Equivalent Effect to Customs Duties - Case Study Example

Scenario No: 2 EU law, under Article 141 is directed towards the achievement of basic employment equality principles of equal pay1 and equal treatment “as regards access to employment including promotion, vocational training and working conditions.”2 Under the provisions of this Article, men and women are to receive equal pay for equal work, with equal pay defined as any other consideration, whether in cash or in kind, which the worker receives, directly or indirectly, in respect of his employment from his employer.3 Moreover, Article 39(2) requires that any kind of discrimination between workers “as regards employment, remuneration and other conditions of work and employment” must be abolished. Rachel is arguing that the treatment she receives in her job as a programming assistant amounts to sex discrimination because she is being paid less than the other employees and given menial tasks such as cleaning. However, in order for any discrimination in pay to be established, the comparison must be restricted to parallels between work which is actually done by different sex employees4 and this was also held in the case of McCarthy’s Ltd v Smith.5 Hence, Rachel must establish indirect discrimination on the basis of work habitually done by her sex and programming is not necessarily a job which would be considered to be more suited to males only because of their superior physical strength. The problem of establishing indirect discrimination in such a case was illustrated in the case of Enderby v French Health Authority6 where it was shown that the performance of women would be traditionally under valued in certain professions. Therefore, if Rachel is to succeed in her case, she must first establish that the value of her work as a female is on par with male workers who are doing the same job. In proving this however, there are some restrictions. Firstly, Rachel’s designation is that of Assistant Programmer rather than Programmer, as a result equal value may not be ascribed to the work she is doing and may not merit equal pay. Secondly, she is the only woman employee, therefore it would also be difficult for her to prove that a significant number of females or a group of women are being discriminated against for the sole reason that they are women, since there is limited parallel cases of women in jobs such as the one Rachel is in. Therefore her chances to win a sex discrimination suit may be limited to some extent. The supervisor’s grounds for excluding Rachel from the pension scheme, i.e, that she might get pregnant and leave soon anyway, may however qualify as discrimination under Article 39(2) which prohibits any kind of discrimination in employment. Redressal would especially be possible under Regulation 1612/68, which specifically states that there must be parity in the “social and tax advantages7 available to workers. It may be possible for Rachel to contest the decision on the grounds that an inappropriate justification was offered to her about the reasons for refusal to include her in the pension scheme, i.e, that she would get pregnant and leave, which appears to be a blatantly sexist reason. In the case of Levin, part time workers were also deemed to be eligible to receive social security benefits8 therefore the fact that Rachel is female and has the designation of Assistant Programmer cannot be grounds for excluding her from the pension scheme. However, the case of Kathy is somewhat different and she has a better chance of proving indirect discrimination. Under Directive 76/207 of Article 141, indirect discrimination has been set out as “a rule or practice, although not formed in terms which apply only to one sex, has the effect of disadvantaging a considerably higher percentage of one sex.”9 Moreover, there is a burden of proof placed upon the claimant in supporting the contention of lower pay.10 Therefore, on this basis, if Kathy is to win her claim of indirect discrimination, she must show that most of the workers who are receiving lower pay are predominantly of one sex, i.e, women. Since the provisions of equal pay for equal work apply equally to both full time and part time workers, there can be no discrimination on this basis either11. Therefore, it may be noted that in Kathy’s case (a) most of the secretaries who are being paid less are women and (b) they possess similar qualifications and experience as the programmers, which justifies her contention that there is indirect sex discrimination that is taking place. The only potential limitation could be precedent in Enderby, wherein a secretarial job may be considered one of those professions where the performance of women is traditionally under valued. Despite this however, there may be merit in the claim of indirect discrimination because the secretaries are receiving only one half of the pay of the programmers. The ECJ has laid out the fact that differences in the pay for part time and full time workers is justifiable since the latter work for more hours, however if more women are employed to indirectly lower payment for the entire group this could constitute discrimination.12 The ECJ also stated differences in pay between workers could be compatible with Article 141 “only in so far as they are objectively justified.”13 Therefore Kathy will have to circumvent any argument from her employers that such differences in wages between the secretaries and programmers is objectively justified, since programmers are required to perform more demanding tasks as compared to programmers. But the significant aspect that works in Kathy’s favour is the fact that most of secretaries are women and there are no men among these lower paid employees while there are several among the programmers who are paid correspondingly higher pay, therefore the policy of the Company disadvantages a significant percentage of women as opposed to men, laying open the grounds for a possible victory in a sex discrimination suit.......................................1100 words 2. Articles 25 and 90EC are complementary in that they both apply in terms of charges levied on import of goods. However, both these provisions cannot apply at the same time because Article 25 applies to any kind of levy on goods, no matter how small, which is imposed when the goods cross the border. Article 90EC applies to taxes levied on both domestic and foreign goods, generally at the same rate. Article 25 prohibits all kinds of quantitative restrictions such as customs duties or any “charges having equivalent effect.” Both these are subject to the restrictions of Article 25, because otherwise, countries seeking to evade the implementation of the restrictions can “reach the same protectionist goal through measures which created in economic terms, a similar barrier against imported goods.”14 This would apply in the case of the extra fees being charged for safety tests, as well as the unloading fee to be paid at Swedish ports. The Rouen company could argue that Germany’s requirement for the payment of fees for safety tests constitutes a restriction on imports and free trade. But since the fault discovered in the Rouen A cars constitutes a safety hazard that could impact negatively on the safety of members of the public in Germany, the government could be justified in the imposition of such a requirement. The imposition of this charge qualifies as an internal tax, but this is likely to be prohibited only if it is discriminatory15. Since justification exists on safety grounds for imposition of such fees, it may not be held to be valid. Moreover, Article 28 of the EC Treaty states that “quantitative restrictions on imports and all measures having equivalent effect” are to be prohibited, hence the Rouen may also contest the restrictions on this basis. Both Articles 28 and 29 are geared towards ensuring that there is free trade and movement of goods across the European Union. However Article 30 qualifies these restrictions by stating that on grounds of public health, public morality or public security, restrictions may be permissible. This was also the line of the “rule of reason” that was spelt out in the case of Cassis de Dijon16 wherein restriction on imports could be justified on the grounds spelt out under Article 30, as a part of public policy. Hence public safety could be a valid ground for the German Government’s requirement. The fee being imposed by the Swedish Government however may constitute a restriction that would fall within the scope of application of Article 25. It may be argued that any kind of pecuniary fee imposed on goods merely because they cross a frontier, would constitute an obstacle to free movement of goods17, especially when accompanied by the concomitant administrative difficulties.18 Although the justification offered is swift customs clearance, this still equates to the imposition of customs duties, which would per se be prohibited. Article 90 EC states that in the matter of taxation, no Member State is to impose “any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.” In the case of Lutticke GmBh v Hauptzollamt19, a milk importer named Luttucke claimed that a tax imposed by German authorities was discriminatory because a similar German product would not be subjected to the same tax. The ECJ also arrived at the same finding and banned the tax on the basis that it would impede free trade and raise the price of Luttucke’s product within Germany. This could well apply to the 10% tax being levied on Rouen A and Rouen B vehicles, because similar make vehicles manufactured in the UK face only 5% tax. Article 90E would also apply in the case of the Class C Rouen vehicles and the tax on these vehicles as compared to similar vehicles in the UK must be equalised or they will not have any protective effect.20 When tax is not equal, then it could be held to be selectively applied to benefit a particular group21 and could therefore be invalid. Under the precedent set out in the Cassis case22, the Court also included another rule – the rule of recognition whereby it stated that: “There is no reason why, provided that [goods]have been lawfully produced and marketed in one of the member states,[ they] should not be introduced into any other member State.” In the Cassis case, the Court made it clear that when certain standards had been applied and found relevant in one member state, there was no reason to reject them in another State without a compelling reason. Such compelling reasons that would permit barriers to trade between member countries could only include such national legal provisions that pertained to public health protection, or the maintenance of fairness in commercial transactions or wherever the interests of the consumer were threatened. In such an instance, where a mandatory measure in existence in a particular state was deemed to be valid, the Commission deemed that it would be necessary for minimum standards to be set through the issue of an EC Directive. Applying this precedent, there is no reason why the Rouen vehicles should be taxed more purely because they are being imported into Sweden and the U.K. In the context of the free movement of goods mandated within the European Union, there is no compelling justification that can be offered under the rule of recognition, for such a difference in taxes and the Courts may find that it is not justified……………………………….1041 words Bibliography Barents, R, 1978. “Charges of equivalent effect to customs duties”, 15 CML Rev 415 at 420 Grain, Paul and Graine DrBurca, ÉU la.w: Text, cases and materials” Monti, G, 2002: "Article 81 EC and Public Policy", in Common Market Law Review, 39: 1057–1099. Tillotson, John and Foster, Nigel. ‘Text Cases and Materials on European Union Weatherill S. and Beaumont P., "EU Law", Third Edition, 1999, Penguin Books, pp. 1065-1070 Weiler, JHH, 1999. “The Constitution of the common marketplace: Text and context in the evolution of free movement of goods “, IN Craig and DeBurca, 1999. “The evolution of EU Law” at 355 Cases cited: A Brunsteiner GmbH (C-376/05), Autohaus Hilgert GmbH (C-377/05) v Bayerische Motorenwerke AG (BMW) [online] available at: http://eur-lex.europa.eu/LexUriServ/ LexUriServ.do?uri=CELEX:62005J0376:EN:HTML Case 129/79 (1980) McCarthy’s Ltd v Smith Case 127/92 (1993) Enderby v French Health Authority Case 26/76 Metro SB-Großmärkte GmbH & Co. KG v Commission [1977] ECR 1875 (Metro I). Case 86/80 Jenkins v Kingsgate Ltd Case 25/68, Statistical Levy (1969) ECR 193 Case 57/65 Lutticke GmBh v Hauptzollamt (1996) Consten and Grundig (Cases 56 and 58/64) Levin Case 53/81 (1982) Scharbatke v Germany (Case 72/92) (1993) ECR I-5509 STM v Maschinbau Ulm (Case 56/65). Read More