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The European Court of Justice


The European Court of Justice was for many years one of the least known institutions of the EU.  As the single market has grown and developed, however, its judgments have become better known and it has made an impact, often beneficial, on a large range of issues affecting businesses and citizens.  Its judgments have affected competition with the US IT giant Microsoft, the composition of football teams, the striking down of discriminatory rules and many other matters.  This paper looks at the Court’s role and explains the basis of the EU’s legal order, including the fact that by the time the UK joined the principle that EU law has primacy over national law when they are in conflict had already been established and was accepted by Member States.


The European Legal Order

From the outset, the European Community (now European Union) was established as an international body whose Member States conferred powers on the Community.  This was made explicit in the Lisbon Treaty but was implicit in the founding Treaty of the European Economic Community in 1957 (the Treaty of Rome) and all the amending treaties since then.

Secondly, the Community was founded as a body based on the rule of law.  Article 5 of the founding Treaty stated that, “Member States shall take all appropriate measures, whether general or particular, to ensure fulfilment of the obligations arising out of this Treaty or resulting from action taken by the institutions of the Community”.

This pooling of sovereignty in the European Community required a system of judicial oversight to ensure that each of the participants in the Community – the Member States and the institutions (such as the Council, the Commission and the Parliament) – acted in practice in accordance with these principles to which they had voluntarily agreed.  That meant establishing a court and giving that court the necessary authority to clarify the meaning of the Treaty when it was disputed, to adjudicate between Member States in disputes and to rule on the actions of Member States and of Community institutions where these were challenged, whether by other Member States, Community institutions, businesses or individuals.  The Court of Justice was established for this purpose but the concept was not a new one because the European Coal and Steel Community, established in 1951, had such a court.


Composition and Jurisdiction of the Court

The Treaty on European Union (the Maastricht Treaty) lays down the powers and composition of the Court of Justice.  The Court consists of one judge from each Member State who is appointed for a term of six years by “common accord of the Member States” and can be re-appointed.  The judges choose one of their number to be president of the Court and they are assisted by advocates-general – legal counsel who consider cases and give an opinion on a case at the end of the oral hearings (but whose opinions do not bind the judges).  The Treaty emphasises the importance of the judges being independent and that they should come from the ranks of senior jurists in their own country.

Article 9F of the Treaty on European Union sets out the jurisdiction of the Court:

3. The Court of Justice of the European Union shall, in accordance with the Treaties:

a) rule on actions brought by a Member State, an institution, a natural or legal person;
b) give preliminary rulings, at the request of courts or tribunals of the Member States, on the interpretation of Union law or the validity of acts adopted by institutions;
c) rule in other cases provided for in the Treaties.

It is therefore possible for an individual Member State, one of the institutions of the EU (commonly the Commission), a business or other organisation, or an individual to bring a case before the Court.  The Court’s jurisdiction is confined to EU matters under the Treaties save that it can interpret the provisions of the European Convention on Human Rights as they apply to EU law; this last position may change when the EU becomes a party to the Convention.

A criticism of the Court was its lack of enforcement powers.  Whilst Member States are under a duty to comply with its judgments, some are reluctant to do so.  In the Francovich case (1991), which concerned Italy, the Court ruled that in certain circumstances Member States could be liable to pay damages because of a failure to obey EU law.  This test case, and the subsequent inclusion in the Maastricht Treaty of a provision enabling the Court to levy large fines on Member States, at least partially corrected the problem over enforcement.

The Court of Justice has evolved, not least because of the increase in its workload since the establishment of the single market.  This has meant in particular the creation of lower courts alongside the main Court.  The judges have always been able to sit in chambers of as few as three judges as well as in plenary session but this proved insufficient to deal with the volume of cases.  This was partly because of the Court’s power to give preliminary rulings at the request of national courts, a procedure often used by the courts of Member States to ascertain the compatibility of EU law with national law.

Member States were initially reluctant to accede to the Court’s request for a lower chamber to allow the backlog of cases to be heard.  By 1985 the average time taken to deal with a case had more than doubled in a decade to 20 months.  As a consequence, the 1986 Single European Act provided for the establishment of a lower court to hear some cases and determine them at first instance.

This Court of First Instance has now become, as a result of the Lisbon Treaty, the General Court and that Treaty also made provision for the establishment of specialised courts.  The General Court is – and the specialised courts will be if they are established – restricted as to the cases they are empowered to decide.  It is a court of first instance, so cases decided in the General Court can be appealed to the main European Court of Justice.


Key Decisions of the Court

Inevitably its judgments are sometimes controversial as it must interpret the Treaties when the meaning is unclear or where there are conflicting interpretations.  A series of landmark cases have defined the limits of European law and the rights of EU citizens.

In Van Gend en Loos (1963) the Court decided that the Articles of the Treaty had direct effect – that is, no further action was required at Community or national level to make it applicable where a provision of the treaties was “self-sufficient and legally complete”.  The principle that EU law has direct effect on individuals and organisations is now established and applies – as a result of a later ruling – to directives and regulations as well as Treaty provisions.  The consequence of this principle is that the failure of a Member State to pass implementing legislation does not mean that the EU law is not applied by the country’s courts.  The failure to implement can be challenged by an individual or company in national courts.

In the case of Costa v. ENEL (1964) the Court’s ruling that EU law has primacy over national law where national law is in conflict with EU law, was far-reaching in its consequences but entirely logical given the pooling of sovereignty created by the Treaties.  Having agreed to pass a law at EU level, Member States cannot logically argue that it should not be applied in their own country or that they, or their law courts, are the best (final) judge of how it shall be applied.

For the United Kingdom, the most significant case was that concerning Factortame Ltd, a Spanish-owned fisheries business.  A series of cases developed out of a challenge by this company to the provisions in the Merchant Shipping Act 1988 requiring British ownership of vessels fishing in UK waters.  The Merchant Shipping Act was a response to what the British Government saw as an abuse of the national quota system established under the Common Fisheries Policy by Spanish-owned vessels, who were taking an increasing share of the catch in British waters as a result of buying permits from British fishermen.

The Court of Justice ruled that the UK was entitled to establish rules concerning national fishing quotas but its attempt to do so by imposing residence qualifications and other rules concerning British ownership breached the Treaty.  The case attracted considerable attention because it was seen as the European Court striking down domestic legislation, though in fact the ECJ ruling came as a result of the case being referred to it by the British courts, and, as the House of Lords made clear in one of its judgments on the case, the principle that Community law overrode national law when the latter was in conflict with the former had been made clear in the European Communities Act 1972.

The case of Jean-Marc Bosman, who took Liège football club and UEFA to the ECJ, has also become well known. M. Bosman was a Belgian footballer who wanted to move to the French team Dunkerque but Liège refused to release him because they argued the transfer fee was insufficient.  Although retained by Liège, M. Bosman’s wages were cut.  The Court ruled that the football transfer rules violated the free movement of workers and that players are free to transfer to another club within the EU at the end of their contracts.

The Court also ruled that domestic football leagues and UEFA could not impose quotas on the number of players from other EU Member States allowed to play, only on players from outside the EU.



The Court of Justice has been criticised in several Member States for “judicial activism” – meaning that the Court has allegedly gone beyond its remit and advanced European integration.  (There has also been particular concern in the UK that Court has also operated in accordance with the civil law rather than the common law tradition but that reflects the majority legal tradition in Europe and elsewhere).

It is fair to point out that the consequences of the Court’s decisions in cases such as Costa v. ENEL, referred to above, did lead to greater European integration but it is hard to argue that this was done in defiance of the principles under which the EU had been established.  A community based on the rule of law could not operate, as has been pointed out, on the basis that Member States could in practice ignore EU rules or act in defiance of them.  Similarly, if the EU’s rules were not directly applicable then businesses or individuals seeking clarification of EU law would have had to take their cases to the Court of Justice rather than being able to settle issues through national courts.  Such a situation would have seriously undermined the credibility and effectiveness of the single market.

What the Court has done is to interpret the detailed application of the treaties and of legislation adopted (often by unanimity but also by qualified majority vote) under those treaties and ensured that EU has functioned as a community governed by the rule of law.  This is to the benefit of all Member States and the benefit can be seen in the UK’s case very clearly in the arguments about the BSE beef ban.  The French Government’s decision to retain a ban on the import of British beef in defiance of the lifting of the EU’s own controls was successfully challenged in the Court of Justice and overturned.  By way of contrast, Australia has banned the import of British beef since 1996, has just extended that ban for two more years and there is no mechanism by which this unilateral ban can be effectively challenged.