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Wednesday, September 10, 2008

A really important article

Former German President Roman Herzog had an article in the FAZ earlier this week. Having nearly finished a translation of our own, it seems EUobserver has now put one up.

The hook for the article is the forthcoming verdict of the German Federal Constitutional Court at Karlsruhe, in which it will decide whether or not to accept that EU law is superior to German law. The cause is a complaint relating to the Mangold Judgement, in which the ECJ (Herzog argues) broke several principles of EU law.

In the article he also lists a series of other rulings by the ECJ, in which, he argues:

"the ECJ consciously and systematically ignores the central principles of western judicial legal interpretation: decisions are carelessly justified; the will of the legislator is turn into its opposite and legal maxims are invented, which it can then later use as the basis for its decisions."

Here is what he has to say about the case itself:

In 2000, the European Union (EU) passed a non-discrimination directive which prohibited the unequal treatment of people in "employment and occupation" on account of age. Of course this EU directive also contains an explicit provision that member states may discriminate against people due to age if such practice serves to foster employment. The manner in which this provision is realised is largely left to the member states.

However, two lawyers in Munich held the view that this reduction of the age limit constituted an infringement of the said EU directive, and so they brought the case to court in 2003. The ECJ judged as follows: The German labour market reform was in fact deemed incompatible with the EU's non-discrimination directive, since it could not be "proved" that the German reform provisions were "objectively required" for the stimulation of the employment of older employees. This so-called "Mangold Judgement" is disputable for various reasons.

Firstly, both labour market policy and social policy are still core competences of the member states. However, this case clearly demonstrates to what extent EU regulation and EU jurisdiction nevertheless interfere in the governing of these core competences.

For even though the EC Treaty allows for a European regulation of non-discrimination, the question of why the EU regulates age discrimination on the labour market at all is raised in all its seriousness. According to the principle of subsidiarity, the EU may take action only if it really has a better solution to a problem than the member states.

According to law as it exists, a basic criterion for such a situation is that the problem must concern an issue of transboundary impact. However, unlike the question of nationality, age discrimination does not have any transboundary relevance and can therefore be easily dealt with by the member states themselves. Yet, the court blithely ignored it.

At least the EU directive does declare unequal treatment on account of age as expressly admissible for the purpose of promoting employment in the member states, but even this did not concern the ECJ. Despite everything, it overthrew the German employment promotion measure.

Secondly, EU directives do not apply to member states directly, but first have to be transposed by the national legislature, which may resolve on the form and methods of the relevant measure independently. Germany had to transpose the aforementioned non-discrimination directive by 2 December 2006. Therefore, there was no obligation to transpose it. Moreover, the lowering of the age limit was due to expire anyway by 31 December 2006, in other words a few days after the expiry of the enforcement deadline. This was also ignored by the ECJ.

Thirdly, to justify its judgement, the ECJ resorted to a somewhat adventurous construction. The ECJ believed it had found a ban on age discrimination within the "constitutional traditions common to the Member States" and "various international treaties". So it was not actually the non-discrimination directive (as yet to be enforced) which caused the German reform provision to breach EU law, but a "general principle of community law".

However, this "general principle of community law" was a fabrication. In only two of the then 25 member states – namely Finland and Portugal – is there any reference to a ban on age discrimination, and in not one international treaty is there any mention at all of there being such a ban, contrary to the terse allegation of the ECJ. Consequently, it is not difficult to see why the ECJ dispensed with any degree of specification or any proof of its allegation. To put it bluntly, with this construction which the ECJ more or less pulled out of a hat, they were acting not as part of the judicial power but as the legislature.

Fourthly, in its judgement the ECJ ordered the German reform provision to remain "not applied" with immediate effect. In fact, it was declared null and void. This also constitutes a highly questionable paradigm shift. The EC Treaty stipulates that member states are not directly bound by EU directives. This means that it is not the EU directives but the national transposition laws that must first create rights and duties for citizens.

The ECJ used to respect this, too: If the national law of a member state was not compatible with an EU directive, the ECJ confined itself to pointing out the inconsistency. Although the member state concerned then had to revise its law, the former version (incompatible with EU law) remained in effect until that was done. Hence, citizens could rely on the binding effect of their national laws. This has now changed: As a consequence of the ECJ judgement, all temporary employment contracts concluded during the German labour market reform were converted into regular employment contracts overnight – resulting in the subsequent material damage incurred by the affected companies.

With these four dubieties, the "Mangold Judgement" provoked almost unanimous and massive criticism among legal experts.

He goes on to argue that there are a series of other cases where the ECJ has ignored, distorted or inverted the intentions of lawmakers.

One relates to a tobacco advertising ban passed by the EU in 2000. Because the EU as yet has not powers in this area it was passed under the internal market article, on the rather ropey reasoning that otherwise national ad bans would become an obstacle to the internal market. The German Government challenged this, pointing out in particular that it was peculiar, in that case, that it applied to local papers too.

Herzog notes: "The fact that local papers are hardly ever sold abroad and therefore an actual impediment does not exist was not considered by the ECJ. The vital German counter-argument that all tobacco ad bans hitherto existing in the member states expressly excluded foreign newspapers and thus could not impede the free sale of foreign newspapers containing tobacco ads was simply "turned upside down".

A second is the infamous ruling on environmental crimes, where the court invented a new right for the Commission to propose criminal laws in fields like the environment where it had competence. Herzog notes the ECJ's extraordinary reasoning: "As a general rule, neither criminal law nor the rules of criminal procedure fall within the Community's competence. However, the last-mentioned finding does not prevent the Community legislature from taking measures which relate to the criminal law of the member states that it considers necessary".

A third relates to a ruling in which the ECJ decided that non-discrimination provisions in a treaty between the EU and Tunisia could be used to challenge for right to remain, despite the fact that the Treaty in question simply rules this out.

He asks

What would happen in Germany if, for instance, the Federal Labour Court imposed such regulations upon the legislator? Yet, at the European level, such incapacitation of the "Masters of the Treaties" appears to go unresisted!

He calls on the court to overrule EU law:

the question the Federal Constitutional Court now has to answer regarding the Mangold Judgement is crucial: if decided in favour of the litigants, the ECJ would be restrained. This would also mean that the ECJ Judgement would not be applied in Germany so that the precedence of EU law over national law would be overturned. But this would be acceptable. Not only because the non-discrimination directive is now in force and thus the non-applicability of the ECJ Judgement would not entail any significant impacts on the legal unity in the EU, but even more because a judgement which dismissed a constitutional complaint would make it much more difficult, probably impossible, for the Federal Constitutional Court to control the ECJ in the future.

And failing that he also has a proposal for a new court to protect the rights of the member states from the EU:

The ECJ is not suitable as a guarantor of subsidiarity and a protector of the member states' interests. This is not surprising, as first of all, according to Articles 1 and 5 of the EU Treaty, the ECJ is obliged to participate in the "process of creating an ever closer union". Secondly, an EU-biased jurisdiction of the ECJ leads to the situation that the areas where the ECJ may judge are also growing, thereby displacing member states' courts, which means that the ECJ is constantly gaining influence. This general tendency is not modified by the occasional deliberately cautious ECJ judgements passed in order to serve as a sedative to the growing resentment of the member states. Against this background and in light of the achieved integration level in the EU, it is absolutely vital that an ECJ independent court for competence issues be set up.

It will be interesting to see what happens in the court case.

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