Fundamental Rights in EU Internal Market Legislation

Vasiliki Kosta

• Publisher: Hart Publishing
• Year: 2015
• Print ISBN: 9781509920006
• eBook ISBN: 9781782258971
• Edition: 1
• Topic: Law
• Subtopic: International Law
• Index: Law

This book attempts to systematise the present interrelationship between fundamental rights and the EU internal market in the field of positive integration. Its intention is simple: to examine the way in which, and the extent to which, fundamental rights protection is realised through EU internal market legislation. To that end, the analysis is conducted around four rights or sets of rights: data protection, freedom of expression, fundamental labour rights and the right to health. The book assesses not only what substantive level of protection is achieved for these fundamental rights, but it also estimates whether there is a 'fundamental rights culture' that informs current legislative practice. Finally, it asks the overarching question whether the current state of harmonisation amounts to a 'fundamental rights policy'. The book offers a much more varied picture of the EU's fundamental rights policy in and through the EU internal market than perhaps initially expected. Moreover, it builds the case for a more conscious approach to dealing with and enhancing fundamental rights protection in and through internal market legislation, and advocates a leading role for the legislature in the establishment of an internal market that is firmly based on respect for fundamental rights.

1

Introduction

I. SETTING THE SCENE: A FUNDAMENTAL RIGHTS POLICY IN THE INTERNAL MARKET?

THIS BOOK EXAMINES the relationship between one of the ‘foundations’ of the European Union (EU),¹ fundamental rights protection and its driving force, also considered the ‘cornerstone of Europe’s integration’, the internal market.²

It focuses on the critical but neglected point where the two meet in the EU’s positive integration process. This process is characterised by the active adoption of measures by the political institutions in order to pursue the objective of integration. It contrasts with the process of negative integration, through which the Court of Justice of the European Union (the Court) plays a central role in interpreting, applying and enforcing legal prohibitions set out by the Treaties.³

Fundamental rights and the internal market not only share their central position in the EU integration project, but also a further characteristic: their respective evolutions are typically described as stories of overall success. The narratives of success differ, however, in their respective fields.

For the internal market project, success was crucially dependent on complementing the operation of the free movement provisions with the pursuit of a rigid and defined policy involving the adoption of positive measures and institutional re-arrangements to facilitate implementation. In other words, the appropriate combination of negative and positive integration had to be achieved. The following is the conventional narrative.

The internal market project underwent a remarkable development from the initial steps in the European Economic Community (EEC) to abolish quotas and tariffs in the trading of goods, to the landmark jurisprudence of the Court of Justice boosting market-making by providing a very wide definition of quantitative restrictions.⁴ Subsequently, the now-renamed EU overcame the stagnant period of the 1980s with the famous White Paper 1992⁵ programme, which could be successfully pursued after adoption of the Single European Act. At the time, a pivotal provision was introduced—Article 100a of the EEC Treaty—today’s Article 114 of the Treaty on the Functioning of the European Union (TFEU). Decision-making at the EU level was facilitated by providing a legal basis for the adoption of harmonising measures by qualified majority voting (as opposed to the previously required unanimity). The adoption of a vast amount of legislation followed between 1986 and 1992,⁶ so that today, the Commission is in a position to say that by 1993 the ‘single market bec[ame] a reality’.⁷ At the same time, on the occasion of the anniversary of the 1992 date which the White Paper set for completing the Internal Market, the Commission made efforts in order to address the ongoing shortcomings.⁸ It adopted the Single Market Act I in order to ‘boost growth and strengthen confidence’.⁹ This item was kept high on the agenda, as is evidenced by the adoption of the Single Market Act II, which complements the list of key legislative actions contained in the former.¹⁰ The political route therefore continues to be key for European trade integration.

The narrative of EU fundamental rights, in contrast, focuses on limits to EU activity—the classic negative function of fundamental rights as a ‘shield’, which contrasts to positive policy-making. This is not surprising, especially when bearing in mind that the watershed moment in the narrative was the introduction of fundamental rights protection in EU law by the Court.

Fundamental rights played a pivotal role in crucial moments of the evolution of the European legal order.¹¹ They constitute a measure for the legality of the EU’s acts, as well as for that of its Member States when they are implementing those acts and when acting more broadly within the scope of EU law. Under Article 7 TEU, Member States may also lose some of their rights under the Treaties if a serious breach on their part of fundamental rights is established. In its external relations, the EU is sending the unequivocal message that it aims at ‘exporting’ the principle for respect of fundamental human rights,¹² thereby pursuing an external human rights policy. With the entry into force of the Lisbon Treaty, the EU now even has its own legally binding catalogue of fundamental rights¹³ and finally established a legal basis mandating EU accession to the European Convention on Human Rights (ECHR).¹⁴

A shift in attention to an EU internal fundamental rights policy also occurred, and it did so long before the Lisbon Treaty. The landmark moment was the ‘turn of the millennium’, when the search for ‘a Human Rights Agenda for the year 2000’ was announced.¹⁵ The report that followed was compiled by Professors Alston and Weiler.^16,17 The authors forcefully identified an inherent paradox in EU fundamental rights protection, which had to be remedied: ‘On the one hand, the Union is a staunch defender of human rights in both its internal and external affairs. On the other hand, it lacks a comprehensive or coherent policy at either level.’¹⁸ This was of course not to deny that single instances of positive action did exist; gender equality is one important example,¹⁹ and data protection and intellectual property are others.

In order to build a comprehensive and coherent fundamental rights policy, the authors put forward important proposals for institutional reform. Some of these have materialised today, such as the creation of Directorate General (DG) Justice and a separate Commissioner responsible for fundamental rights,²⁰ as well as the creation of the Fundamental Rights Agency (FRA).²¹

Interestingly, one of the arguments justifying the need for a comprehensive or coherent policy was the analogy drawn with the internal market: just as the EU internal market could only be completed by complementing negative integration with positive integration, so—it was said—comprehensive fundamental rights protection also required a complementary ‘legal prohibition on violation with positive measures and a pro-active human rights policy’.²²

It should be emphasised, however, that the analogy drawn between the two areas in this integration-inspired paradigm is asymmetrical in the following sense: in internal market law, at the core of the distinction between negative and positive integration stands the question of Member State impact; in other words, whether EU law will only strike down single instances of obstacles to trade on a case-by-case basis or whether it will take away the regulatory autonomy of Member States entirely and replace the national with a EU-wide harmonised standard. The choice between negative and positive integration therefore primarily concerns the vertical relationship between Member States and the EU.

In contrast, the distinction between the negative and positive role of fundamental rights is one that first and foremost concerns the actions and interaction of EU institutions and is therefore horizontal in perspective. Thus, the question of the nature of positive integration in the fundamental rights context is about two different types of EU institutional duties: the abstention of institutions from acting in violation of fundamental rights and a positive duty to act incumbent on the political institutions in order to protect and promote fundamental rights.

The arguments in favour of such an approach are not novel: judicial fundamental rights protection presupposes that a violation has already occurred, that the applicant had the means to access a court and that a judicial remedy is appropriate in the given situation, and ultimately accepts that justice is done only in an individual case. The subject matter of the present book is, crucially, at the intersection of these two (vertical and horizontal) paradigms.

Attention to the question of the position that fundamental rights assume in the internal market was triggered by the negative integration process that also occurred in the 2000s (although after the report of Alston and Weiler). A new line of case law emerged,²³ with the Schmidberger,²⁴ Omega,²⁵ Viking²⁶ and Laval²⁷ cases featuring particularly prominently. In this case law, the possibility of a direct collision between fundamental rights and internal market freedoms became starkly evident for the first time. This collision is complicated by the fact that both interests carry the epithet ‘fundamental’. Unsurprisingly, there was an avalanche of academic commentary on fundamental rights in the process of negative market integration more generally.²⁸

It is this conflict that triggered the examination conducted in this book as there appears to be an opportunity to address the tension emerging out of the process of negative integration through the mechanism of positive integration.

The essential thesis is simple. Since the rules of the market clearly interfere with fundamental human rights protection, as guaranteed at the national level, the balancing of fundamental human rights on the one hand and market freedoms on the other hand is to a certain extent transferred to the European level. Thus, Member States lose a certain degree of their autonomy.²⁹ This ‘loss of autonomy’ not only occurs where the CJEU decides against the lawfulness of a national rule that causes fragmentation of the internal market, but also by the very fact that national rules are caught by free movement rules in the first place. This is particularly evident when taking account of the fact that the EU legislature enjoys the competence ‘to harmonise laws in pursuit of market-building ends’³⁰ (and, it should be added, market-correcting ends) where ‘rules vary between states yet cause lawful obstacles to trade integration’ (emphasis added).³¹ It should also not be forgotten that national autonomy can be indirectly constrained by regulatory competition between Member States.³²

The reason for the utility of positive integration as a tool for calibrating the relationship between market freedoms and fundamental rights is that the balancing of the two interests can be addressed in a conscious manner by the legislator, instead of remaining ‘a functional result of the degree of negative market integration and its system of competition among rules’.³³ Two features of EU legislative involvement serve to compensate in a way (even if not fully) for the loss of national autonomy in the name of the market. One reason is that there is Member State involvement in defining the appropriate balance (through the Council of Ministers), as well as participation of the only democratically elected institution of the EU, the European Parliament. The other reason is that the operation of the free movement rules is in its essence concerned with market-making, whereas positive integration is a powerful tool for market correction and has been to a large extent used as such.³⁴

There is also another point mandating the examination conducted in this book. Ever since the Charter of Fundamental Rights (the Charter) became legally binding, there is also a clear obligation imposed on the EU institutions to promote fundamental rights within the powers and tasks of the EU.³⁵ Thus, these institutions are required to mainstream fundamental rights considerations in each and every legislative and non-legislative initiative. This clearly includes the positive market integration process, it being immaterial whether the national laws that are sought to be harmonised are concerned with fundamental rights regulation or another subject matter.

Against this normative background, an evaluation of the fundamental rights policy in the internal market becomes necessary, and the following questions arise in that respect:

First, does the legislator consciously and expressly pursue an internal market fundamental rights policy? Does internal market legislation refer to, incorporate or address fundamental rights issues?

Second, when viewed from a fundamental rights perspective, what is the state of existing internal market harmonisation practice on fundamental rights? Is it considerable or negligible? Did it start only with the Charter or did it pre-exist that document?

Finally, what is the substantive level of fundamental rights protection achieved through the ongoing interplay between the Court and the legislator?

So far, this theme has not been extensively studied in a systematic way. Academic debates examining the relationship between fundamental rights and economic freedoms in the internal market have mainly focused on the tension between the two interests as it arises in the negative market integration process. Their relationship in the positive integration process has largely been neglected,³⁶ and the present book aims to fill this lacuna.

II. METHODOLOGY

The main part of this study consists of an examination of the existing harmonisation practice and its eventual le...

Table of contents

• Cover
• Title Page
• Foreword by Bruno de Witte
• Acknowledgements
• Table of Contents
• Table of Cases
• Table of Legislation
• Table of Institutional Documents
• 1.Introduction
• 2. Competence
• 3. New Mechanisms for Fundamental Rights Protection in EU Legislation: Building a Fundamental Rights Culture Outside the Courts
• 4. Data Protection
• 5. Freedom of Expression
• 6. Fundamental Labour Rights
• 7. Health
• 8. Conclusions
• Bibliography
• Index
• Copyright Page