Enforcement of Rights under the EU Law - Essay Example

? Enforcement of Rights under EU Law before the National Courts The principles of the EU law of the utmost relevance are those of non – discrimination, effectiveness and judicial protection. Case law with these features is in general, conferred under what is termed procedural autonomy. In this context, it is contended that the case law relating to Member State liability, in accordance with the decisions in Francovich1 and Brasserie,2 could be deemed a source of the European Community (EC) law requirements. This results from the fact that in the majority of the cases, contracting authorities are public bodies, and consequently, State entities.3 A very important feature is the liability of Community institutions, under the provisions of Article 288 EC. Such liability is not directly applicable, as the liability of Community institutions and the liability of the Member States are not always comparable.4 An instance of this is to be found in the Brasserie decision. In Brasserie, the ECJ extended the right of individuals to claim such damages, from any organ of the Member State whose act or omission had resulted in the damage.5 This makes it reasonable to presume that the liability case law, with regard to Member States, is relevant to damages claims for breach of EC law public procurement rules.6 Such course of action is with regard to contracting authorities that are public bodies. However, the term State tends to be vague, even within the realm of Member State liability. There is considerable disagreement as to whether the definition of State aid, provided in the ruling in Foster,7 as being emergent from the State should be acknowledged. All the same, the case law makes it very clear that the term State, in the context of liability cases, has a wider connotation and includes in its ambit, the decentralized bodies and authorities. 8 Hence, there is substantial common ground between a contracting authority and State entity under liability, despite these concepts being incongruent to each other. This contention is restricted to the intersection, wherein the contracting authority is in reality a State body. The public procurement law requires an action for liability to be brought against the contracting authority. However, it is up to the internal system of the national law to identify the State instance against which the action for liability is to be made. 9 This discretion accorded to the national law, while identifying State liability issues, results in grave injustice to the individual. This is because an aggrieved person has the right of direct effect only against a State and its emanations. Moreover, in this case, the ECJ ruled that the liability arising from the damage undergone by individuals, on account of a breach of Community law, was analogous to the liability of the Community under similar circumstances. This holds good, as long as there is no specific justification for the breach of the Community law. 10 This principle was echoed in the decision in Bergaderm.11 Furthermore, in the Brasserie case, 12 the conditions resulting in the liability of a Member State were described. These are; first infringement of rules of the Community that are aimed at providing individual rights; second, the existence of a breach of sufficient gravity; and third, a causal relationship between the breach and the damage sustained.13 This ruling however, failed to address all the issues involved. For instance, the issue of seriousness of the breach of Community law was left unresolved. Moreover, the ECJ had differentiated between areas of sparse and wide discretion, during its attempt to determine whether there were grounds for State liability, as well as the precise nature of these conditions. 14 Moreover, the breach of Community law by a Member State, which caused damage to an individual, placed that Member State under an obligation to make good the loss. This principle was enunciated in the Francovich decision by the ECJ. 15 In addition, in the Francovich case, the European Court of Justice (ECJ) ruled that the Treaty incorporates a general principle, which renders a Member State liable to compensate individuals for the resultant loss caused to them, due to its breach of the Community Law. This was based on the doctrine of direct effect, and the perception that individual rights would be compromised in the absence of such a rule. 16 The interests of the community are promoted by this principle. Since Directives will not accord directly effective rights, an individual is placed in a disadvantageous position in claiming most of the rights provided by the Directives unless they are implemented properly into the national laws. For example, in the case of Peter Paul,17 the ECJ ruled that the concerned Member State was not liable. The reason behind this was that the Directives did not provide individuals with directly effective rights. However, under certain circumstances, the Public Procurement Directives provide individuals with a right that is directly effective, and this is with respect to the receiving of damages.18 In contradistinction to this, the determination of failure to fulfil its obligations under Member State liability does not necessarily result to a finding of resultant damage. As such, in Commission v Germany,19 this important finding was confirmed. The Court held that a Member State was precluded from relying on the fact that a third party had not been made to undergo damage. This generates a tension between liability under the notion of Member State liability and damages under the Directive.20 In general, the latter could be substantially limited. This decision reveals the truth that greater importance had been accorded to the interests of the Member States, in comparison to the issue of damages suffered by individuals. Consequently, for liability to arise, the Member State should have blatantly ignored the bounds on the exercise of its powers. Some of the aspects that the competent court may consider are the precision and clarity of the rule that had been infringed. In the British Telecommunications case, 21 the issue of liability for a legislative act was addressed; this was related to the utilities sector.22 As such, the facts of the British Telecommunications 23 case related to the legislative action taken by a Member State. In this instance, the Court concluded that the wording of Article 8(1) was ambiguous to the extent that it could be reasonably interpreted as had been done by the British authorities. Thus, good faith at the time of implementing Directives tends to exclude the liability of the Member States.24 This exclusion paves the way for Member States to violate the implementation of EU Directives without attracting liability. This exclusion, which is to be enjoyed by the Member States with regard to their legislative functions, places an individual at a disadvantageous position in claiming the rights accorded by EU law. However, the rules relating to Public Procurement are significantly different from those that apply to tenders. Therefore, it would be incorrect to compare the Commission discretion with regard to such tenders to the discretion of contracting authorities, while dealing with Public Procurement Directives. The general case law in the area of Member State liability accepts liability for breach of Community law by its administrative and not legislative action. 25 The Court promoted the view that a restrictive approach had to be taken towards liability, with regard to Member States that were exercising their legislative function. Such an approach would ensure that Member States were not impeded by the unwelcome prospect of actions for damages, in instances in which the general interest necessitated Member States or institutions to adopt measures that could have an adverse impact on the interests of individuals. 26 Under the guise of exercising the legislative functions, the Member States tend to breach the EU Directives causing considerable loss to individuals. However, in the Hedley Lomas case,27 the Court determined that the UK was obliged to make reparation for the damage caused to an individual, because of its refusal to provide an export licence. This was deemed to be in breach of Article 34 of the Treaty. While scrutinising the gravity of the breach, the Court held that in this case the UK did not any choice before it. In cases, where this holds true and where the concerned Member State has drastically reduced discretion or even no discretion whatsoever, infringement of Community law, could be sufficient to establish a serious breach.28 With regard to the provisions of Directives, it could be argued that as these are easier to determine and clear, and that as a result Directives do not provide any leeway to the Member States. Thus, in AGM – COS MET,29 the Court ruled that the obligations enshrined in a Directive did not provide discretion to Member States.30 Consequently, a breach, in this regard, would be of sufficient gravity for liability to arise. The provisions of the Public Procurement Directives are exhaustive, and therefore there is no room for assuming any discretion what so ever.31 Thus, even a simple breach of these Directives is sufficiently serious to imparting strict liability. The objective behind public enforcement by a Member State or the European Commission is to evaluate the full application of EU law. On the other hand, private enforcement, which involves disputes brought before the domestic courts of the Member States by individuals, is actuated by the desire to procure a remedy. All the same, Member State liability and other remedies emanating from the decisions of the ECJ are considered private mechanisms for effecting the enforcement of EU law. The significant notion of Member State liability was introduced, via the ruling in Francovich.32 It has been contended that the remedies made available to private entities and their use by these entities to further their personal interests, facilitate the greater overall compliance with EU law. The decision in Francovich,33 serves as an apt illustration of this phenomenon. The ECJ had opined that in addition to protecting the rights of individuals, EU law would be fully effective, only when a Member State was rendered liable for not transposing a Directive within the stipulated time.34 The ECJ referred to the provisions of Article 4(3) of the Treaty on the Functioning of the European Union (TFEU), which enjoined a duty of loyal cooperation. This pertains to the EU and the Member States. The liability of Member States is accorded a dual purpose, by the simultaneous provision of a means to procure individual compensation and by helping to ensure the full effectiveness of the EU law.35 It has been suggested by some scholars that the judicial protection provided to individuals, in such cases, was just an implication of the principle of full effect of the EU law.36 This situation was aimed at ensuring the obedience of the Member States, rather than according protection to individuals. With the ruling in Brasserie, the ECJ extended the remedy beyond the context of the Directives. Thus, the remedy was made available for any breach of the EU law that was sufficiently serious.37 However, three conditions have to be complied with for availing a remedy under this decision. Dependence on some event or objective factor does not prevent a Community provision from being directly effective. As soon as that condition is satisfied, the national courts are expected to enforce the provision. Thus, the requirement that a right should be unconditional is that it should be independent of some feature that lies within the control of some independent authority. Examples of such independent authorities being a Community institution or the Member State in question; and more importantly, this right should be independent of the discretion or judgement of such bodies.38 The Court adopts a specific strategy while introducing new principles of law and the case law of the ECJ on direct effect provides pertinent examples of this state of affairs. This question arose in the Van Gend & Loos case,39 and the ECJ made it very clear that there was a stringent test and that direct effect, especially with regard to the Treaty provisions, was quite rare.40 Subsequently, after this principle was accepted, the requirements were reduced. As a result, the rule regarding negative obligations was discarded. Moreover, the requirement that the obligations had to be unconditional and not dependent on any further action was qualified to a major extent.41 With these changes, direct effect has become the standard and not the exception. None of the Treaties contain any statement regarding the directly effectiveness of their provisions. This situation makes it possible to assume that the founders of these Treaties had assumed that the question of direct effect would be decided by the national courts, in accordance with the provisions of their national legislation.42 Accordingly, in the Kobler case,43 the ECJ expanded the Member State liability doctrine. This resulted in bringing infringements by the judiciary under its ambit, wherein the breach of the EU law was obvious.44 It has been contended in some quarters that such expansion of State liability attempts to compensate for the EC’s flaws in public enforcement. From the theoretical point of view, it is quite feasible to assume the existence of a unitary test for EU damages actions. This follows from the case law of the ECJ, which has been seized with bringing about a convergence between State and Community liability. This unitary test incorporates the conditions stipulated in the Brasserie ruling.45 This was reiterated by the decision in Bergaderm.46 These forms of action, from the pragmatic perspective, involve several significant differences, which necessitates a separate treatment.47 Individuals who undergo a loss due to a breach of Community law, for which a Member State is responsible, are entitled to compensation. This was the outcome of the decision in Francovich.48 In the absence of such a principle, Community law would be compromised and there would be an emasculation of the protection afforded to the rights of individuals. The existence of this rule is essential for the promotion of the interests of the Community. However, the liability of a Member State arises, when the following material conditions prevail. This was substantiated in the ruling in Brasserie. 49 The first of these requires an infringement of a Community rule that had as its objective, the conferral of individual rights. In addition, the breach should be of a sufficiently serious nature. Finally, there should be a causal relationship between the damage sustained and the breach. It can be surmised from the above discussion that the principle of State Liability, Direct Effect and Indirect Effect are intended for promoting justice to the citizens in an efficient manner, under the norms of the EU law. In practice, it cannot be contended that it benefits individuals to the fullest extent, since the decisions of the courts in this regard reveal the bitter truth that those rights are neither unconditional nor independent, as has been witnessed on several occasions. 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