the ECJ that ensure the enforceability of the European
legal order. Supremacy comes along with direct effect, indirect
effect and State liability (topics covered in Chapter 4).

Supremacy is rooted in supranationalism. Supranationalism is a

method of decision-making by a community of States, wherein
officials are representing their Member States. Unlike federalism
Member States remain sovereign because they decided voluntarily
to be part of the organization and are free at any time to leave it.
However, Member States are delegating some of their sovereign
powers to the community. They might, for instance, be forced to
implement a decision that they did not consent with, as far as
decisions are taken by majority votes.

The principle of supremacy is not written in the founding treaties,

yet is considered to be a fundamental principle of the European
Union. It is linked to the doctrine of autonomy, which implies that
EU’s institutions are independent from its Member States, and
creates an external source of Law despite being created by the
Member States themselves. Supremacy’s main consequence on the
EU legal order is to reinforce its autonomy. The importance of
supremacy in the integration of the European construction was
highlighted by Cruz at the time of the European Communities,
which he claimed: “without supremacy community law ceases to
be communataire”.

The rise of the new European legal order

While supremacy is about the relationship between national Law

and EU Law, it is necessary to present the different approaches of
international Law within the different Member States. On this
issue, European States have adopted two different conceptions:

20
monism or dualism. The monistic conception, on the one hand,
provides that international accords, which through ratification bind
a country in international law, are considered to be part of the
internal legal system without the need for specific measures to
incorporate them. The principle of monism is well known in many
EU countries, such as France for example, and has been accepted
quite early by the Court of Justice.

The dualistic conception, on the other hand, implies that

international accords do not become part of the internal legal
system at the moment of ratification but only if and to the extent
that they are specifically incorporated into national law. This
approach is normally taken by the United Kingdom. In addition to
this, the particular importance attributed to the sacred
parliamentary sovereignty worsens the compliance with the
principle of supremacy.

The development of EU Law created much more problem within

dualist States. At first it appears to be conflicting with the main
principles regulating the European legal order: supremacy, direct
effect and indirect effect. Supremacy is also known as “primacy of
EU law”, from the French primauté du droit de l’Union. The
reasons of its development by the Court are various. First of all,
while the main objective of the Communities was to create a single
Market, Law had to be harmonized through a uniform application
of EU Law within the Member States.

In addition to this, the whole structure of Europe was already

based on supranationalism which implies that the interests of the
community prevail over national interests. Therefore, supremacy
was a necessary component of uniformity and consistency across
the Union. The recognition of EU supremacy has two major
consequences on the competences of national institutions, often
referred to as the doctrine of pre-emption:

 It places the CJEU above the national Courts in case of

conflict of interpretation of EU Law.
 It prevents legislative bodies in the Member States from
enacting legislation that might be incompatible with EU
Law.

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The European construction has been going on for more than 60
years and there is still a debate about supremacy. This is probably
because it touches one of the most delicate areas of EU Law
because it is related to sovereignty. The nationalists’ biggest fear is
to lose sovereignty to the benefits of the community. Unionists
would rather qualify it as a mere transfer of sovereignty.

While nothing in the founding treaties was expressly mentioning

EU supremacy, the closest the pioneers tackled this issue was this
so-called “duty of loyalty” enshrined by Article 10 EC (now
replaced by article 4(3) TUE) which stipulates: “The Member
States shall take any appropriate measure, general or particular,
to ensure fulfilment of the obligations arising out of the Treaties or
resulting from the acts of the institutions of the Union”.

The abandoned Treaty Establishing a Constitution for Europe

(TECE) included a special provision on supremacy. Instead,
declaration 17 of the Lisbon Treaty merely mentions the
“primacy”, making reference to the CJEU’s case law. However,
the recognition of EU supremacy is mostly due to an intense
legislative activism of the ECJ, which has built the principle
throughout a range of cases.

The Court, in its case law, before going into a detailed definition of
supremacy, acknowledged the “specificity” of the EU legal order
that has a “special and original nature” (ECJ Costa v ENEL (Case
6/64) [1964]). This is why supremacy is referred as the rise of a
new legal order. The EU is a sui generis entity, it is unique and it
differs from the traditional models of national or international law.

The famous case affirming the specificity of EU Law is Van Gend

en Loos. Nevertheless, it mainly concerns the principle of direct
effect of EU Law, another crucial pillar of EU Law enforceability,
and will therefore be more fully discussed in the next Chapter.

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General principle: The EU must be regarded as a unique legal
order distinct from either national or international Law.

Van Gend en Loos v Nederlandse Administratie der

Belastingen (Case 26/62) [1963] ECR 1
Facts: The case was related to the introduction of a Dutch law on
taxes, relatively increasing the duty payable and resulting on a loss
suffered by the claimant that which claimed an incompatibility
with European Law. The importer was charged 8% tax on
importation of chemicals from Germany, placing him at a
disadvantage over domestic sellers.
Preliminary Ruling: “The Community constitutes a new legal
order in international law for whose benefits the states have
limited their sovereign rights, albeit within limited fields”.
Application: The EEC Treaty that was at stake in the case was not
an ordinary international Treaty because Members agreed to limit
their sovereignty rights. Van gend en Loos does not give a
complete definition of supremacy. However, by declaring that the
Treaty had established a new legal order in which Member States
had limited their sovereign rights, the judgment paved the way for
the establishment of this principle of EU law.

General principle: National law cannot override EU law.

Flaminio Costa v ENEL (Case 6/64) [1964] ECR 585

Facts: ENEL was an electric company that has been put under
state ownership by the Italian government. Costa, a shared owner
of the company before its nationalisation, has suffered a loss
attributable to the Italian Government. He argued before its
national Courts that the Italian law nationalizing the industry was
incompatible with EC monopoly laws. The case was referred to the
ECJ. Throughout the procedure, the Italian government claimed
that national law should prevail as it was enacted after the law
ratifying the EC Treaty.
Preliminary question before the Court: Whether or not a
national law, enacted after the law ratifying the founding treaties
of the Communities, could contravene to its main objectives?
Preliminary Ruling: The answer of the Court is clearly negative;
incompatible domestic provisions cannot override Community
law, regardless whether or not they were enacted after the
ratification of the founding treaties.

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The ECJ based its reasoning on the framework of Van Gend en
Loos but extended it: “By creating a Community of limited
duration having (…) a transfer of powers from the states to the
community, the member states (…) have thus created a body of law
which binds both their nationals and themselves”. Thus, according
to the Court, the supremacy of EU law logically stems from the
Member Stats’ transfer of power that created an independent body
of law. Application: This case defines and develops the principle
of the supremacy of EU law justifying it by the “special and
original” nature its legal order.
A clear conclusion can be made about the inputs of Costa and
Van Gend en Loos.
The Member States have transfer certain of their sovereign powers
to the Community in order to make law that would bind them and
their individual. As a result Member States cannot introduce new
national laws that would contradict EU Law.

General principle: No provision of national law, of any nature

whatsoever, can override EU Law.

Internationale Handelsgesellschaft mbH v Einfuhr- und

Vorratsstelle für Getreide und Futtermittel (1970) Case 11/70
Facts: A regulation required the introduction of export licences in
respect of certain agricultural products falling under the Common
Agricultural Policy (CAP). Another requirement of this regulation
involved the transfer of a deposit that would be forfeited if no
exportations were realized during the period of the licence, and
this is how the applicant suffered a loss. The applicant claimed that
this EU regulation was incompatible with the German Constitution
for having contravened with the right to run a business freely. The
unconstitutionality was acknowledged but the German Court was
uncertain about the consequences of such a decision.
Preliminary question before the Court: The German Court used
Article 177 to ask the ECJ whether or not national constitutional
law prevails over EC law?
Preliminary Ruling: The Court simply replies: “The validity of a
Community measure or its effect within a member state cannot be
affected by allegations that it runs counter to either fundamental
rights, as formulated by the constitution of the state or the
principles of a national constitutional structure”.
Application: Internationale Handelsgesellschaft enlarges the

24
scope of the supremacy principle: no provisions of national law, of
any nature whatsoever, can override EU Law. In the event of any
conflict or inconsistency between any provisions of national law,
regardless its nature, and EU law, the domestic courts have an
absolute requirement to give effect to EU Law.

General principle: When national law conflicts with EU law,

national law should immediately be set aside by national
Courts.

Amministrazione delle Finanze v Simmenthal SpA (1978) Case

106/77
Facts: Simmenthal, a company importing beef into Italy from
France, was required to pay a tax at the border, which clearly
contradicts the EC provisions on freedom of good at the time.
Preliminary question before the Court: After acknowledging the
incompatibility, the Italian Court referred the case to the ECJ to
know if EU Law had to be applied directly of if it should wait for
the traditional constitutional Court procedure to strike it down for
incompatibility to higher norms?
Preliminary Ruling: The Court mentions in its Judgement that
any EC provision “renders automatically inapplicable every
conflicting provision of current national law”.
Application: The effect of EU Law supremacy is immediate, there
is no need to wait for national procedures to strike down the
impugned law, and it is rendered automatically inapplicable.

General principle: All incompatible domestic law shall be

repealed.

Case 167/73, Commission v France (Re French Merchant

Seamen) [1974] ECR 359
Facts: A French statutory provision required that certain of crew
on French registered merchant ships had to be French. This
provision was violating the rules of freedoms of worker under
article 45. The French government argued that its domestic Courts
were no longer giving effect to this provision and that nothing in
the Treaty required repeal.
Preliminary question before the Court: Do Member States have
to repeal every out-dated incompatible law, even though their
Courts are to giving them effect anymore?

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Preliminary Ruling: The mere existence of such provision was
creating uncertainty that was unacceptable in the pursuit of
harmony.
Application: All previous domestic law that appears incompatible
to EU Law, regardless whether or not it is still applied by domestic
courts shall be repealed by Member States.

Finally, the supremacy of laws taken at the international level is

not a revolution in itself. Actually, it is generally accepted by
States in Public International Law (Treaties and Customs prevail
over national law). However, the particularity of EU supremacy
lies on two points. Firstly, this principle is effectively enforceable
in practice. And this is quite rare in the international order that a
Court has the courage and the resources to go against the States’
will. Secondly, as it has been mentioned in the case previously
presented, the Member States have transferred powers to the
Union, so that they can be forced to implement decisions for which
they were in disfavour. This is certainly why the supremacy issue
is so controversial. Conversely, in Public International Law
nothing, except for the exception of the jus cogens, no rules can be
imposed on States if they did consent to them.

The impact of supremacy on UK Law

The UK compliance with supremacy was probably the most far-

reaching of the EU. Partly because dualist states are generally not
designed to integrate international orders implying any sort of
supremacy. According to Dicey’s traditional definition of
Parliamentary sovereignty, it makes Parliament the supreme legal
authority in the UK, which can create or end any law. Generally,
the courts cannot overrule its legislation. Parliamentary
sovereignty is the most important part of the UK constitution.

However, the CJEU case-law on supremacy requires national

Courts to suspend operations, declare as invalid and dis-apply acts
of Parliament. This approach is completely opposed to the UK
conception of the role of Judges. The United Kingdom being a
dualist system allowed EC law to get an automatic incorporation
through the European Communities Act 1972(ECA). Section 2(1)
of this act particularly conveyed how the UK limited its sovereign
rights in favour of the EC. However section 2(4) limited the EU's

26
sovereignty over domestic law by ensuring that all domestic
enactments had effect only subject to directly applicable rules of
community law. The ECA 1972 had two major consequences on
the traditional UK system: overriding the usual presumption that
any later enactment overruled prior law inconsistent with it and
clearly terminates any effect of acts of Parliament purporting to
contradict EU Law. UK judges took the following positions:

E Coomes (Holdings) Ltd v Shields [1978] IRLR 263 CA,

Facts: Miss Shields was employed as a counterhand in the
appellants bookmakers' shop in Sussex Street, London, on an
hourly rate of 92p, whereas her men colleagues were significantly
paid better for the same job. UK law appeared to be incompatible
with EU Law.
Question before the Court: In case of conflict between UK and
EU Law, which provisions should prevail?
Ratio: Lord Denning stated that “By the 1972 Act, parliament
enacted that we should abide by the principle as laid down by the
European Court”.

English judges have not always reacted in this manner and there
has inevitably been a controversy that arose from the case
Mcarthys v Smith.

Macarthys Ltd v Smith (No.2) [1980] EWCA Civ 7 (17 April

1980)
Facts: This case involved a claim about equal pay based on EC
Law that appeared to be contradicting with the Westminster’s
Equal Pay Act 1970.
Question before the Court: In case of conflict between UK and
EU Law, which provisions should prevail?
Ratio: Lord Denning adopted a constructive approach that was
contradicting EU supremacy, he says “If the time should come
when our Parliament deliberately passes an Act with the intention
of repudiating the Treaty or any provision in it or intentionally of
acting inconsistently with it and says so in express terms then I
should have thought it would be the duty of our courts to follow the
stature of our Parliament.” Justice Cumming-Bruce in his
dissenting judgement took position of EU supremacy.

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Garland v British Rail Engineering Ltd. [1982] 2 WLR 918
Facts: There was a dispute between an employee and her company,
another case relating to equal pay. The employee claiming
discrimination alleged to be suffered by female employees who on
retirement no longer continue to enjoy travel facilities for their
spouses and dependent children although male employees continue
to do so.
Question before the Court: Should the construction approach be
applied when Parliament deliberately passes an Act with the
intention to act inconsistently with EU Law?
Ration: Lord Denning's construction approach was applied in this
case and EU Law has been set aside. This gave rise to a significant
controversy as being incompatible with Van Gend en Loos (1963).

General principle: UK constructive approach is overruled and

the supremacy of EU Law reaffirmed.

R (Factortame Ltd) v Secretary of State for Transport (Case C-

213/89) 1990 ECR 1-2433
Facts: The case involved companies registered in the UK but
mainly owned by Spanish nationals. The Merchant Shipping Act
1988 required a certain percentage of UK national ownership for
the registration of a vessel. This provision expressly violated the
“non-discrimination on nationality” principle of Article 12. The
Divisional Court granted an interim relief suspending the operation
of the impugned law. The House of Lords then made a reference to
the ECJ arguing than nothing neither in the UK Constitution nor in
EC Law permitted such interim.
Preliminary question before the Court: Does the incompatibility
of an act of Parliament, enacted after accession to the Treaties and
expressly introducing inconsistencies to EC Law, permits judges to
suspend the legal effect of the domestic provision?
Preliminary Ruling: The Court firmly recalls that any act of
Parliament, even enacted after the accession Treaties, that would
be inconsistent with EU Law cannot override it.
In addition to this, national Courts being confronted to
inconsistencies or incompatibilities with EU Law are required to
do everything necessary to set aside the impugned law.
Application: The UK constructive approach is overruled and the
supremacy of EU Law is affirmed. There is now an external body
competent to make laws affecting the United Kingdom, which are

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applied by the English Courts irrespective of the wishes of
Parliament.

This brought about academic debate on the concept of

parliamentary sovereignty. Authors such as Wade stated that the
fact of dis-applying an act of Parliament for an allegedly
incompatibility with a superior source meant that “something
drastic had happened to the traditional doctrine of parliamentary
sovereignty”. He claimed that this was revolutionary on the
grounds that the Courts were no longer prepared to uphold
absolute parliamentary sovereignty. Alternatively Craig and De
Burca argued that sovereignty remained intact. Parliament itself
voluntarily decided to set the limits of its sovereignty. The ECJ
just used the competence it has been attributed by the Member
States. On the other hand McCormick argued that in the modern
world it was no longer realistic to speak in terms of absolute
sovereignty due to the inter-dependence of economies.

However many English Lawyers, did not accept the European

Court’s view. They contended that European law overruled
English domestic law only because parliament had chosen to make
it so, and that parliament could change its mind at any time. A
balance is thus preserved between the supremacy of EU law in
matters of substantive law, and the proper supremacy of the UK
parliament in establishing the legal framework within which EU
law operates. The recent events that led the UK to trigger article 50
TFEU support this last argument. Brexit has shown that the UK
Parliament voluntarily transferred some powers to the Union and
was entitled to take them back at any time.

Another act is finally enacted in 2011, The European Union Act,

by the coalition government that makes a number of statutory
qualification about the future relationship between the EU and the
UK. A very interesting provision related to the issue of supremacy
can be found in section 18 of the act. The latter subjects the UK
membership to the continuing will of Parliament. A simple act of
Parliament is all that is needed to exit from the EU.

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The impact of supremacy on other Member States

In France, accepting EU supremacy did not raise such

controversies. It can certainly be explained by the fact that it has a
monist approach of international Law. At quite an early stage, the
Court of Cassation in the case Von Kempis v Geldof (1976) 2
CMLR 462, acknowledged the recent CJEU case law in declaring
that EU Law takes precedence over French legislation.

However, the UK is not the only country to presented difficulties

with supremacy in their national jurisdiction. It was also the case
in other European Union member states such as Germany and
Poland. For example in Germany, the reluctance to accept
supremacy was based on a fear of potential violation of Human
Rights contained in the German Constitution.

Solange I judgment, German Constitutional Court (BVerfGE

37, 271) [1974] 2 CMLR 540
Facts: The case involved an A German import/export company for
which an export deposit of DM17,026.47 was declared to be
forfeited after the firm had only partially used an export licence
gran-ted to it for 20,000tons of ground maize.
Preliminary Ruling: The German Constitutional Court
complained about the legal uncertainty left by the lack of a
codified catalogue of fundamental rights and held that the
fundamental rights guaranteed under the West German constitution
would prevail over EEC law for so long as this situation continued.

The German Constitutional Court finally abdicated in the case

Wunsche Hendelsgesellchaft (1987) 3 CMLR 225 provided that
the EU Law could guarantee as least an equivalent protection. On
the issue of sovereignty, the German Constitutional Court always
maintained a stable position: Germany remains the only sovereign.
In the case Brunner v The European Treaty (1994) 1 CMLR 57,
the Court states: “Germany is one of the ‘Masters of the Treaties’
… Germany thus preserves the quality of a sovereign state in its
own right”.

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Endnote

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Purchase of the whole book is available on Amazon as well. In the
case of Private Law Tutor Publishing, our goal is to give students
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legal education resources that are free of commercial biases. In
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