European Union Law

I Introduction and guide to the law of the European Union and its study 17
1 Introduction 17
2 EU primary law 18
3 EU secondary law 22
4 Finding and studying EU law 24

II The nature of the European legal order and its relationship with the legal orders of the Member States 29
1 Introduction 29
2 Constituting principles 31
2.1 The principle of conferral: the Union’s competences 32
2.1.1 Material safeguard 34
2.1.2 Procedural safeguard 35
2.1.3 Resolving disputes concerning the appropriate legal basis 36
2.2 The principle of subsidiarity: the exercise of competences 37
2.2.1 The subsidiarity test 39
2.3 The principle of proportionality 42
2.3.1 The principle of proportionality and the exercise of competences by the Union 42
2.3.2 The principle of proportionality as a general principle of EU law 45
2.4 Principles governing EU executive action: EU administrative law 49
3 Principles governing the relation between the EU, the member states and private parties 51
3.1 The character and autonomy of EU law 52
3.2 The principle of sincere cooperation 57
3.2.1 The constitutional-institutional aspect of the principle of sincere cooperation 58
3.2.2 The substantive aspect of the principle of sincere cooperation 60
3.3 The full effect of EU law in the national legal orders of the member states 62
3.3.1 Primacy of EU law 63
3.3.2 Direct effect of EU primary law 65
3.3.3 Direct effect of general principles of EU law and fundamental rights 69
3.3.4 The application of EU secondary law at national level 70
3.3.5 The application of international law at national level 94
3.4 Effects of the application of EU law at national level onnational procedural law 95
4 Values and fundamental rights 103
4.1 Origins, evolution and operationalisation 103
4.2 Scope 109
4.3 Substance 112
4.4 Non-discrimination 114
4.4.1 Discrimination on grounds of nationality 115
4.4.2 Other forms of discrimination 117
4.4.3 The principle of equality 118
5 Epilogue 120

III The institutional framework of the European Union 123
1 Introduction 123
2 The European Parliament 124
2.1 Introduction 124
2.2 Composition and election 127
2.3 Tasks 131
2.3.1 The European Parliament as a quasi-legislative body 131
2.3.2 The European Parliament as a democratic watchdog 133
2.3.3 The European Parliament as a budgetary authority 136
2.4 Internal structure 137
3 The European Council 140
3.1 Introduction 140
3.2 Composition 141
3.3 Tasks 143
3.4 Internal structure 146
4 The Council of the European Union 148
4.1 Introduction 148
4.2 Composition 148
4.3 Tasks 151
4.3.1 THe Council as a constitutional body 151
4.3.2 The Council as a legislator 152
4.3.3 The Council as a policy-making body 153
4.3.4 The Council as an administrative body 154
4.4 Internal structure 154
4.4.1 General Secretariat 158
4.4.2 The Presidency 159
4.5 Decision making 161
4.5.1 Blocking minorities and the Ioannina compromise 163
5 The European Commission 166
5.1 Introduction 166
5.2 Composition and appointment 167
5.3 Tasks 171
5.3.1 The Commission as the driving force of the European Union 171
5.3.2 The Commission as the representative of the European Union 173
5.3.3 The Commission as the executive of the European Union 174
5.3.4 The Commission as the watchdog of the European Union 178
5.4 Internal structure 179
6 The Court of Justice of the European Union 183
6.1 Introduction 183
6.2 Composition and appointment 184
6.3 Tasks 186
6.4 Internal structure 190
7 The European Central Bank 191
7.1 Introduction 191
7.2 Composition and appointment 193
7.3 Tasks 194
7.4 Internal structure 194
8 The European Court of Auditors 196
8.1 Introduction 196
8.2 Composition and appointment 196
8.3 Tasks 197
8.4 Internal structure 198
9 Other bodies, offices and agencies 199
9.1 THe European Investment Bank 199
9.1.1 Introduction 199
9.1.2 Composition and appointment 199
9.1.3 Tasks 200
9.1.4 Internal structure 200
9.2 The European Economic and Social Committee and the European Committee of the Regions 201
9.2.1 Introduction 201
9.2.2 Composition and appointment 202
9.2.3 Tasks 203
9.2.4 Internal structure 204
9.3 European Ombudsman 204
9.3.1 Introduction 204
9.3.2 Appointment 205
9.3.3 Duties 205
9.3.4 Internal structure 205
9.4 The agencies of the European Union 208

IV Decision-making procedures in de European Union 211
1 Introduction 211
2 The need for law and policy-making in the European Union 212
3 Who takes the decisions in the European Union? 213
4 Law and policy-making in the framework of the TFEU 215
4.1 Introduction 215
4.2 The Commission’s exclusive right of initiative 217
4.3 Ordinary legislative procedure 221
4.4 Special legislative procedures 225
4.5 “Emergency brake” procedures in the context of the area of freedom, security and justice 226
4.6 The consent procedure 227
4.7 Decision-making on the subject of external action 228
4.7.1 Agreements concerning the common commercial policy 232
4.7.2 The conclusion of mixed agreements 232
4.8 The budgetary procedure 234
4.9 The adoption and implementation of the budget 237
4.10 The procedure between the Council and the Commission 239
4.11 The procedure concerning the adoption liberalisation directives and decisions 239
5 EU law-making in practice 240
6 Law and policy-making on the basis of the Treaty on European Union 246
6.1 The procedure concerning a breach of human rights by a member state 247
6.2 The procedure concerning the revision of the Founding Treaties 248
6.3 The procedure concerning the enlargement of the Union 251
6.4 The procedure concerning withdrawal from the European Union 252
6.5 The procedure concerning enhanced cooperation 254
6.6 Procedures in the framework of the common foreign and security policy 256

V Legal protection in the European Union 261
1 Introduction 261
2 Actions brought before the Court of Justice and the General Court 263
2.1 Introduction 263
2.2 Procedure of the EU courts 264
2.2.1 Language 264
2.2.2 The written and oral parts of the proceedings 266
2.2.3 Judgments 268
2.2.4 Costs 269
2.2.5 Appeals 269
2.3 Infringement procedure 270
2.3.1 Introduction 270
2.3.2 Admissibility 271
2.3.3 Merits 274
2.3.4 Effects of judgments 278
2.3.5 Consequences of a failure to comply with a judgment – the procedure for imposing a lump sum and penalty payment 279
2.4 Actions for annulment 281
2.4.1 Introduction 281
2.4.2 Admissibility 281
2.4.3 Merits 297
2.4.4 Effects of judgments 300
2.5 Actions for failure to act 301
2.5.1 Introduction 301
2.5.2 Admissibility 301
2.5.3 Merits 304
2.5.4 Effects of judgments 304
2.6 Non-contractual liability of the Union 304
2.6.1 Introduction 304
2.6.2 Admissibility 305
2.6.3 Merits 305
2.6.4 Effects of judgments 308
3 Actions before the courts of the member states 308
3.1 The preliminary ruling procedure 309
3.1.1 Introduction 309
3.1.2 Admissibility 311
3.1.3 Effects of preliminary rulings 318
3.2 State liability 320
3.2.1 Introduction 320
3.2.2 Jurisdiction and applicable law 321
3.2.3 EU conditions for member state liability 321
3.3 Contractual liability of the Union 325
3.3.1 Introduction 325
3.3.2 Addressees of liability 325
3.3.3 Jurisdiction 325
3.3.4 Applicable law 326

VI Internal market integration policy 329
1 Introduction 329
2 Market integration 330
2.1 Stages of market integration 331
3 Creating an internal market 333
3.1 Introduction: the transfer of sovereignty and positive and negative integration 333
4 Positive integration through harmonisation 335
4.1 Internal market harmonisation 336
5 Impact of harmonisation 338
6 Degrees and methods of harmonisation 340
6.1 Full harmonisation 340
6.2 Minimum harmonisation 341
6.3 Mutual recognition, optional harmonisation and spontaneous harmonisation 343
6.4 The new approach to harmonisation 344
6.5 Instruments of harmonisation 345
7 The frame of reference for assessing national measures 345

VII Free movement of goods, persons, services and capital 349
1 Introduction: prohibition of discrimination and restrictions on free movement 349
2 Scope of the fundamental freedoms 351
2.1 The wholly internal situation, U-turns, reverse discrimination and abuse of EU law 351
2.2 The requirement of a sufficient causal link between the measure and the obstacle to the free movement 356
3 Free movement of goods: tariff and non-tariff restrictions 357
3.1 Tariff restrictions: charges having equivalent effect 357
3.2 Tariff restrictions: internal taxation 358
3.3 Non-tariff restrictions 362
3.3.1 Article 34 TFEU – prohibition of quantitative import restrictions and measures having equivalent effect 363
3.3.2 Exceptions to the scope of Article 34 TFEU 367
3.4 Article 35 TFEU – prohibition of quantitative export restrictions and measures having equivalent effect 370
3.5 Justifying restrictions to the free movement of goods 372
3.6 Article 37 TFEU – state trading monopolies 384
4 Free movement of persons 384
4.1 Introductory remarks 384
4.2 Scope of EU citizenship and the rights arising from it 385
4.3 Travel rights of EU citizens 386
4.4 Residence rights of EU citizens 386
4.4.1 Market citizens 387
4.4.2 Non-market citizens 389
4.4.3 Right of residence for up to three months 390
4.4.4 Right of residence for more than three months 391
4.4.5 Right of permanent residence 392
4.5 Residence rights and non-discrimination 392
4.5.1 From a prohibition of discrimination to the prohibition of restrictions for workers 398
4.6 EU citizenship as a special fundamental freedom 399
4.7 Exceptions to the scope of the free movement of workers 406
4.8 Justifying restrictions to the free movement of EU citizens 406
4.9 Freedom of establishment 410
4.10 Exceptions to the scope of the freedom of establishment 416
4.11 Justifying restrictions to the freedom of establishment 416
5 Free movement of services 416
5.1 Cross-border services 416
5.2 The demarcation of the free movement of services relative to the other freedoms and non-economic activities 417
5.3 Exceptions to the scope of the free movement of services 420
5.4 The right to freedom of movement for services 422
5.5 Justifying restrictions to the free movement of services 425
6 Free movement of capital 428
6.1 The right to free movement of capital 428
6.2 The demarcation of the free movement of capital from other freedoms 432
6.3 Exceptions to the scope of the free movement of capital 434
6.4 Justifying restrictions to the free movement of capital 434
7 A final reflection on the four freedoms: convergence and further integration 436

VIII Competition law 439
1 Introduction 439
1.1 Position of competition law in the TFEU 440
1.2 Basic principles of competition law 444
1.2.1 The personal scope of competition law: the concept of an undertaking 444
1.2.2 The territorial scope of EU competition law 447
1.2.3 The basic principles of competition as an economic phenomenon: market definition and market power 450
1.3 The objective of EU competition law: workable competition 452
2 Article 101 TFEU: the prohibition of collusive behaviour 454
2.1 Introduction 454
2.2 Article 101(1) TFEU 454
2.2.1 Coordination of market behaviour 455
2.2.2 €e object or effect to restrict competition 459
2.2.3 Restriction, prevention or distortion of competition 463
2.2.4 Exceptions to the scope of Article 101(1) TFEU 469
2.3 Article 101(3) TFEU 471
3 Article 102 TFEU: the prohibition of abuse of dominant position 476
3.1 Introduction 476
3.2 Establishing the existence of a dominant position 476
3.3 Abuse 478
3.3.1 Unfair prices 478
3.3.2 Refusal to supply 479
3.3.3 Abusive rebates 480
3.3.4 Restricting production, sales or technical innovation 481
3.3.5 Objective justification of prima facie abuse 482
3.3.6 Article 102 TFEU in the digital economy 482
4 Enforcement of Articles 101 and 102 TFEU 483
4.1 The enforcement of Article 101 TFEU in respect of harmless agreements 484
4.2 The enforcement of Article 101 TFEU in respect of hard-core cartels 487
4.2.1 Tip-offs, complaints and whistleblowers 487
4.2.2 Information gathering: inspections and requests for information 487
4.2.3 Statement of objections 489
4.2.4 Decision 489
4.3 Legal protection in competition law 490
5 The Merger Regulation 491
5.1 The scope of the Merger Regulation 492
5.2 The procedure of the Merger Regulation 492
5.3 The substantive test of the Merger Regulation 494
6 Government intervention in the market 498
6.1 Introduction 498
6.2 The effet utile (useful effect) rule doctrine 498
6.3 Article 106(1) TFEU: the prohibition applying to public undertakings 500
6.4 Article 106(2) TFEU: the justification for public undertakings 502
6.5 Article 106(3) TFEU 506
7 State aid 506
7.1 Introduction 506
7.2 Article 107(1) TFEU 506
7.3 Article 107(2) and (3) TFEU 514
7.4 State aid procedures 515
8 Final reflections 518

IX Economic and Monetary Union 519
1 Introduction 519
2 Economic policy coordination 521
2.1 Underlying economic principles 523
2.2 Multilateral surveillance in the framework of the European Semester 526
2.3 Common rules for dealing with excessive deficits and macroeconomic imbalances 531
3 Monetary Union 536
3.1 Monetary policy in the euro area 540
3.1.1 Maintaining price stability 541
3.1.2 Exchange rate policy 546
3.1.3 Other tasks of the ECB 546
3.1.4 Legal instruments of the ECB in the field of monetary policy 548
4 Conditions for joining the euro area 548

X The external policy of the European Union 551
1 Introduction 551
2 External policy on the basis of the TFEU 552
2.1 The Union’s competence to conduct external policy 552
2.2 The exclusive nature of the Union’s competences 555
2.3 Further procedural considerations relating to the Union’s external action 559
3 The substance of the Union’s external policies based on the TFEU 560
3.1 Common commercial policy 560
3.2 The Union’s association, development and humanitarian aid policies 563
4 The common foreign and security policy 564
5 EU enlargement 569

XI The development of European integration in context 573
1 Introduction 573
2 Economic integration 575
3 Legal integration 582
4 Political integration 590
5 Chronological overview of European integration 599

Bibliography 603
Index 627
Case Law 639