Form and Substance in European Co...
eulj_517 439..457 Form and Substance in European Constitutional Law: The ���Social��� Character of Indirect Effect Leone Niglia* Abstract: This article proposes to understand the constitutional discourse about individu- als, rights and enforcement, as developed in the courtrooms, in relation to historic and contextual circumstances. It focuses on the interface between indirect effect and social policy, and argues that the creation of indirect effect has been integral to a judicial strategy centred on the key concern for sustaining the balance between market freedom and interventionism as achieved in the political process. I Introduction Analyses of the European Court of Justice (ECJ) led constitutionalisation story1 typi- cally centre less on substantive and more on formal aspects. Scholars see it as a legal development in which the ECJ has established the well-known constitutional prin- ciples, and domestic courts have faithfully acted on them and co-operated with the ECJ in enforcing individual rights.2 Received wisdom has it that all that happened was driven by legal necessity. According to an authoritative description, the ECJ ���won the confidence��� of the domestic courts thanks to the skillful way it dealt with the legal material available.3 This article proposes a line of analysis that focuses more on * Director of the Centre for European Legal Studies and Associate Professor of European Law/Reader, School of Law, University of Exeter, UK Jean Monnet Fellow, University of Michigan, School of Law. I acknowledge support from the Carnegie Trust for the Universities of Scotland and the University of Michigan, School of Law. Thanks to Eric Stein (Ann Arbor, University of Michigan) for comments on a previous draft and to two anonymous referees. 1 ���Constitutionalisation��� is customarily defined as ���the process by which the EC Treaties evolved from a set of legal arrangements binding upon sovereign states, into a vertically integrated legal regime conferring judicially enforceable rights and obligations on all legal persons and entities, public and private, within [the sphere of application of EC law]���: A. Stone, Constitutional Dialogues in the European Community EUI WP RSC No 95/38, at 1 as quoted eg in J.H.H. Weiler, The Constitution of Europe (Cambridge University Press, 1999), 221, and in B. Rittberger and F. Schimmelfennig, The Constitutionalisation of the European Union (Routledge, 2007), 1. 2 Cf Karen Alter, Establishing the Supremacy of European Law (Oxford University Press, 2001), 39 (���legal- ism remains the dominant paradigm for analyzing legal integration in Europe���). 3 Cf G.F. Mancini, ���The Making of a Constitution for Europe���, (1989) 26 Common Market Law Review 595, at 605���606. On the dominance of this understanding in general cf D. Chalmers, ���EU Law and the Failure of the European Social Scientific Imagination���, (2004) (Fall) EUSA Review 4, at 4 (������Law in society��� approaches . . . look at the epistemology of the law, its vision of society: what image does it draw of human European Law Journal, Vol. 16, No. 4, July 2010, pp. 439���457. �� 2010 Blackwell Publishing Ltd, 9600 Garsington Road, Oxford, OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA
substance and less on form. This approach is based on the belief that in order to really understand Europe���s constitutional developments one must employ general theoretical and historical accumulated knowledge on comparative constitutionalism that indicates that constitutional actors typically perform their operations in the space of political engagement and contestation.4 The article submits that there are substantive, that is, historic and contextual aspects that make the constitutional story really intelligible, and discusses formal and substantive features of the constitutional story along these lines, in the conviction that a simultaneous analysis of both is plausible and necessary for advancing our knowledge. The focus of the article is on the doctrine of indirect effect as introduced by the ECJ in the eighties. In section II, I recall that the judge-made constitutional discourse centred on ���direct effect���, that has had the effect of establishing and enforcing the key Community economic rights, at a certain point in time has been broadened to include ���indirect effect���. In section III, I propose a way to understand why the ECJ has framed the two-tier constitutional discourse of direct and indirect effect, in the light of a set of contingent substantive choices made by the key social actors with access to the Com- munity, in both legislative and administrative settings, aimed at creating a system ���in the nature of a market economy tempered by social welfare considerations���. The ECJ constitutional move, I argue, has been conducive to that very project. The constitu- tional doctrines have been part and parcel of a judicial strategy centred on the concern for sustaining the balance between the guarantee of free commerce and intervention- ism, as achieved in the legislative setting in which agriculture and commerce have been placed under European discipline. Specifically, the judicial discourse of indirect effect, I argue, has been devised with the purpose of sheltering from the encroachment of Community law the heritage of social rights as developed in the nation state in the second half of the past century. On the basis of this analysis in section IV, I then subject to scrutiny the contentious doctrinal debate on the ���legal meaning��� of ���indirect effect���, and propose a new understanding that relies on contextual aspects. In section V, I put forward conclusive remarks on the value of the perspective that this article adopts for our understanding of constitutional Europe. Below I address each argument in turn. II Form A The Making of Indirect Effect Notably, more than two decades after Van Gend, and a full decade after Van Duyn,5 the European Court of Justice (ECJ) chose not to extend its direct effect doctrine to cases of un-implemented or incorrectly implemented directives that individuals rely upon relations what ideologies, justified true-beliefs does it draw on how do the internal structures of the law reconstruct these how do legal visions of society compete with other collective visions . . . With some notable exceptions . . . this debate is absent from EU studies���). 4 The literature on the embedded character of constitutional material is obviously large. For example, cf the defence of an ���historic���, rather than a merely ���normative���, approach to constitutionalism in general in D.J. Calligan, ���The Paradox of Constitutionalism or the Potential of Constitutional Theory?���, (2008) Oxford Journal of Legal Studies 343 et seq, and criticising a recent study edited by M. Loughin and N. Walker, The Paradox of Constitutionalism (Oxford University Press, 2007) for not being historic enough. 5 Case 26/62, Van Gend en Loos  ECR 1 (direct effect of treaty rules) and Case 41/74, Van Duyn v Home Office  ECR 1337 (direct effect of directives). European Law Journal Volume 16 440 �� 2010 Blackwell Publishing Ltd.
against other individuals.6 A new path was opened as the Court ruled out the possibility of invoking a directive against individuals, thus effectively confining direct effect only to claims against the state.7 Whilst Van Duyn���s effet utile rationale would have made it compelling for the Court to allow horizontal effect, whatever the type of European rule at stake (primary or secondary),8 the Court chose not to act coherently at all. It held that the justification for direct effect is based not on effet utile, but on the ���estoppel argument���. That is, the state may not rely as against individuals upon its own failure to implement a directive faithfully and timeously.9 Therefore, the Court concluded, ���direct effect��� cannot apply to horizontal claims.10 In a parallel line of cases, started with Von Colson and Kolpinghuis,11 the Court constructively identified what would become known as ���indirect effect��� doctrine. It positively commanded the domestic courts to follow this new doctrine in cases of horizontal claims: in such cases courts are not required to adjudicate under direct effect, per Marshall, but only indirectly to rely on the relevant directive in the following way:12 [T]he member states��� obligation arising from a directive to achieve the result envisaged by the directive and their duty under Article 5 of the Treaty to take all appropriate measures, whether general or particular, to ensure the fulfillment of that obligation, is binding on all the authorities of member states including, for matters within their jurisdictions, the courts. It follows that, in applying the national law and in particular the provisions of a national law specifically introduced in order to implement directive no. 76/207, national courts are required to interpret their national law in the light of the wording and the purpose of the directive in order to achieve the result referred to in the third paragraph of Article 189 . . . [i]t is for the national court to interpret and apply the legislation adopted for the implementation of the directive in conformity with the requirements of Community law, in so far as it is given discretion to do so under national law. B Interpretations of Indirect Effect The introduction of ���indirect effect��� has dramatically redesigned Europe���s constitu- tional story. Constitutional material has taken a new shape. For the kernel of the constitutionalisation story, the placing of European law above national law and at the service of individuals��� claims, has been strongly limited in scope���a substantial set of European rules would no longer enjoy direct effect but could only be indirectly relied 6 Case 152/84, Marshall v Southampton and South West Hampshire Area Health Authority (Teaching)  ECR 723. 7 ibid, at paras 43 and 48. 8 Case 41/74, Van Duyn v Home Office  ECR 1337, para 2: ���It would be incompatible with the binding effect attributed to a directive by Art 189 to exclude, in principle, the possibility that the obligation which it imposes may be invoked by those concerned. In particular, where the Community authorities have, by directives, imposed on member states the obligation to pursue a particular course of conduct, the useful effect of such an act would be weakened if individuals were prevented from relying on it before the national courts and if the latter were prevented from taking into consideration as an element of Community law��� (emphasis added). 9 Cf Case 152/84, Marshall v Southampton and South West Hampshire Area Health Authority (Teaching)  ECR 723, paras 43 and 48, where implicit reliance on a previous case: Case 148/78, Public Ministero v Tullio Ratti  ECR 1629, paras 21 and 22. 10 Cf eg Jason Coppel, ���Rights, Duties and the End of Marshall���, (1994) 57 Modern Law Review 859, at 859���864. 11 Case 14/83, Von Colson v Land Nordrhein-Westfalen  ECR 1891, and Case 80/86, Kolpinghuis Nijmegen BV  ECR 3969. 12 Cf Case 14/83, Von Colson, ibid, at paras 26 and 28, reiterated in Case 80/86, Kolpinghuis, ibid. July 2010 Form and Substance in European Constitutional Law 441 �� 2010 Blackwell Publishing Ltd.