EU Law Lecture 4 Notes: State Liability:

1) Why would states be liable?

- Best way to ensure enforcement is to have a punitive penalty.
- Treaty did not intend to create new remedies.
- Liability can occur for may different breaches, the simplest being non- enforcement
of EU law under treaty, directive or regulation.

+ C-6/90 AND C-9/90 Francovich 1991:

- ‘full effectiveness of community rules would be imposed and the protection of the
rights which they grant would be weakened’.
- Italian claimants sought compensation against Italy for failing to implement a
directive concerning employee protection on insolvency of the company.
- Not a new remedy, was inherent in the treaty already.

+ Reasons for having state liability:

- Helped with enforcement of unimplemented directives.

- Inherent l
- In the treaty anyway not a new remedy
- Adhering to principle of sincere cooperation and procedural authority (C-33/76 Rewe
1976)
- ‘it is the national courts which one entrusted the legal protection’.

+ criteria for claiming SL:

- Originally for directives only from Francoviah case very brief and narrow.
- Later clarified and expanded in Brasserie Du Pecheur
- SL was the available not only for directives but any breach of EU law.

+ Attributions of SL:

- Do all violations of EU law become the states responsibility?

- SL applied irrespective of which organ legislative/ executive or judiciary was
responsible
- Must be for violations of EU law from national courts of final appeal (Kobler)
- No ability to appeal ruling that infringes rights in EU law.

+ C-46/93 and C-48/93 Brasserie Du Percheur 1996:

- Joint cases for financial compensation sought for losses that were sustained from the
Factortame case line of reasoning.
- Also, financial compensation sought from German state for breaching free
movement of goods.
 - Argued that compensation should not be available for directly effective EU law
because national law should have dealt with it.
- Argument not accepted

1) A specific right must be conferred upon an individual

2) The breach must be sufficiently serious
3) A casual link between the breach by the state and the damage to the individual must
exist.

+ grant of rights to individuals:

- Previously only allowed unimplemented directives.

- Now breaches of EU law can claim SL
- Links with the principle of DE
- What right is being granted also determines the sufficiency serious breach itself.

+ Sufficiency serious breach:

- An extremely unclear condition

- Tautological definition of what is considered to be sufficiently serious
- Needs to be an obvious breach
- Very high standard of what is considered to be sufficiently serious

+ Issues with ‘sufficiently serious’:

- Directive imprecisely worded leading to incorrect implementation is not a matter

under SL (ex parta BT)
- Directive incorrectly implemented was not sufficiently serious if other MS also
implemented this way (Denkavit)
- The less discretion afforded to member states, the more likely it is to be a sufficiently
serious breach (Hedley Lamas).

+ Casual link:

- There must be a link between the damage caused and loss suffered and being
claimed.
- Must link to the MS, whatever organ of the state.
- National courts are usually responsible for applying EU law to the facts of the case
(Kobler).

+ Effective on SL on national courts:

- Whilst SL is an EU concept, if a MS is found liable for a breach then it is up to their

own national law on damages.
- CJEU just determines if there has been a case warranting financial compensation.
- Provides procedural autonomy to MS.
 - Still does not avoid the fact that MS sometimes think it is an intrusion into their
autonomy.

+ Criticisms of SL:

- There is no harmonised set of EU remedies and SL does nothing to help this.

- It is a difficult balance between respecting MS autonomy and enforcement of EU
law.
- SL claims usually referred by states who comply with EU law.
- SL as a remedy for national courts of last appeal undermines res judicate (Kobler).
- Independence of the judiciary undermined by offering another remedy through the
EU.
- Domestic courts involved with determining SL may be complicated.

+ Summarising SL:

- C-432/05 unibet 2007

- ‘community law nevertheless requires that the national legislation does not
undermine (42)
- (43) ‘community law must be no less favourable than those governing similar
domestic actions must not render practically impossible or excessively difficult the
exercise of rights conferred by community law.

+ Remedies:

- The concept of SL is related to damages.

- How can you get compensation by the damage caused by MS.
- It is controversial look at the relationship of SL with the national courts.

+ definition:

- Stems from DE way in which EU treaties become part of national MS and supremacy
- Remedy available to individual when MS breach obligations under EU law.
- Financial compensation from MS to individuals affected by breach
- SL is a remedy
- Almost like saving the MS
- Punitive penalty
- SL exists but it doesn’t mean there are no breaches of EU law.
- SL did not create a new remedy, SL derives from the treaty and a different way of
interpreting it.
- Why do we need SL?
1) it really helped with implemented and wrongly implemented directives
- Since cooperation- you sign to cooperate with all 27 states and EU law flourishes.
- Brasemi Du Pesur- not only for directives but you can claim damages for any breach
of EU law.
- Is the breach which occurring is it the states responsibility if not you don’t have the
vertical situation.
- You must go through domestic system then go up only the highest court can
communicate it to with the EU. Casual link