Weatherill2001 Article TheEuropeanCommissionSGreenPap

Stephen Weatherill
The European Commission’s Green Paper

on European Contract Law: Context,
Content and Constitutionality
ABSTRACT. In July 2001 the European Commission published a Communication

to the Council and the European Parliament, its so-called “Green Paper” on European
Contract Law (COM (2001) 398). This document seeks feedback on the options
sketched by the Commission for future European Community action in the contract
law field.
The present note, which incorporates as an Appendix the text of the Green Paper
itself, is designed to explain the background to the Commission’s intervention (the first
section, pp. 339–350 below), to provide a brief commentary on the content of the Green
Paper (the second section, pp. 350–356) and then to assess the constitutional impli-
cations of a proposed advance towards a European Contract Law (the third section,
pp. 356–371). It is argued that the debate about the creation of a European contract
law is properly seen not merely as a matter of cultural feasibility and of commercial
desirability, but that in addition assessment of the EC’s potential contribution is heavily
conditioned by increasing constitutional anxieties about the EC’s legitimate role in
the field of market regulation. The Green Paper avoids explicit treatment of the con-
stitutional dimension of European contract law, yet, it is argued in this note, this is
in fact unavoidable in the wake of the European Court’s seminal judgment of October
2000 in the so-called “Tobacco Advertising” case in which it for the first time inval-
idated a measure of harmonisation of laws on the basis that an insufficient connection
with the process of market-building had been shown by the European Community’s
legislature. This demands that the constitutional validity of legislative proposals in
the field of contract law be examined with care, for the EC, an entity created by an
international Treaty, has been endowed with no general competence as lawmaker in
this or any other field, even though past legislative practice may have tended to obscure
this constitutionally fundamental principle.
THE BACKGROUND TO THE GREEN PAPER: THE CONTENT OF

EUROPEAN CONTRACT LAW
It is well known that the EC has steadily assembled a collection of

twenty or so pieces of secondary legislation that deal with contract
law. It is equally well known that those measures disclose no con-
sistent stated leitmotif. Rather, the EC has created a patchwork of
harmonised rules of contract law, which co-exist with and in some
Journal of Consumer Policy 24: 339–399, 2001.

 2001 Kluwer Academic Publishers. Printed in the Netherlands.
340 Stephen Weatherill
instances replace the more comprehensive systems of contract law

found within national jurisdictions.
In judging the present value and future potential of European
contract law pieced together by the legislative interventions of the EC,
it is of great importance to appreciate the constitutional background
to this process. This will be explored in more critical fashion in the
third section of this paper, but for present purposes it will be helpful,
as an introduction to the overview of the Green Paper itself, to sketch
the evolution of the harmonisation programme as it has affected
contract law.
In their application, the large majority of the EC measures affecting
contract law are confined to consumer contracts. The political com-
mitment to the protection of the economic interests of consumers
has generated a level of legislative activity that finds only a soft
echo in the field of commercial contract law. The EC Treaty confers
an explicit competence on the Community in the field of consumer
protection in Article 153 of the EC Treaty. It is there provided that
in order to promote the interests of consumers and to ensure a high
level of consumer protection the Community shall contribute to pro-
tecting the health, safety and economic interests of consumers, as well
as to promoting their right to information, education and to organise
themselves in order to safeguard their interests via two routes; first,
measures adopted pursuant to Article 95 in the context of the com-
pletion of the internal market, and, second, measures which support,
supplement and monitor the policy pursued by the Member States. But
in fact Article 153 is a relative newcomer to the EC Treaty. It appeared
(in an earlier version, and then numbered as Article 129a EC) only
with effect from 1 November 1993, having been inserted by the
Maastricht Treaty (Weatherill & Micklitz, 1993). The new competence
that it introduced was the second mentioned above, that permitting the
adoption of measures “which support, supplement and monitor the
policy pursued by the Member States,” which plainly places the
Community as an actor in a position subordinate to that of the Member
States in this field. And in fact very few Community acts have been
adopted on this basis, and none of those adopted are remotely revo-
lutionary.1
The key to the EC’s relatively well-developed track record in the
field of consumer contract law lies in the provision to which cross-
reference is made in Article 153 EC, namely Article 95 EC which
permits harmonisation of laws in the context of the completion of
EC Green Paper on Contract Law 341
the internal market. This is no newcomer. Harmonisation of laws in

pursuit of the building of an integrated market for Europe has always
been within the competences available to the Community under its
Treaty. From the entry into force of the Treaty of Rome in 1958,
Article 100, which is now Article 94 since the Treaty was re-numbered
with effect from 1 May 1999 by the Treaty of Amsterdam, provided
such a competence. Since the entry into force of the Single European
Act on 1 July 1987 Article 100a, which is now Article 95, has provided
a complementary competence to harmonise laws.
The detailed constitutional differences between these two provi-
sions will be explored more fully later in this paper. Suffice to say
for the moment that both provisions, and especially latterly Article 95,
have been used and continue to be used with vigour by the Community
legislature to harmonise national laws that are perceived to impede the
creation of an integrated market for Europe. And in so far as the
national laws that are subjected to a process of harmonisation are
contract laws, then the result is the relocation of decision-making
on the shape of (harmonised) contract law to European level. This
is in spite of the fact that contract law is not mentioned at all as a legit-
imate subject of the harmonisation programme. In fact, harmonisation
under the Treaty is not functionally limited.2 The consequence has
been an opportunity for the Community legislature to develop a
functionally extensive scope to the harmonisation programme. This
opportunity has been seized, in contract law, in private law gener-
ally, and in other fields of regulatory activity such as labour market
regulation and environmental protection.
Community Legislation That Affects Contract Law

A helpful catalogue of the relevant measures of secondary
legislation that affect contract law is to be found in Annex I to the
“Green Paper.” For reasons of space this essentially descriptive
Annex is not reprinted here, but it may be consulted via
http://europa.eu.int/comm/dgs/health_consumer/index_en.htm.
Full texts of the secondary legislation may be accessed via
http://europa.eu.int/eur-lex/en/lif/index.html. By way of summary, it
is useful to draw on the structure of Annex 1 to the Green Paper. It
sets out ten areas in which the Community has been active in the
area of private law, listing for each the relevant pieces of secondary
legislation.
1. Consumer Contract Law

Directive 99/44 on certain aspects of the sale of consumer goods and
associated guarantees.
Directive 93/13 on unfair terms in consumer contracts.
Directive 90/314 on package travel, package holidays and package
tours.
Directive 85/577 on the protection of the consumer in respect of
contracts negotiated away from business premises (the “Doorstep
Selling” Directive).
Directive 87/102 on consumer credit, as amended by Directives 90/88
and 98/7.
Directive 97/7 on the protection of consumers in respect of distance
contracts.
Directive 94/47 on the protection of purchasers in respect of certain
aspects of contracts relating to the purchase of the right to use
immovable properties on a timeshare basis (the “Timeshare”
Directive).
2. Systems of Payment
Directive 00/35 on combating late payment in commercial transac-
tions.
Directive 97/5 on cross-border credit transfers.
Directive 98/26 on settlement finality in payment and securities
settlement systems.
3. Commercial Agents
Directive 85/653 on self-employed commercial agents.
4. Posting of Workers
Directive 96/71 on the posting of workers in the framework of the
provision of services.
5. Liability for Defective Products

Directive 85/374 on liability for defective products, amended by
Directive 99/34 (the “Product Liability” Directive).
6. Electronic Commerce
Directive 00/31 on certain legal aspects of information society
services, in particular electronic commerce, in the internal market
(the “E-Commerce” Directive).
Directive 99/93 on a Community framework for electronic signa-

tures.
7. Financial Services
Directive 96/10 on recognition of contractual netting by the compe-
tent authorities (solvency ratios for credit institutions).
Directives 79/267, 90/619 and 92/96, the First, Second and Third
Life Assurance Directives, respectively.
Directive 92/49, the Third non-Life Insurance Directive.
Directive 80/390 co-ordinating the requirements for the drawing
up, scrutiny and distribution of the listing particulars to be pub-
lished for the admission of securities to official stock exchange
listing.
Directive 89/298 co-ordinating the requirements for the drawing-up,
scrutiny and distribution of the prospectus to be published when
transferable securities are offered to the public.
Directive 93/22 on investment services in the securities field.
8. Protection of Personal Data

Directive 95/46 on the protection of individuals with regrad to the pro-
cessing of personal data and on the free movement of such data.
9. Copyright and Related Rights

Directive 92/100 on rental right and lending right and on certain rights
related to copyright in the field of intellectual property.
Directive 93/98 harmonising the term of protection of copyright and
certain related rights.
Directive 91/250 on the legal protection of computer programmes.
Directive 96/9 on the legal protection of databases.
Directive 93/83 on the co-ordination of certian rules concerning
copyright and rights related to copyright applicable to satellite
broadcasting and cable retransmission.
Directive 87/54 on the legal protection of topographies of semicon-
ductor products.
10. Public Procurement

Directive 92/50 relating to the co-ordination of procedures for the
award of public service contracts.
Directive 93/37 concerning the co-ordination of procedures for the
award of public works contracts.
Directive 89/665 on the co-ordination of laws relating to the appli-

cation of review procedures to the award of public supply and
public works contracts, as amended by Directive 92/50. (It is
probable that these Directives will be consolidated into a single
instrument within the next year.)
One could certainly go further in compiling a list of EC measures
relevant to contract law by, for example, adding relevant texts in the
field of employment law and, more generally still, by examining the
complex web of legislation adopted in the field of competition law
which serves to control contractual freedom in the name of the sup-
pression of anti-competitive and/or anti-integrative activities. But such
a broad inquiry would likely become unmanageable and the length
of the list above already provides quite sufficient proof of the impor-
tance of the EC as an actor in the contract law field.
Dominant Tendencies in EC Consumer Contract Law

It is the first of the ten sub-sections, “Consumer Contract Law,” which
is of central significance for this paper and for this Journal. The
Directives on the sale of consumer goods and associated guarantees,
unfair terms in consumer contracts, package travel, “Doorstep Selling,”
consumer credit, distance contracts, and “Timeshare” represent the
core of the EC’s intervention into national consumer contract law and,
in aggregate, they make up the emerging, albeit certainly incomplete,
shape of a European – or at least a European Community – contract
law system.
The dominant tendency in these Directives is to establish legal rules
governing pre-contractual obligations and not to interfere with the
actual content of the bargain struck between the parties. Leaving aside
for one moment the more ambitious Directives 93/13 on unfair terms
and 99/44 on sale of goods, the remaining Directives in this bunch
do not follow an identical pattern, but nevertheless share several
features in common. The trade practices concerned are not outlawed.
Instead, the circumstances in which the deals are struck are the subject
of regulation. Typically information must be disclosed. For example,
Directive 97/7 on the protection of consumers in respect of distance
contracts has as its background the increasing technological feasibility
of establishing means of distribution other than through face-to-face
contact between trader and consumer. Article 4 provides that “in
good time prior to the conclusion of any distance contract [as
defined],” the consumer shall be provided with stipulated informa-

tion about matters including the identity of the supplier, the main
characteristics of the goods or services, and the price of the goods
or services including all taxes. It is stipulated that due regard is to
be paid to the principles of good faith in commercial transactions.
Further requirements of written confirmation are set out in Article 5
of the Directive. The aim is a more informed bargaining environ-
ment and a more efficient, competitive market (Weatherill, 1994).
The Directives listed above also typically provide that an oppor-
tunity must be allowed to the consumer to withdraw from the contract
for a defined period after its conclusion. Article 6 of Directive 97/7
makes provision for the consumer’s right of withdrawal, which is to
extend for at least seven working days after agreement but which
may be extended where the trader has failed to abide by the obliga-
tions to supply information. The assumption appears to be that the
consumer requires protection and a possibility to draw on further infor-
mation, albeit in the post-contractual rather than the pre-contractual
phase (Rekaiti & Van Den Bergh, 2000). A comparable pattern is
found in the other Directives, although, as the Green Paper points
out, there are regrettable differences of detail between the different
measures. There is, for example, no uniform length set for the cooling-
off period. It varies, for no obvious reason beyond inattentive
lawmaking. More generally, there is no set of common rules governing
the sanctions that will apply in case of non-compliance with obliga-
tions in the Directives to disclose information in advance. This is
left to national law and choices vary between Member States.
The EC’s intervention does not only take the form of mandatory
information disclosure and the opportunity to cool off. There is a more
ambitious dimension. Some intrusion has been made into control-
ling and defining the content of the contract. The centrepiece of this
small group of measures is Directive 93/13 on unfair terms in
consumer contracts. Article 3(1) of the Directive provides that “A con-
tractual term which has not been individually negotiated shall be
regarded as unfair if, contrary to the requirement of good faith, it
causes a significant imbalance in the parties’ rights and obligations
arising under the contract, to the detriment of the consumer.” And,
according to Article 6(1), such “unfair” terms are not binding on the
consumer. For English lawyers, at least, the injection of good faith
into contract law creates (for good or ill) a platform for a potentially
more intrusive judicial inquiry into the product of the parties’ free will
than has long been considered orthodox (cf., Beale, 1995; Collins,
1994). This in turn has stimulated interest in the prospect (for good
or ill) of legal cross-fertilisation between the private law systems of
the Member States via the channel of EC legislative harmonisation
(Teubner, 1998; Whittaker, 2001a; Whittaker & Zimmermann, 2000,
esp. Ch. 1), although there is as yet little of significance to report from
judicial practice.3 More recently the EC has adopted Directive 99/44
on certain aspects of the sale of consumer goods and associated guar-
antees, of which transposition by the Member States is required by
1 January 2002. Article 2(1) provides that “The seller must deliver
goods to the consumer which are in conformity with the contract of
sale.” Article 3(1) provides that “The seller shall be liable to the
consumer for any lack of conformity which exists at the time the goods
were delivered.” Remedies are specified for breach of these consumer
rights, which will extend the scope of remedies for breach of contract
in the legal orders of at least some Member States.
The Ambit of Harmonisation

None of these Directives makes any direct constitutional claim to be
a measure aimed primarily at consumer protection or at the shaping
of a European contract law. They appear as measures of harmonisa-
tion designed to build integrated markets. The need to find a legal base
in the Treaty validating such legislation explains this presentational
point. These Directives typically include in their Preambles a con-
scientious repetition of the criteria required for the employment of
the Treaty provision permitting harmonisation. In fact the Preambles
to the Directives tend to be rather brief. Directive 85/577 on “Doorstep
Selling” is a particularly striking example. It is stated that the practice
of doorstep selling is the subject of different rules in different Member
States, and that “any disparity between such legislation may directly
affect the functioning of the common market.” The case for har-
monisation is treated as made – without more. In fact the consumer
protection aspect of the measure receives more extensive attention
in the Directive’s Preamble. Reference is made to the soft law pro-
grammes of 1975 and 1981, taking the shape of Council Resolutions,4
which promised action in this area and it is observed that consumers
may be “unprepared” in negotiations for contracts away from business
premises, which are accordingly the subject of regulation under the
Directive.
Subsequent Directives tend to include rather more detail than the

remarkably terse explanation found in Directive 85/577, but as a
general observation the link between disparity between national laws
in these realms and an effect on the functioning of the common market
is typically asserted, not proven, and the choices made in favour of
consumer protection are freely acknowledged even though, in strict
constitutional terms, these measures were adopted under the Treaty
as measures of harmonisation, predominantly focused on market-
building, and not as measures of consumer protection or private
lawmaking per se. So, from a constitutional perspective, EC consumer
protection and contract law developed as a by-product of the process
of market-building through harmonisation, generated by the percep-
tion that in so far as different rules are applied in different Member
States then the pursuit of trade integration may be hindered by the dis-
parity between national laws and that therefore common Community
rules are required. But the political reality was that the Member
States were agreed on the desirability of legislative action in these
fields, as reflected in the Council Resolutions on the development
of a consumer protection policy for the EC, and they proceeded to
act without any particular sensitivity for the constitutional constraints
imposed by the principle that the Treaty confers only defined com-
petences on the Community. Harmonisation, then, allows “functional
creep” in the scope of Community’s activities (Pollack, 1994), which
may take the EC into areas of common rule-making for which its
Treaty offers no explicit mandate beyond the horizontal power to
harmonise. In this sense, the Council, acting unanimously, was
prepared to treat itself as equipped with carte blanche to issue
measures of harmonisation.
Choices have to be made about the nature and purpose of legal
regulation of the market. Ostensibly the EC legislature as harmoniser
may be dealing the cards of integration but in practice it is unavoid-
ably drawn into balancing integration against the shaping of other
regulatory interests – including the protection of the consumer and the
shaping of private law. What is at stake is not unprompted choices
by the EC legislature about the desirability of consumer protection and
intervention in contractual freedom, but rather EC intervention
triggered by pre-existing national intervention in these realms which
is treated as conflicting with the realisation of the Community’s inte-
grative objectives. However, fixing the quality of the harmonised
standard demands careful attention by the EC’s political institutions,
even though in principle market-building through harmonisation

implies only the need for common rules and makes no assumption
about the quality of the common rule. In harmonising, the EC is
reacting to choices about intervening in the market made within
national systems. In making a market at European level, then, the
EC legislature confronts the accumulation of national regulations
which frequently reflect historical scepticism about the operation of
an unconfined market.
Thus, although assessing the proper limits of autonomy in the
market is not a matter found in the list of competences conferred
on the EC by its Treaty, setting limits to autonomy becomes a
“Europeanised” matter via harmonisation simply because national
systems have already (in diverse ways) taken their own stance. This,
again, is the “functional creep” that is characteristic of harmonisa-
tion as a component of a programme of trade integration founded
on legal rules. The inevitable link between harmonisation as a tech-
nical process and the quality of the harmonised regime has been clear
at a constitutional level since the amendments to the EC Treaty’s
provisions on harmonisation made by the Single European Act
with effect from July 1987 and which are now found in an amended
version in Article 95(3) EC. This provides that “The Commission,
in its proposals envisaged in paragraph 1 concerning health, safety,
environmental protection and consumer protection, will take as a
base a high level of protection, taking account in particular of any new
development based on scientific facts. Within their respective powers,
the European Parliament and the Council will also seek to achieve this
objective.” Moreover the “horizontal” provision found in Article
153(2) EC since the entry into force of the Amsterdam Treaty dictates
that consumer protection requirements shall be taken into account in
defining and implementing other Community policies and activities,
including, no doubt, market-building listed in Article 3 EC and
elaborated in, inter alia, Article 14 EC.
The coherence of the pattern of EC policymaking suffers from its
“hidden” source. To an extent, the “rag-bag” impression created by
survey of the EC’s legislative endeavours in the consumer contract
law field represents the inevitable consequence of the constitutional
limits placed on the Community as an actor in such realms and of
the (partly related) institutional weakness within the Commission
which has allowed the consumer voice inferior status in the devel-
opment of consumer-related policies such as agriculture, competition
and, most of all, the construction of the internal market. Only in

1995 was a separate Directorate-General for Consumer Policy estab-
lished within the Commission. Moreover, the majority of relevant
EC sources add to national law, they do not replace it, for harmoni-
sation of rules affecting the economic interests of consumers is
typically pitched at a minimum level (Stuyck, 1997), generating a
complex layered system of legal regulation in which there will be
variation Member State by Member State even in areas subject to
harmonisation in so far as Member States choose to set stricter stan-
dards. EC consumer law does not pretend to be a fully self-sufficient
system. Rather it supplements pre-existing national regimes and for
that reason its absorption into national systems may cause some indi-
gestion if not handled with care (Heusel, 1999; Schulte-Noelke &
Schulze, 1999).
This awareness of the contingent nature of EC consumer law is
not a denial of the validity of analysis designed to draw out under-
pinning themes in EC consumer law such as the promotion of social
justice, the protection of legitimate expectations, tackling informa-
tion asymmetries, the role of the well-informed consumer and the quest
to build consumer confidence in the viability of the internal market
(for a discussion, see, e.g., Micklitz, 1996, 2000; Reich, 1996; Stuyck,
2000; Weatherill, 1999). The unusual constitutional status of EC
contract law is not at all a reason for excepting it from rigorous and
constructive academic analysis, but rather only a reason for ensuring
that such analysis pays due regard to the actual constitutional context.
In fact, these descriptive and normative investigations have now
assumed added pertinence in the light of the Court’s ruling in the
“Tobacco Advertising” case, examined more fully later in this paper,
which now forces deeper study of the rationale for EC interventions
into consumer policy and private law. But until recently, given unan-
imous support in Council, EC consumer law and private law (of
sorts) emerged from the harmonisation programme and not always
as part of a coherent overall framework.
European contract law by no means begins and ends with the pro-
gramme of legislative harmonisation pioneered by the European
Community. One should also be aware of relevant international instru-
ments. The Green Paper makes explicit reference to this wider context
(paras. 16–20; see also Basedow, 1998, 2001). The Rome Convention
of 1980, which has been ratified by all EU Member States, ensures
the application of uniform private international law rules to deter-
mine which law is applicable to the contract. More broadly, there

are cautious steps towards harmonisation of substantive rules of
contract law at the international level. Annex II of the Green Paper
lists international instruments relating to contract law issues. First,
there are United Nations Conventions, most prominent among which
is the “Vienna Convention” on Contracts for the International Sale
of Goods, adopted in 1980 and to which all the EU Member States
are party excepting only the UK, Portugal and Ireland. The UN instru-
ments also include a batch of non-binding UNCITRAL guides. Second,
in addition to the territory cautiously entered by the UN, there are
listed instruments prepared by UNIDROIT – the International Institute
for the Unification of Contract Law. These include the non-binding
UNIDROIT principles for International Commercial Contracts adopted
in 1994. Third, a batch of Conventions prepared under the auspices
of the Council of Europe is listed. However, the thrust of the Green
Paper prepared by the Commission in Brussels on the subject of
European Contract Law is naturally in the direction of the EC’s dis-
tinctive contribution and this comment follows that pattern.
GENERAL COMMENTARY ON THE GREEN PAPER
The Communication, as a “Green Paper,” is designed to promote

debate about the proper future directions of EC policy in the field
of contract law. In that vein, it is deliberately open-ended, offering
options to be considered rather than firm proposals. The general theme
presented by the Commission questions whether the case-by-case
approach thus far taken to harmonisation of contract law by the
Community legislature is adequate or whether instead a more far-
reaching agenda should be drawn up. In preparing the ground for
future policy, the Commission is explicitly concerned in its Green
Paper to identify concrete problems caused by existing divergences
between national systems of contract law and, if such concrete
problems are demonstrated, to provoke comments on defining possible
solutions. Plainly it wishes to back any future legislative proposals
with corroborated evidence of the need for intervention by the EC
legislature.
The text of the Green Paper is set out below in the Appendix, and
the purpose of this section of the paper is to draw attention to and
to comment on its principal features. The focus on the implications
of harmonisation for the construction and maintenance of the internal

market is made plain in paragraphs 23–33 of the Green Paper. The
Commission calls for information on whether diversity between
national contract laws “directly or indirectly obstructs the functioning
of the internal market, and if so to what extent”, with a view to con-
sidering appropriate action by the EC’s institutions (para. 23). This
inquiry is tied explicitly to the quest to fit contract law to “the current
and future needs of businesses and consumers in the internal market”
(para. 26). One may readily speculate that search costs are incurred
by parties unfamiliar with laws governing contracts in jurisdictions
other than their own, but the Commission wants to pin down whether
and when this is really so, and how high such costs are, before it
considers whether the problems are of a sufficient magnitude to call
for EC-level action. The insistence on the need to gather concrete
examples of cases where diversity between national contract laws
has caused hindrance to cross-border trade is repeated (in bold type!)
in paragraph 72, the penultimate paragraph, in the Green Paper. The
Commission adds anxieties about the costs of lack of uniformity in
the application of Community law (paras. 34–40). This embraces ques-
tions of detailed differences in the scope of application of EC
Directives and the use of abstract terms in Directives that may have
different resonances in different national legal orders. Here too the
Commission invites submissions designed to show whether there are
real practical problems caused by these potential variations.
The Commission looks ahead to options for future action in para-
graphs 41–70 of the Green Paper. It is briefly mentioned in paragraphs
42–44 that any action taken by the EC must be in compliance with
the principles of subsidiarity and proportionality, as stipulated by
Article 5 EC and amplified in the Protocol on subsidiarity and pro-
portionality annexed to the EC Treaty by the Treaty of Amsterdam.
The need to be seen to take these issues seriously can already be
tracked in existing legislative practice. For example, Directive 2000/31
on electronic commerce5 insists in its Preamble that “. . . by dealing
only with certain specific matters which give rise to problems for
the internal market, this Directive is fully consistent with the need
to respect the principle of subsidiarity . . .”; and that “In accordance
with the principle of proportionality, the measures provided for in
this Directive are strictly limited to the minimum needed to achieve
the objective of the proper functioning of the internal market . . .”
The Green Paper introduces discussion of these issues in the context
of contract law generally. Subsidiarity “serves as a guide as to

how the Community powers are to be exercised at Community
level”; moreover, “There should be clear benefits to taking action at
Community level instead of national level” (para. 43). Proportionality
dictates that “measures adopted by Community institutions do not
exceed the limits of what is appropriate and necessary in order to attain
the objectives legitimately pursued by the legislation in question”
(para. 44). It would be unfair to dismiss the Green Paper as paying
mere lip service to these constitutional principles. But the treatment
is rather superficial. The reason why the subsidiarity principle has
come to be taken increasingly seriously by the Commission in par-
ticular and by the Community legislature in general is left unexplained
in the Green Paper. The matter is explored in more detail below in
the next section of this paper, which makes the case that the Green
Paper is a great deal more intriguing for what it does not say about
the constitutional dimension of European Contract Law than for what
it does say.
Options Considered by the Commission

The Green Paper sketches four available options should the existing
case-by-case approach to legislative harmonisation be shown to be
inadequate to meet the problems in the contract law field which the
Commission suspects hinder the building of an internal market.
The first option, no EC action, is based on the perception that
markets have a capacity to achieve self-correction that should not
be underestimated (paras. 49–51). Cross-border commercial activity
is doubtless initially intimidating, especially for consumers and small
and medium-sized enterprises, but one would expect private economic
actors to seek to tackle these barriers. Formal law introduced at EC
level should not be automatically assumed to be necessary.
The second option, the promotion of the development of common
contract law principles leading to greater convergence of national laws,
would be pursued through Commission support for research into com-
parative law and deeper co-operation between academic and practising
lawyers (paras. 52–56). This could in time generate adjustments to
commercial practice designed to improve the functioning of the
internal market.
The third option is directed at improving the quality of legisla-
tion already in place (paras. 57–60). This conforms to existing general
initiatives of this type launched in recent years by the Commission

and fits the higher profile given by the Lisbon European Council of
June 2000 to simplification as the key to reform of the regulatory envi-
ronment in Europe. The Commission has already expressed itself ready
to consolidate measures in order to improve transparency and to pay
closer attention to the quality of drafting.6 This builds on the existing
SLIM initiative – “simpler legislation for the internal market” – out
of which the Commission has made much political capital in the last
five years in its drive to present itself as a regulatory moderniser.7
Simplification is a transparently appealing slogan, though one might
legitimately express greater scepticism about the true value of the
“SLIM” campaign than is to be found in the pages of this Green
Paper. The report on the results of the fourth phase of the “SLIM”
programme, published in February 2000,8 tells of planned future
emphasis on the first and second Company Law Directives (68/151
and 77/91), the Dangerous Substances Directive (67/548), and legis-
lation governing pre-packaging (in particular, Directives 75/106 and
80/232), which hardly are issues at the cutting-edge of the European
economy. But the Commission is only one of the EC’s political
institutions and the Council and Parliament, as the legislative insti-
tutions, are required to take regulatory reform seriously before the
Commission’s crusade can be expected to deliver substantial benefits.
The Commission is justified in complaining that adopted legislation
is on occasion “either too detailed, or insufficiently adapted to local
conditions and experience; often in stark contrast to the original pro-
posals tabled by the Commission.”9 And, moreover, the Commission
is properly alert to draw attention to the tendency of Member States
themselves to “over-regulate,” whether in implementing EC law or
more generally.10 Simplification is a task for all regulators. In the
specific field of contract law, however, one could not fail to applaud
reforms, were they proposed, that would eliminate detailed inconsis-
tencies between individual EC Directives, such as those relating to the
period of “cooling-off” allowed to the consumer entering into a
contract regulated by a relevant EC Directive.
The fourth option floated by the Commission, the adoption of new
comprehensive legislation at EC level, is plainly the most ambitious
and perhaps for this reason the Commission is noticeably coy in setting
out what it has in mind (paras. 61–69). It leaves open the nature of
the appropriate instrument and the question of its binding nature. An
EC Directive, permitting national choices about the specific manner
of transposition into the domestic legal order, would be flexible, yet

may not eliminate some of the divergences between national law which
have created the problem calling for legislative intervention in the first
place. An EC Regulation would by contrast be directly applicable in
the legal orders of the Member States without the need for any further
action at national level. This would secure a higher level of trans-
parency and uniformity but at the cost of robbing national systems
of any choice as to how best to fit the EC rules into the existing
national mould. Whether a Directive or a Regulation is preferred,
the logically subsequent question of the measure’s binding nature
would involve a choice between a model into which the parties to a
contract could opt if it suited them, a set of rules which apply unless
excluded by express contractual provision, or a set of rules which it
would not be open to the parties validly to exclude by provision in
the contract. An EC Recommendation, a non-binding measure
according to Article 249 EC, could be adopted instead of a legally
binding Directive or a Regulation – but only if the first of these
models, that which offers the parties an unfettered option, is preferred.
Clearly the Commission is here raising some fundamental choices
about the desirable intensity of public intervention to deprive private
parties of their contractual autonomy (Collins, 1999; Grundmann,
Kerber, & Weatherill, forthcoming), combined with some questions
about the appropriate precision of the EC model chosen to achieve
that end. The Green Paper is, at least on the surface, entirely open-
minded about the outcome. It solicits feedback.
These four options are not presented as exhaustive of possible solu-
tions, nor are they mutually exclusive (paras. 47, 70). They are also
capable of being developed in combination with agreement on the
international plane (para. 48). It is submitted that options 2 and 3 merit
immediate action irrespective of what else may emerge from this
review of policy. The type of comparative inquiry mooted under option
2 would offer a valuable method of improving the extent to which
existing EC initiatives are applied within national legal orders with
an awareness of their European context. Were this to be pursued as
a continuing exercise in learning by comparing practice, it would
tend to deepen the impact of harmonisation by treating it not simply
as a one-shot legislative act but rather as a process which tends to
bring together national legal orders over time. And simplification of
the type suggested under option 3 is incontestably good regulatory
practice.
Is Convergence of European Contract Law Feasible?

The ambitious quest to construct a European contract law has attracted
much academic discussion, often of a rather polemical nature. The
Commission has on occasion taken the trouble to defend itself against
the charge that EC intervention is destructive of the integrity of
national systems of private law. In its Report on the implementation
of Directive 93/13 on unfair terms, it asserts that “Despite the mis-
givings of the proponents of a certain legal doctrine who feared that
unity of contract law would be rent asunder, the Member States were
able to integrate the Directive into their legal orders without major
problems.”11 One may doubt whether this rather complacent statement
will satisfy all critics, and in the Green Paper on European Contract
Law the Commission may have raised more academic hackles with
its rather breezy claim in paragraph 12 of the Green Paper that “most
Member States’ legal regimes for contract law have similar concepts
and rules.”
Doubtless the Commission hopes for feedback on this and other
aspects of its Green Paper. Pierre Legrand has earned the reputation
as the commentator most closely associated with the thesis that con-
vergence of private law in Europe is simply not culturally feasible
because of the fundamentally divergent mentalités which underpin
common law and civil law approaches (Legrand, 1996, 1997). The
anxieties of Legrand deserve to be taken seriously as rebuttals of
any notion that harmonising laws or styles of legal reasoning is simply
achieved by legislative fiat from Brussels (or from anywhere else),
although the current writer would hold to the view that Legrand over-
states his case by neglecting the capacity of legal systems to mutate
over time, and to learn and to borrow from each other (cf., Watson,
2000), a process that one would suppose is (for good or ill) acceler-
ated by its location within the dynamic system of law created by the
European Community. This may not be convergence in its literal sense
but it is far from negligible as a type of legal cross-fertilisation (cf.,
Vranken, 1997, esp. Ch. 10; Zeno-Zencovich, 1998). Whether or not
one has sympathy for an intensification of the construction by EC
secondary legislation of elements of a common private law for Europe
or, grander still, the elaboration of a European Civil Code which has
so attracted the European Parliament,12 this debate is intellectually
central to the work of modern European private lawyers. Some truly
influential and stimulating work has been published in recent years
in which several manifestations of the “Europeanisation” of private

law have been explored and subjected to critical examination. 13 But
what has frequently though certainly not invariably been missing
from the debate has been rigorous examination of the constitutional
dimension. And although one might suppose the time is ripe for a rein-
vigoration of the drive to deepen the EC’s influence in the private
law field, given that a resolution of the European Parliament adopted
in March 200014 referred to the “essential” need for greater harmon-
isation in this field and moreover that the conclusions of the European
Council held in Tampere (Finland) in October 2000 placed great
emphasis on the need for progress in matters of civil procedure in
the EU, there are nevertheless significant counterbalancing trends
that call into serious question the likelihood of more energetic EC
action in the field. This is the contested constitutional context of
European contract law which is relatively neglected in the Green Paper
but which forms the substance of the discussion in the next section
of this paper.
THE CONSTITUTIONAL CONSTRAINTS ON THE CONSTRUCTION OF A

EUROPEAN CONTRACT LAW
In assessing the constitutional dimension of a European contract

law, or, more specifically, an EC contract law, one should appreciate
in the first place that the publication of a Green Paper is of itself
significant. It marks out the Commission as willing to engage in
wide-ranging and transparent debate on appropriate regulatory strate-
gies before it moves to the preparation of a formal proposal for
legislation to be adopted by the Council and Parliament. This is fore-
shadowed in the Protocol on the Application of the Principles of
Subsidiarity and Proportionality which was attached to the EC Treaty
by the Treaty of Amsterdam with effect from May 1999. Point 9 of
the Protocol declares inter alia that “Without prejudice to its right
of initiative, the Commission should except in cases of particular
urgency or confidentiality, consult widely before proposing legislation
and, wherever appropriate, publish consultation documents; justify the
relevance of its proposals with regard to the principle of subsidiarity;
whenever necessary, the explanatory memorandum accompanying a
proposal will give details in this respect.” The Green Paper, which
covers both substantive matters and the application in this context
of the subsidiarity principle, should be read in the light of the

Commission’s anxiety to match up to the standards of good practice
mapped out in the Amsterdam Protocol. Paragraph 11 of the Green
Paper duly encourages “contributions from consumers, businesses, pro-
fessional organisations, public administrations and institutions, the
academic world and all interested parties.”
Lawmakers should always be aiming to improve the quality of their
product. Pre-legislative consultation is part of this. So too is post-
legislative reform designed, inter alia, to achieve a simplification
and consolidation of existing legislation.15 “Better Lawmaking” is
the apt title of a series of annual Commission reports on this process.16
The quest to deliver more efficient and sensitive patterns of regula-
tion is more firmly on the EC’s agenda today than ever before (Burns,
1996; Timmermans, 1997, 1999). This, however, is not merely because
the EC, like any legislature, should be expected to examine and
improve the quality of its own procedures. In the EC there is a special
reason for insisting on greater transparency and participation in the
process of lawmaking. The decade of the 1990s has for the first time
witnessed serious and sustained questioning of the functional and
constitutional legitimacy of the EC’s initiatives in the consumer field
(and indeed in other fields too). It is the growing mood of unease about
an uncontrolled intensification of regulatory activity by the EC that
has provoked a need to explain more thoroughly just why and how the
EC should act. This may seem paradoxical. After all, the decade of
the 1990s saw for the first time the insertion of a Consumer Protection
Title into the EC Treaty, as a consequence of the Maastricht Treaty’s
amendments. And yet, notwithstanding this apparent confirmation
of the constitutional validity of consumer policy as an EC activity,
the pressure has increased on the Community legislature to demon-
strate just why particular acts are worthwhile.
Hence, reforms such as the growing predilection for publishing con-
sultative Green Papers are not simply designed to improve the quality
of EC lawmaking at all stages but also to establish more clearly the
constitutional legitimacy of the EC’s role by making more secure a
connection between lawmaking and the views of those affected by
it. This issue underpins another Commission document published in
July 2001 which is considerably more ambitious in its scope that the
Green Paper on European Contract Law; the White Paper on European
Governance.17 This seeks to initiate a broad debate targeted at making
the Union’s policymaking processes more open, transparent and
coherent and its rules simpler and susceptible of better enforcement,

against a background perception that Europeans, while currently
expecting political leaders to deliver solutions, are increasingly dis-
inclined to trust political institutions at national and, even more so,
at European level. Wider participation is presented as essential to
improved EU governance. The current commentary is necessarily
limited to the field of contract law, while recognising that a grand
debate on the future vision of the EU is emerging, and it must be asked
exactly why problems of legitimacy in this sector have today become
so acute after a period during the 1980s, in particular, when contract
law was a regular subject of EC harmonisation activity. This demands
a return to European Community constitutional basics.
Powers Conferred by the EC Treaty

As a fundamental matter of EC constitutional law the European
Community is able to act only within the powers conferred on it by
its Treaty. It is not a State with sovereign powers. Only if it is com-
petent according to its Treaty is it able to legislate in a particular field.
This has always been well understood, but it has been explicitly written
into what is now Article 5(1) of the EC Treaty since the entry into
force of the Maastricht Treaty in 1993. This provides that “The
Community shall act within the limits of the powers conferred upon
it by this Treaty and of the objectives assigned to it therein.” Although
it is tempting to assume that an integrated market for Europe inevitably
brings with it an integrated regulatory strategy underpinning that
European market, it is simply the case that the Treaty does not say
this. Markets may be increasingly “Europeanised” but political struc-
tures and wide areas of lawmaking are still tenaciously retained by
the Member States at national or sub-national level, while the EC
possesses only the legal competence conferred on it by its founding
Treaties. In this sense, normative analyses of appropriate regulatory
strategy require conscientious checking against the contested consti-
tutional terrain of the European Community, where Member States and
the institutions of the European Community may possess rather dif-
ferent perspectives as to the appropriate distribution of power to
different levels of governance.
It is clear that nothing at all in the EC Treaty states that the
Community is competent to act in the field of contract law. It has done
so indirectly, as sketched above, by relying on the fact that it is com-
petent under its Treaty to harmonise laws in pursuit of defined ends

associated with market-building, and it has put in place a species of
European contract law in so far as the national laws that are sub-
jected to the harmonisation process happen to be situated in the field
of contract law. Practice over more than two decades may have
tempted one to suppose that this competence was scarcely without con-
stitutional limit. After all, EC measures adopted over that period
harmonising rules concerning contracts dealing with timeshare and
distance selling might be reckoned to enjoy a direct connection with
the building of an integrated European market, for such practices are
unusually well-suited to cross-border transactions. This is where one
might expect the growth of a distinctively communautaire contract
law. But the same cannot be said of measures dealing with, for
example, consumer credit or doorstep selling, which appear on the
EC’s list of harmonisation Directives despite their lack of any obvious
direct link with European market building. As suggested above, this
might lead one to imagine that the EC is in practice able to adopt
legislation in the field of contract law simply by asserting the need
to harmonise.
This might once have been so. It is not so today. The reason why
it is no longer so is closely tied to the way in which EC secondary
legislation is made. The vast majority of measures of harmonisation
in the field of private law adopted before 1987 was based on what was
then Article 100 of the EEC Treaty, the provision permitting har-
monisation of laws in pursuit of the construction of a common market
by unanimous vote in the Council. Where a Member State disapproved
of a proposed initiative, it could, as a last resort, always simply vote
against it in the Council. But where all the States wished to act, they
could and would act, often without paying a great deal of attention
to constitutional niceties. So the political will to develop a consumer
protection for the Community, first made clear at the Paris Summit
of 1972 and articulated in the first Resolution on the matter adopted
by the Council in 1975,18 was not reflected in the formal structure
of the Treaty until as late as 1993, when Consumer Protection became
for the first time a formal competence of the European Community
as a result of the amendments effected by the Treaty of Maastricht.
But many measures, including those affecting the economic inter-
ests of the consumer and affecting contract law, were adopted in
the interim, driven by the unanimous view of the Member States
that the Community should be active in this field and translated
into binding legislation by recourse to the pretext of harmonisation,

a matter in respect of which the Community has always been com-
petent.
The position changed in 1987 when the Single European Act, the
first major formal revision of the original Treaty of Rome came into
force. This introduced alongside Article 100, which is now numbered
as Article 94, a new provision permitting harmonisation in pursuit
of the construction of an internal market, Article 100a, which is now
Article 95. There are some technical differences in the scope of
Articles 94 and 95 which are not of current concern, though the power
of co-decision vested in the Parliament in acts advanced for adoption
under Article 95 is certainly of the highest constitutional signifi-
cance, but the principal difference between the two Treaty Articles
is that concerning the applicable voting rules in Council. Whereas
Article 94 requires unanimity among the Member States, Article 95
requires only a qualified majority vote. The precise details of quali-
fied majority are complex. They are found in Article 205 of the EC
Treaty and they weight the voting power of countries in the Council
according to size of population. An overall majority threshold must
be crossed to ensure adoption of the measure. The vital political
point is that a State can find itself outvoted in Council and still bound
by legislation with which it disagrees. Only if it is able to raise a
sufficiently large coalition of like-minded States to prevent the
majority achieving the necessary qualified majority in Council will
it be able to defeat the adoption of the measure.
Harmonisation has been focused on Article 95 since 1987, and
the old Article 94 has fallen into disuse. This is not because har-
monisation measures are frequently adopted against the wishes of
one or more Member States. Most measures remain adopted with
the support of all the Member States. But the rule of qualified majority
voting under Article 95 does not require that there be consensus and
on occasion States are outvoted in Council. This brings a tension to
European Community legislative practice. Whereas, on the one hand,
the unanimity rule was abandoned as the Community gained new
members in order to make the system more flexible at a time of a
desire to renew the vigour of legislative activity, in particular in con-
nection with the drive to complete the Community’s internal market
by the end of 1992, on the other hand Member States realised that
this left them vulnerable to be condemned in a minority, bound by
the preferences of the majority expressed by vote in Council (see
generally Dashwood, 1998). Not only that. The past practice of a broad
approach to the scope of Community competence, largely driven not
by cautious constitutional interpretation but instead simply by the
naked political fact of unanimity in Council, came back to haunt poten-
tial minorities. They had good reason to fear that the principle that
the Community acts only according to the powers conferred on it
and that accordingly the areas in which they might be outvoted
were defined and limited would come to represent cold comfort. Did
not the Council have a track record of ambitious reading of the
scope of Community competence? It did – especially in the field of
harmonisation.
This, then, is the modern context of EC harmonisation and it is vital
to grasping the style of presentation of the Green Paper on European
Contract Law. The mood may not be properly described as defen-
sive but certainly it is no longer the case that Community initiatives
will be accepted on the nod. Both the quality of their contribution
to building a European market and their very constitutional validity
must be fully explained. It is this that explains the Commission’s
evident eagerness in its Green Paper to track down concrete infor-
mation on exactly where failings in the functioning of the internal
market can be causally connected to the absence of harmonised EC
rules of contract law.
Focus on Subsidiarity
However, it is constitutionally intriguing that this ambition to make
a more rigorous case for the need for Community action is elabo-
rated in the Green Paper in the language of subsidiarity. There is no
doubt that the subsidiarity principle represents the most vivid mani-
festation visible over the last decade of communautaire practice of the
tension between the readiness of the Member States to equip the
Community with extra powers, capable of exercise by qualified
majority vote in Council, and their anxiety that the Community, or
at least particular majority coalitions in Council, might use those
powers in a manner damaging to individual State preferences. The sub-
sidiarity principle was introduced into the EC Treaty by the Maastricht
Treaty with effect from 1 November 1993. It provides, according to
Article 5(2) of the EC Treaty, that “In areas which do not fall within
its exclusive competence, the Community shall take action, in accor-
dance with the principle of subsidiarity, only if and insofar as the
objectives of the proposed action cannot be sufficiently achieved by

the Member States and can therefore, by reason of the scale or effects
of the proposed action, be better achieved by the Community.” In
short, there must be “value added” by the Community before it should
act.
The amplification of the subsidiarity principle in the Amsterdam
Protocol has been mentioned above. This set of guidelines assem-
bled in one place a series of earlier attempts to put flesh on the bones
of the subsidiarity principle. The guidelines contained therein are
designed to convert subsidiarity from a rather vague cri de coeur by
Member States nervous about perceived over-ambition on the part
of the Community into a set of operationally useful principles that
will exert real influence within the Community’s institutional culture
(De Burca, 1999; Weatherill & Beaumont, 1999, pp. 14, 27–32). The
flavour of the Protocol is infused by a general expectation that the
advantages of the proposed Community action over unilateral national
action be fully explored and then fully explained. So point 4 asserts
that “For any proposed Community legislation, the reasons on which
it is based shall be stated with a view to justifying its compliance
with the principles of subsidiarity and proportionality; the reasons
for concluding that a Community objective can be better achieved
by the Community must be substantiated by qualitative or, wherever
possible, quantitative indicators.” One may well doubt the ready avail-
ability of such qualitative and quantitative indicators, but the general
mood is clear: The Community must make a case why its interven-
tion is justified.
To determine whether the objectives of the proposed action can
be better achieved by action on the part of the Community, the
Amsterdam Protocol offers as guidelines the need to consider inter alia
whether the issue under consideration has transnational aspects which
cannot be satisfactorily regulated by action by Member States; and
whether actions by Member States alone or lack of Community action
would conflict with the requirements of the Treaty (such as the need
to correct distortion of competition or avoid disguised restrictions
on trade or strengthen economic and social cohesion) or would
otherwise significantly damage Member States’ interests. This, of
course, has a close resemblance to the articulation of these issues found
in the Green Paper on European Contract Law. The Commission’s plea
to be supplied with concrete information on particular instances of
market failure caused by the absence of EC intervention is fully in
line with the dictates of subsidiarity as a criterion for judging the

appropriateness of EC action.
Therefore, at one level one may simply accept that the Commission,
in taking subsidiarity seriously in its Green Paper on European
Contract Law, has digested the exhortation of Ernst Steindorff that
there should be “efforts to reconcile State and Community levels of
private law where they conflict in specific situations. This should be
guided by research as to where there are the major insufficiencies
of law with respect to the internal market” (Steindorff, 1999, pp.
202–203; cf., Van den Bergh, 1998). From this perspective, there
should be EC intervention in the field of private law only where it
is demonstrably required to sustain the process of market-building.
But there is more to this than meets the eye. The Green Paper’s
focus on subsidiarity neglects an even more fundamental question.
This is: Is the EC even competent at all under its Treaty to legislate
in the field of contract law? Steindorff’s words should be taken as
the need to interrogate both whether the Community should act and
also whether it is constitutionally competent to act (see, more fully,
Steindorff, 1996). And, in fact, it is the latter question that should
precede the former, as a matter of constitutional logic. For only if
the Community is competent to act under its Treaty in the first place
– that is, only if there is an adequate legal base for a proposed
legislative initiative – can the matter of subsidiarity even potentially
arise. No competence, no legislation – and no need to speak the
language of subsidiarity. As point 3 of the Amsterdam Protocol states:
“The principle of subsidiarity provides a guide as to how those powers
[conferred by the Treaty] are to be exercised at the Community level.”
But subsidiarity does not affect the logically prior question of whether
a relevant power really is conferred by the Treaty in the first place.
The Tobacco Advertising Case and Its Repercussions

This immediately raises the question of the impact of the ruling of
the European Court of Justice in October 2000 in the so-called
“Tobacco Advertising” case, more properly Germany v Parliament
and Council.19 As one might expect, one manifestation of the tension
between enhanced Community competence exercisable by qualified
majority vote and the risk that minorities may be disgruntled by the
interpretation placed on the Treaty by other Member States in Council
has been an increasing readiness on the part of States outvoted in
Council to convert their opposition into a challenge in the judicial

forum to the validity of the adopted legislation. The few cases brought
before the European Court had until October 2000 found the Court
willing to allow a wide measure of discretion to the (majority in)
Council and the applications for annulment had failed.20 But in
the “Tobacco Advertising” case, Germany, having been outvoted in
Council under the rules governing qualified majority voting and so
having lost the political battle, succeeded in winning the legal battle,
for the Court refused to accept that Directive 98/34 governing the
regulation of tobacco advertising could be validly presented as a
measure of harmonisation. The Court did not consider that the con-
ditions required for reliance on the legal base in the Treaty permitting
harmonisation of laws were present in the case and it therefore, in
effect, acted to protect the minority against encroachment by the
majority of Member States into areas which had not been demonstrated
to the Court’s satisfaction to fall within the scope of the EC’s attrib-
uted competence.
The Court’s ruling demands analysis, for it reveals a judicial deter-
mination to establish firmer limits on what may be validly achieved
by the Community legislator in the name of harmonisation, in line
with the general mood that a Community able to act in wide fields
of economic activity and to do so with the need only for a qualified
majority of its Member States must, as part of a politically stable
and durable bargain, also take seriously the limits of the competence
that its Member States have been prepared to confer on it. And, more
specifically, it is necessary to inquire whether the Court’s tests applied
in the case, and of which Directive 98/34 on Tobacco Advertising
fell foul, may also be applied to exclude the making of a European
Contract Law on the bases currently to be found in the EC Treaty. That
in turn will demand attention to the intriguing question why the
Commission’s Green Paper is so careful to pitch the discussion of
European Contract Law in the shadow of the subsidiarity principle and
not with direct reference to the logically prior question, which is
whether the Treaty is even able to provide a constitutional basis for
such activity.
The Court’s ruling, supplemented by a lengthy Opinion prepared
by Advocate General Fennelly, is extraordinarily rich and its treatment
here must necessarily be curtailed, and focused on the particular
issue of its impact on the harmonisation of private law. But a brief
explanation of the background to the litigation is indispensable. The
regulation of tobacco advertising by the EC is not new. In 1989

Directive 89/622 was adopted which governed the size of warnings
on cigarette packets and this was amended and extended in 1992
by Directive 92/41.21 Both Directives were adopted as measures of
harmonisation under (what was Article 100a EC and is now, post-
Amsterdam and after amendment) Article 95 EC.
Directive 98/3422 was adopted on the basis of (what were Articles
57(2), 66 and 100a EC and are now, post-Amsterdam and after amend-
ment) Articles 47(2), 55 and 95 EC.23 It was, in short, presented as
a measure of harmonisation and it had been adopted having been
re-drafted on several occasions following an extended period of
debate about its value and in spite of objections to the constitutional
propriety of reliance on the harmonisation legal base for a measure
so evidently motivated by public health policy, in particular the
Community’s fight against cancer.24 Germany voted against the
measure in Council, but it was passed by qualified majority vote in
Council and, with appropriate support from the Parliament, it was duly
adopted in July 1998. Directive 98/34 established much stricter rules
on the advertising and sponsorship of tobacco products than had
been laid down by previous Community interventions in the field. It
imposed a ban on all forms of advertising and sponsorship of tobacco
products throughout the EC, subject only to limited exceptions which,
inter alia, allowed advertising in retail outlets. Germany, having been
outvoted in the Council, chose to bring a challenge to the validity
of the Directive before the European Court. In October 2000 the Court
annulled the Directive.
Before the Court, Germany argued that the Directive was not a
measure of harmonisation within the scope permitted by the Treaty.
Accordingly, argued Germany, (what is now) Article 95 was not avail-
able to the EC as a legal basis for the measure. The EC would therefore
have to look elsewhere in its Treaty for the competence to adopt
such a measure. The EC does have an explicit competence in the
field of public health. This is stated in (now) Article 152. But, as
with Article 153, the consumer protection provision set out above to
which many of the lessons of the “Tobacco Advertising” judgment
may be applied mutatis mutandis, this provision is carefully and
narrowly defined and, of particular pertinence, it explicitly places har-
monisation of public health laws beyond the scope of the powers
transferred to the Community. So if (what is now) Article 95 would
not do, then (what is now) Article 152 would not do either. There
was more to Germany’s challenge25 but at the core of the case is objec-
tion to the EC’s competence under its Treaty to intervene in the market
in this way under the cover of the harmonisation programme. And it
was this fundamental constitutional question tied to the relationship
between the Community’s powers and those reserved to its Member
States on which the Court chose to focus when it delivered its
judgment. The Court insisted that the express exclusion of harmoni-
sation under the public health Title of the EC Treaty, now found in
Article 152(4) EC, cannot be circumvented by recourse to other
Articles of the Treaty. The key question therefore focused on whether
the chosen “other articles,” those authorising harmonisation in pursuit
of defined objectives, were in themselves constitutionally adequate
to support a measure of the challenged type. The Court agreed with
Germany that (what is now) Article 95 and its fellows governing
harmonisation in the services sector had been wrongly used, for the
measure was found to be insufficiently closely connected with the task
of improving the conditions for the establishment and functioning
of the internal market, as defined (post-Amsterdam) in Articles 3(1)(c)
and 14 of the EC Treaty, to which (what is now) Article 95 is
addressed.
The days of unanimously approved consumer policymaking and
contract lawmaking under the guise of the harmonisation programme
may not be at an end, as Directive 99/44 on the sale of goods and
consumer guarantees, mentioned above, may illustrate. However, the
rise of majority voting in Council makes disputes all the more
probable. The scope of Article 95 – harmonisation – is evidently
contested. This litigation would not have arisen under a regime of
unanimous voting. Germany would have voted against the proposal
and it would not have become law. A regime of majority voting forces
attention to be paid to awkward questions surrounding the constitu-
tional limits of EC action. The very fact that a Member State, having
lost the political debate about the desirability of such intervention in
Council, was willing to convert its opposition into a legal challenge
to the validity of the measure demonstrates the current sensitivity to
the question of demarcating the limits of Community competence. This
is the new terrain of EC consumer law and policy and it affects inti-
mately the assessment of the prospects of a European private law.
But what is the scope of Article 95 as a basis for legislative har-
monisation? This question is now vital, and it is surprising that it
plays no overt part in the Commission’s discussion in the Green
Paper on European Contract Law. The Court insisted in its “Tobacco

Advertising” ruling that (what is now) Article 95 does not create a
general power to regulate the internal market, but rather it permits
the adoption of measures designed to improve the conditions for the
establishment and functioning of the internal market. Although Article
95 possesses a broad functional scope and is not limited to partic-
ular subject matters, it does not supply carte blanche to harmonise
national laws and the Court is conspicuously scrupulous in expressing
its fidelity to the constitutional rule that the competence conferred
on the Community is limited to that defined by the Treaty.26 For the
Court, “a measure adopted on the basis of Article 100a [now Article
95] of the Treaty must genuinely have as its object the improvement
of the conditions for the establishment and functioning of the internal
market.”27 The mere fact that national laws differ State by State, with
an abstract risk of obstacles to the exercise of fundamental freedoms
or distortions of competition liable to result therefrom, is not enough
to justify recourse to harmonisation under the Treaty. The Court
proceeded beyond examination of the need to show that a measure
actually contributes to eliminating obstacles to the free movement
of goods and to the freedom to provide services, to consider also the
question of the elimination of distortion of competition achieved by
the measure. The Court insisted that “In examining the lawfulness
of a directive adopted on the basis of Article 100a [now Article 95]
of the Treaty, the Court is required to verify whether the distortion
of competition which the measure purports to eliminate is appre-
ciable.” Harmonisation is not available simply as a means to eliminate
trivial distortions of competition.
The Tobacco Advertising Directive did not meet these requirements.
Many of its provisions did not actually contribute to eliminating
obstacles to the free movement of goods and to the freedom to provide
services. That applied in particular to the prohibition of advertising
on posters, parasols and ashtrays and other articles used in hotels,
restaurants and cafes. Nor did they actually contribute to eliminating
appreciable distortions of competition. Firms based in States that are
light regulators of advertising may enjoy a cost advantage but the
effect of such advantages on competition were treated by the Court
as remote and indirect and they caused no appreciable distortions,
in contrast to rules affecting production costs. The Court did not
deny that concerns to protect public health could properly play a
part in the shaping of the harmonisation programme; indeed it accepted
that (what is now) Article 152(1) provides that public health require-
ments are to form a constituent part of the Community’s other policies
whereas, in addition, (what is now) Article 95(3) makes an express
connection between harmonisation and ensuring a high level of human
health protection.28 The judgment does not therefore support the
view that the Community is unable, by harmonisation, to adopt a re-
regulatory standard that restricts particular forms of trade throughout
the territory of the EU; were it otherwise the validity of measures
such as Directive 84/450 which forbids misleading advertising
would be imperilled. The judgment accepts that harmonisation is
a process which involves close attention being paid to the quality
of the harmonised regime and not simply to the mere fact of its con-
tribution to market-making, although the threshold of a required
sufficient contribution to the improvement of the conditions for
the establishment and functioning of the internal market must be
crossed.
The Community is a re-regulator, not a de novo regulator, and so
of course it reflects policy concerns underpinning choices made at
national level in fixing the quality of the Community regime. This was
explained in the first section of this paper and “Tobacco Advertising”
does not subvert this. In fact, in the “Tobacco Advertising” judgment
the Court did not deny that there may arise circumstances in
which harmonisation of rules suppressing tobacco advertising could
be validly advanced on the basis of the relevant Treaty provisions
governing harmonisation. By way of illustration, it observed that a
Directive prohibiting the advertising of tobacco products in periodi-
cals, magazines and newspapers could be adopted as a measure of
harmonisation with a view to ensuring the free movement of press
products.29
Examining the Prerequisites to Harmonisation

The threshold to be crossed by a valid measure of harmonisation
appears to have the following dimensions. Does a measure of har-
monisation actually contribute to eliminating obstacles to the free
movement of goods and to the freedom to provide services or to
removing appreciable distortions of competition?30 From this per-
spective, Directive 98/34 on Tobacco Advertising made an inadequate
contribution to building the internal market and therefore it was
annulled. It is frankly hard to believe that some of the Directives
adopted in the past in the field of contract law would survive were
they tested against the standards demanded by the Court today. The
“Doorstep Selling” Directive, 85/577, was mentioned above as an egre-
gious example. Its Preamble states baldly that the practice of doorstep
selling is the subject of different rules in different Member States,
and that “any disparity between such legislation may directly affect
the functioning of the common market.” This is some way short of
what the Court demands in “Tobacco Advertising” of the link that must
be shown between the need for Community harmonisation and the
building of an internal market. The context is, admittedly, quite dif-
ferent. The “Doorstep Selling” Directive’s Preamble was drafted in
the secure knowledge that a unanimous vote in Council would propel
the measure through the legislative mechanism of the EC. The Treaty
language of harmonisation could be borrowed to provide constitu-
tionally respectable clothes for the measure. But today a close look
at whether the trappings of harmonisation are really justified is much
more likely, at least where a State outvoted in Council is prepared
to challenge the validity of the measure before the Court. 31 It is plain
that the threshold for reliance on the Treaty as a basis for harmoni-
sation which is envisaged by the Court in “Tobacco Advertising” is
a good deal higher than that with which compliance is asserted in
the Preamble to the Doorstep Selling Directive and that, accordingly,
harmonisation must not now be regarded as in practice functionally
unlimited. Some existing EC legislative measures may yet be chal-
lenged via preliminary references emanating from national courts,
but the most absorbing question is the extent to which the test deployed
by the Court in “Tobacco Advertising” confines the possibility for
the future development of a European Contract Law under the auspices
of the EC Treaty’s harmonisation programme.
It is submitted that there remains much to play for. The older gen-
eration of measures cannot on their face be shown to cross the
threshold established by the Court in “Tobacco Advertising,” but this
does not mean that they could not be so shown. At the time of their
adoption, there was simply no political nor, in practice, legal need
to explore the issue. It is submitted that, even in this climate, it will
be possible to make a convincing case in favour of the further har-
monisation of contract law. That is to say, the Court’s ruling is a
warning to take seriously the limits of Community competence but
it is not at all a signpost to the creation of an internal market that is
a deregulatory free-for-all. Naturally it would be necessary to demon-
strate that harmonisation of contract law would actually contribute

to eliminating obstacles to the free movement of goods and to the
freedom to provide services or to removing appreciable distortions
of competition, but this is a test that, while certainly intended to
demand greater explanatory rigour by the legislature, is nevertheless
neither crystal-clear nor perfectly predictable in its application. When,
for example, is distortion severe enough to merit the adjective “appre-
ciable”? In fact key passages in the judgment are loaded with words
which are imprecise. The Court accepted that (what is now) Article
95 could be validly used if the aim is to prevent the emergence of
future obstacles to trade consequent on diverse national choices but
declared that the emergence of such obstacles must be “likely.”32 But
how to judge what is “likely”?33 One may anticipate that the phrases
employed by the Court in this judgment will recur in the Preambles
of subsequently adopted Directives as the legislature seeks to learn
its lesson and to make future measures “review-proof.” In this sense,
the “Tobacco Advertising” judgment will doubtless, as a minimum,
prompt re-appraisal by the EC’s political institutions of how to present
the role of harmonisation, but, despite the shock caused by the
first ever annulment of legislation of this type, it is plain on close
inspection that the Court has left considerable space for legislative
re-positioning.
“Tobacco Advertising” emphatically does not mean “Farewell
Harmonisation!,” but the tone of the judgment is unmistakably directed
at requiring the legislature to find more concrete reasons for har-
monisation in particular sectors, and not simply to use resort to
harmonisation under the Treaty as a matter of political expediency.
And it is precisely this at which much of the most pointed passages
in the Green Paper on European Contract Law are directed. The
Commission is actively seeking to uncover areas in which the market
is malfunctioning because of deficiencies in the existing package of
harmonised contract law.34 This covers possible situations in which
economically strong parties may face impediments in piecing together
a common commercial strategy for the cross-border market and also
areas where weaker parties, not only consumers but also small and
medium-sized businesses, may be deterred from treating the integrated
market as viable because of unfamiliarity with contractual rules
in jurisdictions other than their own. The binding thread is the
Commission’s thirst for quantitative and qualitative data, so that it
is able to develop a more sophisticated case for future initiatives
than mere generalised assertion of the value of harmonisation in

market-building.
And this perception reveals an answer of sorts to the question
why the Commission’s Green Paper on European Contract Law takes
subsidiarity as its constitutional foundation stone rather than the
logically prior question whether the Community is even competent
to act in the first place. The answer is that the two issues cover very
largely the same ground and demand the gathering of the same type
of material. It is admittedly constitutionally impure to discuss sub-
sidiarity’s impact on a proposal without having established the
Community’s competence in the matter in the first place. This impurity
will be all the more corrupt if AG Fennelly is correct in his view
that subsidiarity is not a hurdle that must be crossed once compe-
tence to harmonise is established, because (he argues) harmonisation
engages an exclusive competence of the Community and according
to the explicit terms of Article 5(2) EC subsidiarity applies only in
areas that do not lie within the EC’s exclusive competence. This
view, articulated in Mr Fennelly’s Opinion in “Tobacco Advertising,”
was ignored by the Court and therefore saved for another day.
Nonetheless, looking beyond these formal constitutional points, the
impression is that one may reasonably regard the accumulation of
material on European market instabilities resulting from absence of
harmonisation of contract law as directly relevant both to establishing
competence to harmonise and to overcoming the subsidiarity barrier.
So if the Commission is able to gather concrete information of the
type it covets, which will reveal areas in which the lack of harmon-
isation of contract law is demonstrably costly in the process of
market-building and market-maintaining, it will thereby meet the
constitutional requirements that serve as pre-conditions to valid
harmonisation under Article 95 and (whether or not it formally needs
to) it will also address the demands of the subsidiarity principle.
CONCLUSION
There should be no great surprise if the demonstration of a valid

competence to harmonise and the satisfaction of the dictates of
the principle of subsidiarity are properly seen as achieved by the
production of similar or even the same data on the failings of unhar-
monised contract law. Both are tied to the same issue – the fixing
of the limits of Community competence to act under the Treaty and

therefore, by inevitable corollary, the residual scope of competence
reserved to the Member States. And, moreover, one should expect that
much closer attention will be paid to these questions in a regime that
cannot be controlled by States simply applying a veto to unwelcome
proposals. The rise of qualified majority voting in Council and the
potential creation of a minority constituency among the Member States
is the direct cause of the general sensitivity about the pattern of dis-
tribution of competences between the Community and the Member
States that finds expression inter alia in the German willingness to
bring the “Tobacco Advertising” case before the Court and in the
gradual elaboration of an increasingly full set of guidelines gov-
erning the application of the subsidiarity principle. And it is precisely
this constitutional sensitivity that has prompted the Commission its
Green Paper on European Contract Law to seek information that will
allow it to underpin its future proposals with detailed explanations
of why, without Community harmonisation, the benefits of economic
integration will be squandered.
Notwithstanding the peculiar preference to address these issues from
the perspective of subsidiarity rather than by seeking to confirm the
very existence of an EC competence in the first place, the end result
is probably largely the same, and the Commission deserves praise
for taking seriously, albeit certainly cautiously, the quest to pull
together a solid and trustworthy case in support of further, deeper
initiatives towards a European Contract Law. If the result of this Green
Paper is a more rigorous debate about the respective merits of
Community and national action, then a service will have been done
to the intellectual shaping of European private law and, more gener-
ally, a valuable lesson will be available in this sector to be learned
throughout the wide sweep of the EU’s contested institutional and
constitutional development.
NOTES
1
E.g., Decision 3092/94 OJ 1994 L331/1 amended by Decision 95/184 OJ 1995
L120/36 on the establishment of a system of information on home and leisure acci-
dents; Directive 98/6 OJ 1998 L80/27 on indication of prices offered to consumers;
and Decision 283/99 OJ 1999 L34/1 establishing a legal framework for Community
activities in favour of consumers.
2
However, Article. 95(2) excludes from Article. 95(1) the possibility to harmonise
fiscal provisions, those relating to the free movement of persons and those relating
to the rights and interests of employed persons. The sensitivity underlying this
exclusion from the material scope of Article 95 is that Article 95(1) allows legisla-
tion to be made by the Article 251 procedure, which involves a qualified majority
vote in Council rather than the unanimity required to act under Article 94.
3
One would expect relevant cases to be rather small-scale and unlikely to prompt
Article 234 preliminary references to the European Court. However, the field is not
entirely barren: see Joined Cases C-240/98 to C-244/98 Oceano Grupo Editorial SA
v Rocio Murciano Quintero et al 27 June 2000 and comment on the decision’s
contribution to “Europeanisation” by Whittaker (2001b). Legal cross-fertilisation
may develop more indirectly than through preliminary rulings; cf., the Commission’s
development of a “European Database on Case Law about Unfair Contractual Terms,”
available at http://europa.eu.int/clab/index.htm. COM (00) 248 provides the
Commission’s (first) report on the implementation of the Directive.
4
Council Resolution on a preliminary programme for a consumer protection and
information policy, OJ 1975 C92/1; Second Council Resolution, OJ 1981 C133/1.
See generally on soft law development of EC consumer policy, Howells and
Wilhelmsson (1997, Ch. 1); Weatherill (1997, Ch. 1).
5
OJ 2000 L178/1.
6
COM (2001) 130, Commission’s Interim Report.
7
Council Resolution on legislative and administrative simplification in the internal
market OJ 1996 C224/5; see subsequent reports at COM (96) 559, COM (97) 618,
COM (99) 88, COM (00) 56, COM (00) 104. See generally Weatherill (2000).
8
COM (00) 56; see also COM (00) 104, Commission Communication to the Council
and Parliament reviewing “SLIM”.
9
White Paper on European Governance, COM (2001) 428, 25 July 2001, p. 12.
10
COM (2001) 428, p. 23. See in similar vein COM (00) 104, n. 8 above.
11
COM (00) 248, p. 30.
12
Cf Resolutions, OJ 1989 C158/400, OJ 1994 C205/518. See Alpa (2000).
13
A vast collection could be compiled but simply as a means to appreciate the diverse
flavour of the debate see, e.g., Campana (2000); Collins (2000); Grundmann (1998);
Hartkamp (1998); Joerges (1997); Lando and Beale (2000); Van Hoecke and Ost
(2000); Whittaker and Zimmermann (2000).
14
OJ 2000 C377/323, para. 28.
15
Note 7 above.
16
See on “Better Lawmaking” COM (97) 626, COM (98) 715, COM (99) 562;
and, for application to the sector at hand, COM (98) 696, the Consumer Action Plan
for 1999–2001.
17
COM (2001) 428, 25 July 2001.
18
Note 4 above.
19
Case C-376/98 judgment of 5 October 2000.
20
See Case C-233/94 Germany v Parliament and Council [1997] ECR I-2405, the
“Deposit Guarantee” case; and Case C-84/94 United Kingdom v Council [1996] ECR
I-5755, the “Working Time” case.
21
OJ 1989 L359/1, OJ 1992 L158/30.
22
OJ 1998 L213/9.
23
Nothing in the Court’s judgment suggests any significant distinction in treatment
between the three cited legal bases (and see similarly para. 63 of AG Fennelly’s
Opinion), and the discussion below therefore deals exclusively with (what is now)
Article 95 EC concerning markets for goods rather than the other provisions which
govern service market integration.
24
See AG Fennelly’s Opinion in the case paras. 16–20, 37, 74–77.
25
Germany also submitted that the Directive violated the subsidiarity principle, the
proportionality principle, Article 28 EC, the right to property and to pursue an economic
activity, rights of freedom of expression, and the obligation to give reasons. These
issues are addressed in AG Fennelly’s Opinion, but not in the Court’s judgment
which does not explore beyond annulment for invalid reliance on the Treaty provi-
sion authorising harmonisation. These supplementary issues will likely recur in future
litigation of this type.
26
In this vein, see especially paras. 83, 106–107 of the judgment.
27
Para. 84 of the judgment.
28
See, generally on future EC (anti-)tobacco policy, Hervey (2001).
29
Such a rule may be subject to the separate challenge that it unlawfully restricts
(commercial) freedom of expression; cf. note 25 above. AG Fennelly considers this
matter in his Opinion in the case and he is sympathetic to the validity of public inter-
vention in such circumstances of proven risk to human health.
30
This is taken from para. 95 of the judgment, though the extra word “appreciable”
is inserted to conform to the Court’s approach elsewhere in the judgment and the
word “or” replaces “and” to comply with the impression given elsewhere in the
judgment that fulfilment of either condition will suffice.
31
Other applicants before the Court are conceivable, including a private party acting
under Art. 230(4) EC, but a disgruntled Member State is the most likely actor.
32
Para. 86 of the judgment.
33
Cf., as well as “appreciable” and “likely,” the use of words such as “genuinely,”
“probable,” and “remote and indirect” in paras. 84, 97, and 109 of the judgment, respec-
tively.
34
Especially paras. 23–33, 72 of the Green Paper.
REFERENCES
Alpa, G. (2000). European Community resolutions and the codification of private

law. European Review of Private Law, 8, 321–334.
Basedow, J. (1998). The renascence of uniform law: European contract law and its
components. Legal Studies, 18, 121–145.
Basedow, J. (2001). Codification of private law in the EU: The making of a hybrid.
European Review of Private Law, 9, 35–49.
Beale, H. (1995). Legislative control of fairness: The Directive on Unfair Terms in
Consumer Contracts. In: J. Beatson & D. Friedmann (Eds.), Good faith and fault
in contract law, pp. 231–262. Oxford: Oxford University Press.
Burns, T. (1996). Law reform in the EC and its limits. Yearbook of European Law,
16, 243–275.
Campana, M.-J. (2000). Vers un langage juridique commun en Europe? European
Review of Private Law, 8, 33–50.
Collins, H. (1994). Good faith in European contract law. Oxford Journal of Legal
Studies, 14, 229–254.
Collins, H. (1999). Regulating contracts. Oxford: Oxford University Press.
Collins, H. (2000). Formalism and efficiency. European Review of Private Law, 8,
211–235.
Dashwood, A. (1998). States in the European Union. European Law Review, 23,
201–216.
De Burca, G. (1999). Reappraising subsidiarity’s significance after Amsterdam.
Harvard: Harvard Law School. Jean Monnet Working Papers 7/99 (available via
http://www.law.harvard.edu/Programs/JeanMonnet).
Grundmann, S. (1998). Europäisches Schuldvertragsrecht. Berlin: de Gruyter.

Grundmann, S., Kerber W., & Weatherill, S. (forthcoming). Party autonomy and the
role of information in the Internal Market. Berlin: de Gruyter.
Hartkamp, A., Hesselink, M., Hondius, E., Joustra, C., & du Perron, E. (1998). Towards
a European Civil Code. Second Edition. The Hague: Kluwer Law International.
Hervey, T. (2001). Up in smoke? Community (anti-)tobacco law and policy? European
Law Review, 26, 101–125.
Heusel, W. (1999). New European contract law and consumer protection. Trier:
Europäische Rechtsakademie Trier/Bundesanzeiger Verlag.
Howells, G., & Wilhelmsson, T. (1997). EC consumer law. Aldershot: Dartmouth.
Joerges, C. (1997). The impact of European integration on private law: Reductionist
perceptions, true conflicts and a new constitutionalist perspective. European Law
Journal, 3, 378–406.
Lando, O., & Beale, H. (2000). Principles of European contract law, Parts 1 and 2.
The Hague: Kluwer.
Legrand, P. (1996). European legal systems are not converging. International and
Comparative Law Quarterly, 45, 52–81.
Legrand, P. (1997). Against a European Civil Code. Modern Law Review, 60, 44–63.
Micklitz, H.-W. (1996). Rechtseinheit oder Rechtsvielfalt in Europa? Rolle und
Funktion des Verbraucherrechts in der EG und den MOE-Staaten. Baden-Baden:
Nomos.
Micklitz, H.-W. (2000). Principles of social justice in European private law. Yearbook
of European Law, 19, 167–204.
Pollack, M. (1994). Creeping competence: The expanding agenda of the European
Community. Journal of Public Policy, 14, 95–134.
Reich, N. (1996). Europäisches Verbraucherrecht. Nomos: Baden-Baden.
Rekaiti, P., & Van den Bergh, R. (2000). Cooling-off periods in the consumer laws
of the EC Member States: A comparative law and economics approach. Journal
of Consumer Policy, 23, 371–407.
Schulte-Noelke, H., & Schulze, R. (1999). Europäische Rechtsangleichung und
nationale Privatrechte. Baden-Baden: Nomos.
Steindorff, E. (1996). EG-Vertrag und Privatrecht. Baden-Baden: Nomos.
Steindorff, E. (1999). Annotation of Case C-104/96. Common Market Law Review,
36, 191–203.
Stuyck, J. (1997). Patterns of justice in the European Constitutional Charter: Minimum
harmonisation in the field of consumer law. In: L. Krämer, H.-W. Micklitz, & K.
Tonner (Eds.), Law and diffuse interests in the European legal order, pp. 279–289.
Baden-Baden: Nomos.
Stuyck, J. (2000). European consumer law after the Treaty of Amsterdam: Consumer
policy in or beyond the Internal Market? Common Market Law Review, 37,
367–400.
Teubner, G. (1998). Legal irritants: Good faith in British law or how unifying law ends
up in new divergences. Modern Law Review, 61, 11–32.
Timmermans, C. (1997). How can one improve the quality of Community legisla-
tion? Common Market Law Review, 34, 1229–1257.
Timmermans, C. (1999). Subsidiarity and transparency. Fordham International Law
Journal, 22, S106–S118.
Van den Bergh, R. (1998). Subsidiarity as an economic demarcation principle and
emergence of European private law. Maastricht Journal of European and
Comparative Law, 5, 129–152.
Van Hoecke, M., & Ost, F. (2000). The harmonisation of European private law.
Oxford: Hart.
Vranken, M. (1997). Fundamentals of European civil law. London: Blackstone.

Watson, A. (2000). Legal transplants and European private law. Maastricht: Ius
Commune Research School. Ius Commune Lectures on European Private Law 2.
Weatherill, S. (1994). The role of the informed consumer in European Community
law and policy. Consumer Law Journal, 2, 49–69.
Weatherill, S. (1997). EC consumer law and policy. Harlow: Longman.
Weatherill, S. (1999). Consumer policy. In: P. Craig & G. de Burca (Eds.), The
evolution of EU law, pp. 693–720. Oxford: Oxford University Press.
Weatherill, S. (2000). New strategies for managing the EC’s Internal Market. In: M.
Freeman (Ed.), Current legal problems, Vol. 53, pp. 595–620. Oxford: Oxford
University Press.
Weatherill, S., & Beaumont, P. (1999). EC law. Third edition. London: Penguin Books.
Weatherill, S., & Micklitz, H.-W. (1993). Consumer policy in the European
Community: Before and after Maastricht. Journal of Consumer Policy, 16, 285–321.
Whittaker, S. (2001a). Judicial review in public law and in contract law; the example
of student rules. Oxford Journal of Legal Studies, 21, 193–217.
Whittaker, S. (2001b). Judicial interventionism and consumer contracts. Law Quarterly
Review, 117, 215–220.
Whittaker, S., & Zimmermann, R. (2000). Good faith in European contract law.
Cambridge: Cambridge University Press.
Zeno-Zencovich, V. (1998). The European Civil Code, European legal traditions and
neo-positivism. European Review of Private Law, 4, 349–362.
THE AUTHOR
Stephen Weatherill is Jacques Delors Professor of European Community Law,

University of Oxford, and Fellow of Somerville College, Oxford OX2 6HD. Fax:
+44 (0)1865 270 620; e-mail: stephen.weatherill@law.oxford.ac.uk.
Appendix
Communication from the Commission to the Council and the

European Parliament on European Contract Law1
EXECUTIVE SUMMARY. This Communication is intended to broaden the debate

on European Contract law involving the European Parliament, Council and stake-
holders, including businesses, legal practitioners, academics and consumer groups.
The approximation of certain specific areas of contract law at EC level has covered
an increasing number of issues. The EC legislator has followed a selective approach
adopting directives on specific contracts or specific marketing techniques where a
particular need for harmonisation was identified. The European Commission is inter-
ested at this stage in gathering information on the need for farther-reaching EC action
in the area of contract law, in particular to the extent that the case-by-case approach
might not be able to solve all the problems which might arise.
The Commission is seeking information as to whether problems result from
divergences in contract law between Member States and if so, what. In particular,
the Communication asks whether the proper functioning of the Internal Market may
be hindered by problems in relation to the conclusion, interpretation and application
of cross-border contracts. Also the Commission is interested in whether different
national contract laws discourage or increase the costs of cross-border transactions.
The Communication also seeks views on whether the existing approach of sectoral har-
monisation of contract law could lead to possible inconsistencies at EC level, or to
problems of non-uniform implementation of EC law and application of national trans-
position measures.
If concrete problems are identified, the Commission would also like to receive views
on what form solutions should or could take. In order to assist in defining possible
solutions, the Communication includes a non-exhaustive list of possible solutions. Other
solutions may be suggested by any interested party, however.
– To leave the solution of any identified problems to the market.

– To promote the development of non-binding common contract law principles, useful
for contracting parties in drafting their contracts, national courts and arbitrators
in their decisions and national legislators when drawing up legislative initiatives.
– To review and improve existing EC legislation in the area of contract law to make
it more coherent or to adapt it to cover situations not foreseen at the time of
adoption.
– To adopt a new instrument at EC level. Different elements could be combined:
the nature of the act to be adopted (regulation, directive or recommendation), the
relationship with national law (which could be replaced or co-exist), the question
of mandatory rules within the set of applicable provisions and whether the con-
tracting parties would choose to apply the EC instrument or whether the European
rules apply automatically as a safety net of fallback provisions if the contracting
parties have not agreed a specific solution.
1. INTRODUCTION
1. Over recent years, discussion has intensified on possible harmon-

isation of substantive private law, in particular contract law.2
2. The European Parliament has adopted a number of resolutions on

the possible harmonisation of substantive private law. In 1989 and
1994 the European Parliament called for work to be started on the
possibility of drawing up a common European Code of Private Law.3
The Parliament stated that harmonisation of certain sectors of private
law was essential to the completion of the internal market. The
Parliament further stated that unification of major branches of private
law in the form of a European Civil Code would be the most effec-
tive way of carrying out harmonisation with a view to meeting the
Community’s legal requirements in order to achieve a single market
without frontiers.
3. Furthermore, in its resolution of 16 March 2000 concerning the

Commission’s work program 2000, the European Parliament stated
“that greater harmonisation of civil law has become essential in the
internal market” and called on the Commission to draw up a study
in this area.4 In its reply of 25 July 2000 to the European Parliament,
the Commission stated that it would “present a communication to
the other Community institutions and the general public with the
aim of launching a detailed and wide-ranging discussion, without
losing sight of the date of 2001 set by the European Council” at
Tampere. The Commission also stated that “in view of the impor-
tance of secondary legislation for the development of the internal
market and future commercial and technological trends, this com-
munication will analyse this legislation – in force or in preparation
– at Community level in the relevant areas of civil law in order to
identify and assess any gaps, as well as the academic work which
has been or is being carried out”.
4. Indeed the conclusions of the European Council held in Tampere

requested, in paragraph 39, “as regards substantive law an overall
study on the need to approximate Member State’s legislation in civil
matters in order to eliminate obstacles to the good functioning of
civil proceedings”.5 A consultative document has been announced in
the Commission’s “scoreboard for the evaluation of progress in the
establishment of an area of freedom, security and justice”.6 The

Tampere European Council dealt with issues concerning judicial civil
cooperation on the basis of title IV of the EC Treaty. In this regard
this Communication can be considered as a first step towards the
implementation of the Tampere conclusions.
5. Finally, this Communication was also included in the Commission

communication on E-Commerce and Financial Services 7 within the
policy area of ensuring coherence in the legislative framework for
financial services.
6. Leading representatives of the academic world have had detailed

discussions on harmonising certain sectors of contract law. Two drafts
of a contract code8 and of general principles of contract law9 have
recently been published. This academic work continues, and includes
work on other issues not included in the two published drafts, such
as contracts in the specific areas of financial services, insurance con-
tracts, building contracts, factoring and leasing as well as some areas
of the law of property. In particular, the academic work is focusing
on areas that have a particular significance for securing rights across
the European borders.10
7. The aim of the academic work carried out varies from the estab-
lishment of a binding code to principles similar to “restatements”
that can be used to provide reliable comparative information on the
European legal situation in these areas.
8. The approximation of certain specific areas of contract law at EC

level has covered an increasing number of issues. In the area of
consumer law no fewer than seven Directives dealing with contrac-
tual issues have been adopted in the period from 1985 to 1999. 11 Other
areas also show increased harmonisation.12
9. This sectoral harmonisation has concerned specific contracts or

specific marketing techniques. Directives have been adopted where
a particular need for harmonisation was identified.
2. PURPOSE OF THE COMMUNICATION
10. The European Commission is interested at this stage of the dis-

cussion in gathering information on the need for farther-reaching EC
action in the area of contract law, in particular to the extent that the
case-by-case approach might not be able to solve all the problems
which might arise. This does not preclude the right of initiative of
the Commission in the future to make proposals for specific actions
on contract law aspects if a specific need for this exists, in partic-
ular on-going initiatives launched or to be launched in the framework
of the Internal Market policy.
11. The purpose of this Communication is therefore to broaden the

debate by encouraging contributions from consumers, businesses,
professional organisations, public administrations and institutions,
the academic world and all interested parties. Part C (paras. 16–40;
note inserted by JCP) examines the current situation of contract law,
the reasons for its importance in cross-border negotiations and
problems of uniform application of EC law. Part D (paras. 41–70; note
inserted by JCP) presents a general framework for future EC policy
in the area of contract law.
12. Contract law encompasses several areas of law. These are linked
to Member States’ different cultural and legal traditions, but most
Member States’ legal regimes for contract law have similar concepts
and rules. Contract law constitutes the principal body of law regulating
cross-border transactions and some Community legislation regulating
contract law already exists, although this legislation has taken a
sector-by-sector approach.
13. The areas concerned by this Communication include contracts

of sale and all kind of service contracts, including financial services. 13
General rules on performance, non-performance and remedies are an
indispensable basis for these contracts and are therefore also covered.
Additionally, rules on general issues such as the formation of a contract
and its validity and interpretation are also essential. Furthermore,
because of the economic context, rules on credit securities regarding
movable goods as well as the law of unjust enrichment may also be
relevant. Finally, the aspects of tort law linked to contracts and to
its other features relevant to internal market should also be taken
into consideration insofar as they are already part of existing EC

law.
14. In certain areas of private law, contracts are only one of the
tools of regulation given the complexity of the relationship between
the parties concerned. These areas, such as employment law and
family law, give rise to particular issues and are not covered by this
Communication.
15. The Commission intends to focus the attention of this

Communication on two areas: firstly on possible problems resulting
from divergences of national contract law, and secondly on options for
the future of contract law in the EC. This will enable the Commission
to define its future policy in this area and to propose any necessary
measures.
3. PRESENT SITUATION OF CONTRACT LAW
3.1. Existing Legislation
3.1.1. International Instruments
16. International remedies offer solutions to certain potential problems

related to differences in national contract law. The first remedy is
the application of uniform private international rules to determine
which law is applicable to the contract. The most important of these
rules is the 1980 Rome Convention,14 ratified by all Member States.
17. The rules of the Rome Convention apply to contractual obligations

in any situation involving a choice between the laws of different coun-
tries.15 Under the Rome Convention parties may agree on which
national law to apply. However, the Convention places limits on this
choice of applicable law and determines which law is applicable if
no choice is made. Furthermore, the rules do not apply to areas men-
tioned in Article 1 of the Convention (such as questions relating to the
status or legal capacity of natural persons or to insurance contracts
which cover risks situated in the territories of the Member States of
the European Community).
18. The second remedy is the establishment of harmonisation of sub-

stantive law rules on an international level. Here the most relevant
instrument is the 1980 United Nations Convention on contracts for the
international sale of goods (the CISG), adopted by all Member States
except the United Kingdom, Portugal and Ireland.
19. The CISG establishes uniform rules for the international sale of
goods, which apply to sales contracts unless the parties state other-
wise. Some areas are excluded from the scope of the Convention, such
as the sale of goods bought for personal, family or household use
and the sale of stocks, shares, investment securities or negotiable
instruments.
20. The Convention includes provisions dealing with the formation

of a contract (offer and acceptance of offer), and the rights and oblig-
ations of the seller and the buyer. The Convention does not govern
the validity of the contract or of its provisions, nor does it cover the
effect which the contract may have on the property in the goods sold.
The Convention also does not address the seller’s liability beyond
the contract.
3.1.2. Description of the Community Acquis
21. Several Community acts include provisions harmonising private

law. Certain Directives specify rules on the conclusion of a contract,
on the form and the content of an offer and its acceptance and on
the performance of a contract, i.e. the obligations of the contractual
parties. Several Directives also specify in detail the content of the
information to be provided by the parties at different stages, in par-
ticular before concluding a contract. Certain Directives cover rights
and obligations of the contracting parties regarding the execution of
a contract, including poor execution and non-execution.
22. A description of the most relevant Community acts regarding

contract law is given in Annex I. Annex II lists binding and non-
binding international instruments relating to substantial private law
issues. Annex III is a structured presentation of the acquis illustrating
the extent to which legislation at Community level as well as the CISG
has already dealt with issues of contract law of areas concerned by
this Communication.
3.2. Implications for the Internal Market
23. The Commission would like to find out if the co-existence of

national contract laws in the Member states directly or indirectly
obstructs to the functioning of the internal market, and if so to what
extent. If such obstacles do exist, the European Institutions may be
called upon to take appropriate action.
24. The EC Treaty has given the European Institutions powers to facil-
itate the establishment and functioning of the internal market, in
particular the free movement of goods, persons, services and capital.
This has allowed the European Community to significantly reduce
impediments for economic actors, including manufacturers, service
providers, intermediaries and consumers, to operate throughout the EC
and beyond.
25. Technical developments, such as the possibilities offered by the

Internet for electronic commerce, have made it easier for economic
actors to conclude transactions over long distances. The introduc-
tion of the Euro as the common currency of twelve of the Member
States is also an important factor in facilitating cross-border trade.
However, in spite of the major successes achieved thus far, certain
problems still remain. Markets are not as efficient as they could and
indeed should be, to the detriment of all parties involved.
26. The exchange of goods and services, be it through sales, leasing

or barter is governed by a contract. Problems in relation to agreeing,
interpreting and applying contracts in cross-border trade may there-
fore affect the functioning of the internal market. Do existing contract
law rules meet the current and future needs of businesses and con-
sumers in the internal market, or is EC action required?
27. Generally, national contract law regimes lay down the principle
of contractual freedom. Accordingly, contracting parties are free to
agree their own contract terms. However, each contract is governed
by the laws and court decisions of a particular state. Some of these
national rules are not mandatory and contracting parties may decide
either to apply these rules or to agree different terms instead. Other
national rules, however, are mandatory, in particular where there is
an important disparity between the positions of the contracting parties,
such as contracts with tenants or consumers.
28. Normally these different national regimes do not create any

problems for cross-border transactions, as parties can decide which
law will govern their contract. By choosing one national law, they
accept all the mandatory rules of that law, as well as those non-manda-
tory rules which they do not replace by different terms. However,
conflicts may arise between mandatory rules of the laws in one country
with contradictory mandatory rules of another national law. These con-
flicts between different mandatory rules may have a negative impact
upon cross-border transactions.
29. Although not required by national laws, certain clauses in con-

tracts may result from common practice in a given member state,
especially if such practice has been formalised in standard contracts.
It may be hard to agree a contract containing terms and conditions dif-
ferent from those generally applied in a particular member state. There
may be important economic or even legal reasons why it is hard or
even impossible for a party to agree to the terms and conditions in
a standard contract that is generally used in the other party’s member
state. Yet, for similar reasons, it may be hard for the latter party to
accept the type of terms which are common practice in the first party’s
member state.
30. For consumers and SMEs in particular, not knowing other contract
law regimes may be a disincentive against undertaking cross-border
transactions. This has been part of the rationale for some existing
Community acts aimed at improving the functioning of the internal
market. Suppliers of goods and services may even therefore regard
offering their goods and services to consumers in other countries as
economically unviable and refrain from doing so. In the field of sub-
contracting, the provisions covering subcontracting and supply
contracts are quite different in the different Member States.16 These
differences may make it difficult for subcontractors – mostly SMEs
– to make cross-border agreements.
31. Moreover, disparate national law rules may lead to higher trans-
action costs, especially information and possible litigation costs for
enterprises in general and SMEs and consumers in particular.
Contractual parties could be forced to obtain information and legal
advice on the interpretation and application of an unfamiliar foreign
law. If the applicable law has been chosen in the contract, this applies
to the contractual party whose law has not been chosen. It applies
to a minor extent also to contracts where the parties have agreed
standard contract terms in the cases where these terms do not cover
all possible problems.
32. These higher transaction costs may furthermore be a competi-

tive disadvantage, for example in a situation where a foreign supplier
is competing with a supplier established in the same country as the
potential client.
33. The Commission is seeking contributions on how far issues

described above create problems for the internal market, and what
other issues relating to contract law also obstruct the functioning of
the internal market.
3.3. Uniform Application of Community Law
34. The European Community legislator must ensure consistency in

the drafting of EC legislation as well as in its implementation and
application in the Member States. The measures adopted by the
European Community must be consistent with each other, interpreted
in the same manner and produce the same effects in all Member States.
The European Court of Justice (the ECJ) has stated that “the need
for uniform application of Community law and the principle of
equality require that the terms of a provision of Community law
which makes no express reference to the law of the Member States
for the purpose of determining its meaning and scope must normally
be given an autonomous and uniform interpretation throughout the
Community”.17
35. In the area of contract law the European legislator has taken a
“piecemeal” approach to harmonisation. This approach combined with
unforeseen market developments, could lead to inconsistencies in
the application of EC law. For example, under certain circumstances18
it is possible to apply both the doorstep selling Directive and the
Timeshare Directive. Both Directives give the consumer a right of
withdrawal; however the time period during which the consumer can
exercise this right is different. Although such cases of conflicts
between rules are exceptional, the Commission would welcome infor-
mation on problems resulting from possible inconsistencies between

EC rules.
36. Using abstract terms in EC law can also cause problems for imple-
menting and applying EC law and national measures in a non-uniform
way. Abstract terms may represent a legal concept for which there
are different rules in each national body of law.19
37. In general, differences between provisions in directives can be

explained by differences in the problems which those directives seek
to solve. One cannot, therefore, require that a term used to solve one
problem is interpreted and applied in precisely the same manner in
a different context. However, differences in terms and concepts that
cannot be explained by differences in the problems being addressed
should be eliminated.
38. In addition, domestic legislation adopted by Member States to

implement EC directives refers to domestic concepts of these abstract
terms. These concepts vary significantly from one Member State to
another.20 The absence of a uniform understanding in EC law of
general terms and concepts (at least in specific or linked areas) may
lead to different results in commercial and legal practice in different
Member States.21
39. This kind of problem does not only apply to horizontal ques-
tions concerning general terms of contract law as mentioned above.
It is also relevant to specific economic sectors.22
40. The Commission is reflecting whether – in order to avoid the

kind of problems described above – the necessary consistency could
be ensured through the continuation of the existing approach or should
be improved through other means. The Commission is therefore inter-
ested in receiving information on practical problems relating to
contract law resulting from the way that EC rules are applied and
implemented in the Member States.
4. OPTIONS FOR FUTURE EC INITIATIVES IN CONTRACT LAW
41. Responses to this document may show that there are impedi-
ments to the functioning of the internal market for cross border
transactions. If these problems cannot be solved satisfactorily through
a case-by-case approach, a horizontal measure providing for com-
prehensive harmonisation of contract law rules could be envisaged
at EC level. However, there are of course limits on the power of the
Commission and the other EC institutions to intervene in this area.
42. Any measure must be in accordance with the principles of sub-

sidiarity and proportionality, as described in Article 5 of the EC Treaty
and the protocol on subsidiarity and proportionality. As the European
Parliament pointed out in its resolutions on the Better Lawmaking
reports,23 the subsidiarity principle is a binding legal standard that
does not rule out the legitimate exercise of the EU’s competencies.
The need to achieve balanced application of this principle has
been highlighted by a number of Member States24 and the European
institutions.
43. The principle of subsidiarity serves as a guide as to how the

Community powers are to be exercised at Community level.
Subsidiarity is a dynamic concept and should be applied in the light
of the objectives set out in the Treaty. It allows Community action
within the limits of its powers to be expanded where circumstances
so require, and conversely, to be restricted or discontinued where it
is no longer justified.25 There should be clear benefits to taking action
at Community level instead of national level. Where the intention is
to have an impact throughout the EC, Community-level action is
undoubtedly the best way of ensuring homogeneous treatment within
national systems and stimulating effective co-operation between the
Member States.
44. Moreover, legislation should be effective and should not impose

any excessive constraints on national, regional or local authorities
or on the private sector, including civil society. The principle of pro-
portionality, which is one of the general principles of Community law,
requires that measures adopted by Community institutions do not
exceed the limits of what is appropriate and necessary in order to attain
the objectives legitimately pursued by the legislation in question; when
there is a choice between several appropriate measures recourse must

be had to the least onerous, and the disadvantages caused must not
be disproportionate to the aims pursued.26 Clearly, the Commission
is duty-bound to propose whatever measures are necessary to sup-
plement Member States’ efforts to achieve the Treaty’s objectives. The
Commission follows two criteria designed to guarantee that fixed
objectives are complied with in both political and legal terms: the
ability of national and regional authorities, and of civil society, to
act to achieve the objectives laid down in a Community provision; and
the compatibility or conformity of these objectives with national or
sectoral practices.27
45. Preparing legislative proposals by way of communications and

green and white papers is one way of consulting the private sector,
civil society and institutions at all levels on the expediency, level
and content of legislative instruments in order to achieve these
objectives. Additionally, the Commission will seek to identify areas
of intervention by involving both civil society and business with
a view to producing legislative instruments geared to users’ real
needs. This Communication and possible further documents are
intended to determine whether EC action is needed and if so in which
areas.
46. There are a number of options that can be considered should

the case-by case approach not fully solve the problem. This
Communication briefly examines four possible scenarios:
I. no EC action;
II. promote the development of common contract law principles
leading to more convergence of national laws;
III. improve the quality of legislation already in place;
IV. adopt new comprehensive legislation at EC level.
47. There are other options beyond these, and these options could also
be combined. These options may cover the field of contract law or
other fields within private law. Each option could be used for specific
economic sectors or apply horizontally. The binding character of a
measure would depend on the area to which the measure applied and
all the interests at stake. However, as a matter of principle, all options
should allow contracting parties the freedom they need to conclude
the contract terms best suited to their specific needs.
48. Another approach, which is not discussed here as it goes beyond

the level of a European initiative, could be the negotiation of an
international treaty in the area of contract law. This would be com-
parable to the CISG but with a broader scope than purely the sale
of goods. However, the provisions of the CISG could also be inte-
grated into options II and IV which would increase their acceptance
in commercial and legal practice.
4.1. Option I: No EC Action
49. In many cases the market creates problems of public concern,

but it also develops its own solutions. The effectiveness of the market
in responding to different social values and to public opinion should
not be underestimated. As a result of competitive behaviour, many
of the problems created by the market may be solved automatically
by the pressure exercised by the interest groups involved (consumers,
NGOs, enterprises). Public authorities can enhance this coincidence
of self-interest and public interest.
50. Different incentives by Member States and trade associations

e.g. offering assistance and advice on cross border transactions can
efficiently channel the market in a specific direction (for example
speed up the use of new technologies or encourage new types of
commercial practices). These could compensate for economic and
psychological risks of cross-border trade activity, whether these risks
are perceived or real. Different services from economic operators
can efficiently overcome problems of cross border transactions that
have been identified. For example, trade associations could offer assis-
tance or advice to SMEs.28
51. Economic developments, in particular the increasing integration

of markets into a genuine internal market, also create incentives for
national policymakers and legislators to look for solutions to problems
with contracts involving parties in other Member States. This could
result in a certain degree of “soft harmonisation” – not driven by
binding EC rules, but coming about as a result of economic devel-
opments. This could solve some of the problems for intra-community
trade, provided that there is a genuine and fair free choice of law
for contracting parties, full, correct and freely available information
about the existing rules and practices and fair and affordable alter-
native dispute resolution mechanisms.
4.2. Option II: Promote the Development of Common Contract

Law Principles Leading to More Convergence of National
Laws
52. In order to achieve more convergence of national contract laws,

one solution would be for the Commission to promote comparative
law research and co-operation between – amongst others – acade-
mics and legal practitioners (including judges and experts). This
co-operation could aim to find common principles in relevant areas
of national contract law. The existing work in this area could be used
and developed, including the results of academic studies and con-
clusions drawn in international academic forums. The framework for
this research and co-operation could be a kind of partnership, in which
the EC institutions – and more particularly the Commission – could
play a co-ordination role. In the field of trans-national contracts, some
common solutions, principles or even sets of rules could be defined.
53. The outcome of these discussions could vary from common prin-
ciples to the drafting of guidelines or specific codes of conduct for
certain types of contracts. The common principles could be useful
for contractual parties at the drafting stage of new contracts, as well
as for the execution of contracts. They could also be useful for national
courts and arbitrators who have to decide legal issues – especially con-
cerning cross-border cases – which are not fully covered by binding
national rules or where no legislative rules exist at all. The courts
or arbitrators would know that the principles they were applying
represented the solution common to all the national contract law
systems in the EU. At the same time common principles could help
national courts which have to apply foreign law to have a basic under-
standing of the underlying general principles of law. The guidelines
could be followed as much as possible by Member States or the EC
when issuing new legislation or adapting old legislation in the area
of contract national law.
54. The application of common principles could even lead to the

creation of customary law provided that there is a long and con-
tinued application and a commonly shared conviction. This might
influence or even change existing commercial practice in the Member
States that could create impediments to the full functioning of the
internal market.
55. Once those common principles or guidelines were established

and agreed upon by all interested parties in the Member States, broad
dissemination should be ensured amongst those who would be
supposed to apply them. This would ensure coherent and uniform
application of the common principles or guidelines. These common
principles or guidelines could however only be applied on a volun-
tary basis. If this were indeed done continuously by a sufficiently large
number of legal practitioners as well as EC and national legislators,
this would bring about greater convergence in the area of European
contract law. However, for this option to be meaningful, it is clear that
the common principles should be defined in such a way as to meet
all legitimate requirements.
56. Another solution could concern standard contracts. In order to

facilitate economic transactions a large number of standard contracts
are in use in all Member States. Such standard contracts spare parties
the need to negotiate the contract-terms for every single transaction.
They also provide a degree of certainty to parties and obtain almost
semi-regulatory status. It is precisely for this reason that it is often dif-
ficult to agree a contract with a party in another Member State which
does not comply with the standard contract terms that the other party
is used to. Parties from different Member States may indeed be used
to different terms which are in standard use in their respective states.
These problems could be solved, in conformity with Community law,
if standard contracts were developed for use throughout the EC. The
Commission could promote the development of such standard con-
tracts by interested parties.
4.3. Option III: Improve the Quality of Legislation Already in

Place
57. The Lisbon European Council has asked the Commission, the
Council and the Member States “to set out by 2001 a strategy for
further co-ordinated action to simplify the regulatory environment”.
Answering to this request, the Commission has given an initial
response through an Interim Report to the Stockholm European
Council29 which takes stock of the situation and sets out the
Commission’s initial thoughts on putting the Lisbon mandate into
practice.
58. Improving the quality of legislation already in place implies first

modernising existing instruments. The Commission intends to build
on action already undertaken on consolidating, codifying and
recasting30 existing instruments centred on transparency and clarity.
Quality of drafting could also be reviewed; presentation and termi-
nology could become more coherent. Apart from those changes
regarding the presentation of legal texts, efforts should moreover be
systematically focused on simplifying and clarifying the content of
existing legislation.31 Finally, the Commission will evaluate the effects
of Community legislation and will amend existing acts if necessary.32
59. Where appropriate, directives could be subject to simplification

of their provisions. In fact, for several years now, the EC has been
pursuing a policy of simplifying Community legislation. The SLIM
initiative33 (simpler legislation for the internal market) remains one
of the most ambitious examples of the ongoing simplification work.
Simplification exercises34 could be used to improve the quality, reduce
the volume of existing regulatory instruments, and, at the same time
remedy possible inconsistencies or even contradictions between legal
instruments.
60. Moreover, a further improvement would be to adapt the sub-

stance of existing legal instruments where necessary35 before adopting
new ones. For instance, the scope of application of various direc-
tives should be extended if necessary and if appropriate to those
contracts or transactions which have many similar features with those
covered by the directive but, for various reasons, were in not included
in the scope of application of the directive at the moment of its
adoption. This would ensure greater coherence within a well-defined
sector of activities or type of transactions.36 Along the same lines,
reasons why different solutions are given to similar problems in the
context of different directives should be re-examined.
4.4. Option IV: Adopt New Comprehensive Legislation at EC Level
61. Another option would be an overall text comprising provisions

on general questions of contract law as well as specific contracts.
For this option, the choice of instrument and the binding nature of
the measures need to be discussed.
62. The choice of instrument depends on a number of factors, including

the degree of harmonisation envisaged.
63. A Directive would, on one hand, give Member States a certain

degree of flexibility to adapt the respective provisions of the imple-
mentation law to their specific national economic and legal situation.
On the other hand, it may allow differences in implementation which
could constitute obstacles to the functioning of the internal market.
64. A Regulation would give the Member States less flexibility for
its integration into the national legal systems, but on the other hand
it would ensure more transparent and uniform conditions for economic
operators in the internal market.
65. A Recommendation could only be envisaged if a purely optional

model is chosen.
66. Concerning the binding nature of the measures to be proposed,

the following approaches, which can also be combined, are:
a) A purely optional model which has to be chosen by the parties.

An example would be a Recommendation37 or a Regulation38 which
applied when the parties agree that their contract was to be governed
by it.
b) A set of rules which would apply unless their application were
excluded within the contract. This kind of legislation already exists
in the context of the late payments directive39 or in the CISG.40 This
approach would create fall-back provisions where the contracting
parties are free to agree on other solutions by way of contract,
i.e. the application of a co-existing national law or contract-specific
solutions. It would ensure that contractual parties keep complete
contractual freedom to define the content of the contract. At the
same time it would represent a “safety net” which would only apply
if no specific contractual provisions were in place.
c) A set of rules whose application cannot be excluded by the contract.
67. The third approach would replace existing national law, while
the first would co-exist with national law. The second approach could
co-exist with national law or replace it.
68. Each applicable set of rules could distinguish between manda-

tory and non-mandatory rules.
69. A combination of the above-mentioned second and third option

could, for instance, be envisaged in areas of law like consumer pro-
tection where, besides a general and automatically applicable set of
fall-back provisions, some mandatory provisions which cannot be
waived by the contracting parties still apply.
4.5. Any Other Option
70. As indicated above, the list of options is not exhaustive but only
indicative. Therefore, the Commission welcomes any other sugges-
tions for efficient and effective solutions to the problems identified.
5. CONCLUSIONS
71. The purpose of this Communication is to initiate an open, wide-

ranging and detailed debate with the participation of the institutions
of the European Community as well as of the general public, including
businesses, consumer associations, academics and legal practitioners.
In the light of the feedback received, the Commission will, within
its right of initiative, decide on further measures.
72. In particular the Commission would like to have views on problems

for the functioning of the internal market resulting from the co-exis-
tence of different national contract laws. To be the most useful, such
information should be as specific as possible. Ideally, it should include
concrete examples of cases in which differences between the contract
laws of the Member States have made intra-community trade more
onerous or even impossible for manufacturers, service providers,
traders or consumers. This may include cases in which sellers, busi-
nesses or consumers have incurred substantial additional costs as a
result of differing legal requirements in Member States.
73. Moreover, the Commission is keen to receive feedback on which

of the possible options explained in part D [4] (or other possible solu-
tions) would be the most appropriate in order to solve the problems
identified in the present Communication.41
NOTES TO THE COMMUNICATION
1
Issued by the Commission of the European Communities, Brussels, 11.07.2001,
COM(2001) 398 final. The original document also contains three annexes, not repro-
duced here; Annex I: “Important Community Acquis in the Area of Private Law”;
Annex II: “List of International Instruments Relating to Substantial Contract Law
Issues”; Annex III: “Structure of the Acquis and Relevant Binding Instruments.”
2
Cf. Ole Lando and Hugh Beale (eds.), Principles of European Contract Law Parts
I and II (Kluwer Law International, 2000); Academy of European Private Lawyers,
European Contract Code – Preliminary draft (Universita Di Pavia, 2001) hereafter
referred to as “the Pavia Group”; the “Study Group for a European Civil Code”. A
comprehensive discussion, including a detailed bibliography, of the issues concerning
civil law in Europe can be found in Hartkamp, Hesselink, Hondius, Joustra, Perron
(eds.), Towards a European Civil Code (Kluwer Law International, 1998).
3
OJ C 158, 26.6.1989, p. 400 (Resolution A2-157/89); OJ C 205, 25.7.1994,
p. 518 (Resolution A3-0329/94).
4
OJ C 377, 29.12.2000, p. 323 (Resolution B5-0228, 0229–0230/2000, p. 326 at point
28).
5
Presidency Conclusions, Tampere European Council 15 and 16 October 1999, SI
(1999) 800.
6
COM(2000) 167, 24.3.2000, last updated in May 2001, see COM(2001) 278 final,
23.5.2001.
7
COM(2001) 66 final, 7.2.2001, p. 11.
8
The “Pavia Group” has recently published its “European Contract Code –
Preliminary draft” (Universita Di Pavia, 2001) based on the work of the Academy
of European Private Lawyers. This code contains a body of rules and solutions based
on the laws of members of the European Union and Switzerland and covers the areas
of contractual formation, content and form, contractual interpretation and effect, exe-
cution and non-execution of a contract, cessation and extinction, other contractual
anomalies and remedies.
9
The “Commission on European Contract Law” (which has received a major part
of its subsidies from the Commission of the EC) has published Principles of European
Contract Law Parts I and II, edited by Ole Lando and Hugh Beale (Kluwer Law
International, 2000). These common principles for the countries of the European
Community concern the issues of formation, validity, interpretation and contents of
contracts, the authority of an agent to bind his principal, performance, non-performance
and remedies. The book provides text proposals for common rules and includes com-
mentary and comparative analysis for each rule.
10
Another important ongoing academic exercise in this area is the “Study Group on
a European Civil Code” consisting of academic experts of the 15 Member States and
some candidate countries. Their work concerns areas like “Sales/Services/Long Term
Contracts”, “Securities”, “Extracontractual Obligations” or “Transfer of property on
movable Goods” and includes a comparative research with the final objective of a fully
formulated and commented draft on the areas concerned.
11
Directive 1999/44/EC of the European Parliament and of the Council of 25 May
1999 on certain aspects of the sale of consumer goods and associated guarantees (OJ
L 171, 7.7.1999, p. 12). Council Directive 93/13/EEC of 5 April 1993 on unfair
terms in consumer contracts (OJ L 95, 21.4.1993, p. 29). Council Directive 90/314/EEC
of 13 June 1990 on package travel, package holidays and package tours (OJ L 158,
23.6.1990, p. 59). Council Directive 85/577/EEC of 20 December 1985 to protect
the consumer in respect of contracts negotiated away from business premises (OJ L
372, 31.12.1985, p. 31). Council Directive 87/102/EEC of 22 December 1986 for

the approximation of the laws, regulations and administrative provisions of the Member
States concerning consumer credit (OJ L 42, 12.2.1987, p. 48) as modified by Directive
90/88 (OJ L 61, 10.3.1990, p. 14) and Directive 98/7 (OJ L 101, 1.4.198, p. 17).
Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997
on the protection of consumers in respect of distance contracts (OJ L 144, 4.6.1997,
p. 19). Directive 94/47/EC of the European Parliament and the Council of 26 October
1994 on the protection of purchasers in respect of certain aspects of contracts relating
to the purchase of the right to use immovable properties on a timeshare basis (OJ L
280, 29.10.1994, p. 83).
12
Council Directive 86/653/EEC of 18 December 1986 on the co-ordination of the
laws of the Member States relating to self-employed commercial agents (OJ L 382,
31.12.1986, p. 17), Directive 2000/31/EC of the European Parliament and of the
Council of 8 June 2000 on certain legal aspects of information society services, in
particular electronic commerce, in the Internal Market (OJ L 171, 17.7.2000, p. 1),
Directive 2000/35/EC of the European Parliament and of the Council of 29 June
2000 on combating late payment in commercial transactions (OJ L 200, 8.8.2000,
p. 35), Council Directive 85/374/EEC of 25 of July 1985 on the approximation of
the laws, regulations and administrative provisions of the Member States concerning
liability for defective products (OJ L 210, 7.8.1985, p. 29) as modified by the Directive
99/34/EC (OJ L 141, 4.6.1999, p. 20), Directive 97/5/EC of the European Parliament
and the Council of 27 January1997 on cross-border credit transfers (OJ L 43, 14.2.1997,
p. 25) should be noted as examples.
13
COM (2001) 66 final, 7.2.2001, p. 11.
14
1980 Rome Convention on the law applicable to contractual obligations (consol-
idated version) (OJ C 27, 26.1.1998, p. 34).
15
Alongside the convention there is also the Brussels Convention of 27 September
1968 on jurisdiction and the enforcement of judgments in civil and commercial matters,
as amended by Conventions on the accession of the new Member States to that
Convention. This determines which forum is competent to deal with a case. For all
Member States except Denmark this Convention is to be replaced as from 1 March
2002 by the Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdic-
tion and the recognition and enforcement of judgments in civil and commercial matters
(OJ L 12, 16.1.2001, p. 1).
16
Provisions range from a specific subcontracting law in Italy and a law on payment
conditions to subcontractors in France, to civil code provisions on contractual relations
in most Member States (e.g. in Germany subcontracting falls under a 1976 law on
the general terms of business and under a few articles of the civil code.
17
Case C-357/98 The Queen v. Secretary of State for the Home Department ex parte:
Nana Yaa Konadu Yiadom [2000] ECR-9265, at para. 26. Cf. also Case C-287/98
Luxemburg v. Linster [2000] ECR-6917, at para. 43; Case C-387/97 Commission v.
Greece [2000] ECR-5047; Case C-327/82 Ekro v Produktschap voor Vee en Vlees
[1984] ECR I-107, at para. 11. The principle of uniform application also applies in
the area of private law cf. Case C-373/97 Dionisios Diamantis v. Elliniko Dimosio
(Greek State), Organismos Ikonomikis Anasinkrotisis Epikhiriseon AE (OAE) [2000]
ECR I-1705, at para. 34; Case C-441/93 Pafitis and Others v. TKE and Others [1996]
ECR I-1347, at para. 68 to 70.
18
Cf. Case C-423/97, Travel-Vac S.L. and Manuel José Antelm SanchÌs [1999] ECR
I-2195.
19
These matters have recently been examined by a EP study, drafted by a team of
high ranking independent legal experts. It states with regard to the example of the
term “damage” that: “The European laws governing liability do not yet have even a
reasonably uniform idea of what damage is or how it can be defined, which natu-
rally threatens to frustrate any efforts to develop European directives in this
field”;European Parliament, DG for Research: “Study of the systems of private law
in the EU with regard to discrimination and the creation of a European Civil Code”
(PE 168.511, p. 56). Some Directives (Art. 9 of Directive 85/374/EEC, Art. 17 of
Directive 86/653/EEC) contain differing definitions of the term “damage”. Each
definition, however, is intended solely for the purpose of each respective Directive.
Other Directives (Art. 5 of Directive 90/314/EEC) use the term without defining it.
20
This problem is highlighted by a case pending with the ECJ (C-168/00, Simone
Leitner/TUI Deutschland GmbH & Co KG). On the basis of a package travel contract
concluded under Austrian law with a German tour operator, the complainant seeks
compensation for “moral damages” (unrecoverable holiday spent in hospital). Austrian
law does not grant compensation for this kind of damage, but the laws of Germany
and some other Member States do. The complainant points at Article 5 of the Package
Travel Directive, saying that this Article establishes a specific concept of “damage”
that includes “moral damage”.
21
The Commission has emphasised for example in its report on the application of
the Commercial Agents Directive (COM (1996) 364 final, 23.7.1996) that the appli-
cation of the system of compensation for damage foreseen in the Directive concerning
the same factual situation produces completely different practical results in France
and the UK due to different methods of calculation for the quantum of compensa-
tion.
22
The problem referred to here also exists outside the contract law area. Thus in
its report on the Regulation of European Securities Markets, the Committee of Wise
Men led by Alexandre Lamfalussy pointed to problems resulting from the use in certain
directives in the financial area of ambiguous notions, which allowed member states
to apply these directives in a disparate manner. Final Report, Brussels, 15.2.2001,
Annex 5 (Initial Report of 9. 11.2000).
23
COM (2000) 772 final, 30.11.2000, p. 3.
24
COM (2000) 772 final, 30.11.2000, p. 3.
25
See Protocol on the application of the principles of subsidiarity and proportion-
ality (OJ C 340, 10.11.1997, p. 105).
26
Case C-331/88 Fedesa [1990] ECR-4023 at para. 13; Case C-133/93, C-300/93 and
C-362/93 Crispoltoni [1994] ECR-4863 at para. 41; Case C-157/96 The Queen v
Ministry of Agriculture, Fisheries and Food, Commissioners of Customs & Excise,
ex parte: National Farmers’ Union [1998] ECR-2236 at para. 60.
27
COM (2000) 772 final, 30.11.2000, pp. 8–9.
28
Below are two examples of national/industry associations’ initiatives that aim at
providing a solution for cross-border contractual problems through voluntary agree-
ments on cross-border model contracts: – In 1999 a group of six German industry
federations, the so-called working group of the components supply industry, agreed
on a set of minimum clauses for cross-border contracts. However, this model applies
to cross-border contracts ruled exclusively by German law (the contractual parties must
agree to rule the cross-border contract in question under German law) and includes
provisions on prices, confidentiality, moulds, equipment, industrial property rights,
guarantee, liability, product damage, etc. – Also ORGALIME (European group of
the mechanical, electrical, electronic and metalworking industries) issued a model
for international “consortium agreement” to foster cross-border inter-enterprise co-
operation.
29
Interim Report from the Commission to the Stockholm European Council
“Improving and simplifying the regulatory environment” – COM (2001) 130, 7.3.2001.
30
Cf. Interim Report, – COM (2001) 130, 7.3.2001, p. 10.
31
32
33
The SLIM (Simpler Legislation for the Internal Market) pilot project – This project
was introduced in 1996 as an initiative for improving the quality of Internal Market
legislation, for counteracting superfluous legislation and for limiting the costs asso-
ciated with implementing. SLIM attempts to focus attention on specific issues and is
not meant to advocate deregulation. The work is extremely targeted, in order to be
run in a limited period of time, and focused on making precise recommendations.
The European institutions have agreed that simplification ought not to encroach on
the so-called acquis communautaire. In essence, simplification is to be prevented
from acting as a passkey to calling in question again harmonisation reached in sectors
like health protection, worker and consumer protection, environmental policy and
free trade. Simplification – this is the idea – should become a resource for com-
pleting the internal market, not for dismantling it.
34
• The BEST (Business Environment Simplification Task Force) – In 1997 the
Commission also set up the Business Environment Simplification Task Force
(BEST). This task force submitted a report containing 19 recommendations in
1998. These focused on the business environments in the Member States in a
wide variety of fields.
• The Action Plan for the Single Market – The Action Plan was launched in 1997,
listing four strategic objectives: making the rules more effective, dealing with
market distortions, removing barriers to market integration, and finally ensuring
an internal market that benefits all citizens of the Union.
• The “state of the art” on simplification in the “better law-making” reports –
Each year, since 1995, the Commission publishes a report on “better lawmaking”
in which it reports also on the contribution it has made to simplifying EU
rules.
• The Interinstitutional Agreement on drafting quality – This agreement was
published in March 1999, following on from the Treaty of Amsterdam and is
binding upon the Commission, the Council and the European Parliament.
35
The above-mentioned “Study of the systems of private law in the EU with regard
to discrimination and the creation of a European Civil Code”, launched by the European
Parliament states in general terms that “The existing rules enshrined in the agree-
ments and directives need to be systematically gone over with a fine-tooth comb,
incorporated into national law where necessary, supplemented in content and refined
in form. They must be co-ordinated and dovetailed with each other, cleansed of all
redundant regulation, inconsistency and terminological insularity, so that they can ulti-
mately be fitted into a systematically coherent structure, into the ‘overall picture’ of
a codified system.”
36
A limited scope of application is typical for many directives (e.g.: Directives 85/577
on Doorstep Selling: not covered are insurance contracts, contracts on real estate,
construction, . . . ; 97/7 on Distance Contracts: not covered are contracts on real
estate, construction, . . . ; 94/47 on Timesharing Contracts: covered are only con-
tracts with a minimum term of 3 years, Directive 2000/35/EC on combatting late
payment in commercial transactions: transactions with consumers are not covered.
37
Cf. for example Article 1:101 (2) of the Principles of European Contract Law
(see Note 2).
38
An example could be the “Council Regulation on the Statute for a European
Company (SE)” on which the Council adopted a political orientation on 20 December
2000 (Council document 14.886-00, 1.2.2001).
39
Article 3(1)(b) of Directive 2000/35/EC provides for specific criteria for defining
the date as of which interest shall become payable, if the date or period for payment
is not fixed in the contract (30 days following the date of receipt by the debtor of
the invoice or 30 days after the date of receipt of the goods or services). Article 3(1)(d)
provides for a “statutory interest rate” to be paid, unless otherwise specified in the
contract.
40
Cf. Article 6 CISG.
41
In order to stimulate a real debate on the issue, the Commission has published
this Communication on the Commission’s Europa website under http://europa.eu.int/
comm/off/green/index_en.htm. Incoming contributions will be published on the same
website if senders request.

Weatherill2001 Article TheEuropeanCommissionSGreenPap

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Weatherill2001 Article TheEuropeanCommissionSGreenPap

Uploaded by

Copyright:

Available Formats

Stephen Weatherill

The European Commission’s Green Paper

ABSTRACT. In July 2001 the European Commission published a Communication

THE BACKGROUND TO THE GREEN PAPER: THE CONTENT OF

It is well known that the EC has steadily assembled a collection of

Journal of Consumer Policy 24: 339–399, 2001.

instances replace the more comprehensive systems of contract law

the internal market. This is no newcomer. Harmonisation of laws in

Community Legislation That Affects Contract Law

1. Consumer Contract Law

5. Liability for Defective Products

Directive 99/93 on a Community framework for electronic signa-

8. Protection of Personal Data

9. Copyright and Related Rights

10. Public Procurement

Directive 89/665 on the co-ordination of laws relating to the appli-

Dominant Tendencies in EC Consumer Contract Law

defined],” the consumer shall be provided with stipulated informa-

The Ambit of Harmonisation

Subsequent Directives tend to include rather more detail than the

even though in principle market-building through harmonisation

and, most of all, the construction of the internal market. Only in

mine which law is applicable to the contract. More broadly, there

GENERAL COMMENTARY ON THE GREEN PAPER

The Communication, as a “Green Paper,” is designed to promote

of harmonisation for the construction and maintenance of the internal

of contract law generally. Subsidiarity “serves as a guide as to

Options Considered by the Commission

initiatives of this type launched in recent years by the Commission

of transposition into the domestic legal order, would be flexible, yet

Is Convergence of European Contract Law Feasible?

in which several manifestations of the “Europeanisation” of private

THE CONSTITUTIONAL CONSTRAINTS ON THE CONSTRUCTION OF A

In assessing the constitutional dimension of a European contract

of the subsidiarity principle, should be read in the light of the

coherent and its rules simpler and susceptible of better enforcement,

Powers Conferred by the EC Treaty

petent under its Treaty to harmonise laws in pursuit of defined ends

into binding legislation by recourse to the pretext of harmonisation,

objectives of the proposed action cannot be sufficiently achieved by

line with the dictates of subsidiarity as a criterion for judging the

The Tobacco Advertising Case and Its Repercussions

Council to convert their opposition into a challenge in the judicial

regulation of tobacco advertising by the EC is not new. In 1989

Paper on European Contract Law. The Court insisted in its “Tobacco

Examining the Prerequisites to Harmonisation

strate that harmonisation of contract law would actually contribute

than mere generalised assertion of the value of harmonisation in

There should be no great surprise if the demonstration of a valid

of the limits of Community competence to act under the Treaty and

Alpa, G. (2000). European Community resolutions and the codification of private

Grundmann, S. (1998). Europäisches Schuldvertragsrecht. Berlin: de Gruyter.

Vranken, M. (1997). Fundamentals of European civil law. London: Blackstone.

Stephen Weatherill is Jacques Delors Professor of European Community Law,

Communication from the Commission to the Council and the

EXECUTIVE SUMMARY. This Communication is intended to broaden the debate

– To leave the solution of any identified problems to the market.

1. Over recent years, discussion has intensified on possible harmon-

2. The European Parliament has adopted a number of resolutions on

3. Furthermore, in its resolution of 16 March 2000 concerning the

4. Indeed the conclusions of the European Council held in Tampere

establishment of an area of freedom, security and justice”.6 The

5. Finally, this Communication was also included in the Commission