Assessment Coversheet

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Candidate Number: N12996

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Degree Title: LLB Honours

Module Title: EU Law

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Module Code: LA2024

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Enter the numbers, and sub-sections, of the questions in the order in which you
have attempted them: 1, 2, 6 and 7s

Date: 19-10-2021

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Question No 1
The main issue is this scenario is whether the measure adopted by Medicinal Product
Control (MPC) is a measure having equivalent effect to quantitative restrictions on the right
of free movement of goods as protected by Art 34 of the TFEU. In order to access this we
have to consider the measure, its nature and its purpose. It shall be argued below that this
measure breaches Art 34. Finally we shall see the possible justifications which the
German authorities may tender for this measure with finally concluding that given the
recent jurisprudence of ECJ on Art 34, especially its approach towards Keck principle, it is
highly unlikely that such a blanket ban coupled with the way it affects Europharma’s
market (i.e. market access), it is highly unlikely that this ban would pass the test.
Breach of Art 34
First of all we can look at Dassonville in which the Court interpreted Art 34 in an unlimited
fashion, i.e. Dassonville held that any rule or measure adopted which has the effect of
“hindering, directly or indirectly, actually or potentially, intra-community trade” is an MEQR
and therefore void. However, later, the Court clarified the position in Cassis de Dijon and
held that certain measures, adopted pursuant to valid policy grounds (rule of reason)
would not breach Art 34 provided that they are not only indistinctly applicable (i.e. they
apply to domestic as well as foreign goods) but the measure adopted is also a necessary
and proportionate one. Moreover, the Court also held that there is, in principle, no reason
why a good cannot be sold/marketed in a Member State when it is legally sold/marketed in
another Member State (i.e. the principle of mutual recognition), provided that there are
some overriding factors that may lead the Court to antoher conclusion (e.g. certain cultural
grounds like public morality etc, R v. Henn & Darby)
Now if we consider the facts of the present case against the background of Dassonville
principle (as qualified by Cassis), Europharma can clearly argue that the blanket ban,
notwithstanding its ‘indistinctly applicable nature,’ is unjustified because it is already
selling/marketing these pharmaceutical products in Poland through similar means.
Moreover, the nature of measure, does not in itself poses any danger to the public health
or consumer protection. However, in order to successfully argue this, Europharma must
overcome the possible argument which the German authorities are most to tender, i.e. the
argument of selling arrangement as provided in Keck, because notwithstanding the recent
case law (discussed below), Keck is still a valid authority on this subject matter.
MPC’s justification under Keck
In Keck, the Court acknowledge a new principle/interpretation of Art 34 under which
certain national measure would not be caught by Art 34 provided that they are merely rules
of trading in a certain way (selling arrangement) provided that the rules are not product
requirement, they are necessary proportionate, and above all they apply similar in law as
well as in fact (De Agostini and Gourmet).
Therefore, the German authorities may argue that the measure in question is merely a
selling arrangement (as was the case in Hünermund which concerned prohibited
advertisement of certain pharmaceutical products outside its premises) rather than a
product requirement. However, this argument is likely to fail for two main reasons.
First of all, as provided in the facts that Germany is one of Europharma’s largest markets,
a blanket ban as such would seriously impede the marketing of their products, especially
given the competitive edge of Europharma’s promotion (15% discount). It is therefore
highly unlikely that the German authorities would be able to justify their ban, especially
providing evidence that the measure in question applies similar in law as well as in fact,
i.e. it does not hinder Europharma’s access to German market as compared to the
domestic pharmaceutical companies and shops that obviously have a competitive
advantage simply by reason of being physically present in the German market.
Secondly, in recent jurisprudence of the Court, it seems that the Court now places
importance on this factor, i.e. market access. In Scotch Whisky Association v Lord
Advocate, the Court clearly held that the Scottish legislation which “prevented the lower
cost price of imported products being reflected in the selling price” clearly breached Art 34
because it significantly restricted the market access for the seller. Deutsche Parkinson
Vereinigung (DPV) is much more important in this regard because this case involve similar
facts to the current scenario, i.e. “mail-order pharmaceuticals” and “strict-price fixing of
certain pharmaceutical products”. The Court held that this German measure breached Art
34 because it gave the domestic pharmaceuticals a competitive advantage over the mail-
order pharmaceuticals.
What is the most important aspect of Deutsche Parkinson Vereinigung (DPV) case for the
current discussion is the way Court dealt with the issues that are primarily faced by mail-in
or online sellers, i.e. the Court expressly and specifically acknowledged the factors of
limited services mail-in pharmacies provides as compared to the traditional pharmacies.
Moreover, the Court also acknowledged that in such cases (i.e. mail-in/online pharmacies
compared with tradition pharmacies) “price competition lays the basis for their potential to
access” to the relevant market.
Therefore it is very unlikely that the German authorities could justify their measure on the
principle on Keck, and especially given the judgment in Deutsche Parkinson Vereinigung
(DPV). However, as an alternative, the German Authorities may seek to rely on express
derogation in Art 36, i.e. Protection of life or health of humans, however, yet again,
provided with our above discussion on necessity and proportionality, it is highly unlikely
that a blanket ban requiring a foreign company to stop advertising their product through
competitive-price promotion would pass the test of proportionality. Therefore, it
Europharma can successfully argue that case and challenge the measure by MPC as a
breach of Art 34’s protection as the German measure, pursuant to the decision in
Deutsche Parkinson Vereinigung (DPV), “directly restricts Europharma’s access to the
German market in medicinal products.”

Question No 2
The case deals with the issues of directives and their direct/indirect effect. In order to
assess whether Tom and Jane can get any remedy against the hardships they have
suffered as a direct result of Poland’s failure to implement the directive by the deadline.
The Nature and Effect of Directives
First of all it should be noted that under Art 288 TFEU itself provides that Directives are
subject to implementation by the Member States, and it is only in case of the Member
State’s failure to implement the Directive by the deadline or implementing it in a wrong
way, that can give rise to a direct effect of Directive, per Ratti which held that “a Member
State cannot rely on its own failure to perform the obligations that the Directive entails”.
Even in such a case of non-implementation on the part of Member State by the deadline,
Directives can only have Vertical-Direct effect, i.e. it can only be enforced against state
and organizations working under and as a part of the State. This is because individuals
cannot be held responsible for the Directive’s non-incorporation. This was reaffirmed in
Marshall v Southampton and South West Hampshire AHA [1986], and later reaffirmed in
Faccini Dori v Recreb srl.
Tom
It is clear that Poland has failed to implement the Directive in question by the deadline. But
it is in itself not enough, i.e. He must prove that the Directive in question provides
sufficiently clear and precise right which is unconditional (Van Duyn). It is clear from the
facts of the case, that the Directive in question is not only sufficiently clear and precise (i.e.
“organisations with more than 100 employees make available nursery arrangements for
their staff”) but it is also unconditional. As far as the question of vertical direct effect is
concerned, it is clear that the working of City Mayor clearly form the part of local
government and therefore, Tom can claim damages for not only Poland’s local authority in
failure to abide by the Directive but also for his wrongful dismissal.
Jane
The case of Jane is pretty different from Tom, because in her case her employer is not an
organ of state or even an organization which is a part of the state or performs its function
on the state’s behalf. Therefore, even if Poland has failed to implement the directive by the
deadline, she cannot sue her employer because that would amount to horizontal direct
effect, as held in many cases (mentioned above) it is in principle to hold private citizens
accountable for the failure of state to enact a measure which would (only in the event of
implementation) impose obligation on them.
However, The Court has established the notion of indirect effect to handle the issues faced
by people who could not rely on Directives as the requirements for direct effect were not
satisfied. This principle was laid down in von Colson v Land Nordrhein-Westfalen [1984].
The ECJ set out that the national court is an under an obligation to construe domestic law,
so far as possible, to attain the objective contained in the Directive. This principle is found
on the concept that domestic courts are a component of the state, and, hence, are
confined by Article 4(3) TEU. The Article asks the Member States “pursuant to the
principle of sincere cooperation’ to ‘take any appropriate measure … to ensure fulfilment of
the obligations’ under the Treaties.” However, at the same time it should be noted that the
principle in von Colson can only help Jane, if there is a domestic legislation that is capable
of being interpreted in compliance with the Directive. Moreover, even if there is any
legislation (facts of the cases does not mention any), it must be noted that the words must
be capable of being interpreted in light/compliance with the Directive. In other words, with
the national legislation expressly provides provisions that are expressly and clearly
contrary to the Directive, then there is no obligation on the domestic courts to interpret
such a legislation in a ‘contra legem’ manner (per Pupino).
However, it should be noted that if Jane could not obtain a remedy under the above rules,
it does not mean that there is no remedy at all. In other words, Poland remains in breach
of its obligations to implement the Directive which is a breach of Art. 4(3) TEU, that
requires member states to take measures to ensure that obligations under the treaty are
fulfilled., otherwise, as the Court noted in Francovich & Bonifaci v Italian Republic, “full
effectiveness of Community rules would be impaired and the protection of the rights would
be weakened if individuals were unable to obtain redress.” Therefore, Jane can establish
Poland’s “State-Liability” because the issue clearly satisfies the criteria of Brasserie du
Pêcheur / Factortame; i.e. The directive is clearly and unequivocally conferring rights on
individuals and the only reason why Jane cannot get a redress in domestic courts is
because of Poland’s serious failure in not implementing the Directive which in turn
provides the causal link between the breach and the damaged Jane has suffered.

Question:6
This question deals with the issues of free movement of workers and their family rights and
I shall discuss each issues separately.
In order to advice all the relative parties concerned, we need to first define worker. The
free movement of workers rights are given in Art. 56 of TFEU. The ECJ had construed a
wide application of Art. 56 in caselaw. The general definition of workers was given in
Lawrie Blum in which the court held that a worker is someone who performs an activity for
someone under their supervision for a certain period of time under in return for
remuneration. Later, the ECJ had widen its approach that a worker is not someone who is
currently employed but it can also include a person “likely to remain in the territory of a
member state after having been employed in that state” (Hoekstra). The ECJ affirmed this
approach recently in Trojani at [15] that “any person who pursues activities which are real
and genuine, to the exclusion of activities on such a small scale as to be regarded as
purely marginal and ancillary”. The interpretation by the court of notion contained in Art
45(3)(a) ‘to accept offers of employment actually made’ was to include job-seekers. The
courts have applied this article widely and they held in Antonissen that a strict application
of art.45(3)(a) would jeopardise the chances of a member state citizen to find work in
another member state. The ECJ said in this case that a reasonable time must be given to
the job seeker in any member state.
Advice to Lina:
The first advice that needs to be given to Lina concerns that whether she could remain in
Germany even after she is now unemployed. She came within the definition of worker
discussed above as she has worked in some commercials after moving to Germany and
although she has worked only in some commercials, this could not be said to be a work of
marginally or ancillary nature. As ECJ said in Ninni-Orasche that an employment of short
duration also came under definition of work and also in Levin that a person working under
below substantive wage could also be classified as a worker. So Lina by appearing in
commercials came under the definition of a worker. The question now arises is whether
she could now remain in Germany after being unemployed. She is a job seeker and as per
Antonissen, she must be given a reasonable period of time to find job. This is now covered
by Art. 14(4)(b) of Directive 2004/38 which states that 3 months must be given to a person
who is finding a job. If they have a genuine chance of finding a work, this period can be
further extended (Art.6 of same directive). So Lina has right to stay in Germany and find
work there for a reasonable period of time.
Advice to George:
George comes under the definition of worker and has a right to enter in Germany as an
offer of employment is made to him (Antonissen) but the issue is whether Germany can
rely on the derogation of public policy and public security under Directive 2004/38. It is
written in Directive 2004/38 that if a measure is to be proven contrary to public health or
public security, it shall be based exclusively on personal conduct. It was also said in Art.
27(2) that the measure should also be proportionate. Here, although George is offered a
job by a far rightist newspaper, the element of personal conduct is hard to justify here as it
has nothing to do with George personally. Although ECJ in Van Duyn v Home Office
allowed the member state margin of appreciation to refuse entry to an EU citizen for its
association in Church of Scientology on basis of public policy, but there is a chuck of
academic debate of academics arguing that given the freedom of expression and other
freedoms of EU law now, that case could be decided differently now. Considering all the
relevant discussion into account, Germany cannot rely on the ground of public policy or
public health. So, George has a right to enter and stay in Germany.
Advice to Jenny and Alex:
The next issue that arises here is whether Jenny and Alex come under the definition of
workers family and could reside in Germany. The list of family members is given in
Directive 2004/38 as it includes spouse, the partner with whom union citizen had
contracted partnership. Direct descendants and dependents of Spouse and partners. Here
it is not given in question that whether they had contracted a registered partnership.
Assuming that if the George and Jenny had not registered their partnership, Jenny could
not be considered as a spouse and has not a right to reside in Germany. As ECJ held in
Netherlands v Reed that ‘spouse’ in directive means husband and wife and it does not
include cohabiting couples. So if Jenny does not have a right to enter and reside, Alex
automatically does not have any right to enter or reside Germany. On the contrary, if we
assume that their partnership is registered, then Jenny has a right to enter and reside and
the issue is of Alex whether he could enter and reside in Germany. Even if George and
Alex are registered spouses, Alex is not a direct descendent to Jenny and could not come
within the definition of a family member. However, as Alex is unfit to work and dependent
on Jenny, it could be argued that Jenny is his primary carer and he could move to
Germany with Jenny. As ECJ in Baumbast v SOS for Home Department said that a person
who is dependent on someone, has a right to be accompanied by a primary carer and if
refused, the refusal must be proportionate. Here considering the condition of Alex, it would
be highly disproportionate to refuse Alex right to enter and reside in Germany as he has
has primary carer with him. So, it is highly probable that Alex can enter and reside in
Germany without any restriction.
Question no 7
This question deals with Art. 56 of free movement of services, I shall discuss each issue in
the given scenario and then advise Kafza whether EU law can protect his rights or not.
Art 56, its scope and breadth
It is illegal to impose restrictions on the free movement of services within the European
Union as per Art. 56 TFEU. In the case of Van Binsbergen it was held by the ECJ that
Art.56 has direct effect. This direct effect is vertical as well as horizontal in nature. The
measures that are indistinctive in nature i.e., indistinctively applicable measures fall within
the scope of Art. 56. The extent of indiscriminatory nature was given by ECJ in Webb and
Sager. The ECJ ruled that the measure in question although being indiscriminatory in
nature, must be necessary and proportionate to achieve the desired objective.
Breach of Art. 56
The issue that arises here is that whether the ban on Gambling activities was in breach of
Article 56 or not. Over the years, ECJ has liberalized and expanded its approach on the
question that what would amount to restriction on free movement of services for the
purposes of Art. 56. Early on in Van Binsbergen, the restriction imposed was
discriminatory in nature by virtue of nationality and was held to breach Art 56 but later in
Sager, the scope of restriction on services was further expanded to the extent that it would
also include any measure that although is indiscriminatory in nature, but impedes the
movement of services in the Union; such a measure will be caught. Later on, in Analir,
ECJ went even further to add to the extent of Art 56 that such restrictions which are
although indiscriminatory in nature but prohibit or make the service of a service provider
less attractive would be in breach of Art. 56. This can be compared with De Agostini and
Gourmet (FMG cases) in which ECJ made it crystal clear that it is not conclusive that if a
measure is indiscriminative in nature, it will not constitute a breach. If it can be proved that
a measure was applied indistinctively at law, but in fact it gave protective effect to
domestic providers and targeted foreign business, it would result in a breach. So here
although the measure was indistinctively applicable both in law and in fact, it breaches
Art.56 as there was a complete ban on gambling and blanket ban is not a good option to
go with in Union law.
The next issue that arises here is that whether the traditional video games and gambling
continued by Kafza in his amusement park could be justified or not. The ECJ has adopted
a soft approach and leaned in favor of the member states in certain controversial areas
such as in virtual reality games (laser gun shooting game; Omega) and in case of illegal
services like gambling (Bwin Int.). The ECJ came with a surprising decision in Bwin Int.
that although a measure seems clearly disproportionate to layman’s eye but it can be
considered proportionate considering the member state cultural and social background as
each member state has different cultures. So, they must be given a certain margin of
appreciation in selecting which measures or policies can be used to attain certain aims.
Same approach was echoed by the court in Anamar & Josemans. As also in Schlinder,
prevention of German lotteries in UK because of UK rules against large scale lotteries was
justified on the basis that each member state has its own cultural and social features. So
here, as it could be seen that local council was doing it to counter the commercialization of
the city center and this could be justified on the basis of public policy of the member state
and they could be given a margin of appreciation.
Justification:
The next issue that arises here is whether the confiscation of laptops, shutting down of Mr
Kafza’s amusement park and fine of £5000 was justified or not. The development of free
movement of services is very much akin to the development of free movement of goods. In
free movement of services, derogations are provided within the treaty articles even for
discriminatory measures (Art. 51-52) as well as in case law i.e., in Sager that deals with
indiscriminatory measures. It must be noted that whether the measure comes within the
scope of derogations under Art 51-52 or case law of ECJ, the measure must be
proportionate and necessary and also compatible with Art 56.

Onus of burden shifts on the member states to prove not only that the restriction enacted
was necessary and proportionate to attain a certain aim, e.g., let’s say public health
(Kohll) or public policy (Omega) but the member state must also prove that the restriction
enacted was most reasonable restriction that could be enacted at that time and there was
no less restrictive measure and without that restriction, such an aim would be impossible
to attain. As De Coster concerned an objective aim to preserve the quality of the
environment by Belgian authorities through controlling the proliferation of satellite dishes.
The ECJ ruled that although the measure of applying tax on these services was necessary
and proportionate, but this measure was not the most reasonable restriction imposed and
the same objective of protection of environment can also be attained by imposing a less
restrictive measure.

Evaluation of Justification:

Webb and Sager, two key decisions of the ECJ can be analyzed in two stages here.
At the first stage, the courts while deciding that the current measure in question is
necessary and proportionate should look at whether the control that this measure will
exercise can be attained by other less restrictive measures. The courts could also look at
whether the measure in question is adequately carried out by service provider’s home
state. This very much reflects the ‘dual-burden’ doctrine in Cassis de Dijon (FMG case).
This leads us to second test in which the ECJ in Sager ruled that a restriction can be
justified by some reason relating to public interest and for the restriction to be justified, it
must be shown that the restriction was necessary, proportionate and non-discriminatory in
nature. The ECJ also made it clear that the scope of Art. 56 is not limited to the elimination
of distinctively applicable measures. It also includes measure although being non-
discriminatory in nature, prohibits or impedes the activities of a service provider
established in another member state. ECJ’s approach of ‘mutual respect’ or ‘mutual
recognition’ can be shown towards Art. 56 as was shown in Art. 34 in case of Casis de
Dijon. So here the measure of confiscation of laptops and shutting the place down was not
necessary as the measure of the home state i.e., to stop gambling could be attained by a
less disproportionate means e.g. by imposing a fine. The fine of £5000 could also said to
be disproportionate as it was a hefty amount coupled with the fact that all his laptops were
taken away and amusement park being closed. So Czeck Republic was in breach of Art
56.
Conclusion:
Concluding the discussion above although margin of appreciation was given to Czeck
Republic for the breach of Art 56 because member states knew better how to protect their
culture and how to carry out their public policy, but the measures adopted by Czeck
Republic was highly disproportionate and not necessary so Mr Kafza will be awarded
damages and he can may continue providing the services and his fine should be reduced.