Member States are under an obligation to amend their national law so as to conform to Community law in cases where there is a ruling given by the ECJ. The foundation of the relationship between domestic courts and the ECJ may be seen in the cases which follow.
The ECJ in Van Gend en Loos v The Netherlandse Tariefcommissie3 stated that by signing the treaties the Member States had created a new legal order in which Member States had limited their sovereignty rights. Furthermore, it was submitted that Article 12 of the EEC Treaty was ideally suited to having direct effect, i. e.its implementation did not depend on any legislative enactment of national law. In Costa v ENEL4, this view was reaffirmed by the ECJ. It further stated that the national court is the one deciding whether a reference in a case of domestic nature is to be asked for from the ECJ. An additional provision of the decision was that when there is a clash between domestic and EC law, it is for the ECJ to decide which one prevails.
This has an implication in English law as it contradicts with the doctrine of supremacy of Parliament, according to which no Parliament can bind its successors, i. e. the later law binds the earlier and not vice-versa. The views of the German Constitutional Court and the English Courts: Internationale Handelsgesellschaft GmbH v EVST5 or otherwise known as "Solange 1" takes the principle of Community supremacy further. Its decision was that for as long as EC did not have regard for basic rights at high level as Grundgesetz had, it may be ignored by German Courts who reserved the right to refer secondary EC law to BVerfG6 in order that EC law may be constitutionally reviewed.
This decision questions every aspect of Community sovereignty that is established in Van Gend en Loos7 and Costa v ENEL8. It further states that EC law is neither national nor international law. It derives from a self-governing source. Both German and Community law are independent from one another and most importantly Community law is not a superior part of German law. German law will be recognised for as long as it does not interfere with the rights of German citizens. The above decision of the BVerfG was later modified by the decision in the case of Wunsche Handelsgesellschaft9, also called "Solange II".
It stated that as long as Community law ensures the effective provisions of fundamental rights, the BverfG would not review Community law. It was held that the protection of fundamental rights by the ECJ is now sufficient and easy to compare to those provided by the Grundgesetz. Furthermore, provided that EC law meets the above-mentioned requirement, it was held that it would overrule the German Constitution and lower German courts will not be able to address constitutional complaints to the BVerfG10.
Indeed, the BVerfG took that decision because Art 24 allows it to transfer powers and the Accession Act obliges German courts to accept the supremacy of EC. In contrast to the German Constitutional Court, English courts are more susceptible to the adoption of Community law in Britain. As the legislation stated below shows, this appears to be a more straightforward process. The European Communities Act 1972, s. 2 (1) gives present and future community law legal force in the United Kingdom and section 2(2) provides for the implementation of Community law by means of secondary legislation.
However, the Act does not specifically prohibit Parliament from enacting conflicting legislation. If however, such conflicting legislation was ineffective insofar as it was inconsistent with Community law, the Parliament's power to legislate as it liked would be limited accordingly. In Stoke-on-Trent City Council v B & Q plc11, Hoffmann J. was prepared to adopt the ECJ's proportionality test when considering the compatibility of the Shops Act 1950 and the free provision of the EC Treaty. He further went on to say:
"The EEC Treaty is the supreme law of this country, taking precedence over Acts of Parliament. Our entry into the Community meant that (subject to our undoubted but probably theoretical right to withdraw from the Community altogether) Parliament surrendered its sovereign right to legislate contrary to the provisions of the Treaty on the matters of social and economic policy which it regulated. " It was always thought that an Act of Parliament was the supreme law. Hoffmann J's judgement, however, indicates that EEC Treaty is more important.
Indeed, this case is an example of a straightforward adoption of Community law. German Courts had experienced some difficulties in the past with regards to references to the ECJ under the preliminary ruling procedure, Article 177 (now, Article 234) of the EEC Treaty. In the case of Kloppenburg12, the Federal Tax Court, despite acknowledging that EC legislation has precedence, refused to recognise the direct effects of EC law. Contrasting the above-mentioned case with Amministrazionne delle Finanze dello Stato v Simmenthal Spa13, the ECJ strictly affirmed the direct effect of EC legislation.
Indeed, it held that in the case of directly applicable EEC provisions within Article 189, if provision of national law conflicts with EEC law, national law provision is to be ignored without awaiting repeal and, moreover, it has an immediate retroactive effect, i. e. the repeal is effective from the time the case first occurred and not from the time it has been repealed! In Re Vat Exemption14 and Re Patented Feedstuffs15 1988 the decision in Kloppenburg16 was rejected by the BVerfG.
Indeed, German courts were found obliged to make reference to the ECJ in order to allow the parties to the case the chance to see whether Community law would have affected the outcome of the case. Indeed, individuals have now the right to a lawful judge and access to the ECJ, if needed. 17 Thus, it follows that Community rights are to be at least considered in German Courts. Although rejecting the ratio in Kloppenberg18, this decision was still miles apart from the decision in Simental Spa19, as it lacked the firmly established principle in favour of Community law.
In contrast to the German Constitutional Court, the English courts did not hesitate to rely on the direct applicability of Community law. Indeed, in R v Secretary of State for Transport, ex parte Factortame Ltd20 not only did the Divisional Court wished to refer to the ECJ under Article 177 (now, Article 234), it in fact had to grant the plaintiffs an interim injunction against the government restraining it from applying the Merchant Shipping Act Regulations until final judgment was made following a reference to the ECJ.
The reason being, the plaintiffs objected to the matter being referred to the ECJ unless the above-mentioned injunction was granted. This resulted in the government appealing to the Court of Appeal who ruled that the court had no jurisdiction to grant interim relief disapplying an Act of Parliament. Consequently, the House of Lords upheld the decision of the Court of Appeal: injunctive reliefe against the Crown was not within the court's jurisdiction.