Lecture 1
Introducti on, the EU internal market & recap
History, background & challenges
Challenges
- European Commission initiated infringement procedure against Hungary.
o Higher Education Law adopted in Hungary, in violation of free movement rules
(services and establishment), EU Charter of Fundamental Rights &
International Trade Law
o Article 2 TEU: EU is founded on values of respect for human dignity, freedom,
democracy & rule of law
o European Commission is interfering, but it is difficult. The EC found a way by
the internal market for saying that the Hungarian law violates the
fundamental freedom of services, fundamental rights and international trade
law. When you want to become a member of the EU you need to fulfill certain
requirements (human dignity, freedom, democracy and rule of law), but once
you are a member of the EU it is hard for the EU to keep the members to
those requirements.
- Interim relief decision from the Court of Amsterdam asking for a preliminary ruling by
the CJEU on the consequences of Brexit for British citizens
o The courts need to give their opinions because the citizens do not trust the
politics anymore.
o Same kind of case now pending in Ireland
- A deeper & fairer EU single market
o The digital single market
Introducing a fifth freedom? -> free movement of data
o The importance of the EU Charter of Fundamental Rights
The EU Internal Market
What is the EU internal market?
- From common market to internal market, to digital internal market
- Art. 26 TFEU: Internal Market
o The treaty of Schengen is not the same as the EU law, but it is incorporated in
the EU law now.
o The article does not say anything about how the market should look like
o In order to reestablish the internal market, which was almost gone because of
all the protectionist measures, some measures were taken. Art. 114 TFEU is
the legal basis for the EU to obtain legislation about the internal market.
- Court of Justice EU (15/81, Gaston Schul)
o (33). “The concept of a common market as defined by the court in a
consistent line of decisions involves the elimination of all obstacles to intra-
community trade in order to merge the national market into a single market
bringing about conditions as close as possible to those of a genuine internal
market.”
, - Art. 3(3) TEU: concept of social market economy
o This article assumes that the internal market is only about making the market
as free as possible with no interference from the member states.
What are its building blocks?
- Building blocks
o Four freedoms
Free movement of goods
Free movement of persons
Free movement of capital
Free movement of services
Sometimes these movements can also be addressed to private
organizations (Bosman case)
o EU Competition rules
Not only states that make use of the internal market, also companies.
By that, they have to do with competition.
o Harmonization of national laws
Especially with state aid; when a state privatizes companies. When a
state gives subsidy or tax measures to a certain company, the state
needs to report this to the European Commission.
- Negative & positive integration
o Crucial for negative integration: principles of direct effect and supremacy (Van
Gend & Loos; Costa/ENEL)
Negative integration: by simply applying the four freedoms from the
treaty, the treaty rules, national laws will have to be set aside. The
national court will have to apply these treaty rules. In this way, the
national market will slowly emerge into the internal market. This is a
process of deregulation. Direct effect and supremacy play an
important role in the negative integration. Because of direct effect
nationals can invoke the treaty provisions before a court and because
of supremacy the court needs to set aside national rules that conflict
with the treaty. Negative integration never attains a true internal
market, because there will always be member states that can ‘stop’
internal market on behalf of proportionality, rule of law etc.
Positive integration: EU legislator taking action by setting rules
(directives and regulations)
o Important role for the CJEU
o EU legislature -> common rules
- Home country, host country & harmonized model
o Home country plays an important role since the case Cassis de Dijon. Only the
home country can set the rules, the host country cannot set additional rules.
o Sometimes the EU needs to harmonize rules in order to really establish an
internal market
- Differentiation vs. preserving unity of the internal market
o Perfect unity is neither possible nor desirable. Perfect internal market does
not mean that there cannot be any room for differentiation.
Introducti on, the EU internal market & recap
History, background & challenges
Challenges
- European Commission initiated infringement procedure against Hungary.
o Higher Education Law adopted in Hungary, in violation of free movement rules
(services and establishment), EU Charter of Fundamental Rights &
International Trade Law
o Article 2 TEU: EU is founded on values of respect for human dignity, freedom,
democracy & rule of law
o European Commission is interfering, but it is difficult. The EC found a way by
the internal market for saying that the Hungarian law violates the
fundamental freedom of services, fundamental rights and international trade
law. When you want to become a member of the EU you need to fulfill certain
requirements (human dignity, freedom, democracy and rule of law), but once
you are a member of the EU it is hard for the EU to keep the members to
those requirements.
- Interim relief decision from the Court of Amsterdam asking for a preliminary ruling by
the CJEU on the consequences of Brexit for British citizens
o The courts need to give their opinions because the citizens do not trust the
politics anymore.
o Same kind of case now pending in Ireland
- A deeper & fairer EU single market
o The digital single market
Introducing a fifth freedom? -> free movement of data
o The importance of the EU Charter of Fundamental Rights
The EU Internal Market
What is the EU internal market?
- From common market to internal market, to digital internal market
- Art. 26 TFEU: Internal Market
o The treaty of Schengen is not the same as the EU law, but it is incorporated in
the EU law now.
o The article does not say anything about how the market should look like
o In order to reestablish the internal market, which was almost gone because of
all the protectionist measures, some measures were taken. Art. 114 TFEU is
the legal basis for the EU to obtain legislation about the internal market.
- Court of Justice EU (15/81, Gaston Schul)
o (33). “The concept of a common market as defined by the court in a
consistent line of decisions involves the elimination of all obstacles to intra-
community trade in order to merge the national market into a single market
bringing about conditions as close as possible to those of a genuine internal
market.”
, - Art. 3(3) TEU: concept of social market economy
o This article assumes that the internal market is only about making the market
as free as possible with no interference from the member states.
What are its building blocks?
- Building blocks
o Four freedoms
Free movement of goods
Free movement of persons
Free movement of capital
Free movement of services
Sometimes these movements can also be addressed to private
organizations (Bosman case)
o EU Competition rules
Not only states that make use of the internal market, also companies.
By that, they have to do with competition.
o Harmonization of national laws
Especially with state aid; when a state privatizes companies. When a
state gives subsidy or tax measures to a certain company, the state
needs to report this to the European Commission.
- Negative & positive integration
o Crucial for negative integration: principles of direct effect and supremacy (Van
Gend & Loos; Costa/ENEL)
Negative integration: by simply applying the four freedoms from the
treaty, the treaty rules, national laws will have to be set aside. The
national court will have to apply these treaty rules. In this way, the
national market will slowly emerge into the internal market. This is a
process of deregulation. Direct effect and supremacy play an
important role in the negative integration. Because of direct effect
nationals can invoke the treaty provisions before a court and because
of supremacy the court needs to set aside national rules that conflict
with the treaty. Negative integration never attains a true internal
market, because there will always be member states that can ‘stop’
internal market on behalf of proportionality, rule of law etc.
Positive integration: EU legislator taking action by setting rules
(directives and regulations)
o Important role for the CJEU
o EU legislature -> common rules
- Home country, host country & harmonized model
o Home country plays an important role since the case Cassis de Dijon. Only the
home country can set the rules, the host country cannot set additional rules.
o Sometimes the EU needs to harmonize rules in order to really establish an
internal market
- Differentiation vs. preserving unity of the internal market
o Perfect unity is neither possible nor desirable. Perfect internal market does
not mean that there cannot be any room for differentiation.
