European Business Law, the fourth volume in our series, shows how the European authorities simultaneously abolish all restrictions on access to and exercise of economic activities and support the growth of domestic markets, through the harmonization the internal legislation or the enactment of genuinely unified regulations.

European Business Law

Article 288 TFEU only addresses the effect of European acts and contains no provision relating to agreements entered into by the Union with non-member States. According to the ECJ , the direct application of an international agreement entered into by the Union with a non-member country depends on its wording, purpose and nature. The provision must contain clear and precise obligations which are not subject, in their implementation or effects, to the adoption of any subsequent measure . By contrast, the provisions of a general character or setting forth a program, which do not in themselves establish precise rules for the purposes of attaining an objective, do not produce any direct effect . A standstill clause, which lays down clearly, precisely and unconditionally an obligation imposed on the Member States to refrain from taking an action, creates rights for individuals who may rely upon it before the national courts to prevent the application of inconsistent rules of national law . The fact that there is imbalance of obligations between the Member States who are parties to an agreement  or that strictly defined reserves are expressed  is irrelevant. The direct effect is recognized under the same conditions for measures adopted by institutions set up by these agreements .

The European court has therefore established the direct effect of provisions relating to the control of movement certificates for certain types of goods  or an unconditional rule against discrimination in matters of taxation , as well as the ban on discrimination based on nationality against migrant workers from non-member States employed in the territory of the host Member State as regards working conditions and remuneration  or social security . 

Agreements such as the GATT  or the WTO, and their annexes , which reserve a significant part for negotiation between the parties, are not capable of conferring rights on citizen which they can invoke before the courts. They cannot produce any direct effect by reason of the significant flexibility of their provisions in terms of the possibilities for derogation, the measures to be taken when confronted with exceptional difficulties and the settlement of conflicts between the contracting parties. Where the obligations arising out of those agreements are not unconditional, the legality of a European act can only be reviewed by the Court with regard to those rules in the event that the Union plans to implement a particular obligation assumed in the context of the GATT or when the act expressly refers to the precise conditions thereof . However, the WTO agreement was entered into by the Union and all its Member States by virtue of a shared competence. The provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs), as set out in the annexes of the WTO agreement, form an integral part of the European legal system . The national court must adopt as far as possible an interpretation complying with the provisions of the TRIPs agreement where it finds that a European regulation exists in the field concerned without however recognizing direct effect for the provision in question in that agreement . After finding that, in the absence of European regulation, European law neither requires nor forbids the legal order of a Member State to accord to individuals the right to rely directly on a rule laid down in the TRIPs agreement or to oblige the court to apply that rule of its own motion , the Court of Justice reaffirmed that those provisions, which do not have direct effect under EU law, are not such as to create rights upon which individuals may rely directly before their national courts .

Case 12/86 Demirel v Stadt Schwäbisch Gmünd [1987] ECR 3719, LawLex200900001511JBJ; C-213/03 Pêcheurs de l'étang de Berre [2004] ECR I-7357, LawLex200900001206JBJ; C-16/05 Tum and Dari [2007] ECR I-7415, LawLex200900000631JBJ.

Case C-432/92 The Queen v Minister of Agriculture, Fisheries and Food, ex parte Anastasiou [1994] ECR I-3087, LawLex200900000800JBJ.

Cooperation agreement between the EU and Morocco, Case C-18/90 Office national de l'emploi v Kziber [1991] ECR I-199, LawLex201100000267JBJ; C-126/95 Hallouzi-Choho v Bestuur van de Sociale Verzekeringsbank [1996] ECR I-4807, LawLex200900000465JBJ; EEC/Algeria cooperation agreement, C-113/97 Babahenini v Belgian State [1998] ECR I-183, LawLex200900000377JBJ; C-103/94 Krid v Caisse nationale d'assurance vieillesse des travailleurs salariés [1995] ECR I-719, LawLex200900000319JBJ.

Case 21/72 International Fruit Company and others v Produktschap voor Groenten en Fruit [1972] ECR 1219, LawLex200900001659JBJ; 9/73 Schlüter v Hauptzollamt Lörrach [1973] ECR 1135, LawLex200900001959JBJ; C-469/93 Amministrazione delle finanze dello Stato v Chiquita Italia [1995] ECR I-4533, LawLex200900000965JBJ.

Case C-149/96 Portugal v Council [1999] ECR I-8395, LawLex200700001795JBJ; T-18/99 Cordis v Commission [2001] ECR II-913, LawLex200900001285JBJ and T-52/99 T. Port v Commission [2001] ECR II-981, LawLex200900001380JBJ.

Case C-280/93 Germany v Council [1994] ECR I-4973; 70/87 Fediol v Commission [1989] ECR 1781; C-69/89 Nakajima v Council [1991] ECR I-2069, LawLex200900001097JBJ.

Case C-344/04 IATA and ELFAA [2006] ECR I-403, Rec. I-403; C-459/03 Commission v Ireland [2006] ECR I-4635.

Case C-300/98 Dior and others [2000] ECR I-11307, LawLex200700001624JBJ; Case C-238/06 P Develey v OHIM [2007] ECR I-9375, LawLex200900000841JBJ.

Case C-431/05 Merck Genéricos Produtos Farmacêuticos [2007] ECR I-7001, LawLex200900000795JBJ.

Case C-135/10 Società Consortile Fonografici (SCF), Judgment of 15 March 2012, LawLex201200000629JBJ.

Case C-37/98 Savas [2000] ECR I-2927, LawLex200700001590JBJ, The provisions of Article 13 of the association agreement between the EU and Turkey do not have any direct effect where they do no more than lay down in general terms, with reference to the corresponding provisions of the TFEU, the principle of eliminating restrictions on the freedom of establishment between the contracting parties. Provisions requiring that the contracting parties are to refrain from any measures liable to jeopardize the attainment of the objectives of the agreement, are not likely to directly confer rights on individuals which may be relied on before the national courts, such as the right to family reunification, Case 12/86 Demirel v Stadt Schwäbisch Gmünd [1987] ECR 3719, LawLex200900001511JBJ; C-213/03, Pêcheurs de l'étang de Berre [2004] ECR I-7357, LawLex200900001206JBJ; C-16/05 Tum and Dari [2007] ECR I-7415, LawLex200900000631JBJ.

Case C-37/98 Savas [2000] ECR I-2927, LawLex200700001590JBJ; C-317/01 Abatay and others [2003] ECR I-12301, LawLex200900000551JBJ; C-16/05.

Case 87/75 Bresciani v Amministrazione delle finanze dello Stato [1976] ECR 129, LawLex200900001977JBJ: Since association agreements entered into by the Union are not concluded in order to ensure equality in the obligations which the Union assumes with regard to the associated States, but in order to promote their development, the imbalance between their respective obligations does not prevent recognition that the provisions of an agreement have a direct effect; See also, for some provisions of the Fourth ACP-EEC Convention, C-469/93 Amministrazione delle finanze dello Stato v Chiquita Italia [1995] ECR I-4533, LawLex200900000965JBJ.

Case C-18/90 Office national de l'emploi v Kziber [1991] ECR I-199, LawLex200400003365JBJ 

See regarding a decision from the Association Council instituted by the EEC/Turkey association agreement which prohibits the Member States from discriminating, on the basis of nationality, against Turkish migrant workers as regards remuneration and other conditions of work, Case C-192/89 Sevince v Staatssecretaris van Justitie [1990] ECR I-3461, LawLex200400002994JBJ; C-171/01 Wählergruppe Gemeinsam [2003] ECR I-4301, LawLex200900000711JBJ; C-262/96 Sürül [1999] ECR I-2685, LawLex200700001892JBJ; C-63/99 Gloszczuk [2001] ECR I-6369, LawLex200900001089JBJ: regarding the clear and unconditional provisions of the EU/Poland association agreement.

Protocol to the Association Agreement between the EU and Cyprus, Case C-432/92 The Queen v Minister of Agriculture, Fisheries and Food, ex parte Anastasiou [1994] ECR I-3087, LawLex200900000800JBJ.

Free-trade agreement between the EU and Portugal, Case 104/81 Hauptzollamt Mainz v Kupferberg & Cie [1982] ECR 3641, LawLex200900001455JBJ.

Cooperation agreement between the EU and Morocco, Case C-416/96 Eddline El-Yassini [1999] ECR I-1209, LawLex200900000765JBJ.

181. International conventions