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MEMO/11/739

Brussels, 27 October 2011

EU law: Commission acts to ensure that European legislation is fully and properly implemented

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In its monthly package of infringement decisions, the European Commission is pursuing legal action against 27 Member States for failing to comply properly with their obligations under EU law. These decisions cover many sectors. They aim at ensuring proper application of EU law for the benefit of citizens and businesses. The Commission has taken today 208 decisions, including 9 complaints taking Member States before the European Union's Court of Justice. In this package, 1 decision relates to failure to respect a previous Court ruling (where the Commission is requesting financial penalties). In another 3 cases, the Commission is referring Member States to the Court for failure to implement Directives within the deadline agreed by the EU's Council of Ministers and the European Parliament, and for the first time is using new powers under the Lisbon Treaty to request the Court to impose financial penalties the first time the case goes to Court.

Formal complaints to the Court of Justice (Article 258)

In accordance with the provisions of Article 258 of the Treaty on the Functioning of the European Union (TFEU), the Commission has decided today to take several Member States to Court for failing to comply with their legal obligations under EU law. Before referring a Member State to the Court, the Commission first requests information from the Member State concerned and then, if necessary, formally requests the Member State to comply with EU law. Around 95% of infringement cases are resolved before they reach the Court.

Free movement of workers (Italy): The Commission has decided to refer Italy to the Court because of discrimination against nationals of other Member States as regards public sector jobs. In particular, legislation applicable in Italy's province of Bolzano states that job candidates resident in the province of Bolzano for at least two years have preference over other candidates in accessing posts in the province’s public sector. See IP/11/1269

Free movement of goods (Lithuania): The Commission has decided to refer Lithuania to the Court because it maintains obstacles to the registration of right-hand drive vehicles in Lithuania in breach of EU rules on vehicle type-approval and on the free movement of goods. National legislation in Lithuania prohibits registration of new and used cars with right-hand drive. The Commission considers that these restrictions constitute a disproportionate barrier to importing such vehicles from other EU Member States (e.g. by citizens returning to Lithuania after having worked in the United Kingdom or Ireland). In November 2010 the Commission requested the Lithuanian authorities to put an end to these restrictions (see IP/10/1546) but they are still in place. See IP/11/1251

Taxation (Cyprus): The Commission has decided to refer Cyprus to the Court because its car taxation rules discriminate against non-Cypriot EU citizens who transfer a car into Cyprus. Under Cypriot legislation, EU nationals who set up a permanent residence in Cyprus are only exempted from paying excise duty on a new imported car if they do not practice a profession in Cyprus. Such a condition does not apply to Cypriot citizens, nationals and descendants who return to live permanently in Cyprus. See IP/11/1277

Taxation (Ireland): The Commission has decided to refer Ireland to the Court for failing to correctly implement EU rules on excise duties on fuel. Until the end of 2006, Ireland was allowed to apply an exemption on fuel used by disabled people for their motor vehicles. At the end of 2006 this derogation came to an end. However, Ireland continued applying this exemption. The Commission formally asked Ireland to remedy this breach of EU law in September 2008. Although the Irish authorities informed the Commission in January 2009 that they would bring their law into line with EU rules, they still have not done so. See IP/11/1280

Taxation (Spain): The European Commission has decided to refer Spain to the Court for discriminatory rules on inheritance and gift tax that require non-residents to pay higher taxes than residents. Inheritance and gift tax in Spain are regulated at both state level and at the level of autonomous communities. The autonomous communities' legislation grants residents a number of tax benefits that, in practice, allow them to pay much lower taxes than non-residents. The Commission had already formally requested Spain on May 2010 (IP/10/513) and additionally on 17 February 2011 to take action to ensure compliance with the EU rules in regard to inheritance and gift tax provisions. However, no amendments have been made to Spanish legislation on the matter. See IP/11/1278

Enforcing Court rulings

When, despite a first ruling by the Court, a Member State still fails to act, the Commission warns the Member State in writing. In case of continued lack of appropriate action by the Member State, the Commission may take the Member State back to Court, and can request the Court to impose a lump sum penalty and/or a daily penalty payment on the Member State concerned. This procedure is based on Article 260 of the Treaty on the Functioning of the European Union.

Environment (Luxembourg): The Court previously ruled in November 2006 that Luxembourg was failing in its obligation to treat and dispose of urban waste water in an adequate manner. Nearly five years after the Court's ruling, four agglomerations in Luxembourg do not yet comply with EU legislation, including the capital city. The Commission is therefore referring Luxembourg back to the EU Court of Justice and asking the Court to impose a lump-sum fine of €1 248 per day and a daily penalty payment of €11 340. See IP/11/1273

Failure to respect deadlines for implementing Directives

The Commission has also adopted decisions to request Member States to adopt implementing measures for Directives where the deadline has already passed and warned Member States that if they fail to do so they may not only be referred to the Court but also that the Commission intends to request the Court to impose a financial penalty on the Member State concerned. Since the entry into force of the Lisbon Treaty, the Commission may now request the Court, the first time the case is referred to the Court, to impose financial penalties in cases where Member States have failed to implement Directives within the deadline agreed by the EU's Council of Ministers and the European Parliament.

For the first time, the Commission has used this new possibility laid down in Article 260 (3) of the TFEU, and requested the Court, at the first referral, to impose a financial penalty on 3 Member States that have failed to implement Directives.

Marché Intérieur, Directive «services» (Autriche, Allemagne, Grèce): La Commission européenne a décidé de saisir la Cour de justice contre l'Autriche, l'Allemagne et la Grèce parce que ces Etats membres n'ont transposé que partiellement la directive services (2006/123/CE), et de demander à la Cour d'imposer des astreintes financières aux trois Etats membres. La directive relative aux services dans le marché intérieur a été adoptée le 12 décembre 2006 et son délai de mise en œuvre a expiré le 28 décembre 2009. Depuis l'expiration du délai de transposition, 22 mois se sont écoulés. Les sanctions financières demandées à la Cour s'élèvent à 44 876,16 € pour l'Autriche, 141 362,55 € pour l'Allemagne et 51 200,10€ pour la Grèce. Elles ont été fixées en tenant compte des situations respectives des Etats membres et de la gravité de l'infraction. Les sanctions financières demandées seraient des astreintes journalières qui devraient être payées à partir du jour du prononcé de l'arrêt de la Cour aussi longtemps que la transposition n'est pas achevée. Voir IP/11/1283

Background on legal process

Article 258 of the Treaty on the Functioning of the European Union (TFUE) gives the Commission the power to take legal action against a Member State that is not respecting its obligations under EU law.

The infringement procedure begins with a request for information (a "Letter of Formal Notice") to the Member State concerned, which must be answered within a specified period, usually two months.

If the Commission is not satisfied with the information and concludes that the Member State in question is failing to fulfil its obligations under EU law, the Commission may then send a formal request to comply with EU law (a "Reasoned Opinion"), calling on the Member State to inform the Commission of the measures taken to comply within a specified period, usually two months.

If a Member State fails to ensure compliance with EU law, the Commission may then decide to refer the Member State to the Court of Justice. However, in around 95% of infringement cases, Member States comply with their obligations under EU law before they are referred to the Court. If the Court rules against a Member State, the Member State must then take the necessary measures to comply with the judgment.

If, despite the ruling, a Member State still fails to act, the Commission may open a further infringement case under Article 260 of the TFEU, with only one written warning before referring the Member State back to Court. If the Commission does refer a Member State back to Court, it can propose that the Court imposes financial penalties on the Member State concerned based on the duration and severity of the infringement and the size of the Member State (both a lump sum depending on the time elapsed since the original Court ruling and a daily penalty payment for each day after a second Court ruling until the infringement ends).

In the specific case of Member States that have failed to implement Directives within the deadline agreed by the EU's Council of Ministers and the European Parliament, the Commission may request the Court to impose a financial penalty on the Member State concerned the first time the Court rules on such a case, rather than when it is referred back for a second time. This possibility, introduced by the Lisbon Treaty, is laid down in Article 260 (3) of the TFEU.

For current statistics on infringements in general, see:

http://ec.europa.eu/community_law/infringements/infringements_en.htm


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