General
The legal sources examined hitherto could be described as formal sources of Community law. However comprehensive these may be, they are not equal to every issue to which Community law gives rise. This is particularly the case as regards the protection of individual rights – an important consideration, given that Community law confers rights and imposes obligations on private parties as well as on the EU institutions and the national authorities. It is particularly in this regard that the ECJ has applied what are known as the ‘general principles of law’.
38 See, inter alia, Opinion 1/76, Re Laying-Up Fund [1976] ECR 741; Opinion 1/78, Re Rubber Agreement [1979] ECR 2871; Re Draft Agreement on a European Economic Area [1991] ECR I-6079.
39 Case 104/81, Kupferberg [1982] ECR 3641 at 3662.
40 Cases 21–24/72, International Fruit Company v Produktschap voor Groenten en Fruit [1972] ECR 1219 at 1227.
To a certain extent, the EC Treaty made provision for the application of these general principles. In Article 220 (ex Art 164), the ECJ is required to ensure that
‘the law is observed’ when interpreting and applying the Treaty. Under Article 230 (ex Art 173), one of the grounds for review of Community acts is the infringement of the Treaty ‘or any rule of law relating to its application’. ‘The law’ means a good deal more than simply the formal rules described above. In addition, Article 288 (ex Art 215) requires the tort liability of the Community to be decided in accordance with ‘the general principles common to the laws of the Member States’. They can be brought under four headings: (a) the general principles derived from the nature of Community law; (b) those which are common to the legal orders of one or more Member States; (c) fundamental human rights, and (d) general principles of international law. They are examined in turn below.
It is the ECJ which is responsible for introducing these general principles into the ambit of Community law. One of the reasons for this is the fact that most of its judges were trained in codified legal systems, where the courts have been more inclined to apply them than has been the case in common law jurisdictions.
General principles derived from the nature of Community law
These are the principles which are the inevitable corollary of the provisions of Community law. They include:
Equality
This notion is inherent in a number of Treaty provisions, both general (Article 12 (ex Art 6), which prohibits any discrimination on grounds of nationality) and specific (eg Article 141 (ex Art 119) requiring equal pay for equal work).
However, ‘equality’ as a general legal principle has a much broader meaning than that conveyed by these provisions. Essentially, it prohibits the unequal treatment of comparable situations or the equal treatment of unequal situations, unless such differential treatment can be justified on objective grounds.41 The equality principle, used in this generalised manner, was expressed for the first time by the ECJ in an early ECSC case.42 Here, the Court required all comparably placed consumers within the common market to have equal access to sources of production. In that case, the equality principle was applied in a commercial context. However, the principle has been applied on a wider basis than the purely commercial, as is exemplified by a staff case which arose in the late 1980s.43 An ECSC employee had, under Luxembourg law, been excluded
41 Constantinho and Dony, 1995, p 125.
42 Case 8/57, Hauts Fourneaux et Aciéries Belges v High Authority [1958] ECR 245 at 256.
43 Case 130/87, Retter v Caisse de pension des employés privés [1989] ECR 865.
from a private pension fund available to EEC and Euratom officials. The Court held that to do so would entail a fundamental inequality between ECSC officials on the one hand, and EEC and Euratom employees on the other.
Solidarity
This is the principle which holds that, since the Member States enjoy the advantages of membership, they must also observe its rules. The decision in which this was most clearly expressed was made in Case 39/72.44 Here, the Commission had accused Italy of misapplying a Community regulation which instituted a system of payments made for slaughtering cows and withdrawing dairy produce from the market. The Court held that by unilaterally breaking the link between the advantages and the obligations resulting from EC membership, a Member State was endangering the equality between the Member States and their citizens, and was failing to observe the solidarity which was required of the Member States.
General principles common to the legal orders of several Member States
As the number of Member States has risen, it has been increasingly difficult to discern principles which they have in common. However, there are a considerable number of principles which are applicable in several Member States, especially those which have separate courts proceedings arising from administrative disputes.
Legal certainty
Although most European legal systems have developed this notion, it is fair to state that it is mainly the German law model which inspired the ECJ to include this general principle among the sources of Community law. Legal certainty can be described as the obligation on the part of the public authorities to ensure that the law should be readily ascertainable by those to whom it applies, and that the latter should be able, within reason, to predict its existence, as well as the manner in which it will be applied and interpreted.45 The fundamental importance of this requirement was emphasised by the Court where it held that the criteria of certainty and forseeability ‘are requirements which must be observed strictly in the case of rules liable to entail financial consequences’.46
More particularly, this principle has been invoked by the ECJ in order to ensure that the Community institutions enable those individuals who have legal
44 Commission v Italy [1973] ECR 101.
45 Charlesworth and Cullen, 1994, p 122.
46 Case C-30/89, Commission v France [1990] ECR-I 691 at 717.
relations with them to ascertain their exact position. Thus in BASFG and Other v Commission,47the Commission had found against several companies for having infringed Community competition law. The CFI held this decision to be unlawful on a number of grounds, one of which was that the Commission was unable to present an original version of the decision, properly authenticated as required by Rules of Procedure. The CFI found that this failure represented an infringement of the principle of legal certainty. Another aspect of the notion of legal certainty takes the form of the principles of non-retroactivity and of vested rights. The former is a principle which is common to virtually all Member States. As the ECJ stated in the Racke decision,48 its main purpose is to ensure that no measure taken by the public authorities be applicable to those concerned before the latter have been able to become aware of it. However, the same judgment also states that retrospective measures are exceptionally permissible if the purpose to be achieved demands it, and provided that the legitimate expectations of those affected have been respected. The notion of ‘legitimate expectation’ will be dealt with later.
As to ‘vested rights’, an inevitably unsatisfactory translation of the French term droits acquis, these concern such rights as have been conferred upon the individual by the law, and which subsequent legislation may not be allowed to remove or diminish. As such, they are an extension of the non-retroactivity rule.
Unless there is clear evidence to the contrary, legislation is invariably deemed to be non-retroactive. This rule prevents Community legislation from entering into effect before its date of publication.49 The term ‘date of publication’ means the actual date of publication, rather than that on which publication was intended.
In one particular case,50 the planned date of publication of a Community regulation was frustrated for reasons beyond the control of the institution which issued it. The Court held that the regulation could not be considered to have entered into effect before the true date of publication.
The retroactivity of Community acts may, however, be accepted in exceptional circumstances. In Amylum v Council,51the contentious measure was a regulation imposing a system of levies and quotas on isoglucose. As has already been noted earlier (see above, p 38) that regulation had been annulled by the Court because the Council had failed to consult the European Parliament.
It had therefore been set aside on procedural, rather than substantive, grounds.
The Council reimposed the measure with retroactive effect – having on this occasion duly consulted the Parliament. The applicant claimed that the retroactive nature of the regulation made the latter unlawful.
47 Cases T-79, 84–86, 89, 91–92, 94, 96, 98, 102 and 104/89, [1992] ECR II-315.
48 Case 98/78, Racke v Hauptzollamt Mainz [1979] ECR 69.
49 Kent, 2001, p 48.
50 Case 88/76, Société pour l’exportation des sucres v Commission [1977] ECR 709.
51 Case 108/81 [1982] ECR 3107.
The Court held that the general interest pursued by the regulation, being the stabilisation of the market in sweeteners, could not have been achieved if the Council had reintroduced this measure without retroactive effect. The reason for this was that isoglucose producers, who were in competition with sugar producers, would otherwise have gained an unfair advantage by escaping the restrictions which had affected sugar producers. Therefore the object to be achieved, to wit the stabilisation of this market without arbitrary discrimination between traders, required the provision in question to be retroactive.
This prompts the conclusion that the retroactive effect of Community acts may be justified in exceptional circumstances where individual rights must yield to economic and social considerations based on the Treaty.
The foregoing observations on non-retroactivity apply to Community acts.
However, Court of Justice rulings are retroactive in principle unless, in the interests of legal certainty, the ECJ restricts the effect of its ruling on past transactions.52 Its decisions state the law as it has always been – in other words, they are declaratory. Therefore an interpretative ruling defines and clarifies the scope of a provision of EU law, in the manner in which it should have been interpreted and applied from the time at which it entered into force.53
Recently, however, the Court limited the retroactive nature of an ECJ ruling – at least in fiscal matters54 – where it ruled that legal relations which had exhausted their effects in the past should not be called into question. Naturally, when departing from the aforementioned rule that the law as interpreted has unrestricted retrospective effect, the Court must have assessed the consequences which application of that principle would have in practice – more particularly in terms of legal certainty and financial impact.
Legitimate expectation
This concept is very much a corollary to the principle of legal certainty, and is once again the product of German administrative law (Vertrauenschutzprinzip). It seeks to ensure that, where the legal system induces the belief on the part of the individual that he or she will achieve a certain result if he or she acts in accordance with the rules, this expectation must be protected. It was applied for the first time in the Staff Salaries decision,55in which the Commission applied for annulment of a Council measure. This measure had itself reversed a previous decision setting the criteria on which salaries of EC officials were to be based.
The new salary scales thus set by the Council were held to be invalid. The main
52 See eg Case 66/80, ICI v Amministrazione delle Finanze dello Stato [1981] ECR 1191.
53 Tillotson, 2000, p 241.
54 Case C-434/97, Commission v France and Case C-437/97, Evangelische Krankenhausverein [2000] ECR I-1129.
55 Case 81/72, Commission v Council [1973] ECR 575.
reason advanced by the Court was that the decision annulled by the Council had created certain valid expectations on the part of the officials concerned.
The principle of legitimate expectation is, however, subject to a number of limitations. The first is the reasonableness test. Community law will only protect the legitimate expectations of the cautious and reasonable individual. If a ‘prudent and discriminating’ trader should have anticipated the adoption of a Community act capable of affecting his interests, he or she cannot rely upon the legitimate expectation rule if the measure in question is adopted.56 Secondly, the principle may only be relied upon if the expectation is legitimate. In Mackprang,57the applicant had purchased a quantity of grain in France. His sole purpose in doing so was to sell it to a German agricultural intervention agency in order to take advantage of the devaluation of the French franc. The Commission forestalled this kind of speculative activity by allowing the German government to refuse to buy non-German grain. The Court held that the speculative expectation of the applicant in concluding this transaction was not a legitimate one, and therefore disallowed the challenge.
Proportionality
Although this notion was once again inspired by German law (Verhältnismäßigkeitsgrundsatz), it can be found, albeit under a different formulation, in various other legal systems. It requires the public authorities to observe a due sense of proportion between the objectives to be achieved and the means placed at their disposal for achieving them. This principle was formally adopted as a general rule of Community law when the TEU inserted Article 3b, para 3 (now Article 5) into the EC Treaty, which requires that ‘any action of the Community shall not go beyond what is necessary to achieve the objectives of this Treaty’. Prior to that, however, it already had specific application in the EC Treaty by means of such provisions as Article 34(3) (ex Art 40(3)) (common organisation of agricultural markets), Article 81(3) (ex Art 85(3)) (exemptions from the prohibition on restrictive agreements) and Article 87 (ex Art 92) (permissible state aids).
To make an assessment of what is ‘proportionate’ is almost as difficult as deciding what is ‘reasonable’. It is obvious that a great deal will depend on the specific circumstances of each particular case. This is well-illustrated by a few cases in which the applicants challenged decisions making them forfeit deposits paid on the issuing of a export licences. In Internationale Handelsgesellschaft,58 a German trader, on being granted a licence to export cereals, was required to pay
56 Case 265/85, Van den Bergh en Jurgens BV and Van Dijk Food products (Lopik) BV v Commission [1987] ECR 1155.
57 Case 2/75, Einfuhr- und Vorratstelle für Getreide und Futtermittel v Mackprang [1975] ECR 607.
58 Case 11/70 [1970] ECR 1125.
a deposit of DM 17,000. This deposit was forfeited when the trader in question failed to export the full amount of corn-flour involved. The ECJ did not consider this to be a disproportionate penalty. In Case 181/84,59 on the other hand, the trader involved forfeited a deposit of £1,670,000 on the grounds that its application for an export licence was received by the Commission four hours past the time limit specified. The ECJ considered the forfeiture of such a sizeable sum for such a relatively trivial infringement to be entirely disproportionate.
More controversially, the Court has recently held that the general prohibition on women serving in the British and German armies also infringed the principle of proportionality.59a
Fundamental human rights
Originally, the area of human rights was regarded as totally alien to a legal order based firmly on economic foundations. Any European attempt in this direction was regarded as the preserve of the European Court of Human Rights, established within the framework of the Council of Europe, whose task it was to apply the European Convention on Human Rights (ECHR). Gradually, however, the ECJ recognised the need to observe certain fundamental rights when applying Community law, even though it never specifically referred to the ECHR for this purpose.
The SEA was the first Community instrument to give official recognition to the ECHR, even though it merely did so in its Preamble. The TEU was more forthcoming on this issue. In Article 6(2) (ex Art F(2)), it states:
The Union shall respect fundamental human rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms signed in Rome on 4 November 1950 and as they result from the constitutional traditions common to the Member States, as general principles of Community law.
The Amsterdam Treaty has gone even further by raising the respect for human rights to the status of one of the general principles underlying the EU (new Article 6(1) (ex Art F(1))). The first case in which the Court made use of fundamental human rights was Stauder v Ulm.60Under a Commission decision of 1969, the Member States were authorised to make butter available at cheap rates to certain low-income groups. In order to take advantage of this system, the applicant had to present a voucher issued in his or her name. This provision was ambiguous because of a difference in wording between the French and the Dutch text. The Court decided to give preference to that version which did not
59 R v Intervention Board for Agricultural Produce ex p Mann (Sugar) Ltd [1985] ECR 2889.
59a Case C-273/97, Sirdar v The Army Board and Secretary of State for Defence [1999] ECR I-7403;
Case C-285/98, Kreil v Germany [2000] ECR I-69.
60 Case 29/69 [1969] ECR 419.
require the beneficiaries to be actually identified by name when applying for the butter in question. Interpreted in this manner, concluded the Court, the provision in question would not contain anything ‘capable of prejudicing the fundamental human rights enshrined in the general principles of Community law and protected by the Court’.
In Stauder, the Court studiously avoided making any references to any international instrument for the protection of these fundamental rights. In the Nold case,61however, it conceded that international human rights treaties could
‘supply guidelines which should be followed within the framework of Community law’. By now, the Court has not only recognised the ECHR as the main source of legally protected human rights, but also stipulated that ‘the Community cannot accept measures which are incompatible with observance of human rights thus recognised and guaranteed’.62 The scope of this work unfortunately prevents an in-depth exploration of the various individual human rights to which the Court has given protection through its case law.
Briefly, it has been possible for the ECJ to protect the right to privacy,63the right to due legal process,64the right to privacy in the relationship between the legal adviser and his client65and religious rights.66It has even upheld these rights in the criminal law – an area which does not, in principle, fall within the scope of Community law.67
The IGC at Nice in December 2000 had a number of important repercussions in the field of human rights at the EU level. On 7 December 2000, the Charter of Fundamental Human Rights of the European Union was solemnly proclaimed by Presidents of the European Parliament, European Council and the Commission. Its purpose is to encourage the citizens of the EU to identify with a set of formally protected and recognised common values, and to clarify the terms of Article 6(2) of the TEU which, as has been mentioned earlier (above, p 89) makes the respect for human rights a general principle of EU law.
The Charter sets out the civil and political rights derived from the ECHR, constitutional traditions common to the Member States, from citizens’ rights already contained in the Community Treaties, and from the economic and social rights inspired by the Social Charters of the Council of Europe, the EU’s Charter of Fundamental Social Rights, as well as Community derived legislation.68 The
61 Case 4/73, Nold v Commission [1974] ECR 491.
62 Case C-260/89, Elliniki Radiophonia Tileorassi AE v Dimotiki Etairia Pliroforissis and Sotirios Kouvelas [1991] ECR I-2925 at 2963–64.
62 Case C-260/89, Elliniki Radiophonia Tileorassi AE v Dimotiki Etairia Pliroforissis and Sotirios Kouvelas [1991] ECR I-2925 at 2963–64.