EU LAW

Prof. Dr. Anna Katharina Mangold, LL.M. (Cambridge)

Lecture Autumn Term 2023
email: anna-katharina.mangold@uni-flensburg.de
LECTURE 8
 Revision lecture 7
 Overview: Substantive Law of the EU
 The Single Market and Economic Freedoms
 Core messages lecture 8
OVERVIEW:
SUBSTANTIVE LAW OF THE EU
 Lecture 8

Substantive EU Law: Overview

Guarantees
 Economic freedoms (Art. 26-37, 45-66 TFEU)

 Fundamental rights, ChFR (Art. 6 TEU)

 General prohibition of discrimination

(Art. 18 TFEU)
 Union Citizenship (Art. 20 TFEU)

 General right to free movement (Art. 21 TFEU)

 Lecture 8

Substantive EU Law: Overview

Policies of the European Union

 Economic policy(/policies) historically most important

 Environmental and social policy least expressed

 Area of freedom, security and justice

 Common foreign and security policy now important: unified voice for conflicts
THE SINGLE MARKET AND
ECONOMIC FREEDOMS
1. Economic Freedoms and Internal Market
2. Overview: Five Economic Freedoms
3. What do the Economic Freedoms protect?
4. Effect of Economic Freedoms in MS law
5. Overview: Infringement of Economic Freedoms
ECONOMIC FREEDOMS AND
INTERNAL MARKET
 Lecture 8

Economy and European integration

1950: Schuman Declaration
1951: Establishment of the initial integration on just one domain , coal and steel, coal and stelle cant be
moved anywhere and it can be observed quite easily

European Coal and Steel Community (ECSC).

1954: The European Defence Community (EDC) fails in the
French National Assembly, and with it the project of a
European Political Community (EPC). failed both, discussion of european army,
we see the same old patterns on these two

1957: Treaties of Rome establish the European Economic

Community (EEC) and the European Atomic Energy
Community (EURATOM, EAEC) founding fathers, coal and steel being extended to the
whole economic
automic bond never worked bc of de gaule

→ Path dependency: economic integration as fall back

 Lecture 8

Economy and European integration

1957: Internal Market objective already enshrined
in the EEC Treaty developed, but then the empty chair crisis, luxembourg compromise, if national
interests are voiced it is still unanimity

1985: "White Paper on the completion of the internal market“

already foresaw economic union of europe, is exponant of neoliberal thinking
1986: Single European Act (EEA) - Art. 8a EEC Treaty
 Lecture 8

Art. 8a EEC Treaty

The Community shall adopt measures with the aim of
progressively establishing the internal market over a
period expiring on 31 December 1992, in accordance with the
provisions of this Article and of [other new] Articles … and
without prejudice to the other provisions of this Treaty.

The internal market shall comprise an area without

internal frontiers in which the free movement of goods,
persons, services and capital is ensured in accordance with
the provisions of this Treaty.
 Lecture 8

Art. 26 para. 2 TFEU

The internal market shall comprise an area without
internal frontiers in which the free movement of goods,
persons, services and capital is ensured in accordance with
the provisions of the Treaties. fundamental freedom - portays them as equivalent as fundamental right
but they are not, they are economical freedoms

same words like the EEC Treaty

5 fundamental economic freedoms paradoxical nature

 Lecture 8

Art. 3 para. 3 TEU internal market - defined

The Union shall establish an internal market. It shall work for the
sustainable development of Europe based on balanced economic
growth and price stability, a highly competitive social market
economy, aiming at full employment and social progress, and a high
level of protection and improvement of the quality of the environment.
It shall promote scientific and technological advance.
It shall combat social exclusion and discrimination, and shall promote
social justice and protection, equality between women and men,
solidarity between generations and protection of the rights of the child.
It shall promote economic, social and territorial cohesion, and
solidarity among Member States.
It shall respect its rich cultural and linguistic diversity, and shall
ensure that Europe's cultural heritage is safeguarded and enhanced.
 Lecture 8

EU legal concept of the internal market

Art. 26 para. 2 TFEU
The internal market shall comprise an area without
internal frontiers in which the free movement of goods,
persons, services and capital is ensured in accordance with
the provisions of the Treaties.
 Lecture 8

Art. 26 para. 2 TFEU

The internal market shall comprise an area without
internal frontiers in which the free movement of goods,
persons, services and capital is ensured in accordance with
the provisions of the Treaties.
 Lecture 8

Making the Single Market a reality for the EU

Instruments:

1) Abolition of internal customs duties and

establishment of a customs union (Art. 28, 30 TFEU)

2) Negative integration through economic freedoms

(Art. 34, 45, 49, 56, 63 TFEU) individual countries goign against measures

3) Positive integration through harmonisation

(Art. 26 para. 1, 114 TFEU etc.) thign member states can do, they reach the concesus
on the rules they decide on. difficulty reaching
harmonised rules. harmonise rules on the eu level

easier to go against rules rather than harmonise tthem

 Lecture 8

Making the Single Market a reality for the EU

Accompanying regulations :

1) Rules for uniform conditions of competition

if we have a competitive single market

(Art. 101-109 TFEU)

we want them to be the best and competitive but we dont want
them to be monopolies.
the companies to be leaders but not monopolists, we also dont
want the memeber states to influence this by subsidising their
companies.

2) Economic and Monetary Union

3) Foreign trade law

 Lecture 8

Economic integration
in the common market / internal market
1. Overcoming barriers to trade
this needs to be established in the internal market

2. Liberalisation of previously closed markets also needed

(= deregulation)
e.g. telecommunications sector; employment agency; abolition of
state monopolies for alcohol, oil, matches and tobacco by 1969
3. hesitantly:
adding political and social aspects to economic integration
→ Tension between economic and political integration
→ Tension between Economic and Social Union
 Lecture 8

Concept of the internal market

1. Territorially defined area (external frontiers)

2. Harmonised legal order

3. Free mobility of all production factors

 free movement of goods

 free movement of capital

 free movement of workers

 free movement of services

 free movement for entrepreneurs

OVERVIEW:
FIVE ECONOMIC FREEDOMS
 Lecture 8

Economic (Fundamental) Freedoms

1. Free movement of goods Goods
(raw materials and end products)
2. Free movement of persons
= free movement of workers
3. Freedom to provide services Persons

4. Freedom of establishment
= entrepreneurial freedom
5. Free movement of capital Capital
 Lecture 8

Economic Freedoms: Articles in TFEU

1. Goods:
 Art. 28-37 TFEU
 Def./Application: Art. 28/29 TFEU
 Customs union: Art. 30-32 TFEU
 Quantitative restrictions + measures having equivalent
effect: Art. 34-36 TFEU
 Trade monopolies: Art. 37 TFEU
2. Persons:
 Workers - Free movement of persons: Art. 45-48 TFEU
 Self-employed persons - Establishment: Art. 49-55 TFEU
 Service providers - services: Art. 56-62 TFEU
3. Capital:
 Art. 63-66 TFEU
WHAT DO THE ECONOMIC
FREEDOMS PROTECT?
 Lecture 8

Goods: Art. 34 TFEU

Quantitative restrictions on imports and
all measures having equivalent effect shall
be prohibited between Member States.
 Lecture 8

What is a good in EU law?

Good
= any
① physical object,
② that has a market value and
③ may be the subject of a commercial transaction
④ Goods must originate from EU-MS or be in free
circulation in the EU (Art. 28 Para. 2 TFEU)
 Lecture 8

Free Movement of Workers: Art. 45 TFEU

(1) Freedom of movement for workers shall be
secured within the Union.
(2) Such freedom of movement shall entail the
abolition of any discrimination based on
nationality between workers of the Member States
as regards employment, remuneration and other
conditions of work and employment.
 Lecture 8

Who is a worker in EU law?

Worker
= any Union citizen[Article 20(1) TFEU]
who carries out
① for a certain period of time
② a dependent
③ economically utilizable activity
④ for a fee.
 Lecture 8

Freedom of Establishment: Art. 49 para. 1 TFEU

Within the framework of the provisions set out below,
restrictions on the freedom of establishment of nationals of a
Member State in the territory of another Member State shall
be prohibited.
 Lecture 8

What does establishment mean in EU law?

Establishment
= if someone
① with a firm basis
② permanently
③ participates in the economic life of another MS
 Lecture 8

Freedom to provide services: Art. 56 para. 1 TFEU

Within the framework of the provisions set out below,
restrictions on freedom to provide services within the Union
shall be prohibited in respect of nationals of Member States
who are established in a Member State other than that of the
person for whom the services are intended.
 Lecture 8

What does service mean in EU law?

Service =
① rendered
② for a fee
③ independently,
④ insofar as they are not covered
by any other Economic Freedom
[= subsidiarity: Art. 57 (1) TFEU]
 Lecture 8

What does service mean in EU law?

See e.g. Art. 57 para. 2 TFEU:
‘Services’ shall in particular include:
(a) activities of an industrial character;
(b) activities of a commercial character;
(c) activities of craftsmen;
(d) activities of the professions.
 Lecture 8

Free movement of capital/payments: Art. 63 TFEU

(1) Within the framework of the provisions set out in this
Chapter, all restrictions on the movement of capital
between Member States and between Member States and
third countries shall be prohibited.
(2) Within the framework of the provisions set out in this
Chapter, all restrictions on payments between Member
States and between Member States and third countries shall
be prohibited.
 Lecture 8

What does capital/payment mean in EU law?

Capital/Payments investor from sweden invest in an german

nuclear plan, germany doesnt want to use
nuclear anymore, we prohibit the usage of

= cross-border traffic with nuclear plants, the sweden go against

ger,any and say they have to pay billions of
euros because they have restrcited their
investment.

① non-cash and cash capital thats why we dont move into the area
of cial change or environmental
change because this system is
currently ruling the worlds

② for investment purposes

(free movement of capital) or

③ for a consideration
(payment transactions)
EFFECT OF ECONOMIC
FREEDOMS IN MS LAW
 Lecture 8

Economic Freedoms and MS law

1) Direct effect ecj we will control what eu law is,

2) Supremacy, eu law has supremacy and the individuals can rely on direct effect and doesnt stand in the way of
national courts

incl. over MS constitutional law

3) Enforceable subjective rights

 Individuals and businesses can directly complain

about MS violation of the economic freedoms
before national courts.
OVERVIEW: INFRINGEMENT
OF ECONOMIC FREEDOMS
 Lecture 8

Economic Freedoms and MS law

1) Direct effect

2) Supremacy,

incl. over MS constitutional law

3) Enforceable subjective rights

 Individuals and businesses can directly complain

about MS violation of the economic freedoms
before national courts.
 Lecture 8

Infringement of Economic Freedom?

I. Scope of protection of Economic Freedom

II. Restriction of Economic Freedom

III. Justification of the restriction

 Lecture 8

Infringement of an Economic Freedom?

I. Scope of protection of Economic Freedom
 Is a “good” concerned? (definition of good)
II. Restriction of Economic Freedom
 What is a “measure having equivalent effect” to
quantitative restrictions (Art. 34, 35 TFEU)?
III. Justification of the restriction
 How to prevent state protectionism while allowing
state regulation for legitimate policy goals (e.g.
health, consumer or environmental protection)?
 Lecture 8

Phases of CJEU: Free Movement of Goods

Phase Developments

1974: „Dassonville” term „measure having equivalent effect”

= direct or indirect, actual or potential
hindrance

1979: „Cassis de Dijon” justification of hindrances also

„immanent justifying reasons“

1993: „Keck” mere „selling arrangements” do not qualify as

„measure having equivalent effect“
INFRINGEMENT OF AN
ECONOMIC FREEDOM?
I. Scope of protection of Economic Freedom

II. Restriction of Economic Freedom

III. Justification of the restriction

 Lecture 8

Restriction of Economic Freedom

Type of restriction
Initially:
= prohibition of discrimination
CJEU, Dassonville (1974):
= mere “hindrance”, even if non-discriminatory
“All [measures] enacted by MS which are capable
of hindering, directly or indirectly, actually or
potentially, intra-Community trade […].”
INFRINGEMENT OF AN
ECONOMIC FREEDOM?
I. Scope of protection of Economic Freedom

II. Restriction of Economic Freedom

III. Justification of the restriction

 Lecture 8

Art. 36 TFEU
The provisions of Articles 34 and 35 shall not preclude
prohibitions or restrictions on imports, exports or goods in
transit justified on grounds of
 public morality, public policy or public security;
 the protection of health and life of humans, animals or plants;
 the protection of national treasures possessing artistic,
historic or archaeological value;
 or the protection of industrial and commercial property.
Such prohibitions or restrictions shall not, however, constitute a
means of arbitrary discrimination or a disguised restriction on
trade between Member States.
 Lecture 8

Justification of the restriction

Reasons for justification

Unwritten (CJEU, Cassis de Dijon, 1979):

"necessary in order to satisfy mandatory

requirements"
CORE MESSAGES
 Lecture 8

Core messages
1. Historical development of economic integration

2. Read TFEU: What are the five economic freedoms?

3. Judicial review of infringements

of economic freedoms:

I. Scope of protection of Economic Freedom

II. Restriction of Economic Freedom

III. Justification of the restriction