What, if anything, has been said about the minor amendments in Article 124 of the Treaty on the Functioning of the European Union (TFEU)?
***
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.4: Revised text of Part Three, Titles VII to XVII of the Treaty establishing the European Community (TEC): Other internal EC policies’ (Version 2, 24 October 2007) includes the current Title VII Economic and monetary policy.
Peers presented the text of Article 102 TFEU (ToL), to be renumbered Article 122 TFEU in the consolidated version, and highlighted the changes, except the expanded Union ‘institutions, bodies, offices or agencies’. He offered the following comment (page 7):
“The legal base in paragraph 2 has been moved to Article 103(2), with amendments.”
The analysis 3.4 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 124 TFEU, Article 102 TFEU (ToL) in the original Lisbon Treaty (page 12):
“In substance the same as Article 102 TEC, but now includes a reference to agencies. Outdated paragraph 2 is deleted.”
[Nit-picking: Both ‘offices’ and ‘agencies’ are new. The ‘deleted’ paragraph 2 reappears in the following Article, with amendments.]
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed ‘H. Economic and Monetary Policy’ on pages 61 to 64, but I found nothing on Article 102 TFEU (ToL).
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is refreshing in that it evaluates amendments and evidence given, but nothing seems to have been said about Article 102 TFEU (ToL).
The impact assessment report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
The following post is going to present additional legislative materials on Article 124 TFEU.
Ralf Grahn
Showing posts with label prohibition. Show all posts
Showing posts with label prohibition. Show all posts
Wednesday, 1 October 2008
Thursday, 5 June 2008
EU TFEU: Prohibited tax subsidies on exported goods
Article 110 of the Treaty on the Functioning of the European Union (TFEU) prohibits tax discrimination against products from other member states, and Article 111 offers a mirror view in that it forbids direct or indirect tax subsidies on products exported to another member state.
These rules apply within the internal market, but not in relation to third countries.
We look at the prohibition on tax subsidies for exports in the light of the EU Treaty of Lisbon.
***
Article 111 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 111 TFEU
(ex Article 91 TEC)
Where products are exported to the territory of any Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 91 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 91 TEC first became Article 91 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 111 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 91 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
No specific amendment and no horizontal amendment; the wording of Article 91 TEC is exactly the same as Article 111 TFEU.
***
We have now seen that 91 TEC in force and 111 TFUE are exactly the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-60 of the draft Treaty establishing a Constitution for Europe reworded Article 91 TEC slightly, without altering the substance (OJ 18.7.2003 C 169/37):
Article III-60 Draft Constitution
Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
The IGC 2004 created Article III-170 with three paragraphs by housing Articles III-59, III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38).
Article III-170(2) of the Constitutional Treaty was exactly the same as Article III-60 of the draft Constitution:
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about Article 111 TFEU, unchanged from the current Article 91 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 91 TEC and TFEU (ToL), to be renumbered Article 111 TFEU in the consolidated version, without comment (page 28).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 111 TFEU, Article 91 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 91 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Having found at least a general comment in English, we gratefully reproduce the text on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 111 TFEU (Article 91 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Provisions on taxes and charges (Veroja ja maksuja koskevat määräykset), offers a brief statement on the unchanged nature of Article 91 TFEU (ToL), renumbered Article 111 TFEU (page 208):
”91 artiklaa (uusi 111 artikla), jonka mukaan tuotteita toisen jäsenvaltion alueelle vietäessä sisäisten maksujen palautus ei saa olla sisäisesti perittyjä maksuja suurempi, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Bestämmelser om skatter och avgifter’ on the unchanged nature of Article 91 TFEU (ToL), the future Article 111 TFEU, on page 211:
”Artikel 91 (blivande artikel 111), enligt vilken återbetalning av interna avgifter för varor som exporteras till någon annan medlemsstats territorium inte får ske med belopp som överstiger de interna avgifterna, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
These rules apply within the internal market, but not in relation to third countries.
We look at the prohibition on tax subsidies for exports in the light of the EU Treaty of Lisbon.
***
Article 111 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 111 TFEU
(ex Article 91 TEC)
Where products are exported to the territory of any Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 91 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 91 TEC first became Article 91 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 111 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 91 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
No specific amendment and no horizontal amendment; the wording of Article 91 TEC is exactly the same as Article 111 TFEU.
***
We have now seen that 91 TEC in force and 111 TFUE are exactly the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-60 of the draft Treaty establishing a Constitution for Europe reworded Article 91 TEC slightly, without altering the substance (OJ 18.7.2003 C 169/37):
Article III-60 Draft Constitution
Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
The IGC 2004 created Article III-170 with three paragraphs by housing Articles III-59, III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38).
Article III-170(2) of the Constitutional Treaty was exactly the same as Article III-60 of the draft Constitution:
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about Article 111 TFEU, unchanged from the current Article 91 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 91 TEC and TFEU (ToL), to be renumbered Article 111 TFEU in the consolidated version, without comment (page 28).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 111 TFEU, Article 91 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 91 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Having found at least a general comment in English, we gratefully reproduce the text on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 111 TFEU (Article 91 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Provisions on taxes and charges (Veroja ja maksuja koskevat määräykset), offers a brief statement on the unchanged nature of Article 91 TFEU (ToL), renumbered Article 111 TFEU (page 208):
”91 artiklaa (uusi 111 artikla), jonka mukaan tuotteita toisen jäsenvaltion alueelle vietäessä sisäisten maksujen palautus ei saa olla sisäisesti perittyjä maksuja suurempi, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Bestämmelser om skatter och avgifter’ on the unchanged nature of Article 91 TFEU (ToL), the future Article 111 TFEU, on page 211:
”Artikel 91 (blivande artikel 111), enligt vilken återbetalning av interna avgifter för varor som exporteras till någon annan medlemsstats territorium inte får ske med belopp som överstiger de interna avgifterna, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
Wednesday, 4 June 2008
EU TFEU: Tax provisions
The EU Treaty of Lisbon leaves the tax provisions (fiscal provisions) of the current Treaty establishing the European Community essentially unchanged.
Article 110 of the Treaty on the Functioning of the European Union prohibits tax discrimination within the internal market and imposes a requirement of neutrality on the member states’ governments.
***
Article 110 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 110 TFEU
(ex Article 90 TEC)
No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 90 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 90 TEC first became Article 90 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 110 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 90 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/78).
No specific amendment and no horizontal amendment; the wording of Article 90 TEC is exactly the same as Article 110 TFEU.
***
We have now seen that 90 TEC in force and 110 TFUE are exactly the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-59 of the draft Treaty establishing a Constitution for Europe was exactly the same as Article 90 TEC (OJ 18.7.2003 C 169/37).
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Even if the first paragraph of Article III-170 was the same as Article III-59 proposed by the European Convention, the IGC 2004 created an Article with three paragraphs by housing Articles III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38):
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about the unchanged Article 110 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 90 TEC and TFEU (ToL), to be renumbered Article 110 TFEU in the consolidated version, without comment (page 28).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 110 TFEU, Article 90 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 90 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Because this blog post is an introduction to the tax provisions, we reproduce the comments on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 110 TFEU (Article 90 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), offers an introductury comment on taxes and charges (Veroja ja maksuja koskevat määräykset) and a brief statement on the unchanged nature of Article 90 TFEU (ToL), renumbered Article 110 TFEU (page 208):
”Määräykset koskevat veroihin ja maksuihin sovellettavia pääperiaatteita sekä neuvoston toimivaltaa niiden osalta ja ne vastaavat määräysten sanamuodon teknisiä tarkistuksia lukuun ottamatta pääasiallisesti nykyisen EYsopimuksen kolmannen osan VI osaston 2 luvun määräyksiä samoin kuin perustuslakisopimuksen III-171 ja III-172 artiklan määräyksiä.
90 artiklaa (uusi 110 artikla), joka kieltää jäsenvaltioita määräämästä muiden jäsenvaltioiden tuotteille korkeampia välillisiä tai välittömiä sisäisiä maksuja kuin kotimaisille tuotteille, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), presents the same introductory remark on fiscal provisions under ’Bestämmelser om skatter och avgifter’ and the comment on the unchanged nature of Article 90 TFEU (ToL), the future Article 110 TFEU, on page 211:
”Bestämmelserna gäller de huvudprinciper som ska tillämpas på skatter och avgifter samt rådets befogenheter i fråga om dem och de motsvarar de tekniska anpassningarna av bestämmelsernas ordalydelse med undantag i huvudsak för bestämmelserna i avdelning VI kapitel 2 i det nuvarande EG-fördragets tredje del liksom även bestämmelserna i artiklarna III-171 och III-172 i det konstitutionella fördraget.
Artikel 90 (blivande artikel 110), som förbjuder medlemsstaterna att direkt eller indirekt på varor från andra medlemsstater lägga interna skatter eller avgifter som är högre än de skatter eller avgifter som direkt eller indirekt läggs på liknande inhemska varor, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
Article 110 of the Treaty on the Functioning of the European Union prohibits tax discrimination within the internal market and imposes a requirement of neutrality on the member states’ governments.
***
Article 110 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 110 TFEU
(ex Article 90 TEC)
No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 90 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 90 TEC first became Article 90 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 110 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 90 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/78).
No specific amendment and no horizontal amendment; the wording of Article 90 TEC is exactly the same as Article 110 TFEU.
***
We have now seen that 90 TEC in force and 110 TFUE are exactly the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-59 of the draft Treaty establishing a Constitution for Europe was exactly the same as Article 90 TEC (OJ 18.7.2003 C 169/37).
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Even if the first paragraph of Article III-170 was the same as Article III-59 proposed by the European Convention, the IGC 2004 created an Article with three paragraphs by housing Articles III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38):
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about the unchanged Article 110 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 90 TEC and TFEU (ToL), to be renumbered Article 110 TFEU in the consolidated version, without comment (page 28).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 110 TFEU, Article 90 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 90 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Because this blog post is an introduction to the tax provisions, we reproduce the comments on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 110 TFEU (Article 90 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), offers an introductury comment on taxes and charges (Veroja ja maksuja koskevat määräykset) and a brief statement on the unchanged nature of Article 90 TFEU (ToL), renumbered Article 110 TFEU (page 208):
”Määräykset koskevat veroihin ja maksuihin sovellettavia pääperiaatteita sekä neuvoston toimivaltaa niiden osalta ja ne vastaavat määräysten sanamuodon teknisiä tarkistuksia lukuun ottamatta pääasiallisesti nykyisen EYsopimuksen kolmannen osan VI osaston 2 luvun määräyksiä samoin kuin perustuslakisopimuksen III-171 ja III-172 artiklan määräyksiä.
90 artiklaa (uusi 110 artikla), joka kieltää jäsenvaltioita määräämästä muiden jäsenvaltioiden tuotteille korkeampia välillisiä tai välittömiä sisäisiä maksuja kuin kotimaisille tuotteille, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), presents the same introductory remark on fiscal provisions under ’Bestämmelser om skatter och avgifter’ and the comment on the unchanged nature of Article 90 TFEU (ToL), the future Article 110 TFEU, on page 211:
”Bestämmelserna gäller de huvudprinciper som ska tillämpas på skatter och avgifter samt rådets befogenheter i fråga om dem och de motsvarar de tekniska anpassningarna av bestämmelsernas ordalydelse med undantag i huvudsak för bestämmelserna i avdelning VI kapitel 2 i det nuvarande EG-fördragets tredje del liksom även bestämmelserna i artiklarna III-171 och III-172 i det konstitutionella fördraget.
Artikel 90 (blivande artikel 110), som förbjuder medlemsstaterna att direkt eller indirekt på varor från andra medlemsstater lägga interna skatter eller avgifter som är högre än de skatter eller avgifter som direkt eller indirekt läggs på liknande inhemska varor, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
Tuesday, 20 May 2008
EU TFEU: Transport non-discrimination and direct effect
What’s in a name? When discrimination ‘shall be abolished’ is replaced by ‘shall be prohibited’ in the Treaty of Lisbon, non-discrimination and direct effect appear in a new light.
***
Article 95 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/86:
Part Three ‘Policies and internal actions of the Union’
Title VI TFEU ‘Transport’
Article 95 TFEU
(ex Article 75 TEC)
1. In the case of transport within the Union, discrimination which takes the form of carriers charging different rates and imposing different conditions for the carriage of the same goods over the same transport links on grounds of the country of origin or of destination of the goods in question shall be prohibited.
2. Paragraph 1 shall not prevent the European Parliament and the Council from adopting other measures pursuant to Article 91(1).
3. The Council shall, on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, lay down rules for implementing the provisions of paragraph 1.
The Council may in particular lay down the provisions needed to enable the institutions of the Union to secure compliance with the rule laid down in paragraph 1 and to ensure that users benefit from it to the full.
4. The Commission shall, acting on its own initiative or on application by a Member State, investigate any cases of discrimination falling within paragraph 1 and, after consulting any Member State concerned, shall take the necessary decisions within the framework of the rules laid down in accordance with the provisions of paragraph 3.
***
In Article 2, point 72 of the Treaty of Lisbon (ToL) the intergovernmental conference (IGC 2007) laid out the specific amendments to Article 75 TEC (OJ 17.12.2007 C 306/68):
72) Article 75 shall be amended as follows:
(a) in paragraph 1, the words ‘shall be abolished’ shall be replaced by ‘shall be prohibited’;
(b) in paragraph 2, the words ‘the Council’ shall be replaced by ‘the European Parliament and
the Council’;
(c) in the first subparagraph of paragraph 3, the words ‘the Economic and Social Committee’
shall be replaced by ‘the European Parliament and the Economic and Social Committee’.
***
The TFEU table of equivalences tells us that Article 75 TEC first became Article 75 TFEU (ToL), but later renumbered Article 95 TFEU in the consolidated version (OJ 17.12.2007 C 306/210).
***
The current Article 75 of the Treaty establishing the European Community (TEC) is found under Title V ‘Transport’ in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/71–72):
Article 75 TEC
1. In the case of transport within the Community, discrimination which takes the form of carriers charging different rates and imposing different conditions for the carriage of the same goods over the same transport links on grounds of the country of origin or of destination of the goods in question shall be abolished.
2. Paragraph 1 shall not prevent the Council from adopting other measures pursuant to Article 71(1).
3. The Council shall, acting by a qualified majority on a proposal from the Commission and after consulting the Economic and Social Committee, lay down rules for implementing the provisions of paragraph 1.
The Council may in particular lay down the provisions needed to enable the institutions of the Community to secure compliance with the rule laid down in paragraph 1 and to ensure that users benefit from it to the full.
4. The Commission shall, acting on its own initiative or on application by a Member State, investigate any cases of discrimination falling within paragraph 1 and, after consulting any Member State concerned, shall take the necessary decisions within the framework of the rules laid down in accordance with the provisions of paragraph 3.
***
We look at the previous stages of the treaty reform process. First, the European Convention.
According to Article III-138 of the draft Treaty establishing a Constitution for Europe, in addition to minor amendments, the cases of discrimination mentioned shall be ‘prohibited’ instead of ‘abolished’ as in the current Article 75 TEC (OJ 18.7.2003 C 169/54):
Article III-138 Draft Constitution
1. In the case of transport within the Union, discrimination which takes the form of carriers charging different rates and imposing different conditions for the carriage of the same goods over the same transport links on grounds of the Member State of origin or of destination of the goods in question shall be prohibited.
2. Paragraph 1 shall not prevent the adoption of other European laws or framework laws pursuant to the first paragraph of Article III-134.
3. The Council of Ministers, on a proposal from the Commission, shall adopt European regulations or decisions for implementing paragraph 1. It shall act after consulting the European Parliament and the Economic and Social Committee.
The Council of Ministers may in particular adopt the European regulations and decisions needed to enable the institutions to secure compliance with the rule laid down in paragraph 1 and to ensure that users benefit from it to the full.
4. The Commission, acting on its own initiative or on application by a Member State, shall investigate any cases of discrimination falling within paragraph 1 and, after consulting any Member State concerned, adopt the necessary European decisions within the framework of the European regulations and decisions referred to in paragraph 3.
***
Article III-240 of the Treaty establishing a Constitution for Europe adopted the text of the European Convention with only some terminological change (OJ 16.12.2004 C 310/106–107).
***
The current Article 75 TEC depends on implementing measures to abolish discrimination with regard to carriers charging different rates and imposing different conditions for the carriage of the same goods over the same transport links on grounds of the country of origin or of destination of the goods. As such, Article 75 TEC is not directly applicable.
The Treaty of Lisbon (TFEU) has taken over the prohibition concerning discriminatory transport practices, proposed by the European Convention. A prohibition can be applied directly, without the need for implementing rules.
On the other hand, given the general ban on ‘any discrimination on grounds of nationality’ in Article 18 TFEU (currently Article 12 TEC), what is the scope for the special prohibition in the area of transport policy and with regard to certain forms of discrimination?
***
We now check our preliminary conclusions against how others who have scrutinised the Lisbon Treaty have informed ratifying parliaments and the public.
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title V Transport.
Peers highlighted the differences between the current Article 75 TEC, the Constitutional Treaty and the Lisbon Treaty, but found no need to comment on Article 75 TFEU (ToL), to be renumbered Article 95 TFEU in the consolidated version (page 21–22).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). The comment on Article 95 TFEU, Article 75 TFEU (ToL) in the original Lisbon Treaty, focuses of the requirement to consult the European Parliament (page 11):
“In substance the same as Article 75 TEC, with a new requirement to consult the EP.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) wrapped up Transport in a brief comment on page 56:
“F. Transport
Title V, Articles 70-80 (Constitution Articles III-236 – 245) are on transport and are based largely on Articles 70 – 75 TEC, but with a change in the voting procedure to the OLP with QMV, except for Article 72, which replaces unanimity in the Constitution Article III-237 with a “special legislative procedure”. Other, minor, changes are Article 75(c), which adds the EP to those bodies to be consulted, and Article 78 (Constitution Article III-243), allowing the Article concerning German unification to be repealed after 5 years.
Present Articles 154 – 156 on Trans-European Networks (TENS) have been moved to Title VII and contain only minor amendments.”
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) made no explicit reference to Article 95 TFEU.
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper of the government of Sweden, ‘Lissabonfördraget; Statsrådsberedningen, Departementsserien (Ds), Ds 2007:48’ published 20 December 2007, bundled together transport and trans-European networks under the headline ‘Transporter och transeuropeiska nät’ (page 280 to 282).
The text offers an overview of the coming Title VI ‘Transport’. Without mentioning Article 75 TFEU (ToL), the future Article 95 TFEU, the consultation paper describes the current rules to abolish discrimination on page 281 and mentions the change that the European Parliament has to be consulted according to Article 75(3) TFEU (ToL):
“Beslutsförfarandet för att genomföra avskaffande av diskriminering vid transporter inom gemenskapen ändras på så sätt att Europaparlamentet ska höras innan rådet fattar beslut med kvalificerad majoritet (artikel 75.3 i EUF-fördraget).”
The consultation paper ’Lissabonfördraget’ is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
***
Finland
The systematic Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), explains the amendments to Article 75 TFEU (ToL), renumbered Article 95 TFEU, although it does not draw any connclusions from the difference between measures to abolish discrimination and an outright prohibition (page 206):
”75 artiklaa (uusi 95 artikla), joka koskee syrjintää yhteisön sisäisessä liikenteessä tavaroiden alkuperä- tai määrämaan perusteella, muutetaan siten, että syrjinnän poistamisen sijasta käytetään ilmaisua ”Unionin sisäisessä liikenteessä on kiellettyä”.
SEUT 75 artikla vastaa pääosin perustuslakisopimuksen III-240 artiklaa. Perustuslakisopimuksen III-240 artiklan 1 kohdassa käytetään kuitenkin ilmaisun ”tavaroiden alkuperä- tai määrämaa” sijasta ilmaisua ”tavaroiden alkuperä- tai määräjäsenvaltio”. Sen lisäksi perustuslakisopimuksen III-240 artiklan 2 ja 3 kohdassa yksilöidään käytettävät säädösinstrumentit.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), offers the same explanation on pages 208–209:
”Artikel 75 (blivande artikel 95), som gäller diskriminering vid transporter inom gemenskapen på grund av godsets ursprungs- eller bestämmelseland, ändras så att man i stället för avskaffandet av diskriminering använder ”vid transporter inom unionen ska all sådan diskriminering vara förbjuden".
Artikel 75 i EUF-fördraget motsvarar i huvudsak artikel III-240 i det konstitutionella fördraget. I artikel III-240.1 i det konstitutionella fördraget används dock uttrycket "godsets ursprungs- eller bestämmelsemedlemsstat” i stället för ”godsets ursprungs- eller bestämmelseland". I artikel III-240.2 och III-240.3 i det konstitutionella fördraget specificeras de rättsaktsinstrument som ska användas.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
The current Article 75 TEC does not, if I understand correctly, have direct effect, since it depends on implementing measures. But the new TFEU 95 prohibition on discrimination should be directly applicable as ‘lex specialis’. In a concrete case the provision’s scope for non-discrimination and direct effect requires study, with the general ban on discrimination based on nationality (18 TFEU, 12 TEC) as a guiding light for interpretation.
Should my reasoning be correct, I am surprised that my sources have paid so little attention to the proposed change.
Ralf Grahn
***
Article 95 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/86:
Part Three ‘Policies and internal actions of the Union’
Title VI TFEU ‘Transport’
Article 95 TFEU
(ex Article 75 TEC)
1. In the case of transport within the Union, discrimination which takes the form of carriers charging different rates and imposing different conditions for the carriage of the same goods over the same transport links on grounds of the country of origin or of destination of the goods in question shall be prohibited.
2. Paragraph 1 shall not prevent the European Parliament and the Council from adopting other measures pursuant to Article 91(1).
3. The Council shall, on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, lay down rules for implementing the provisions of paragraph 1.
The Council may in particular lay down the provisions needed to enable the institutions of the Union to secure compliance with the rule laid down in paragraph 1 and to ensure that users benefit from it to the full.
4. The Commission shall, acting on its own initiative or on application by a Member State, investigate any cases of discrimination falling within paragraph 1 and, after consulting any Member State concerned, shall take the necessary decisions within the framework of the rules laid down in accordance with the provisions of paragraph 3.
***
In Article 2, point 72 of the Treaty of Lisbon (ToL) the intergovernmental conference (IGC 2007) laid out the specific amendments to Article 75 TEC (OJ 17.12.2007 C 306/68):
72) Article 75 shall be amended as follows:
(a) in paragraph 1, the words ‘shall be abolished’ shall be replaced by ‘shall be prohibited’;
(b) in paragraph 2, the words ‘the Council’ shall be replaced by ‘the European Parliament and
the Council’;
(c) in the first subparagraph of paragraph 3, the words ‘the Economic and Social Committee’
shall be replaced by ‘the European Parliament and the Economic and Social Committee’.
***
The TFEU table of equivalences tells us that Article 75 TEC first became Article 75 TFEU (ToL), but later renumbered Article 95 TFEU in the consolidated version (OJ 17.12.2007 C 306/210).
***
The current Article 75 of the Treaty establishing the European Community (TEC) is found under Title V ‘Transport’ in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/71–72):
Article 75 TEC
1. In the case of transport within the Community, discrimination which takes the form of carriers charging different rates and imposing different conditions for the carriage of the same goods over the same transport links on grounds of the country of origin or of destination of the goods in question shall be abolished.
2. Paragraph 1 shall not prevent the Council from adopting other measures pursuant to Article 71(1).
3. The Council shall, acting by a qualified majority on a proposal from the Commission and after consulting the Economic and Social Committee, lay down rules for implementing the provisions of paragraph 1.
The Council may in particular lay down the provisions needed to enable the institutions of the Community to secure compliance with the rule laid down in paragraph 1 and to ensure that users benefit from it to the full.
4. The Commission shall, acting on its own initiative or on application by a Member State, investigate any cases of discrimination falling within paragraph 1 and, after consulting any Member State concerned, shall take the necessary decisions within the framework of the rules laid down in accordance with the provisions of paragraph 3.
***
We look at the previous stages of the treaty reform process. First, the European Convention.
According to Article III-138 of the draft Treaty establishing a Constitution for Europe, in addition to minor amendments, the cases of discrimination mentioned shall be ‘prohibited’ instead of ‘abolished’ as in the current Article 75 TEC (OJ 18.7.2003 C 169/54):
Article III-138 Draft Constitution
1. In the case of transport within the Union, discrimination which takes the form of carriers charging different rates and imposing different conditions for the carriage of the same goods over the same transport links on grounds of the Member State of origin or of destination of the goods in question shall be prohibited.
2. Paragraph 1 shall not prevent the adoption of other European laws or framework laws pursuant to the first paragraph of Article III-134.
3. The Council of Ministers, on a proposal from the Commission, shall adopt European regulations or decisions for implementing paragraph 1. It shall act after consulting the European Parliament and the Economic and Social Committee.
The Council of Ministers may in particular adopt the European regulations and decisions needed to enable the institutions to secure compliance with the rule laid down in paragraph 1 and to ensure that users benefit from it to the full.
4. The Commission, acting on its own initiative or on application by a Member State, shall investigate any cases of discrimination falling within paragraph 1 and, after consulting any Member State concerned, adopt the necessary European decisions within the framework of the European regulations and decisions referred to in paragraph 3.
***
Article III-240 of the Treaty establishing a Constitution for Europe adopted the text of the European Convention with only some terminological change (OJ 16.12.2004 C 310/106–107).
***
The current Article 75 TEC depends on implementing measures to abolish discrimination with regard to carriers charging different rates and imposing different conditions for the carriage of the same goods over the same transport links on grounds of the country of origin or of destination of the goods. As such, Article 75 TEC is not directly applicable.
The Treaty of Lisbon (TFEU) has taken over the prohibition concerning discriminatory transport practices, proposed by the European Convention. A prohibition can be applied directly, without the need for implementing rules.
On the other hand, given the general ban on ‘any discrimination on grounds of nationality’ in Article 18 TFEU (currently Article 12 TEC), what is the scope for the special prohibition in the area of transport policy and with regard to certain forms of discrimination?
***
We now check our preliminary conclusions against how others who have scrutinised the Lisbon Treaty have informed ratifying parliaments and the public.
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title V Transport.
Peers highlighted the differences between the current Article 75 TEC, the Constitutional Treaty and the Lisbon Treaty, but found no need to comment on Article 75 TFEU (ToL), to be renumbered Article 95 TFEU in the consolidated version (page 21–22).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). The comment on Article 95 TFEU, Article 75 TFEU (ToL) in the original Lisbon Treaty, focuses of the requirement to consult the European Parliament (page 11):
“In substance the same as Article 75 TEC, with a new requirement to consult the EP.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) wrapped up Transport in a brief comment on page 56:
“F. Transport
Title V, Articles 70-80 (Constitution Articles III-236 – 245) are on transport and are based largely on Articles 70 – 75 TEC, but with a change in the voting procedure to the OLP with QMV, except for Article 72, which replaces unanimity in the Constitution Article III-237 with a “special legislative procedure”. Other, minor, changes are Article 75(c), which adds the EP to those bodies to be consulted, and Article 78 (Constitution Article III-243), allowing the Article concerning German unification to be repealed after 5 years.
Present Articles 154 – 156 on Trans-European Networks (TENS) have been moved to Title VII and contain only minor amendments.”
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) made no explicit reference to Article 95 TFEU.
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper of the government of Sweden, ‘Lissabonfördraget; Statsrådsberedningen, Departementsserien (Ds), Ds 2007:48’ published 20 December 2007, bundled together transport and trans-European networks under the headline ‘Transporter och transeuropeiska nät’ (page 280 to 282).
The text offers an overview of the coming Title VI ‘Transport’. Without mentioning Article 75 TFEU (ToL), the future Article 95 TFEU, the consultation paper describes the current rules to abolish discrimination on page 281 and mentions the change that the European Parliament has to be consulted according to Article 75(3) TFEU (ToL):
“Beslutsförfarandet för att genomföra avskaffande av diskriminering vid transporter inom gemenskapen ändras på så sätt att Europaparlamentet ska höras innan rådet fattar beslut med kvalificerad majoritet (artikel 75.3 i EUF-fördraget).”
The consultation paper ’Lissabonfördraget’ is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
***
Finland
The systematic Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), explains the amendments to Article 75 TFEU (ToL), renumbered Article 95 TFEU, although it does not draw any connclusions from the difference between measures to abolish discrimination and an outright prohibition (page 206):
”75 artiklaa (uusi 95 artikla), joka koskee syrjintää yhteisön sisäisessä liikenteessä tavaroiden alkuperä- tai määrämaan perusteella, muutetaan siten, että syrjinnän poistamisen sijasta käytetään ilmaisua ”Unionin sisäisessä liikenteessä on kiellettyä”.
SEUT 75 artikla vastaa pääosin perustuslakisopimuksen III-240 artiklaa. Perustuslakisopimuksen III-240 artiklan 1 kohdassa käytetään kuitenkin ilmaisun ”tavaroiden alkuperä- tai määrämaa” sijasta ilmaisua ”tavaroiden alkuperä- tai määräjäsenvaltio”. Sen lisäksi perustuslakisopimuksen III-240 artiklan 2 ja 3 kohdassa yksilöidään käytettävät säädösinstrumentit.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), offers the same explanation on pages 208–209:
”Artikel 75 (blivande artikel 95), som gäller diskriminering vid transporter inom gemenskapen på grund av godsets ursprungs- eller bestämmelseland, ändras så att man i stället för avskaffandet av diskriminering använder ”vid transporter inom unionen ska all sådan diskriminering vara förbjuden".
Artikel 75 i EUF-fördraget motsvarar i huvudsak artikel III-240 i det konstitutionella fördraget. I artikel III-240.1 i det konstitutionella fördraget används dock uttrycket "godsets ursprungs- eller bestämmelsemedlemsstat” i stället för ”godsets ursprungs- eller bestämmelseland". I artikel III-240.2 och III-240.3 i det konstitutionella fördraget specificeras de rättsaktsinstrument som ska användas.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
The current Article 75 TEC does not, if I understand correctly, have direct effect, since it depends on implementing measures. But the new TFEU 95 prohibition on discrimination should be directly applicable as ‘lex specialis’. In a concrete case the provision’s scope for non-discrimination and direct effect requires study, with the general ban on discrimination based on nationality (18 TFEU, 12 TEC) as a guiding light for interpretation.
Should my reasoning be correct, I am surprised that my sources have paid so little attention to the proposed change.
Ralf Grahn
Friday, 18 April 2008
EU TFEU: Free movement of capital
The current Treaty establishing the European Community as well as the Treaty on the Functioning of the European Union (following from the Treaty of Lisbon) prohibit restrictions on the movement of capital and on payments between member states as well as between member states and third countries.
***
We move to a Chapter 4 ‘Capital and payments’. Article 63 of the Treaty on the Functioning of the European Union (TFEU), is presented as amended by the intergovernmental conference (IGC 2007) in the Treaty of Lisbon (ToL) and provisionally consolidated by the Council of the European Union (document 6655/08; page 93), with the location of the provision added from the table of equivalences (page 460 to 462):
Part Three ‘Policies and internal actions of the Union’
Title IV TFEU ‘Free movement of persons, services and capital’
Chapter 4 ‘Capital and payments’
Article 63 TFEU
(ex Article 56 TEC)
1. Within the framework of the provisions set out in this Chapter, all restrictions on the movement of capital between Member States and between Member States and third countries shall be prohibited.
2. Within the framework of the provisions set out in this Chapter, all restrictions on payments between Member States and between Member States and third countries shall be prohibited.
***
The IGC 2007 made no specific amendment to Article 56 TEC. Cf. OJ 17.12.2007 C 306/55. The provision is only renumbered.
***
The current key provision on capital and payments, Article 56 TEC, is found in the latest consolidated version of the treaties, OJ 29.12.2006 C 321 E/63.
***
The European Convention preferred a shorter version of the opening provision of Section 4 ‘Capital and payments’ in the draft Treaty establishing a Constitution for Europe (OJ 18.7.2003 C 169/34):
SECTION 4
Capital and payments
Article III-45 Draft Constitution
Within the framework of this Section, restrictions both on the movement of capital and on payments between Member States and between Member States and third countries shall be prohibited.
***
The IGC 2004 adopted the wording of the draft in Article III-156 of the Treaty establishing a Constitution for Europe (OJ 16.12.2004 C 310/66).
***
We see that no substantial change has been adopted during the various stages of the treaty reform process after the Treaty of Nice, but the wording proposed by the European Convention and agreed by the IGC 2004 would arguably have been more elegant.
In this, as in many other cases, the IGC 2007 decided to save ink by preserving the current wording when the reasons for change would have been purely aesthetic.
***
Some suggestions for further reading, first two standard books:
Josephine Steiner, Lorna Woods and Christian Twigg-Flesner: EU Law (Oxford University Press, Ninth Edition, 2006), Chapter 16 Free movement of payments and capital (pages 344-354)
Paul Craig and Gráinne de Búrca: EU Law, Text, Cases, and Materials (Oxford University Press, Fourth Edition, 2007), page 723 to 727 in Chapter 20 Free movement of capital and economic and monetary union
Then a few web resources:
The Commission’s introductory web page ‘Free movement of capital’ offers a quick overview and additional links (last updated 30 May 2007):
http://ec.europa.eu/internal_market/capital/index_en.htm
The web page ‘Treaty provisions’ presents the basic rules and further links (last update 27 August 2007):
http://ec.europa.eu/internal_market/capital/framework/treaty_en.htm
The European Parliament fact sheet 3.2.4 ‘Free movement of capital’ is an alternative presentation of the basics (last updated 25 October 2006):
http://www.europarl.europa.eu/facts/3_2_4_en.htm
The Commission’s Scadplus pages offer summaries or links to introductory pages on European Community legislation. In this case the starting point could be the web page ‘Single market for capital’ with more than thirty links on different aspects (no date):
http://europa.eu/scadplus/leg/en/s70001.htm
EU Law Blog has three posts on recent ECJ cases archived under ‘Capital: Free movement’:
http://eulaw.typepad.com/eulawblog/free_movement_of_capital/index.html
An example of the Court of Justice’s reasoning about the relationship between the provision of services and free movement of capital is Case C-452/04:
http://curia.europa.eu/jurisp/cgi-bin/gettext.pl?where=&lang=en&num=79938996C19040452&doc=T&ouvert=T&seance=ARRET
Ralf Grahn
***
We move to a Chapter 4 ‘Capital and payments’. Article 63 of the Treaty on the Functioning of the European Union (TFEU), is presented as amended by the intergovernmental conference (IGC 2007) in the Treaty of Lisbon (ToL) and provisionally consolidated by the Council of the European Union (document 6655/08; page 93), with the location of the provision added from the table of equivalences (page 460 to 462):
Part Three ‘Policies and internal actions of the Union’
Title IV TFEU ‘Free movement of persons, services and capital’
Chapter 4 ‘Capital and payments’
Article 63 TFEU
(ex Article 56 TEC)
1. Within the framework of the provisions set out in this Chapter, all restrictions on the movement of capital between Member States and between Member States and third countries shall be prohibited.
2. Within the framework of the provisions set out in this Chapter, all restrictions on payments between Member States and between Member States and third countries shall be prohibited.
***
The IGC 2007 made no specific amendment to Article 56 TEC. Cf. OJ 17.12.2007 C 306/55. The provision is only renumbered.
***
The current key provision on capital and payments, Article 56 TEC, is found in the latest consolidated version of the treaties, OJ 29.12.2006 C 321 E/63.
***
The European Convention preferred a shorter version of the opening provision of Section 4 ‘Capital and payments’ in the draft Treaty establishing a Constitution for Europe (OJ 18.7.2003 C 169/34):
SECTION 4
Capital and payments
Article III-45 Draft Constitution
Within the framework of this Section, restrictions both on the movement of capital and on payments between Member States and between Member States and third countries shall be prohibited.
***
The IGC 2004 adopted the wording of the draft in Article III-156 of the Treaty establishing a Constitution for Europe (OJ 16.12.2004 C 310/66).
***
We see that no substantial change has been adopted during the various stages of the treaty reform process after the Treaty of Nice, but the wording proposed by the European Convention and agreed by the IGC 2004 would arguably have been more elegant.
In this, as in many other cases, the IGC 2007 decided to save ink by preserving the current wording when the reasons for change would have been purely aesthetic.
***
Some suggestions for further reading, first two standard books:
Josephine Steiner, Lorna Woods and Christian Twigg-Flesner: EU Law (Oxford University Press, Ninth Edition, 2006), Chapter 16 Free movement of payments and capital (pages 344-354)
Paul Craig and Gráinne de Búrca: EU Law, Text, Cases, and Materials (Oxford University Press, Fourth Edition, 2007), page 723 to 727 in Chapter 20 Free movement of capital and economic and monetary union
Then a few web resources:
The Commission’s introductory web page ‘Free movement of capital’ offers a quick overview and additional links (last updated 30 May 2007):
http://ec.europa.eu/internal_market/capital/index_en.htm
The web page ‘Treaty provisions’ presents the basic rules and further links (last update 27 August 2007):
http://ec.europa.eu/internal_market/capital/framework/treaty_en.htm
The European Parliament fact sheet 3.2.4 ‘Free movement of capital’ is an alternative presentation of the basics (last updated 25 October 2006):
http://www.europarl.europa.eu/facts/3_2_4_en.htm
The Commission’s Scadplus pages offer summaries or links to introductory pages on European Community legislation. In this case the starting point could be the web page ‘Single market for capital’ with more than thirty links on different aspects (no date):
http://europa.eu/scadplus/leg/en/s70001.htm
EU Law Blog has three posts on recent ECJ cases archived under ‘Capital: Free movement’:
http://eulaw.typepad.com/eulawblog/free_movement_of_capital/index.html
An example of the Court of Justice’s reasoning about the relationship between the provision of services and free movement of capital is Case C-452/04:
http://curia.europa.eu/jurisp/cgi-bin/gettext.pl?where=&lang=en&num=79938996C19040452&doc=T&ouvert=T&seance=ARRET
Ralf Grahn
Saturday, 22 March 2008
EU TFEU: Legitimate restrictions on imports and exports
The free movement of goods is a fundamental principle of the internal market of the European Community (European Union). There are, however, other societal values, which call for attention, and they can vary between the member states.
A balance has to be sought between these different values, leaving scope for national sensitivities, but preventing discriminatory use.
***
Since the intergovernmental conference (IGC 2007) had nothing in particular to say about the contents of Article 30 of the Treaty establishing the European Community (TEC), we start by looking up the provision in the latest consolidation of the treaties OJ 29.12.2006 C 321 E/53:
Article 30 TEC
The provisions of Articles 28 and 29 shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of industrial and commercial property. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States.
***
In the Treaty of Lisbon (ToL) Article 30 TEC becomes Article 30 of the Treaty on the Functioning of the European Union (TFEU). In later consolidated versions the provision and the two Articles referred to are renumbered according to the Tables of equivalences referred to in the IGC 2007 Article 5 of the Treaty of Lisbon (OJ 17.12.2007 C 306/207). We indicate the Article numbers and the location of the provision:
Part Three Policies and internal actions of the Union
Title I The internal market
Chapter 2 (renumbered Chapter 3) Prohibition of quantitative restrictions between Member States
Article 30 TFEU (ToL), new numbering Article 36 TFEU
The provisions of Articles 28 [TFEU (ToL), new number Article 34 TFEU] and 29 [TFEU (ToL), renumbered Article 35 TFEU] shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of industrial and commercial property. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States.
***
I routinely check my rendering against Klemens H. Fischer: Der Vertrag von Lissabon, the IIEA: Treaty on the Functioning of the European Union (Consolidated version) and the Statewatch Analysis by Steve Peers. If I find an anomaly, I check again.
***
Because the draft Treaty establishing a Constitution for Europe had only one Article prohibiting quantitative restrictions on both imports and exports, the referral was different, but otherwise the European Convention took over the text of Article 30 TEC word for word in its Article III-43 (OJ 18.7.2003 C 169/34).
The same goes for Article III-154 of the Treaty establishing a Constitution for Europe (OJ 16.12.2004 C 310/66).
***
The grounds for exceptions (derogations) from the free movement of goods may be easier to read if presented in the form of a list:
· Public morality
· Public policy
· Public security
· Protection of health
· Protection of national treasures
· Protection of industrial and commercial property
These are only possible grounds for prohibitions or restrictions on the free movement of goods by the member states.
In order to override the commercial interest of free flow of goods, the exceptions have to be justified on objective grounds. They have to be necessary to achieve the policy aim in question, and they have to be proportional, namely no more disruptive than needed to attain their objective.
The Court of Justice (‘of the European Union’, as it is to be known) is the final arbiter of when restrictive measures are legitimate and when they constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States. Derogations or exceptions are interpreted narrowly.
One example of a national measure on public morality grounds that would fail is a prohibition of imports of pornographic products, if domestic goods of the same kind were allowed.
Ralf Grahn
A balance has to be sought between these different values, leaving scope for national sensitivities, but preventing discriminatory use.
***
Since the intergovernmental conference (IGC 2007) had nothing in particular to say about the contents of Article 30 of the Treaty establishing the European Community (TEC), we start by looking up the provision in the latest consolidation of the treaties OJ 29.12.2006 C 321 E/53:
Article 30 TEC
The provisions of Articles 28 and 29 shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of industrial and commercial property. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States.
***
In the Treaty of Lisbon (ToL) Article 30 TEC becomes Article 30 of the Treaty on the Functioning of the European Union (TFEU). In later consolidated versions the provision and the two Articles referred to are renumbered according to the Tables of equivalences referred to in the IGC 2007 Article 5 of the Treaty of Lisbon (OJ 17.12.2007 C 306/207). We indicate the Article numbers and the location of the provision:
Part Three Policies and internal actions of the Union
Title I The internal market
Chapter 2 (renumbered Chapter 3) Prohibition of quantitative restrictions between Member States
Article 30 TFEU (ToL), new numbering Article 36 TFEU
The provisions of Articles 28 [TFEU (ToL), new number Article 34 TFEU] and 29 [TFEU (ToL), renumbered Article 35 TFEU] shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of industrial and commercial property. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States.
***
I routinely check my rendering against Klemens H. Fischer: Der Vertrag von Lissabon, the IIEA: Treaty on the Functioning of the European Union (Consolidated version) and the Statewatch Analysis by Steve Peers. If I find an anomaly, I check again.
***
Because the draft Treaty establishing a Constitution for Europe had only one Article prohibiting quantitative restrictions on both imports and exports, the referral was different, but otherwise the European Convention took over the text of Article 30 TEC word for word in its Article III-43 (OJ 18.7.2003 C 169/34).
The same goes for Article III-154 of the Treaty establishing a Constitution for Europe (OJ 16.12.2004 C 310/66).
***
The grounds for exceptions (derogations) from the free movement of goods may be easier to read if presented in the form of a list:
· Public morality
· Public policy
· Public security
· Protection of health
· Protection of national treasures
· Protection of industrial and commercial property
These are only possible grounds for prohibitions or restrictions on the free movement of goods by the member states.
In order to override the commercial interest of free flow of goods, the exceptions have to be justified on objective grounds. They have to be necessary to achieve the policy aim in question, and they have to be proportional, namely no more disruptive than needed to attain their objective.
The Court of Justice (‘of the European Union’, as it is to be known) is the final arbiter of when restrictive measures are legitimate and when they constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States. Derogations or exceptions are interpreted narrowly.
One example of a national measure on public morality grounds that would fail is a prohibition of imports of pornographic products, if domestic goods of the same kind were allowed.
Ralf Grahn
Tuesday, 4 March 2008
EU TFEU: Nationality and non-discrimination
The declaration by the French foreign minister Robert Schuman on 9 May 1950 started the ongoing quest to build Europe “through concrete achievements which first create a de facto solidarity”.
Already the Treaty establishing the European Coal and Steel Community (ECSC) prohibited discriminating practices (Article 4).
Since the then Article 7 of the Treaty establishing the European Economic Community (EEC), non-discrimination on the grounds of nationality has been a fundamental principle of the common market, enriched by the landmark decisions of the European Court of Justice.
Today, the prohibition of discrimination on grounds of nationality is found in Article 12 of the Treaty establishing the European Community, but achieving the mindset expressed by ‘de facto solidarity’ is a never ending challenge for both national governments and citizens.
***
We start to look at Part Two of the Treaty establishing the European Community (TEC), renamed the Treaty on the Functioning of the European Union (TFEU). In the Treaty of Lisbon (ToL) the intergovernmental conference (IGC 2007) gave Part Two a new headline: Non-discrimination and citizenship of the Union (adding ‘Non-discrimination and’). See Official Journal (OJ) 17.12.2007 C 306/50:
NON-DISCRIMINATION AND CITIZENSHIP
31) The heading of Part Two shall be replaced by the following heading: ‘NON-DISCRIMINATION AND CITIZENSHIP OF THE UNION’.
32) An Article 16 D shall be inserted, with the wording of Article 12.
***
We are sent scurrying for Article 12 TEC, currently in Part One, Principles. The provision can be found in the latest consolidated version of the present TEU and TEC, in OJ 29.12.2006 C 321 E/48:
Article 12 TEC
Within the scope of application of this Treaty, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.
The Council, acting in accordance with the procedure referred to in Article 251, may adopt rules designed to prohibit such discrimination.
***
After the obligatory horizontal amendments, we have the text of the Lisbon Treaty provision before our eyes:
Part Two – Non-discrimination and citizenship of the Union
Article 16d TFEU (ToL), after renumbering Article 18 TFEU
Within the scope of application of the Treaties, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.
The European Parliament and the Council, acting in accordance with the ordinary legislative procedure, may adopt rules designed to prohibit such discrimination.
***
The European Convention proposed to give the fundamental principle of non-discrimination on grounds of nationality the visibility it deserved by placing the provision in Article I-4(2) of Part I, Title I Definition and objectives of the Union, of the draft Treaty establishing a Constitution for Europe (OJ 18.7.2003 C 169/8):
Article I-4 Draft Constitution
Fundamental freedoms and non-discrimination
1. Free movement of persons, goods, services and capital, and freedom of establishment shall be guaranteed within and by the Union, in accordance with the provisions of the Constitution.
2. In the field of application of the Constitution, and without prejudice to any of its specific provisions, any discrimination on grounds of nationality shall be prohibited.
***
Article III-7 of the draft Constitution contained the basis for legislation (OJ 18.7.2003 C 169/29):
TITLE II
NON-DISCRIMINATION AND CITIZENSHIP
Article III-7 Draft Constitution
European laws or framework laws may lay down rules to prohibit discrimination on grounds of nationality as referred to in Article I-4.
***
The IGC 2004 followed the same approach in the Treaty establishing a Constitution for Europe, where Title I Definition and objectives of the Union, of Part I, contained Article I-4(2) (OJ 16.12.2004 C 310/12):
Article I-4 Constitution
Fundamental freedoms and non-discrimination
1. The free movement of persons, services, goods and capital, and freedom of establishment shall
be guaranteed within and by the Union, in accordance with the Constitution.
2. Within the scope of the Constitution, and without prejudice to any of its specific provisions, any discrimination on grounds of nationality shall be prohibited.
***
The legal basis is found in Article III-123 of the Constitutional Treaty (OJ 16.12.2004 C 310/56):
TITLE II
NON-DISCRIMINATION AND CITIZENSHIP
Article III-123 Constitution
European laws or framework laws may lay down rules to prohibit discrimination on grounds of nationality as referred to in Article I-4(2).
***
A few remarks by your glossator:
The position of the prohibition of discrimination on grounds of nationality may be less dignified in the Lisbon Treaty than in the Constitution, but the fundamental principle is preserved and its scope widens from the ‘Community’ to encompass the treaties as a whole.
Specific provisions against discrimination and the (gradual) establishment of EU citizenship as a fundamental status for equal rights bolster the classical non-discrimination requirement on the basis of nationality.
The ordinary legislative procedure applies, replacing the co-decision procedure (Article 251 TEC), although many problems relate to partial practices rather than lack of legislation.
***
An introduction to the inventiveness concerning discrimination on grounds of nationality is offered, free of charge, by the ECJ’s Digest of case-law (available only in French).
Ralf Grahn
Sources:
Declaration of 9 May 1950 (the Schuman declaration)
http://europa.eu/abc/symbols/9-may/decl_en.htm
European Court of Justice: Répertoire de jurisprudence communautaire (Digest of Community case-law), B – The European Community (EEC/EC), B-01.05 Interdiction de discrimination en raison de la nationalité (Derniére mise à jour au 02/03/2008), 83 summaries
http://curia.europa.eu/common/recdoc/repertoire_jurisp/bull_cee/data/index_B-01_05.htm
Already the Treaty establishing the European Coal and Steel Community (ECSC) prohibited discriminating practices (Article 4).
Since the then Article 7 of the Treaty establishing the European Economic Community (EEC), non-discrimination on the grounds of nationality has been a fundamental principle of the common market, enriched by the landmark decisions of the European Court of Justice.
Today, the prohibition of discrimination on grounds of nationality is found in Article 12 of the Treaty establishing the European Community, but achieving the mindset expressed by ‘de facto solidarity’ is a never ending challenge for both national governments and citizens.
***
We start to look at Part Two of the Treaty establishing the European Community (TEC), renamed the Treaty on the Functioning of the European Union (TFEU). In the Treaty of Lisbon (ToL) the intergovernmental conference (IGC 2007) gave Part Two a new headline: Non-discrimination and citizenship of the Union (adding ‘Non-discrimination and’). See Official Journal (OJ) 17.12.2007 C 306/50:
NON-DISCRIMINATION AND CITIZENSHIP
31) The heading of Part Two shall be replaced by the following heading: ‘NON-DISCRIMINATION AND CITIZENSHIP OF THE UNION’.
32) An Article 16 D shall be inserted, with the wording of Article 12.
***
We are sent scurrying for Article 12 TEC, currently in Part One, Principles. The provision can be found in the latest consolidated version of the present TEU and TEC, in OJ 29.12.2006 C 321 E/48:
Article 12 TEC
Within the scope of application of this Treaty, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.
The Council, acting in accordance with the procedure referred to in Article 251, may adopt rules designed to prohibit such discrimination.
***
After the obligatory horizontal amendments, we have the text of the Lisbon Treaty provision before our eyes:
Part Two – Non-discrimination and citizenship of the Union
Article 16d TFEU (ToL), after renumbering Article 18 TFEU
Within the scope of application of the Treaties, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.
The European Parliament and the Council, acting in accordance with the ordinary legislative procedure, may adopt rules designed to prohibit such discrimination.
***
The European Convention proposed to give the fundamental principle of non-discrimination on grounds of nationality the visibility it deserved by placing the provision in Article I-4(2) of Part I, Title I Definition and objectives of the Union, of the draft Treaty establishing a Constitution for Europe (OJ 18.7.2003 C 169/8):
Article I-4 Draft Constitution
Fundamental freedoms and non-discrimination
1. Free movement of persons, goods, services and capital, and freedom of establishment shall be guaranteed within and by the Union, in accordance with the provisions of the Constitution.
2. In the field of application of the Constitution, and without prejudice to any of its specific provisions, any discrimination on grounds of nationality shall be prohibited.
***
Article III-7 of the draft Constitution contained the basis for legislation (OJ 18.7.2003 C 169/29):
TITLE II
NON-DISCRIMINATION AND CITIZENSHIP
Article III-7 Draft Constitution
European laws or framework laws may lay down rules to prohibit discrimination on grounds of nationality as referred to in Article I-4.
***
The IGC 2004 followed the same approach in the Treaty establishing a Constitution for Europe, where Title I Definition and objectives of the Union, of Part I, contained Article I-4(2) (OJ 16.12.2004 C 310/12):
Article I-4 Constitution
Fundamental freedoms and non-discrimination
1. The free movement of persons, services, goods and capital, and freedom of establishment shall
be guaranteed within and by the Union, in accordance with the Constitution.
2. Within the scope of the Constitution, and without prejudice to any of its specific provisions, any discrimination on grounds of nationality shall be prohibited.
***
The legal basis is found in Article III-123 of the Constitutional Treaty (OJ 16.12.2004 C 310/56):
TITLE II
NON-DISCRIMINATION AND CITIZENSHIP
Article III-123 Constitution
European laws or framework laws may lay down rules to prohibit discrimination on grounds of nationality as referred to in Article I-4(2).
***
A few remarks by your glossator:
The position of the prohibition of discrimination on grounds of nationality may be less dignified in the Lisbon Treaty than in the Constitution, but the fundamental principle is preserved and its scope widens from the ‘Community’ to encompass the treaties as a whole.
Specific provisions against discrimination and the (gradual) establishment of EU citizenship as a fundamental status for equal rights bolster the classical non-discrimination requirement on the basis of nationality.
The ordinary legislative procedure applies, replacing the co-decision procedure (Article 251 TEC), although many problems relate to partial practices rather than lack of legislation.
***
An introduction to the inventiveness concerning discrimination on grounds of nationality is offered, free of charge, by the ECJ’s Digest of case-law (available only in French).
Ralf Grahn
Sources:
Declaration of 9 May 1950 (the Schuman declaration)
http://europa.eu/abc/symbols/9-may/decl_en.htm
European Court of Justice: Répertoire de jurisprudence communautaire (Digest of Community case-law), B – The European Community (EEC/EC), B-01.05 Interdiction de discrimination en raison de la nationalité (Derniére mise à jour au 02/03/2008), 83 summaries
http://curia.europa.eu/common/recdoc/repertoire_jurisp/bull_cee/data/index_B-01_05.htm
Monday, 25 February 2008
EU TFEU: Combating discrimination
The European Union is bound by prohibitions on discrimination and the European Community is allowed action to combat discrimination on various grounds.
The Treaty of Lisbon introduces a horizontal aim to combat discrimination on specific grounds in the policies and activities of the European Union.
***
The intergovernmental conference (IGC 2007) inserted a new provision having general applicability into the Treaty of Lisbon (ToL), more precisely the Treaty establishing the European Community (TEC), renamed the Treaty on the Functioning of the European Union (TFEU). See OJ 17.12.2007 C 306/48:
Article 5b TFEU (ToL), to be renumbered Article 10 TFEU
In defining and implementing its policies and activities, the Union shall aim to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.
***
Reading is fine, but understanding is better. We set out to see the origins of this new transversal provision, by looking first at the Treaty establishing a Constitution for Europe, where Title I Provisions of general application of Part III The policies and functioning of the Union has this to offer (OJ 16.12.2004 C 310/55):
Article III-118 Constitution
In defining and implementing the policies and activities referred to in this Part, the Union shall aim to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.
***
We are able to see that the only difference is of an editorial nature, the substance including the specific grounds for discrimination to combat being identical in the Lisbon Treaty and the Constitution.
***
If we find something in the Constitutional Treaty, there is cause to take a peek at what the European Convention proposed in the draft Treaty establishing a Constitution for Europe. Part III The policies and functioning of the Union, and its Title I Clauses of general application offer us this provision (OJ 18.7.2003 C 169/29):
Article III-3 Draft Constitution
In defining and implementing the policies and activities referred to in this Part, the Union shall aim to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.
***
The draft Constitution and the Constitution are identical in this respect.
***
Article III-3 of the draft Constitution has been described as a new horizontal provision, which would apply to the Constitution and the Lisbon Reform Treaty, as well.
Let us see if there are any points of reference in the current treaties, the TEU and the TEC.
***
One provision to check would seem to be Article 6 TEU, especially paragraph 2 with its reference to the European Convention for the Protection of Human Rights and Fundamental Freedoms (the latest consolidated version of the current TEU and TEC being found in OJ 29.12.2006 C 321 E/1, with Article 6 TEU on page 12):
Article 6 TEU
1. The Union is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law, principles which are common to the Member States.
2. The Union shall respect fundamental rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms signed in Rome on 4 November 1950 and as they result from the constitutional traditions common to the Member States, as general principles of Community law.
3. The Union shall respect the national identities of its Member States.
4. The Union shall provide itself with the means necessary to attain its objectives and carry through its policies.
***
The European Human Rights Convention, consolidated with later amending protocols, can be found on the web pages of the Council of Europe:
http://conventions.coe.int/Treaty/Commun/QueVoulezVous.asp?NT=005&CM=7&DF=2/25/2008&CL=ENG
Our attention turns to Article 14, as amended by Protocol 11:
Article 14 – Prohibition of discrimination
The enjoyment of the rights and freedoms set forth in this Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.
***
On the face of it, most of the specific grounds for prohibited discrimination seem to be shared by the European Human Rights Convention and the Lisbon Treaty, but a more thorough examination would be required to ascertain if, for instance, ‘birth or other status’ have been given the same scope by the European Court of Human Rights as ‘disability, age or sexual orientation’ enumerated in the Treaty of Lisbon.
***
One of the mainstays of the common market has been the prohibition of discrimination on grounds of nationality, to be found in the existing Article 12 TEC (OJ 29.12.2006 C 321 E/48):
Article 12 TEC
Within the scope of application of this Treaty, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.
The Council, acting in accordance with the procedure referred to in Article 251, may adopt rules designed to prohibit such discrimination.
***
We come even closer when we take a look at the specific grounds for discrimination to combat in the current Article 13 TEC:
Article 13 TEC
1. Without prejudice to the other provisions of this Treaty and within the limits of the powers conferred by it upon the Community, the Council, acting unanimously on a proposal from the
Commission and after consulting the European Parliament, may take appropriate action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.
2. By way of derogation from paragraph 1, when the Council adopts Community incentive measures, excluding any harmonisation of the laws and regulations of the Member States, to support action taken by the Member States in order to contribute to the achievement of the objectives referred to in paragraph 1, it shall act in accordance with the procedure referred to in Article 251.
***
The grounds mentioned in Article 13 TEC and Article 5b TFEU (ToL) are identical, and more than a prohibition against discrimination the current treaty envisions active action to combat discrimination.
We are going to leave the question open for now, if the present requirement for unanimity is upheld in the Treaty of Lisbon.
***
The fundamental rights of the citizens of the European Union (or universally), caused a fair amount of commotion among member states’ governments. This warrants a closer look at the Charter of Fundamental Rights and related expressions of concern.
We take note of the fact that the Charter of Fundamental Rights of the European Union includes a prohibition of discrimination, by the EU institutions and the member states when implementing EU law, on various grounds, many of them fairly familiar by now (OJ 14.12.2007 C 303/7):
Article 21 Charter
Non-discrimination
1. Any discrimination based on any ground such as sex, race, colour, ethnic or social origin, genetic features, language, religion or belief, political or any other opinion, membership of a national minority, property, birth, disability, age or sexual orientation shall be prohibited.
2. Within the scope of application of the Treaties and without prejudice to any of their specific provisions, any discrimination on grounds of nationality shall be prohibited.
***
We refer the interested reader to the Explanations relating to the Charter of Fundamental Rights (OJ 14.12.2007 C 303/24):
Explanation on Article 21 — Non-discrimination
Paragraph 1 draws on Article 13 of the EC Treaty, now replaced by Article 19 of the Treaty on the Functioning of the European Union, Article 14 of the ECHR and Article 11 of the Convention on Human Rights and Biomedicine as regards genetic heritage. In so far as this corresponds to Article 14 of the ECHR, it applies in compliance with it.
There is no contradiction or incompatibility between paragraph 1 and Article 19 of the Treaty on the Functioning of the European Union which has a different scope and purpose: Article 19 confers power on the Union to adopt legislative acts, including harmonisation of the Member States' laws and regulations, to combat certain forms of discrimination, listed exhaustively in that Article. Such legislation may cover action of Member State authorities (as well as relations between private individuals) in any area within the limits of the Union's powers. In contrast, the provision in Article 21(1) does not create any power to enact anti-discrimination laws in these areas of Member State or private action, nor does it lay down a sweeping ban of discrimination in such wide-ranging areas. Instead, it only addresses discriminations by the institutions and bodies of the Union themselves, when exercising powers conferred under the Treaties, and by Member States only when they are implementing Union law. Paragraph 1 therefore does not alter the extent of powers granted under Article 19 nor the interpretation given to that Article.
Paragraph 2 corresponds to the first paragraph of Article 18 of the Treaty on the Functioning of the European Union and must be applied in compliance with that Article.
***
Naturally, should we be confronted with a problem pertaining to the Charter, we have to be aware of the Protocol on the application of the Charter of Fundamental Rights of the European Union to Poland and to the United Kingdom, these countries wanting to evade enforceable rights (OJ 17.12.2007 C 306/154-155):
PROTOCOL
ON THE APPLICATION OF THE CHARTER OF FUNDAMENTAL
RIGHTS OF THE EUROPEAN UNION TO POLAND AND TO THE
UNITED KINGDOM
THE HIGH CONTRACTING PARTIES,
WHEREAS in Article 6 of the Treaty on European Union, the Union recognises the rights, freedoms and principles set out in the Charter of Fundamental Rights of the European Union;
WHEREAS the Charter is to be applied in strict accordance with the provisions of the aforementioned Article 6 and Title VII of the Charter itself;
WHEREAS the aforementioned Article 6 requires the Charter to be applied and interpreted by the courts of Poland and of the United Kingdom strictly in accordance with the explanations referred to in that Article;
WHEREAS the Charter contains both rights and principles;
WHEREAS the Charter contains both provisions which are civil and political in character and those which are economic and social in character;
WHEREAS the Charter reaffirms the rights, freedoms and principles recognised in the Union and makes those rights more visible, but does not create new rights or principles;
RECALLING the obligations devolving upon Poland and the United Kingdom under the Treaty on European Union, the Treaty on the Functioning of the European Union, and Union law generally;
NOTING the wish of Poland and the United Kingdom to clarify certain aspects of the application of the Charter;
DESIROUS therefore of clarifying the application of the Charter in relation to the laws and administrative action of Poland and of the United Kingdom and of its justiciability within Poland and within the United Kingdom;
REAFFIRMING that references in this Protocol to the operation of specific provisions of the Charter are strictly without prejudice to the operation of other provisions of the Charter;
REAFFIRMING that this Protocol is without prejudice to the application of the Charter to other Member States;
REAFFIRMING that this Protocol is without prejudice to other obligations devolving upon Poland and the United Kingdom under the Treaty on European Union, the Treaty on the Functioning of the European Union, and Union law generally,
HAVE AGREED UPON the following provisions, which shall be annexed to the Treaty on European Union and to the Treaty on the Functioning of the European Union:
Article 1
1. The Charter does not extend the ability of the Court of Justice of the European Union, or any court or tribunal of Poland or of the United Kingdom, to find that the laws, regulations or administrative provisions, practices or action of Poland or of the United Kingdom are inconsistent with the fundamental rights, freedoms and principles that it reaffirms.
2. In particular, and for the avoidance of doubt, nothing in Title IV of the Charter creates justiciable rights applicable to Poland or the United Kingdom except in so far as Poland or the United Kingdom has provided for such rights in its national law.
Article 2
To the extent that a provision of the Charter refers to national laws and practices, it shall only apply to Poland or the United Kingdom to the extent that the rights or principles that it contains are recognised in the law or practices of Poland or of the United Kingdom.
***
We have joint Declaration (number 1) concerning the Charter of Fundamental Rights of the
European Union, with one more reminder of the limited impact of the Charter (OJ 17.12.2007 C 306/247):
1. Declaration
The Charter of Fundamental Rights of the European Union, which has legally binding force, confirms the fundamental rights guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms and as they result from the constitutional traditions common to the Member States.
The Charter does not extend the field of application of Union law beyond the powers of the Union or establish any new power or task for the Union, or modify powers and tasks as defined by the Treaties.
***
Citizens’ rights received special attention from two member state governments, leading to three additional declarations:
53. Declaration by the Czech Republic on the Charter of Fundamental Rights of the European Union
61. Declaration by the Republic of Poland on the Charter of Fundamental Rights of the European Union
62. Declaration by the Republic of Poland concerning the Protocol on the application of the Charter of Fundamental Rights of the European Union in relation to Poland and the United Kingdom
***
Combating discrimination is set to be a generally applicable principle of EU action.
Ralf Grahn
The Treaty of Lisbon introduces a horizontal aim to combat discrimination on specific grounds in the policies and activities of the European Union.
***
The intergovernmental conference (IGC 2007) inserted a new provision having general applicability into the Treaty of Lisbon (ToL), more precisely the Treaty establishing the European Community (TEC), renamed the Treaty on the Functioning of the European Union (TFEU). See OJ 17.12.2007 C 306/48:
Article 5b TFEU (ToL), to be renumbered Article 10 TFEU
In defining and implementing its policies and activities, the Union shall aim to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.
***
Reading is fine, but understanding is better. We set out to see the origins of this new transversal provision, by looking first at the Treaty establishing a Constitution for Europe, where Title I Provisions of general application of Part III The policies and functioning of the Union has this to offer (OJ 16.12.2004 C 310/55):
Article III-118 Constitution
In defining and implementing the policies and activities referred to in this Part, the Union shall aim to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.
***
We are able to see that the only difference is of an editorial nature, the substance including the specific grounds for discrimination to combat being identical in the Lisbon Treaty and the Constitution.
***
If we find something in the Constitutional Treaty, there is cause to take a peek at what the European Convention proposed in the draft Treaty establishing a Constitution for Europe. Part III The policies and functioning of the Union, and its Title I Clauses of general application offer us this provision (OJ 18.7.2003 C 169/29):
Article III-3 Draft Constitution
In defining and implementing the policies and activities referred to in this Part, the Union shall aim to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.
***
The draft Constitution and the Constitution are identical in this respect.
***
Article III-3 of the draft Constitution has been described as a new horizontal provision, which would apply to the Constitution and the Lisbon Reform Treaty, as well.
Let us see if there are any points of reference in the current treaties, the TEU and the TEC.
***
One provision to check would seem to be Article 6 TEU, especially paragraph 2 with its reference to the European Convention for the Protection of Human Rights and Fundamental Freedoms (the latest consolidated version of the current TEU and TEC being found in OJ 29.12.2006 C 321 E/1, with Article 6 TEU on page 12):
Article 6 TEU
1. The Union is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law, principles which are common to the Member States.
2. The Union shall respect fundamental rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms signed in Rome on 4 November 1950 and as they result from the constitutional traditions common to the Member States, as general principles of Community law.
3. The Union shall respect the national identities of its Member States.
4. The Union shall provide itself with the means necessary to attain its objectives and carry through its policies.
***
The European Human Rights Convention, consolidated with later amending protocols, can be found on the web pages of the Council of Europe:
http://conventions.coe.int/Treaty/Commun/QueVoulezVous.asp?NT=005&CM=7&DF=2/25/2008&CL=ENG
Our attention turns to Article 14, as amended by Protocol 11:
Article 14 – Prohibition of discrimination
The enjoyment of the rights and freedoms set forth in this Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.
***
On the face of it, most of the specific grounds for prohibited discrimination seem to be shared by the European Human Rights Convention and the Lisbon Treaty, but a more thorough examination would be required to ascertain if, for instance, ‘birth or other status’ have been given the same scope by the European Court of Human Rights as ‘disability, age or sexual orientation’ enumerated in the Treaty of Lisbon.
***
One of the mainstays of the common market has been the prohibition of discrimination on grounds of nationality, to be found in the existing Article 12 TEC (OJ 29.12.2006 C 321 E/48):
Article 12 TEC
Within the scope of application of this Treaty, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.
The Council, acting in accordance with the procedure referred to in Article 251, may adopt rules designed to prohibit such discrimination.
***
We come even closer when we take a look at the specific grounds for discrimination to combat in the current Article 13 TEC:
Article 13 TEC
1. Without prejudice to the other provisions of this Treaty and within the limits of the powers conferred by it upon the Community, the Council, acting unanimously on a proposal from the
Commission and after consulting the European Parliament, may take appropriate action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.
2. By way of derogation from paragraph 1, when the Council adopts Community incentive measures, excluding any harmonisation of the laws and regulations of the Member States, to support action taken by the Member States in order to contribute to the achievement of the objectives referred to in paragraph 1, it shall act in accordance with the procedure referred to in Article 251.
***
The grounds mentioned in Article 13 TEC and Article 5b TFEU (ToL) are identical, and more than a prohibition against discrimination the current treaty envisions active action to combat discrimination.
We are going to leave the question open for now, if the present requirement for unanimity is upheld in the Treaty of Lisbon.
***
The fundamental rights of the citizens of the European Union (or universally), caused a fair amount of commotion among member states’ governments. This warrants a closer look at the Charter of Fundamental Rights and related expressions of concern.
We take note of the fact that the Charter of Fundamental Rights of the European Union includes a prohibition of discrimination, by the EU institutions and the member states when implementing EU law, on various grounds, many of them fairly familiar by now (OJ 14.12.2007 C 303/7):
Article 21 Charter
Non-discrimination
1. Any discrimination based on any ground such as sex, race, colour, ethnic or social origin, genetic features, language, religion or belief, political or any other opinion, membership of a national minority, property, birth, disability, age or sexual orientation shall be prohibited.
2. Within the scope of application of the Treaties and without prejudice to any of their specific provisions, any discrimination on grounds of nationality shall be prohibited.
***
We refer the interested reader to the Explanations relating to the Charter of Fundamental Rights (OJ 14.12.2007 C 303/24):
Explanation on Article 21 — Non-discrimination
Paragraph 1 draws on Article 13 of the EC Treaty, now replaced by Article 19 of the Treaty on the Functioning of the European Union, Article 14 of the ECHR and Article 11 of the Convention on Human Rights and Biomedicine as regards genetic heritage. In so far as this corresponds to Article 14 of the ECHR, it applies in compliance with it.
There is no contradiction or incompatibility between paragraph 1 and Article 19 of the Treaty on the Functioning of the European Union which has a different scope and purpose: Article 19 confers power on the Union to adopt legislative acts, including harmonisation of the Member States' laws and regulations, to combat certain forms of discrimination, listed exhaustively in that Article. Such legislation may cover action of Member State authorities (as well as relations between private individuals) in any area within the limits of the Union's powers. In contrast, the provision in Article 21(1) does not create any power to enact anti-discrimination laws in these areas of Member State or private action, nor does it lay down a sweeping ban of discrimination in such wide-ranging areas. Instead, it only addresses discriminations by the institutions and bodies of the Union themselves, when exercising powers conferred under the Treaties, and by Member States only when they are implementing Union law. Paragraph 1 therefore does not alter the extent of powers granted under Article 19 nor the interpretation given to that Article.
Paragraph 2 corresponds to the first paragraph of Article 18 of the Treaty on the Functioning of the European Union and must be applied in compliance with that Article.
***
Naturally, should we be confronted with a problem pertaining to the Charter, we have to be aware of the Protocol on the application of the Charter of Fundamental Rights of the European Union to Poland and to the United Kingdom, these countries wanting to evade enforceable rights (OJ 17.12.2007 C 306/154-155):
PROTOCOL
ON THE APPLICATION OF THE CHARTER OF FUNDAMENTAL
RIGHTS OF THE EUROPEAN UNION TO POLAND AND TO THE
UNITED KINGDOM
THE HIGH CONTRACTING PARTIES,
WHEREAS in Article 6 of the Treaty on European Union, the Union recognises the rights, freedoms and principles set out in the Charter of Fundamental Rights of the European Union;
WHEREAS the Charter is to be applied in strict accordance with the provisions of the aforementioned Article 6 and Title VII of the Charter itself;
WHEREAS the aforementioned Article 6 requires the Charter to be applied and interpreted by the courts of Poland and of the United Kingdom strictly in accordance with the explanations referred to in that Article;
WHEREAS the Charter contains both rights and principles;
WHEREAS the Charter contains both provisions which are civil and political in character and those which are economic and social in character;
WHEREAS the Charter reaffirms the rights, freedoms and principles recognised in the Union and makes those rights more visible, but does not create new rights or principles;
RECALLING the obligations devolving upon Poland and the United Kingdom under the Treaty on European Union, the Treaty on the Functioning of the European Union, and Union law generally;
NOTING the wish of Poland and the United Kingdom to clarify certain aspects of the application of the Charter;
DESIROUS therefore of clarifying the application of the Charter in relation to the laws and administrative action of Poland and of the United Kingdom and of its justiciability within Poland and within the United Kingdom;
REAFFIRMING that references in this Protocol to the operation of specific provisions of the Charter are strictly without prejudice to the operation of other provisions of the Charter;
REAFFIRMING that this Protocol is without prejudice to the application of the Charter to other Member States;
REAFFIRMING that this Protocol is without prejudice to other obligations devolving upon Poland and the United Kingdom under the Treaty on European Union, the Treaty on the Functioning of the European Union, and Union law generally,
HAVE AGREED UPON the following provisions, which shall be annexed to the Treaty on European Union and to the Treaty on the Functioning of the European Union:
Article 1
1. The Charter does not extend the ability of the Court of Justice of the European Union, or any court or tribunal of Poland or of the United Kingdom, to find that the laws, regulations or administrative provisions, practices or action of Poland or of the United Kingdom are inconsistent with the fundamental rights, freedoms and principles that it reaffirms.
2. In particular, and for the avoidance of doubt, nothing in Title IV of the Charter creates justiciable rights applicable to Poland or the United Kingdom except in so far as Poland or the United Kingdom has provided for such rights in its national law.
Article 2
To the extent that a provision of the Charter refers to national laws and practices, it shall only apply to Poland or the United Kingdom to the extent that the rights or principles that it contains are recognised in the law or practices of Poland or of the United Kingdom.
***
We have joint Declaration (number 1) concerning the Charter of Fundamental Rights of the
European Union, with one more reminder of the limited impact of the Charter (OJ 17.12.2007 C 306/247):
1. Declaration
The Charter of Fundamental Rights of the European Union, which has legally binding force, confirms the fundamental rights guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms and as they result from the constitutional traditions common to the Member States.
The Charter does not extend the field of application of Union law beyond the powers of the Union or establish any new power or task for the Union, or modify powers and tasks as defined by the Treaties.
***
Citizens’ rights received special attention from two member state governments, leading to three additional declarations:
53. Declaration by the Czech Republic on the Charter of Fundamental Rights of the European Union
61. Declaration by the Republic of Poland on the Charter of Fundamental Rights of the European Union
62. Declaration by the Republic of Poland concerning the Protocol on the application of the Charter of Fundamental Rights of the European Union in relation to Poland and the United Kingdom
***
Combating discrimination is set to be a generally applicable principle of EU action.
Ralf Grahn
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