Senior European Experts: The Role of the Court of Justice of the European Union

10 April 2018

This briefing explains why the Court is necessary to the EU, how it works day-to-day and the impact of its decisions on the UK and other EU Member States during the 45 years of our membership. It makes brief reference to other methods of dispute resolution in the context of Brexit.

Cases concerning the United Kingdom

A number of cases have demonstrated the value of the Court to the United Kingdom.  These include:

• Overturning the French beef ban – as a result of the outbreak of the BSE disease in the 1980s, British beef was banned from sale in the EU while safety precautions were put in place; France retained a ban on British beef imports long after the EU had lifted its restrictions but in 2001 the Court overturned the French ban (the US, by contrast, which is not subject to the rulings of the Court, maintained the beef ban for many more years after that);
• In 2015 the Court ruled against a European Central Bank directive that would have had the effect of requiring part of London’s financial services sector, the euro clearing houses, to relocate to the eurozone;
• In 2016 an attempt by European Commission to overturn restrictions on the granting of housing and child benefit to EU migrants was rejected by the Court, which held that the UK’s residency test was within the law.

Some cases have gone against the UK, as is to be expected when disputes are decided by the courts.  It has been suggested that the UK has lost as many as three out of four cases in the Court.  This reflects the fact that the majority of cases concern a failure to implement EU law.  The European Commission does not bring such cases unless it believes it has a high chance of success and only after a lengthy process of trying to persuade the Member State in question to act without recourse to the Court.  Between 1973 and 2016 there were 131 cases in total before the Court that concerned the UK.  Out of the 91 cases brought by the Commission, it won 77 of them (84 per cent).  In the 40 cases not brought by the Commission, the UK did much better winning 60 per cent of them (24 out of 40).  The UK’s failure rate in the European Court is lower than that of comparable Member States, for example, France loses 90 per cent of its cases at the Court.  The larger point is that the UK benefits from other Member States’ defeats in the Court, as over the French beef ban.

The most famous case lost by the United Kingdom was the Factortame case. ECR I-2433]  This concerned provisions in the Merchant Shipping Act 1988 which said that 75 per cent of directors and shareholders of fishing vessels registered in the United Kingdom must be British.  The purpose of the legislation was to prevent so-called fisheries quota hopping by other EU Member States, notably Spain.  The Court overturned this part of the Act on the grounds that it was discriminatory.  But the fact that it would be challenged in the courts was known before the legislation became law and MPs had suggested that it violated EU law.

British judges have been influential members of the Court.  The distinguished Scots lawyer Lord Mackenzie-Stuart served as President between 1984 and 1988.  UK lawyers and judges have brought to the Court their understanding of how a single market with multiple legal jurisdictions like the UK works successfully.  They have also enabled judges from different legal traditions to better understand the common law which is also practised by three other Member States, Cyprus, Ireland and Malta.

 

Dispute resolution after Brexit

The transition agreement endorsed by the European Council provides for the Court to retain its jurisdiction in the UK throughout the period of the transition from 30 March 2019 to 31 December 2020.

Some kind of dispute resolution mechanism or mechanisms will be needed after the end of the transition period to regulate the relationship between the UK and the EU in any new partnership.  The UK accepts this but the Prime Minister has rejected the UK continuing to accept the Court’s direct jurisdiction in most areas.  Nonetheless, ministers have accepted that in practice the UK will work with the Court’s jurisdiction so that it can stay involved in important EU agencies such as those dealing with medicines and civil aviation and, if the EU agrees, continue to operate key crime and justice measures, such as the European Arrest Warrant.

For the UK-EU trade agreement, the options for dispute resolution mechanisms include making use of the Court of the European Free Trade Association or the establishment of a new court specifically for this agreement.  These alternatives to the Court would neither involve direct effect nor the UK accepting the primacy of EU law.  Even if such a special arrangement proves acceptable to the EU in respect of trade cases, it is highly unlikely that it would accept this approach in justice and home affairs cases.

Although the Court has often been criticised in the UK – as it is in other Member States – for ruling against the government’s policies, it has nonetheless been of great benefit to the UK.  By developing a system of law that provides certainty for business and protection for individuals and consumers, the Court has helped to shape the EU to the advantage of British businesses and citizens.  The demonisation of the Court during and since the referendum campaign in 2016 has no basis in reality. [...]

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