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EU case law

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Overview
Over the European Court of Justice’s existence a number of important law cases have set out the powers of the EU’s institutions and the limits of EU control over member states. Below are some of the most important.

Elisabeta Dano, Florin Dano v Jobcenter Leipzig (November 2014)
Facts: Two Romanian nationals brought proceedings against Jobcenter Leipzig, which refused to grant them search for employment benefits intended to cover the recipient’s living costs during jobsearching. Ms Dano (the claimant) did not enter Germany in order to seek work there.

Question of law: Can economically inactive EU citizens who go to another member state solely in order to obtain social assistance be excluded from certain social benefits?

Decision: Member states can deny certain social payments to unemployed EU citizens who move to that country and show no sign of seeking work. This establishes the principle that the freedom of movement within the EU does not grant EU citizens an absolute right to claim benefits in whichever country they choose. If the EU citizen does not have the financial resources to remain resident in another member state after an initial three months, that does not make rules excluding them from certain benefits discriminatory.

Where the period of residence is longer than three months but less than five years, economically inactive persons (those not in work or looking for work) must have sufficient resources of their own to claim right of residence. The ruling only relates to non-contributory benefits.

United Kingdom v European Central Bank (March 2015)
Facts: In July 2011 the European Central Bank published new rules, proposing that securities clearing houses based in non-eurozone countries would have to move inside the eurozone to continue to do business in euros. Clearing houses are financial institutions where cheques and bills from member banks are exchanged. Securities are financial assets that guarantee the repayment of a loan, which are forfeited in the case of non-payment. The UK argued that the ECB lacked the power to dictate the location of business and that this policy would place a residency constraint on certain financial transactions, which goes against EU competition rules and the spirit of the single market.

If the court had ruled in the ECB’s favour, it may have damaged London’s position as a leading financial centre.

Question of law: Does the ECB have the competence necessary to require central counterparties to be located in the eurozone?

Decision: The court annulled the ECB’s proposal. The court held that the ECB lacks the competence necessary to regulate the activity of securities clearing systems, limiting its competence to payment systems alone. This decision showed the limits of the eurozone and the ECB’s powers. It highlighted that the single market must be respected.

ClientEarth v Secretary of State for the Environment, Food and Rural Affairs (November 2014)
Facts:  Environmental group Client Earth brought the case against the British government over the country’s levels of nitrogen dioxide. The case was referred to the European courts after the UK Supreme Court ruled that the government was failing in its legal duty to protect people from the harmful effects of air pollution.

EU legislation sets out the limits for different air pollutants to which all EU member states must uphold. The UK missed the 2010 deadline and, to apply for a time extension, the UK government drew up plans to meet the legal limits which showed the limits would not be met until after 2030. Nitrogen dioxide mostly comes from diesel exhaust fumes and can play a role in asthma, bronchial symptoms and reduced lung function.

Question of law: Whether the establishment of an air quality plan is relevant to the question of whether a member state has complied with the directive, and, if it has not complied, what measures the national court is required to take.

Decision: The court dismissed the long-stated policy of seeking to comply with EU air pollution laws by simply appealing to Europe for more time. The government has to urgently clean up air pollution in British cities. Individuals will now be able to sue the government for breaching EU pollution laws. Campaigners believe the ruling could see many diesel cars and commercial vehicles banned from city centres. The UK Supreme Court interpreted what the real time limit should be in 2015.

Marc Michel Josemans v Burgemeester van Maastricht (December 2010)
Facts: Local authorities in the Netherlands may authorise coffee shops to sell cannabis alongside food and non-alcoholic drinks. In an effort to reduce drug tourism and related public nuisance, Maastricht Council imposed a residence criterion, prohibiting coffee shop owners from admitting tourists onto their premises. Mr Joseman, owner of the Easy Going coffee shop in Maastricht, argued that the residence requirement constituted unjustified unequal treatment of EU citizens and, since non-residents could not buy food or drink from the coffee shops, the rule breached EU law.

Question of law: Does the residence requirement restrict an EU freedom, and if so is that restriction justified?

Decision: Even though narcotic drugs are restricted throughout the EU, freedoms of movement still apply. The sale of food and drink in coffee shops, even if this is only their secondary purpose, constitutes a catering activity. Thus, the freedom to provide services applies. However, although the residence requirement did restrict the exercise of that freedom, the restriction was justified by the objective of combating drug tourism and public nuisance. The restriction served the maintenance of public order and the protection of the health of citizens, at both member state and EU level. Those objectives constitute a legitimate interest which justifies a restriction of Community law obligations.

Association belge des Consommateurs Test-Achats ABSL and Others v Conseil des ministres (March 2011)
Facts: The case involves a Council Directive which seeks to implement ‘the principle of equal treatment between men and women in the access to and supply of goods and services’. When the directive came into force in 2004, member states could opt out of the prohibition on discrimination with regards to insurance, provided that the situation was reviewed by 21 December 2012. A Belgian consumer association challenged the legality of this opt-out.

Question of law: In light of fundamental principles, in particular the principle of equality for men and women enshrined in EU law, is the derogation legally valid?

Decision: As actuarial factors related to sex were commonly used in the provision of insurance services at the time the directive was adopted, the legislature could implement unisex premiums and benefits gradually. The directive states that any derogation must be reviewed, but it is silent as to the length of time during which those differences may continue to be applied. Thus, there was a risk that EU law may permit the derogation to persist indefinitely. The derogation therefore worked “against the achievement of the [directive’s] objective” of equal treatment. Consequently, the derogation has been invalid from 21 December 2012.

FIFA and UEFA v Commission (February 2011)
Facts: The sale of the television broadcasting rights for the World Cup and European Championship is a major source of income for FIFA and UEFA respectively. Under a television broadcasting directive, member states can prohibit the exclusive broadcasting of events of major importance to society, where this would prevent a substantial proportion of the public from viewing those events on free television. Belgium and the UK each drew up a list of events of major importance; Belgium’s list included the World Cup games, and the UK included both the World Cup and European Championships. Both lists were verified as compatible with EU law by the European Commission.

Question of law: Can limitations justified by overriding reasons of public interest be placed on the television broadcasting rights of FIFA and UEFA?

Decision: The court rejected FIFA and UEFA’s argument that the World Cup or European Championships should be viewed as a series of matches rather than a single event, so that ‘non-prime’ matches could not lawfully be included on a list of events of national importance. The court noted that the national team’s participation in ‘prime’ matches could depend on the results of ‘non-prime’ matches. Thus, there may still be particular public interest in ‘non-prime’ matches. Consequently, member states are justified in their decision that all matches of a competition are of major importance for society. The restriction on the freedom to provide services and freedom of establishment is justified, as it seeks to protect the right to information and to ensure wide public access to television broadcasts of events of major importance.