The Significance of Article 234 - Coursework Example

The Significance of Article 234 Introduction: Article 5 (formerly 3B) of the EC Treaty effectively defines the relevant competencies of both individual Member States and the Community as follows: “….. the Community shall take action…. only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the Member States.”1 Therefore, the EC Treaty as originally conceived, visualized separate areas of competency for the Community and the Member States. Article 5 was meant to designate authority in areas of mutual competence of both the Community and the States. The question of subsidiarity arises in areas where the Community shares powers with those of the Member States.2 Therefore, as per Article 5, in areas that do not fall within its exclusive jurisdiction, the Community is to act to the extent that is required, according to the principles of subsidiarity, to achieve the stated aims. There are two aspects to this article (a) subsidiarity will prevail only when the achieved objective cannot be achieved by the Member State; with preference for power to be allocated to the smaller unit, i.e, the member States.3 (b)Subsidiarity also denotes an efficiency test, i.e, when a desired goal can be achieved with better efficiency by the Community. Therefore, on the basis of subsidiarity and the principle outlined in Article 5, the ECJ does not enjoy unlimited competence to act; rather it must work within the constraint of the powers attributed to it through the Treaty. However, in practice, what has emerged through the rulings of the European Court of Justice is that there are no areas that may be designated as off limits to the EC and exclusive to the Member States.4. This judicial activism of the European Court of Justice has resulted in the relationship between EC law and national laws being redefined in many aspects, such that the supremacy of Community Law has been established. The Role of the European Court of Justice: The formal role of the European Court of Justice, as set out in the EC Treaty, is merely to “ensure that in the interpretation and application of this Treaty, the law is observed.”5 Therefore, it was intended to be more regulatory than activist in nature and as stated by Bermann, the EC Treaty “was conceived as an international agreement, and only later came to be viewed as a constitutional document.”6 However, during the 1960s and 1970s the ECJ has handed down a set of landmark rulings which has added impetus to European integration and led to the subordination of national laws through the fashioning of a constitutional framework for a federal type of structure within the European Union.7 According to D. Anderson, the judicial activism of the European Court “appoints the European Court as meeting place between the legal order of the Community and those of its member states.”8 In analyzing the roots of the judicial activism of the ECJ, Koopmans has pointed out how the legislative processes within the EU were characterized by inertia, since unlike a democracy, there was a marked gap between wishes of voters and political decisions, which necessitated a more active judicial role for the ECJ9. Article 234 of the EC Treaty appears to appoint the ECJ as the interpreter of the aims and objectives of the Treaty, so that it has been placed in the position of having to exercise judicial creativity in order to bring justice to individual litigants in the Member States. Article 234: The significance of Article 234 in mediating the relations between Community law and national laws may be noted in its provisions, which states that in matters of Community law where there are questions or where clarification is required by national bodies, they have the discretion to refer the matter to the ECJ, which in turn is empowered to issue a preliminary ruling on the issue. According to the provisions of Article 234, any national body that functions in any kind of permanent judicial capacity with compulsory jurisdiction may refer matters to the ECJ; hence even a lower Court can approach the ECJ, irrespective of the judicial hierarchies prevailing within a particular Member State. There is no mandate on a reference to the ECJ under Article 234 by national bodies, rather it is a discretionary reference available to national bodies where no effective remedy to an issue exists under the framework of national laws10. Article 234 was formerly Article 177 and the purpose behind setting out its provisions was laid out in the case of Bosh v De Geus11 as a fruitful collaboration between national courts and the Court of Justice in such a manner that there would be no encroachment into their respective jurisdictions. It was intended to ensure that the Treaty was uniformly applied to all member states as set out below: “Article 234 is essential for the preservation of the Community character of the law established by the Treaty and has the object of ensuring that in all circumstances the law is the same in all States of the Community.”12 Developments through case law: There are several landmark decisions of the ECJ. Its decision in the case of Van Gend en Loos13 was notable in establishing the direct effect doctrine, wherein the Court ruled that the protection of EU law applied to individuals as well as member states. As a result, individual rights that were created under community law became enforceable within the Member States. In this case, the Court held that under certain conditions, the provisions of the EC treaty could have a direct effect in the member States and those states who were not honoring their Community obligations were liable to face legal action in their own national courts. This had the effect of constitutionalizing the EC Treaty rather than leaving it as an international Convention. Subsequently, the Court also established the horizontal direct effect doctrine by extending the Van Gend principle to the case of Sabrenna14. This may be noted in the extension of the supremacy of EU law over national laws into areas such as sex discrimination, as in the case of Sabena where it was held that national courts have a duty to protect the right to equal pay for men and women enshrined in EU law. The case of Francovich15 also established liability that would rest upon a Member State for the infringement of individual rights. Since then, a succession of cases16 have extended the principle of Member State liability to cover other instances of infringement of individual rights that could reasonably have been foreseen by the State. Application of national law where individual rights may be violated, will be limited by the obligation of the Member States to implement the EU Directives.17 This pattern of judicial activism of the ECJ highlights the fundamental aims of the EC Treaty as being geared towards securing the individual freedoms of European citizens. However, the ECJ has not necessarily interfered in every case; rather it has issued its preliminary rulings on the basis of the applicability of the discretionary referral only when no remedy exists in national courts. For example, in the case of CILFIT18, the ECJ established the following criteria to determine when it would not interfere under Article 234: (a) when the subject matter of the question is identical to another A234 reference which the Court has already answered. The Court made an exception to this rule in the case of DaCosta19 where it held that reference could be made even if Court had answered a materially identical question in some special cases. (b) When the interpretation of community law has no bearing upon the adjudication of the case in question and it is a matter primarily for the national courts (c) Where the doctrine of acte clair is applicable. According to this doctrine, the Court will not exercise its discretion to pass a preliminary ruling under Article 234 when the correct application of EU community law as spelt out in the Treaty is so obvious “as to leave no scope for any reasonable doubt as to how the question raised is to be resolved.” In the case of HP Bulmer, it was held by the Court that a ruling by the ECJ using its prerogative under Article 234 would not be mandated in every instance, rather it would become necessary mainly in instances where such ruling would be essential for a judgment20 and where no recourse existed in national law, thereby making the European Court of Justice the Court of last resort. Moreover, the ECJ will not interfere with national law in every instance, neither will not take action on every reference that is brought before it, but only in those cases involving a reference where a judgment of a lower Court is such that “there is no judicial remedy under national law”21 and only in instances where there is a real doubt about the proper application of Community law. Moreover, not all cases are suitable for referral to the ECJ. The jurisprudence of the Court has not been geared towards subordinating national laws or the independence of the national Courts but rather in encouraging them in applying the principles of the Treaty on their own. One of the significant cases in this aspect is that of Foglia v Novello22, where the ECJ clarified that it would not interfere in matters that were referred to it purely on procedural disputes. The case of Foglia concerned a dispute over a clause in a contract between the disputing parties, where the exact meaning of Article 234 was to be interpreted. However the ECJ stated that it could only rule on a genuine dispute rather than a rhetorical or procedural one, and also scotched the same case when it was raised again23 on the same grounds, stating that it would not render a decision in cases where there was use of a “procedural device to induce a ruling.” Furthermore the ECJ has also stated that it would not allow an Article 234 reference in those instances of a purely academic dispute where hypothetical questions are raised in the absence of “those elements of fact and national law necessary for it to provide a useful answer to the questions.”24 However, in the process of establishment of the supremacy of Community law over incompatible member state law, the rights of member states have been notably diminished by the supremacy doctrine. This may be noted especially in the case of Costa v ENEL, where the Court stated: “The transfer by the states from their domestic legal systems to the Community Legal system of the rights and obligations arising under the Treaty carries with it a permanent limitation of their sovereign rights, against which a subsequent unilateral act incompatible with the concept of the Community cannot prevail.”25 The Court has drawn an analogy between the liability of the member states and the tortious liability of the Community institutions under Article 215(2), where the Community enjoys a wide discretion in the exercise of its powers and is liable for violations and incurs liabilities only when it can be firmly established that it had seriously disregarded the limitations of those powers and their attendant responsibilities. Therefore on this basis, it would be necessary to establish that the member States have thus violated their discretion in the exercise of their powers before a matter could become actionable by the ECJ. But, as the case of Costa establishes, there is a “permanent limitation of their sovereign rights” that has arisen where national laws are concerned. The Rheinmuhlen case26 also established the principle that ECJ rulings are very powerful because they are not bound by national precedents or by Court structure. Moreover, national Courts do not have the authority to declare that a Community Act is invalid27 and it was stated in the case of Foto-Frost that when the issue of validity of a community Act is challenged, uniformity and legal certainty are imperative across all the member States, without which the Act itself would be challenged and jeopardize Community unity. Therefore, in the event of a conflict between national and Community law, it will be the community law as laid out by the ECJ that will predominate and state liability may be incurred regardless of which administrative section or body was responsible for the breach.28 This was also the position taken by the ECJ in the cases of Factorame II29 and Brasserie30. In the case of Factorame III, the UK legislature enjoyed a wide scope of discretionary power in the implementation of its powers in reference to the registration of vessels. The ECJ held that this discretionary power had been seriously disregarded. Preceding case law was drawn upon by the ECJ in arriving at its decision.31 In both Brasserie and Factorame, the Courts were prevented by their own laws from awarding damages to the individuals in question.32 The question of liability of a State for incorrect or improper implementation of an EC Directive was also an issue in the case of R. v. H.M. Treasury33 and in the case of Hedley Lomas.34 The case of R v H.M.Treasury, ex parte British telecom35 concerned the incorrect implementation of a Directive for which State liability was imputed by the Plaintiff and the case of Lomas concerned the rights of the applicant which had been breached by a national authority under the provisions of Article 34 of the EC Treaty. Both these cases illustrate the overriding of national law by EC law in the event of a dispute between the Community and the State in implementing a Directive. Similarly, in the case of Commission v United Kingdom36 the ECJ held to mandatory for the UK to ensure that workers are informed, consulted and empowered through a system of worker representation in accordance with EU laws while no such provision existed in the UK, thereby overriding national law. Another remarkable instance of the overriding of UK national law was that of Marshall v Southampton and South West area Health authority (No: 2)37 which abolished the limits that existed in UK law on compensation in sex discrimination suits. Conclusions: On the basis of the above, it may be noted that the reference under Article 234 is a discretionary one that may be applied by national bodies only when there is no remedy under national law or where there is genuine doubt about the scope and applicability of EU law. Another aspect that is clearly established through the pattern of judgments in the cases above is the emphasis that has been placed on individual rights guaranteed under EU law and the undoubted supremacy of Community law over national laws in areas where Community Directives and laws have been established. It is only the ECJ that has the power to declare an Act that has been set out under the EC Treaty invalid. However, once the ECJ has made such a declaration about the invalid nature of a law or an Act, this will be universally applicable across all the Member States. In those aspects where the ECJ has made a preliminary ruling on a matter of community law, such a ruling will be binding upon the national courts and in future cases, such rulings may be relied upon as established precedents for national courts to follow. Therefore, in a sense, it is the ECJ that has been making the law – establishing the principles of direct and indirect effect and in matters of conflict between national and Community law – the precedence of Community law. In the light of the above, it may be noted that the ECJ has functioned in a capacity that has set out basic constitutional concepts for the governance of the European Community and in the words of Judge Mancini, “coincides with the making of a Constitution for Europe.”38 It enables the Court to clarify and explain the proper reach of EC law, so that any irregularity or anomaly in the Community Acts may be challenged by national Courts. However, it must be noted that inspite of the fact that the judicial activism of the ECJ has elevated it to the status of an authority that has mandated a federal constitutional framework for the European Union, nevertheless the application of Article 234 shows that the ECJ is not an appellate Court for the member states and ultimately, all judicial activity is intended to be restricted to the states themselves so that the validity of national law remains unchallenged. The ECJ does not have the prerogative to rule on issues of national law and it must restrict itself only to providing guidance on the enforcement of Community Law within the member states. Rasumssen contends that the ECJ has moved much further than the mere compensation for political intertia through its activist case law regarding direct effect, supremacy and the protection of individual rights and freedoms39 and he is a strong critic of its appropriation an extra-constitutional role through its activitism40. Volcansek offers a different view and argues that the ECJ has assumed a vital role in the European Community and that if it had not effectively established the supremacy of community law, “other fields of community policy could have been affected adversely, for each member State would have accepted or rejected community decisions in an ad hoc manner.”41 She also points out that EU Treaties and secondary legislation arising out of it could have been accepted or rejected at the whim of every national court.42 Therefore, the ECJ by its judicial activisim, utilizing Article 234 has established the supremacy of Community law but has also helped to ensure that Community law becomes binding on the member states and produces increased legal certainty within the European union. A national court that wishes to invoke the provisions of Article 234 in the event of a doubt about the correct application of EU law, must first make a reference to the ECJ and get its clarification before proceeding to complete its judgment on the case that is before it. Once the ECJ has completed the clarification process it is not expected to remain involved in the case, or get involved with any of the facts of the case43, neither is it to comment upon any aspect of the validity of the national law as it related to Community law. The function of the ECJ is restricted towards providing the necessary clarification and interpretation of community law. Therefore, on an overall basis, it has served to enforce Community law on a uniform basis across all the member states and ensure that its validity is preserved. Bibliography Books/Journal Articles: * Anderson D, 1995. “References to the European Court.” London: Sweet and Maxwell at p. ix * Barner, N.W, 2005 . “The limited modesty of subsidiarity” . European Law Journal, 11(3) at 308-325 * Bermann, George A, 1994. "Taking Subsidiarity Seriously: Federalism in the European Community and the United States," Columbia Law Review 94 at 355 * Bernard, N, 1996."The Future of European Economic Law in the Light of the Principle of Subsidiarity" 33 CML Rev 633 * Consolidated version of the EC Treaty” [Online] Available at: http://europa.eu.int/eur-lex/en/treaties/dat/C_2002325EN.003301.html. * Craig, Paul and de Búrca, Grainne 2003. “EU Law: Text, Cases and Materials” (3rd ed.) Oxford: Oxford University Press, at pp 262. * Craig, Paul P, 1997. “Once more unto the breach: the Community, the State and Damages Liability” Law Quarterly Review 113, pp 67-94. * Koopmans, T, 1988. “The Roots of Judicial Activism” IN Protecting Human Rights: The European Dimension, Studies in Honour of Gerard J. Wiarda 327. Mather & H. Petzold eds * Mancini, Frederico, 1989. “The Making of a Constitution for Europe” Common Market Law Review, 26:595 * Rasmussen, Hjalte, 1998. “Between self restraint and Activism: A judicial policy for the European Court”, 13, European Law review at 28 * Rasmussen, Hjalte, 1992. “Towards a Normative Theory Interpretation of Community Law”, University of Chicago legal Forum, 135-178 * Volcansek, Mary L, 1992.”The European Court of Justice: Supranational policy making.” Western European Politics, 15:109 * Weatherill, Stephen, 2005. “Better Competence Monitoring” European law review, 30(1) at 23-41 Cases: * Andrea Francovich and Danila Bonifaci and others v Italian Republic, Joined Cases C-6/90 and C-9/90, European Court Reports 1991 page I-05357 * Bosh v De Geus (1962) ECR 45 * Brasserie du Pecheur SA v Germany (C46/93) [1996] E.C.R. I-1029 (ECJ) * DaCosta en Schaake NV v Nederlandse Belastingadminstratie Case 28-30/62 Rheinmuhlen-Dusseldorf v Einfuhr-Und Vorrasstelle fur Getreide und Furttermittel (NO.1) (1974) EC 33 * Case 26/62, Van Gend en Loos  v. Nederlandse Admistratie der Belastingen,1963 E.C.R. 1. * Case 43/75, Defrenne v Sabena, 1976 E.C.R. 455 * Case C-5/94 R v. Ministry of Agriculture, Fisheries and Food, ex parte Hedley Lomas (Ireland) Ltd, The Times, June 6, 1996 * Case No: 314/85 of Foto-Frost v Hauptzollamt Lubeck-Ost [1987] ECR 4199 * Case C-246/89, Commission v. United Kingdom [1991] E.C.R. I-4585 * Cilfit srl v Ministro della Sanita [1982] ECR 3415 * Commission v United Kingdom Case C-382/92 and Case C-383/92) (1994) * Costa v ENEL, Case 6/64 (1964) ECR 585 * Foglia v Novello [1980] ECR 745 * Foglia v Novello (1980) ECR 3045 * HP Bulmer Ltd v J Bollinger SA [1974] Ch 401 (CA) * Marshall v Southhampton and South West area health authority Case C-271/91 (1993) * Melicke v ADV/ORGA AG [1992] ECR I-4871 * R v H.M.Treasury, ex parte British telecommunications Case C-392/93 * R. v. H.M. Treasury, ex parte British Telecommunications Plc [1996] 2 C.M.L.R. 217 * R. v Secretary of State for Transport Ex p. Factortame Ltd (C48/93) (1996). * Telemarsicabruzzo v Circistel [1993] ECR I-393 Read More