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Topic 5

EU law revision notes


The concept of direct effect

Distinguish direct effect from direct applicability

- Although used interchangeably by the courts, difference
rather substantial - Article 249 (189) of the EC Treaty
specifically mentions the concept of direct applicability, but
is silent as to the concept of direct effect, which was
instead developed by the ECJ in the case of Van Gend en
- Direct applicability applies only to regulations they take
effect in domestic law of Member States without the need
for further enactment; s2 (1) of the ECA 1972 recognizes
the existence of directly applicable provisions and states
that they are without any further enactment to be given
legal effect or use in the United Kingdom.

- Article 226 of the Treat allowed the Commission to sue MS
before the ECJ for breach of Community law - public
- Van Gend en Loos ECJ legitimated private law
enforcement by holding that Treaty Articles could have
direct effect such that an individual could rely on them
before the national courts and challenge inconsistent
national action the ECJ thus brought the individuals into
Communitys legal order (contrast with the usual effect of
international treaties which cannot be enforced by

The academic and judicial uncertainty over the

meaning of direct effect
a) Broader definition the capacity of a provision of EC law
to be invoked before a national court (objective direct
b) Narrower definition capacity of a provision of EC law to
confer rights on individuals which they may enforce
before a national court (subjective direct effect)
- The degree of difference in definition is dependent upon
the conception of rights
a) Right to invoke EC law in a national court to assist ones

b) Substantive right to be relied upon by the individual in a

national court, entitlement to a particular remedy and
the imposition of a corresponding liability or duty on
another party


Direct effect of Treaty Provisions

Van Gend en Loos

- the Community constitutes a new legal order in
international law, for whose benefit the States have limited
their sovereign rights, albeit within limited fields, and the
subjects of which compromise not only the member-states,
but also their nationals. Community law, therefore, apart
from the legislation by the member-states, not only
imposes obligations on individuals but also confers on them
legal rights.
- Treaty Articles are capable of direct effect
- Public enforcement of EC law via Article 226 did not
preclude private enforcement via direct effect (a new
enforcement method was needed to ensure that Member
States complied with the provisions to which they have
- Treaty Articles direct effect test:
1) Provision is self-executing
2) It is clear, negative, unconditional, containing no
reservation on the part of the MS
3) It is not dependant on any national interpreting measure
(does not require enforcement via domestic law, such as
via enactment of a Parliament Act).

Original conditions for the direct effect have been loosened

since Van Gend en Loos, although the ECJ still sometimes finds
the Treaty Articles as not having a direct effect

The current position is that a Treaty Article will be accorded

direct effect provided that
a) It is intended to confer rights on individuals
b) It is sufficiently clear, precise and unconditional

The test leaves the Community courts with a lot of room for


Legal effect of Regulations

Article 249 - ...binding in their entirety and directly applicable

in all Member States
Direct effect affirmed in the Slaughtered Cow case owing to
their very nature and their place in the system of sources of
Community law, regulations operate to confer rights on
individuals which the national courts have a duty to protect
It is only if a Member State by way of a national measure
alters, obstructs or obscures the direct effect of regulations
that it will be held to constitute a breach of EC law Member
States can provide in national legislation for appropriate
sanctions not provided for in regulation and continue to
regulate issues not covered in the regulation


Art. 249-....binding in its entirety upon those to whom it is

Usually not a general measure (like a regulation) but an
individual one, directed at certain addressee/s.
Held to be capable of direct effect in Grad, despite the fact
that Art 249 made no reference to its direct applicability
(unlike in case of regulations). The Court ruled that it did not
follow from this that other categories of legal measures
mentioned in the Article can never produce similar effect.
Could be in suitable cases invoked by individuals before the
national courts.


Legal Effect of Decisions

Legal effect of Directives

1) Generally
Article 249 a directive shall be binding as to the result to be
achieved upon each Member State to whom it is addressed
but shall leave to the national authorities the choice of form
and methods
MS must implement the provisions within the time limits laid
down in the directive
Directive is an instrument of harmonization used by
Community institutions to bring together or coordinate
disparate laws of Member States in various fields. Eventual
implementation hence does not have to be uniform in all MS,
although the aim must be secured.
**Van Duyn case
- The ECJ held that directives could in principle have direct
effect , because of the:

a) Functional reason directives are binding and will be

more effectively enforced if individuals can rely on them
b) Textual reason Article 234 allows national courts to
refer questions concerning any community measure to
the ECJ, including directives, and this implied that such
acts could be invoked by individuals before the national
c) Estoppel argument MS were precluded by their failure
to implement the directive properly from refusing to
recognise its binding effect in cases where it was
pleaded against them; the MS should have implement
the directive and where it had not done so it should not
be allowed on its failure to implement it as to deny the
binding effect of the directive after the date for
implementation had passed.

2) Time Limits
The directive may have an impact before time limit for its
implementation has expired although the MS are not obliged
to implement it before the expiration date they are obliged
during that time period to refrain from adopting any measures
which might compromise the result prescribed by the
Even after the MS had implemented the directive into national
law, an individual can rely on its provisions directly against the
State, as long as then directive is not being applied in practice
3) The vertical/horizontal distinction

- ECJ held that direct effect of a directive could not be
pleaded against an individual, but only against the state
(no horizontal effect)
4) Expansion of direct vertical effect by expanding the
scope of public authority

Expansion of the notion of public body in Marshall (Health

Authority) and Foster v British Gas (British Gas)
**Foster v BG
- Held that the provisions of a directive can be relied on
against organizations or bodies which are subject to the
authority or control of the state or have special powers

beyond those which result from the normal rules applicable

to individuals.
Key issue whether D was part of the state / very broad
conception of public body resulted, although no clear
definition was provided by the court and it remains unclear
what level of control the State must have over the body in
question for it to be deemed part of the State

5) Indirect effect: principle of harmonious


Requires national law to be interpreted in light of the


**Von Colson
- National courts are required to interpret their national law
in light of the wording and purpose of the Directive in order
to achieve the result which is binding on the MS. It is for
the national court to interpret and apply legislation adopted
for implementation of Directive in conformity with
requirements of the community law; at least in so far as it
is given the discretion do so under national law.
- ECJ expressly identified courts as organs of the State which
are responsible for the fulfilment of Community obligations.

Also applies in horizontal case, between private parties

- **Marleasing
- Von Colson was affirmed, but this time between private
parties; also confirmed that an unimplemented directive
could be relied upon to influence interpretation of national
law in a case between individuals.

The obligation applies to all national law, not only to

legislation implementing the Directive, whether it predates or
post-dates the Directive; whether it has any specific
connection with the Directive or not (Marleasing)

The obligation is strong, but does not require a contra legem

interpretation of national law it is up to the national courts to
decide whether it is possible or would result in a contra legem
reading (Dori)

The positive obligation of harmonious interpretation applies

only when the time limit for the implementation of Directive
has expired, BUT the courts still have a negative obligation to
refrain as far as is possible from interpreting the domestic law
in a manner which might compromise the objective pursued
by the Directive
6) Indicental horizontal effect

Permits the use of unimplemented directives in certain cases

between private parties, thus lessening the impact of Marshall
Directives can have a limited form of direct effect where they
do not directly impose obligations on individuals
Exclusionary effect a directive is invoked in a case between
individuals to preclude the application of a conflicting
provision of national law, the result being that one of the
parties to the case is subject to legal liability or a
disadvantage to which he would not have been a subject to
had the offending national law been applied (contrast with the
substitution effect)
7) The principle of State liability for damages for nonimplementation of a Directive

Another way for an individual to enforce provisions of a

Directive despite the prohibition of horizontal effect is to sue
the MS for damages for loss caused by the States failure to
implement the directive (Francovich)

- Held that full effectiveness of Community rules would be
impaired and the protection of rights they grant weakened
if individuals were unable to obtain compensation when
their rights are infringed by a breach of Community law for
which a MS can be held responsible

Brasserie v Germany & Factortame

- Confirmed Francovich
- Said the test for whether MS will be liable to compensate
a) Is the breach of the Directive sufficiently serious?
b) Did the MS attempt to implement it?

c) Was there any case law precedent/guidance from the


- The principle of state liability applies even to a court at last