The law of Brussels and daily Dutch practice

The majority of the laws which Judge Ruud Winter has to rule on have their roots in Brussels. “European Law is dominant”.

Ruud Winter is president of the Court of Appeal for trade and industry. The Court is the first and highest court which passes sentence in disputes in the area of socio-economic administrative law.

If the proprietor of a garden centre wants to be open on Sundays in spite of a law forbidding this, he can lodge an appeal to the Court. If a farmer refuses to have his cows put down when there is there is a virus about, he will come to the Court.

In fact, says Winter, the Court is active in areas which every average Dutchman has to do with every day. Breakfast with cornflakes and milk? The court is competent in matters of additives and fat percentages in milk. Making a mobile telephone call? The court is competent in matters of telecommunications law. Meat for dinner? The court tests decisions which have been made on the basis of legislation on commodities and the Agricultural Quality Act. In total there are about ninety laws in which the court is the competent court.

For an average case there are three big piles of paper on Winter’s desk. One pile with European legislation, one stack with national legislation and one small pile with general administrative orders. And this is the normal procedure in nearly all cases, Winter says, because at least 80% of the laws that he has to rule on, has European roots. They are European regulations or it concerns acts based on European directives.

The greater part of the cases we deal with have a European dimension, Winter says. In fact this was already the case in the early years of the Court, in the fifties, when European co-operation had just started. Winter: “When you take a closer look at the case law of these days, it will strike you what at the time the views were about what the influence of European law should be. Judges had a detached attitude. Nobody realised at that time that one day European law would play a dominant role.”

However, the European Court of Justice in Luxembourg made short work of that attitude, Winter says. The court again and again made it very clear that European law derogates from and prevails over the national law systems. Mr Winter does not give his opinion about whether this is good or not good. “It does not become a judge”, is his remark. However he is prepared to say this: “Citizens do not always realise that European rules are established from another perspective than national laws. When national laws are made, there is a problem first. Subsequently everyone agrees that the problem has to be solved and that it is useful to make a law on it. On European level it works differently. There is legislation, after which it becomes necessary to create public support for it.”

Legislation from Brussels is not really increasing, Winter says, but it is becoming more and more detailed. And especially when European legislation gives member states too much room, the countries will go their own way and this again could create a barrier for the trade between countries. Germany had its own “ Reinheitsgeboten ”, very specific legislation, in practice only applicable to German beer. “With that legislation all other beers were excluded, with which Germany protected their beer market”. More detailed European rules could have prevented that.

How difficult it is for member states to obey European rules, was evident in 2001, when there was an outbreak of foot-and-mouth disease and thousands of cows had to be put down as a preventive measure. All the farmers applied to the Court to challenge those “slaughter decisions”, which were based on the Animal Health and Welfare Act. Farmers wanted to vaccinate their animals to prevent them from getting the disease, but this was not allowed by European legislation. Winter: “We worked seven days a week. Sometimes we received a request for provisional relief at four p.m., which we ruled on in the evening”. For all the farmers it was very urgent, it was literally about life and death.

In one case - of a person who did not live in a “virus area” and for whom the threat of the disease was not acute - the Court decided to follow a special procedure: the “fast track procedure”. The Court went to the Court of Justice in Luxembourg to seek clarification of the vaccination prohibition. “We wanted them to clarify whether the European prohibition was really valid”. It was the first time ever that the ECJ was confronted with such a request. The decision came with “impressive speed”. Normally such a procedure will last about two years. Now there was a ruling after three months: the European prohibition on vaccination was valid. And therefore Dutch farmers could not get an exemption from the European prohibition. The cows had been justly killed.

Task 4: Euro: in, out or over?

Will they, won’t they? There are only two possible dates for a euro referendum in this parliament, but of those, the spring of 2003 looks much more realistic. Neither Mr Brown nor Mr Blair wants to reveal his hand about when exactly the government might recommend that Britain should join the Euro. The two men may agree on that, but not on much else. Mr Blair would very much like to take Britain into the euro as soon as possible, if only he could find a way of overcoming public hostility. Mr Brown, while no closet euro-sceptic, worries about the economic risks: “I’m not convinced that the Euro-area and Britain form an Optimum Currency Area”. … Before then, much will have to be done. Like the countries already in the monetary union, Britain will have formally to pass the convergence tests set by the Maastricht treaty of 1992. Besides that, Mr Brown, the Chancellor of the Exchequer, set up his own economic tests as well. Especially the divergence of the EU economies worries British economists and politicians.

Source: Economist 2-8-2001, slightly adapted

Hungary offers painful lesson for Euro Aspirants   For the European Union’s Class of ’04, joining the euro will be a much trickier task than joining the EU. Adopting the bloc’s common currency is appealing ….but large budget deficits and other fiscal shortcomings are likely to delay those benefits for five years or longer for the biggest new entrants. And if they try to rush their euro membership, they risk a repeat of the currency crisis that rocked plans for monetary integration in the early 1990s. The risks became painfully clear when Hungary, a former favourite of investors, stumbled last year when it tried a shortcut to the euro by keeping its currency artificially stable. Speculators, aware that Hungary’s fiscal problems would make a stable-currency policy hard to defend, swooped in to aggressively sell and buy the forint, forcing the country’s central bank to make abrupt interest-rate adjustments. To prove their currencies are stable enough to join the euro, EU members must join the exchange rate mechanism II. Meeting that test has been difficult for previous euro candidates.

Source: Wall Street Journal Europe, 28-4-2004 (parts)

The euro's existential worries May 6th 2010 From The Economist print edition What lies behind differences over the future of the euro

WILL the euro still exist in 10 years’ time? That is a trickier question to answer than it was three months ago, when European Union leaders first lined up in Brussels to wag their fingers at the markets and offer vague declarations of “solidarity” with Greece in its hour of fiscal need. The political will to preserve the euro should not be underestimated, any more than was the political will to create it. Indeed, EU resolve has strengthened since February. But the crisis has worsened even faster.

Source: Economist 6 May 2010

Task 5: Hey, big spender!

Last June, a new European Parliament has been elected. This autumn, a new European Commission will be in charge. One of the main issues, besides formulating the European answer on the global crisis, is the state of the EU budget. Although the size of the EU budget is quite limited compared to the budgets of the national governments, the status of the 2 big spenders, the common agricultural policy (CAP) and the regional policy is subject of fierce debates and political rumour.

Although the role of the CAP has been reduced compared to the 1970’s, the basic principle of the CAP is still responsible for internal EU problems as well as external problems, especially, but not only, related to the WTO. The debate on the EU sugar reform is an example for this.

Regional policy is, in terms of money spend, the successor of the CAP, and is sometimes regarded as the logical consequence of the EU enlargement. Nevertheless, the rationale of the policy is questioned. Criticizers claim that regional policy is just throwing money down the drain. On a more general level, some economists were questioning the case as well: according to them the EU integration process would, under the influence of market forces, lead to convergence of the development of regions rather than divergence, in this way undermining the foundation of the regional policy.

Both regional policy and the CAP are subject of continuous criticism of EU-sceptics in the “old” EU countries who continue to blame the EU for an imbalance in payments and revenues.

Task 6: Men come from Mars, women from Venus?

About law and about making a correct comparison.

In The Netherlands students learn at school to look closely into something in order to get a better picture of a specific case before drawing their final conclusion. Do not judge too quickly: sometimes things are neither black nor white, grey is another possibility! They are warned by all kinds of educators not to compare “apples and pears”. Both are fruits, but from different trees, with different tastes and a different structure. Of course things may be compared, but the question remains what do you want to compare and what is relevant once a comparison is made.

When we look at equality as a legal concept, it is remarkable to find out that it took so long before it became acknowledged by the European Court of Justice. The concept itself was already clearly outlined in the first established treaties.

Maybe the cause of that somewhat reluctant acceptance is that people use phrases such as “fair” and “equal” all the time, but they rarely bother to explain what they really mean.

When a girl e.g. says that it is unfair that the BBC rarely, if ever, broadcasts a football game between female teams, everyone agrees because it is a fact of life; these matches are indeed seldom broadcasted. On the other hand is it allowed to ask whether the game is played as well by women as by men? Or is that not a proper (right) question?

The word “discrimination” is often used, but ask a person to give a proper definition of discrimination and he will have a problem. Once a Dutch guy was accused of discrimination of a black boy because he had kicked the black boy who was committing petty crimes with another - white - boy. When asked later why he had kicked the black boy and not the white one, his answer was simple: because I could catch up with the black boy while running, the white boy was much faster than me.

While this task is being written, two articles in a newspaper are intriguing the writer. In Mauritania, a Dutch quality newspaper (NRC – Aug. 2007) writes, slavery was officially abolished in 1981, which is much later than in most western countries. However, the phenomenon was not eradicated by such a ban. It has existed until today! So new legislation has been adopted by the government to punish people who are involved in slavery, threatening them with punishments of more than 10 years’ imprisonment, once proven guilty.

Another interesting question was raised by a Polish student in Breda, who wanted to do some work during his summer holiday in the Netherlands. He soon found out that Dutch wages are legally determined, also for minors. So his wage was somewhat lower than the wage of his friend who was one year older than he was. He thought it was a clear case of age discrimination. This was denied by the Dutch Ministry of Social Affairs, because they claimed: “it is the law” and when it is law it can’t be discrimination. But Dutch courts are not allowed to examine a law that way. That examination is the privilege of the Dutch legislator.

In some cases, students’ attention has to be drawn to the fact that what they consider to be “normal” today was not that normal yesterday. Or what is still normal in foreign countries is not that normal in your country. For example, in England students wear their school uniforms at public schools. Even to propose such a thing in Holland will cause a lot of anger because it is old fashioned style! In the Netherlands measures which are found useful elsewhere (and indeed involve some costs) are voted down without telling so as the main reason. Today boys and girls are educated at one school together. It is not that long ago that the sexes had to be separated all the time, which is still done in a lot of countries where schools exist for boys and girls only. Think of the sons of Charles and Diana in the UK, and Ms Hillary Clinton in the USA: they all attended schools for boys or girls.

Equality does not refer to gender issues only. Nationality can be a reason for committing discrimination. For a very long time almost every big city in the western parts of Canada and the USA has had a Chinatown. Have you ever asked yourselves why is this? Other examples are Jews who were once separated in Europe in “their” own part of the town. People who are disabled have problems getting a job, even if they can do the work easily. Gipsies in Europe face problems all the time and First Nations (we call them “Indians”, which word is not appreciated by the people themselves) in America and Canada have similar problems. Is that due to their own nature or do we discriminate against these human beings?

When you are a full member of society, you want to vote too! If that is true, why do so many people abstain from their right to vote, a right which is sometimes very hard to acquire?

What do we know about Mary Wollstonecraft, born in London in 1759, or Dr. Aletta Jacobs, the first female doctor in the Netherlands? In 1885, the latter had to attend her lectures separated from the male students, just if she was a prisoner! And even until today cases have been brought to the courts by females. For example Gabrielle Defrenne in the 1970s, whose contract was terminated. The problem is that big that even the EU quite recently came with a code on equal treatment and sexual harassment.

The question remains if this is problem which a civilized society has to solve by law or if it is more a problem of our minds and of the parts of our heads we call “ears”?

We listen all right, but do we understand?

Task 7: Competition policy I

Neelie Kroes European Commissioner for Competition Policy Introductory remarks at press conference on Ryanair/Aer Lingus decision Brussels, 27th June 2007 In order to safeguard consumers, the European Commission has decided to prohibit the proposed takeover by Ryanair – which is one of the largest airlines in the world – of its main competitor in Ireland, Aer Lingus. The Commission does not prohibit takeovers lightly – indeed this is only the second time since I became Competition Commissioner in November 2004. But in this case, the Commission had no alternative……………

Neelie Kroes European Commissioner for Competition Policy Press conference on Telefónica decision – introductory remarks Brussels, 4^th July 2007 Today the European Commission has fined Telefónica 151,875,000 euros for impeding competition on the Spanish broadband internet access market for more than five years, and so depriving consumers and business of a choice of broadband suppliers. In particular, Telefónica has committed a very serious abuse of its dominant position on the Spanish broadband market…………..

State aid: latest Scoreboard analyses harm done by illegal aid Brussels, 28^th June 2007 The spring 2007 update of the State Aid Scoreboard, just adopted by the European Commission, concludes that illegal state aid is in general much more harmful to competition and trade than notified aid. The analysis is based on some 600 Commission decisions on illegal state aid adopted during the past seven years. Illegal aid is aid which has been implemented in a Member State without prior notification to the Commission or before a Commission decision has been taken. The Scoreboard shows that illegal aid is a particular problem in the large Member States (France, Germany, Italy, Spain and the UK account for 73% of the illegal aid cases) and in the industry and services sectors. The Scoreboard also indicates that the amount of incompatible aid effectively recovered has increased significantly in recent years although further efforts are required to ensure more immediate and effective execution of recovery decisions.

Sources: www.europa.eu

Just 3 examples of cases/issues in EU competition policy. Other quite spectacular cases were (are) the Microsoft case and the case in which VW was fined for restrictive practices when introducing the Passat on various European markets.

For Telefonica and Ryanair the case is not over and lost yet, since an appeal can be successful, as the French companies Legrand and Schneider and the British travel companies Airtours and First Choice proved.

Decisions like these will certainly fuel the dispute raised in recent years in which people question the economic (regarding the proof of a dominant position) and juridical base (especially regarding the role of the Commission) of EU’s competition policy. Nevertheless, the EU is convinced that having an internal market policy without a strong competition policy doesn’t make sense.

Task 8: Mergers & Acquisitions I

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