This month’s case law digest contains an update on the EU’s conclusion of the Istanbul Convention on the prevention and combating of violence against women and domestic violence, as well as several important state aid decisions. It also contains cases on establishing jurisdiction in cases of child abduction, and national prohibitions on the use of technical surveillance measures in criminal proceedings. 

Court: Court of Justice of the European Union  

Case: C-362/19 P - Commission v Fútbol Club Barcelona 

Date: 4 March 2021 

Facts: A Spanish law adopted in 1990 obliged all Spanish professional sports clubs to convert into public ownership unless they had achieved a positive financial balance during the preceding years. Barcelona, Pamplona, Bilbao, and Real Madrid were the only clubs which satisfied the exception and therefore continued to operate as non-profit legal persons and to enjoy a special rate of income tax as such. The European Commission took the view that the special tax rate was unlawful state aid and ordered Spain to discontinue it and recover the aid provided to each of the affected clubs. However, in a hearing of the General Court, it was found that the Commission had not sufficiently assessed whether the advantage resulting from the special tax rate could be offset by a less favourable deduction rate for reinvestment of extraordinary profits applicable to such non-profit sports clubs. The General Court therefore annulled the Commission’s decision to classify the special tax rate as unlawful state aid. The Commission appealed the General Court’s judgment. 

Held: The CJEU accepted the appeal and set aside the General Court’s judgment. It held that to demonstrate that the special tax rate was an aid scheme conferring an advantage on its beneficiaries under Article 107(1) TFEU, the Commission was not required to examine the deduction rate for reinvestment of extraordinary profits or to consider whether this would neutralise the advantage resulting from the special tax rate. The CJEU found that the tax scheme did constitute state aid under Article 107(1) TFEU, and definitively dismissed FC Barcelona’s appeal against the Commission’s original decision. 

Court: Court of Justice of the European Union – Opinion of Advocate General Hogan 

Case: Avis 1/19 - Istanbul Convention  

Date: 11 March 2021 

Facts: The Istanbul Convention on preventing and combating violence against women and domestic violence was adopted by the Council of Europe and opened for signature in 2011. A first proposal by the Commission for a Council decision on the EU’s signing of the Istanbul Convention did not obtain sufficient support of the members of the Council. Consequently, it was decided to reduce the scope of the EU’s proposed conclusion of the Istanbul Convention and to limit it to areas that were considered as falling within the exclusive competence of the EU. It was also decided to split the Commission’s proposal for a Council decision to sign the Istanbul Convention into two separate decisions. The two Council decisions were adopted in May 2017. The first covers the aspects of the Convention falling within the EU’s competences on judicial cooperation in criminal matters and mentions Articles 82(2) and 83(1) TFEU as substantive legal bases. The second covers the aspects of the Convention relating to asylum and non-refoulement and mentions Article 78(2) TFEU as the substantive legal basis.  

The European Parliament (EP) requested the CJEU’s opinion on the accession of the EU to the Istanbul Convention. The EP asked which articles of the TFEU should constitute the appropriate legal bases for the Council to conclude the Convention on behalf of the EU, and whether it was necessary or possible to adopt two separate decisions on the signing and on the conclusion of the Convention. The EP also asked whether the EU’s conclusion of the Convention under Article 218(6) TFEU is compatible with the EU’s founding Treaties in the absence of a common agreement of all the Member States to be bound by the Convention. 

Held: Advocate General Hogan proposes that the CJEU hold that although the EU has signed the Istanbul Convention, the Council is entitled to wait (without however being forced to do so) for the common agreement of all Member States to be bound by the Convention before deciding whether and to what extent the EU will accede to it. It is exclusively for the Council to decide whether to wait for a common agreement or not. If the Council’s intentions with respect to the extent of the shared competences to be exercised upon conclusion of the Convention remain unchanged, the decision to authorise that conclusion on behalf of the EU should be founded on Articles 78(2), 82(2), 84 and 336 TFEU as substantive legal bases. The conclusion of the Istanbul Convention by the EU by means of two separate decisions would not render the conclusion of the Convention invalid. 

Court: Court of Justice of the European Union 

Case: C-603/20 PPU SS v MCP 

Date: 24 March 2021 

Facts: SS and MCP are the father and mother of P, who was born in 2017 and has British citizenship. SS and MCP are of Indian nationality and have leave to remain in the UK. They are not legally married but jointly hold parental responsibility. In October 2018, the mother went to India with P, who has since lived there with her maternal grandmother and is therefore no longer habitually resident in the UK. The father made an application for the return of P to the UK before the High Court of Justice (England & Wales), Family Division. The mother challenged the jurisdiction of the courts of England and Wales to decide on this application.  

The High Court noted that at the time the father made his application, the child was habitually resident in India and was fully integrated into an Indian social and family environment. The High Court asked the CJEU how it should interpret the Brussels II bis Regulation, which establishes grounds for jurisdiction in cases of the wrongful removal or retention of a child. In particular, the High Court doubted whether Article 10 of the Regulation can apply to a conflict of jurisdiction between the courts of a Member State and the courts of a third State. The High Court asked if at the time an application relating to parental responsibility is brought, the child is found to have acquired habitual residence in a third State following their abduction to that State, whether the courts of the Member State where the child was habitually resident immediately before their abduction retain jurisdiction indefinitely. 

Held: The CJEU found that the jurisdiction of the court of a Member State over an action relating to parental responsibility cannot be based on Article 10 of the Brussels II bis Regulation in a case of abduction of a child to a third State. Where a finding is made that the child now has their habitual residence in a third State, the jurisdiction of the court will have to be determined in accordance with the applicable international conventions or, in their absence, in accordance with Article 14 of the Brussels II bis Regulation. 

Court: Court of Justice of the European Union  

Case: C-392/19 -VG Bild-Kunst v Stiftung Pressischer Kulturbesitz (SPK) 

Date: 9 March 2021 

Facts: SPK is the operator of a German digital library containing links in the form of digital thumbnails to digitised content stored on the internet portals of participating institutions. VG Bild-Kunst, (VBK) a visual arts copyright collecting society, maintains that the conclusion of a licence agreement between VBK and SPK for the use of VBK’s catalogue of works in the form of thumbnails should be conditional on the inclusion of a provision that SPK must implement effective technological measures against third parties ‘framing’ VBK’s works. Framing is a technique consisting of dividing a website page into several frames and posting within one of them a link to an element coming from another site, to hide the original source of the image from the users of the site. SPK insists that such a term is not reasonable in light of copyright, and brought an action stating that VBK is required to grant the licence without such a requirement. The German Federal Court sought a determination as to whether framing is to be regarded as a communication to the public under Directive 2019/29 (if this is the case, VBK could require SPK to accept the contested provision).  

Held: The CJEU held that the alteration of an image’s size is not a factor in the assessment as to whether the image is a communication to the public. Where the copyright holder has imposed measures to restrict framing, the embedding of a work in a website page by means of the technique of framing constitutes an act of making that work available to a new public. The framing must therefore be authorised by the copyright holder. The copyright holder may not limit its consent to framing by means other than effective technological measures.  

Court: Court of Justice of the European Union – Opinion of Advocate General Bobek 

Case: Joined Cases C-357/19 Ministerul Public - Parchetul de pe lângă Înalta Curte de Casaţie şi Justiţie and others v QN and others and C-547/19 CY and others, Case C-379/19 DNA- Serviciul Teritorial Oradea v IG and others and Joined Cases C-811/19 and C-840/19 Ministerul Public – Parchetul de pe lângă Înalta Curte de Casaţie and others v FQ and others  

Date: 4 March 2021 

Facts: During 2019, the Romanian Constitutional Court referred several questions to the CJEU concerning judicial independence, the rule of law and the fight against corruption. The Advocate General considered these cases and the various constitutional points raised as a whole, as detailed below. 

Decision 685/2018  

In Decision 685/2018, the Romanian Constitutional court stated that some panels of the national supreme court, the Înalta Curte de Casaţie şi Justiţie (High Court of Cassation and Justice ‘HCCJ’), were improperly composed. This decision had enabled some of the parties concerned to introduce extraordinary appeals, which in turn raised potential issues concerning the protection of the financial interests of the EU under Article 325(1) TFEU. 

Held: AG Bobek proposed that the CJEU rule that EU law (Article 325(1) TFEU) does not preclude a decision of a national constitutional court declaring unlawful the composition of panels of a national supreme court on the ground that the right to an independent and impartial tribunal has been infringed, even if it has the consequence of allowing for extraordinary actions to be brought against final judgments. 

Decision 51/2016  

In Decision 51/2016, the Romanian Constitutional court declared that domestic intelligence services carrying out technical surveillance measures to investigate criminal activities was unconstitutional, and such evidence must be excluded from criminal proceedings.  

Held: AG Bobek proposed that the CJEU rule that EU law (the principle of judicial independence and Decision 2006/928/EC) does not preclude a decision of a national constitutional court from declaring the carrying out of technical surveillance measures in the framework of criminal proceedings by domestic intelligence services to be unconstitutional and requiring the exclusion of evidence obtained as such. 

Decision 417/2019 

In Decision 417/2019, the Romanian Constitutional court declared that the HCCJ had failed to comply with its legal obligation to establish specialist panels to deal at first instance with corruption offences. This led to the re-examination of closed cases concerning corruption connected with the management of EU funds. 

Held: AG Bobek proposed that the CJEU rule that Article 325(1) TFEU precludes a decision of a national constitutional court from declaring unlawful the composition of the panels of the national supreme court adjudicating on corruption offences on the ground that those panels are not specialised in corruption, even though the judges composing those panels were recognised as having the required specialisation, when such a finding is liable to give rise to systemic risk of impunity regarding offences affecting the financial interests of the EU.  

Court: Court of Justice of the European Union  

Case: C 562/19 P Commission v Poland and C 596/19 P Commission v Hungary 

Date: 16 March 2021 

Facts: In 2016 Poland introduced a tax on the retail sector based upon monthly turnover of any retailer involved in the sale of goods to consumers with a turnover exceeding 17 million Polish zlotys (PLN). The tax had two bands, with a 0.8% rate on turnover between 17-170 million PLN and 1.4% for turnover above 17 million PLN. The European Commission considered that the tax constituted state aid incompatible with the internal market on the basis that it gave a selective advantage to businesses with low turnover. The Commission therefore required the cancellation and suspension of all payments made under the tax. In May 2019, the General Court annulled the Commission’s decision and held that the Commission was wrong to find the tax to confer any selective advantage.  

In 2014 Hungary had also introduced a progressive tax on revenue linked to the broadcast and publication of advertisements. The tax had two different rates based on turnover and had the option for taxable persons whose taxable profits before tax in 2013 were zero or negative to deduct from their tax base 50% of the losses carried forward from previous years. The Commission found this tax measure to be state aid because of its progressive structure and the option to deduct losses. In 2019, the General Court annulled this decision and held that the Commission had erred in finding that the tax measure conferred selective advantages. The Commission appealed both cases.  

Held: The CJEU found that, given the current state of harmonisation of EU tax law, the Member States are free to establish the system of taxation which they deem most appropriate so that the application of progressive taxation falls within the discretion of each member state. The Polish retail tax and Hungarian advertising tax therefore do not infringe EU law on state aid. The CJEU dismissed the Commission’s appeals and upheld the judgment of the General Court in both cases. 

Court: Court of Justice of the European Union  

Case: C-746/18 - H.K v Prokuratuur 

Date: 2 March 2021 

Facts: Criminal proceedings were brought by Estonia against HK on various counts of low-level offences. HK was subsequently jailed for two years with the evidence provided relying upon personal data generated through electronic communications. The Estonian supreme court asked the CJEU whether the objective of combating crime justifies such an interference with the fundamental rights of the person being investigated under EU law (Article 15(1) of Directive 2002/58/EC on privacy and electronic communications), particularly where the investigating authority has access to the data for a very short period or the amount of data gathered is very limited.  

Held: The CJEU held that access, for purposes in the criminal field, to a set of traffic or location data in respect of electronic communications, allowing precise conclusions to be drawn concerning a person’s private life, is permitted only to combat serious crime or prevent serious threats to public security. In addition, EU law precludes national legislation that confers upon the public prosecutor’s office the power to authorise access of a public authority to such data for the purpose of conducting a criminal investigation. 

Court: Court Justice of the European Union  

Case: C-28/20 - Airhelp Ltd v Scandanavian Airlines System SAS 

Date:  23 March 2021 

Facts: A passenger had booked a seat on a Scandinavian Airlines System (SAS) flight. The flight was cancelled on the day of the flight because of a strike by SAS’s pilots. Airhelp brought proceedings on the passenger’s behalf before the Attunda District Court in Sweden, claiming the compensation laid down by the Air Passenger Rights Regulation (Regulation 261/2004) for cancellation of a flight. SAS refused to pay the compensation, taking the view that the strike by its pilots constituted an ‘extraordinary circumstance’ within the meaning of Regulation 261/2004 since it was not inherent in the normal exercise of its activity of providing air transport services and was beyond its actual control. Airhelp took the view that the strike did not constitute an ‘extraordinary circumstance’ of that kind since industrial action, such as strikes, falls within the ordinary course of business of an airline. The Swedish court referred the question to the CJEU. 

Held: The CJEU held that a strike organised by a trade union of the staff of an air carrier that is intended in particular to secure pay increases does not fall within the concept of an ‘extraordinary circumstance’ capable of releasing the airline from its obligation to pay compensation for cancellation or long delay in respect of the flights concerned. This is so even if the strike is organised in compliance with the conditions laid down by national legislation for organising strikes.  

Court: Court of Justice of the European Union  

Case: C-425/19 P Commission v Italy, Fondo interbancario di tutela dei depositi, Banca d’Italia et Banca Popolare di Bari SCpA 

Date: 2 March 2021 

Facts: Italian bank Banco Popolare di Bari expressed an interest in subscribing to a capital increase in Tercas Bank subject to the condition that the negative equity be covered in full by FITD (a mutual consortium of Italian banks governed by private law). The FITD covered the negative equity and granted Tercas certain guarantees; Banca d’Italia approved these measures. This decision was subsequently determined to constitute unlawful state aid by the Commission. Italy and the banks took the matter before the General Court, which annulled the Commission’s decision. The Commission appealed.  

Held: The CJEU dismissed the Commission’s appeal and upheld the General Court’s decision. It held that the General Court rightly found that those measures do not constitute state aid because they are not imputable to the Italian State, in accordance with Article 107(1) TFEU. There is no link between FITD and the Italian State, and the Commission erred in taking the view that the Italian authorities had exercised substantial public control in establishing the measures adopted by FITD.  

Court: Court of Justice of the European Union  

Case: C-64/20 - UH v An tAire  Talmhaiochta Bia agus Mara, Éire, An tArd-Aighne 

Date: 17 March 2021 

Facts: UH, a native Irish speaker, claimed that the information accompanying veterinary products was written exclusively in the English language. UH noted that Directive 2001/82 requires this information to be in both of the official languages of Ireland, Irish and English. UH requested that the Irish High Court make a declaration that the Directive 2001/82 was incorrectly transposed, and that Ireland was under an obligation to amend its national legislation accordingly. The Irish Court found that the packaging did not comply with the language requirements set out in Directive 2001/82. However, as Regulation 2019/6 was due to come into force from 28 January 2022 and required the packaging to be in Irish and English, the claimant would only get a limited temporary benefit from any amendment to Irish law. The Irish court therefore asked the CJEU whether it had discretion to refuse relief in spite of its finding that national law had failed to give effect to a particular aspect of an EU directive. 

Held: The CJEU held that Article 288 TFEU must be interpreted as precluding a national court which finds its Member State has not properly transposed an EU directive from refusing, on the grounds that national legislation is compliant with a Regulation which will soon come into force, to make a declaration that that Member State has not correctly transposed that directive and is required to take remedial steps in that regard.  

Court: Court of Justice of the European Union  

Case: C-824/18 - A.B and Others v Krajowa Rada Sądownictwa 

Date: 2 March 2021 

Facts: By resolutions adopted in August 2018, the Polish National Council of the Judiciary (the KRS) decided not to present to the President of the Republic of Poland proposals for the appointment of five candidates (the ‘appellants’) to the Polish Supreme Court and to instead propose other candidates to these positions. In 2018, the appellants lodged appeals against these nominations. The Polish law on judicial nominations had been amended to provide that unless all the participants in a procedure for appointment to a position as judge at the Supreme Court challenged the relevant decision of the KRS, that decision became final with respect to the candidate presented for that position. The Polish referring court asked for a preliminary ruling from the CJEU on whether the Polish judicial appointment rules were compliant with EU law. In 2019 the Polish law on judicial nominations was amended again and it became impossible to lodge appeals against decisions of the KRS concerning the proposal/non-proposal of candidates for appointment to judicial positions of the Supreme Court. As a result, any pending appeals were declared to be discontinued by operation of law. This de facto deprived the Polish referring court of its jurisdiction to rule on that type of appeal and of the possibility of obtaining an answer to the questions that it had referred to the CJEU for a preliminary ruling. The Polish referring court requested a further preliminary ruling on whether the new rules were compatible with EU law.  

Held: The CJEU held that the 2018 and 2019 amendments to the Polish judicial appointment laws, which had the effect of removing effective judicial review of the KRS’ decisions proposing to the President of the Republic candidates for the office of judge at the Supreme Court, were liable to infringe EU law. Article 267 TFEU and Article 4(3) TEU preclude legislative amendments with the specific effect of preventing the CJEU ruling on questions referred for a preliminary ruling, as in this case. Article 19(1) TEU also precludes legislative amendments capable of giving rise to legitimate doubts as to the imperviousness of the judges appointed. If an infringement is proved, the principle of the primacy of EU law requires the Polish national court to disapply the amendments to the judicial appointment rules. 

Court: Court of Justice of the European Union 

Case: C-739/19 - VK v An Bord Pleanála 

Date: 10 March 2021 

Facts: VK is a party in appeal proceedings before the Irish Supreme Court concerning the liability for the costs of judicial proceedings relating to planning permission granted for the construction of an animal inspection unit close to his farm. VK decided to represent himself before the Irish Supreme Court and have Ms O, established in Germany, represent him in the CJEU. VK now wishes to engage Ms O to represent him before the Irish Supreme Court. The Irish Supreme Court referred the case to the CJEU on the basis that it is uncertain whether Regulation 6 of the 1979 Irish Lawyers Regulation is compatible with EU law, in so far as it requires a visiting lawyer (Ms O) to be assisted by the services of a local lawyer practising before the judicial authority in question. The Irish Supreme Court asked whether Article 5 of Directive 77/249 (which concerns freedom to provide services for lawyers) precludes such a requirement for visiting lawyers.  

Held: The CJEU held that Article 5, Directive 77/249 does not preclude a visiting lawyer from being required to work in conjunction with a local lawyer who practises before the judicial authority in question. This obligation on visiting lawyers is not disproportionate in the light of the objective of the proper administration of justice. However, a general obligation to work in conjunction with a local lawyer who practises before the judicial authority in question which does not account for the experience of that visiting lawyer, goes beyond what is necessary to attain the objective of the proper administration of justice. It is for the Irish referring court to determine whether Ms O has the capability to practise before the judicial authority in question.  

Court: Court of Justice of the European Union 

Case: Joined Cases C-870/19 and C-871/19 Prefettura Ufficio territoriale del governo di Firenze v MI and TB 

Date: 24 March 2021 

Facts: In 2013, the Italian authorities established that MI (Case C-870/19) and TB (Case C-871/19), as drivers of road transport vehicles (lorries, motor coaches and buses), were not able to produce the record sheets of the tachograph installed in their vehicles relating to the current day and several of the previous 28 days. EU Regulation 3821/85 requires a driver to be able to produce the record sheets relating to the period covering the current day and the previous 28 days. The Italian authorities therefore imposed several administrative penalties on MI and TB for several infringements. MI and TB brought actions before the Italian courts against those penalties. The Italian Supreme Court of Cassation asked the CJEU whether Regulation 3821/85 must be interpreted as meaning that, in circumstances such as those of the present cases, the competent authorities must impose on that driver a single penalty, for a single infringement, or rather a number of separate penalties for a number of separate infringements, the number of which corresponds to that of the missing record sheets. 

Held: Lorry, motor coach and bus drivers who, during an inspection, do not produce the record sheets for the tachograph relating to the current day and the previous 28 days are subject to a single penalty, irrespective of the number of missing record sheets. The principle that offences and penalties must be defined by law, so that citizens can ascertain what conduct will make them criminally liable and the penalties which that conduct attracts, applies to this field. 

Court: Court of Justice of the European Union 

Case: C-771/19 NAMA Symvouloi Michanikoi kai Meletites AE - LDK Symvouloi Michanikoi A.E. and Others v Archi Exetasis Prodikastikon Prosfigon (AEPP) and Attiko Metro A.E. 

Date: 24 March 2021 

Facts: The company Attico Metro (AM) held an open tendering procedure for technical consultancy services for the project to extend the Metro in Athens. The first stage of the tendering procedure consisted of reviewing the candidates’ technical bids, while the second consisted of reviewing economic bids and an overall assessment. Four candidates, including NAMA and SALFO, submitted a bid. AM excluded NAMA’s bid at the first stage of the tendering procedure on the grounds that the experience of NAMA’s construction team did not meet the requirements of the contract notice. AM admitted SALFO’s bid through to the second stage of the procedure. NAMA brought a pre-litigation administrative appeal against this decision before the Greek Public Procurement Review Authority (AEPP). The AEPP partially dismissed the appeal, allowing it only in so far as it was directed against the grounds of AM’s decision concerning the proof of experience of one of the members of NAMA’s construction team.  

NAMA then brought an action before the Greek Council of State Suspension chamber (SEEA) seeking the suspension of the AEPP’s decision and AM’s decision. SEEA asked the CJEU whether the Greek national practice of holding that a tenderer who has been excluded from the tendering procedure cannot show an interest in bringing proceedings to dispute the lawfulness of the participation of another tenderer in that procedure, except on the grounds of an infringement of the principle of equality in the assessment of the bids, is contrary to EU law (namely Directive 92/13/EEC on public procurement and the award of concession contracts). 

Held: The CJEU held that EU law precludes a national practice by which a candidate excluded from a public procurement procedure may rely, in that candidate’s appeal against the decision to admit the bid of another tenderer, only on the infringement of the principle of equality in the assessment of bids. The dismissal of a pre-litigation administrative appeal against a decision to exclude a candidate does not affect that candidate’s interest in bringing proceedings, provided that that dismissal does not have the authority of res judicata (i.e., the dismissal is issued by a competent court, and therefore cannot be pursued any further).