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Complete Summary Lectures European Commercial Law
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Lecture 1: Introduction to European Commercial LawPreliminary Questions
- What do you know about Europe?
o Different cultures and religions
Christianity, protestants, Catholics, orthodox, Islam etc.
o Different languages
A little continent compared to Africa but with a lot of different languages.
o Different legal system (Comman Law and Civil law: German law tribe, French law tribe,
Roman law tribe etc.)
o Continent of wars. We did a lot of fighting. One of the reasons why it’s still peaceful after
WW2 is because of the EU.
- What do you know about EU?
o Is it a state? no, because the power the EU has only was given to them by the Member States. It’s
competence competence. The EU doesn’t have competence to create competence. They have to
ask the MS for competence. That’s different from a national state.
o It’s Sui generous. It’s unique. It’s on the way to a federation but it’s not yet.
o Being able to create competence is normally one of the important things of the state. ECJ
said that the EU is a structure sui generis (something unique in between an International
organisation and a State).
Notion of ECL
- No uniform meaning:
o Not a state but it is more than just being contractual partners
- ECL understanding here:
o Mainly private law, less public law (but see lecture 4 on Digital Service Act Legal Hybrid
o More substantial law than procedural law
o B2B and B2c only no c2c
- First meaning:
o Covers entire national systems of (business-related) private law
o Comparative approach
- Second meaning (=our understanding)
o Entire (business-related) private law of the EU (excluding national law)
o Thus covers private law in the:
Primary law
Secondary law
European Court of Justice (CJEU/ECJ) jurisprudence
The term ‘European private law’ does not have an established meaning.
- When used in a narrow sense, it is taken to include the influence of the law of the European
Union on private law, but not the influence of the ECHR.
- When used in a wider sense, it is understood to also include:
o a. Rules adopted within the context of the EU and relating to matters of international
procedure and private international law. Such rules were originally adopted in the form of
treaties and subsequently transformed into Regulations.
o b. Treaties in the field of private law concluded within a broader context than the
‘regional’ European context, where all or virtually all MS of are signatories to such a
treaty. Most important one: the Vienna Sales Convention/CISG.
o c. Regulations that have not yet entered into force and of which it is not certain that they
will ever do so.
o The foundation of this system of ‘soft law’1 was laid by the Principles of European
Contract Law: a text drafted by a group of legal scholars, containing general provisions on
contract law. The project shows that is is quite possible to harmonise the general part of
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, contract law if the task is approached from an academic perspective instead of a political
one.
o Two complications:
1. The Principles have been drawn up in a fairly rough outline. For the purposes
of actual codification many subjects would have to be supplemented and worked
out in greater detail.
2. The Principles consist almost exclusively of provisions that are non-mandatory
law in the national context.
Legal significance:
- Very high significance
- Delors, Former President of the European Commission
o 50% of national law and
o 80 % of commercial law is influenced by EU law
A lot of business law derives in the meanwhile of Brussels. National jurisdictions
are waiting for Brussels to do a regulation or directive but they are not doing it
bij themselves anymore.
o No empirical evidence for the numbers above.
o But his bottom line is right. There is a very high significance
- EU law triggers often national reforms of private/commercial law, e.g. in Germany:
o Modernisation of the law of obligations (2002)
o The EU law modernises the national law
Development of commercial law in Europe in a nutshell
- From 11th century: reception of Roman Law (Continental Europe).
o A uniform law for the entire Roman Emperor.
o Roman empire collapsed, roman law got lost
o Ius commune: “common law” for continental Europe (combination of canon (church law)
Law and Roman Law). When a French person traded with German Person they used the
ius commune
- From 18th/19th century: Fragmentation of private/commercial law due to the rise of nation-states.
o Reason: wanting their own civil code because of national pride
o Suddenly there where a lot of states (France, Germany and Italy). They were first
microstates but suddenly there were states. In Italy there was Venice and Florence but no
‘Italy’.
o For nation states the two things you want to have:
Currency
Law
o You want to show how progressive you are. In France there was the Code de Napoleon.
National states developed their own law
o Codification of private/commercial law as an expression of national pride
o Developments in private/commercial law drifted further apart
- At the beginning of the 20th century we had a lot of states and a lot of private and national
business law
- Foundation of European Economic Community (1957, later EU then):
o The effect of two world wars: as a consequence, the European Economic Community was
founded (1957, Rome treaties
o Control of steel, coal, and energy (nuclear) (essential in war). After two wars no one
trusted germans but western states needed them. Keep your enemies close.
- Hallstein, 1st president of the European Commission (1964):
o “Private law unification urgently needed!” (Including commercial law)
Because if so many legal systems it is hard for business man to trade.
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, He didn’t speak of harmonization, he sad unification so a step further
- Development of ECL since the mid-1980s (esp. directives)
o The European commission started the first directives which regulated private/commercial
law
o Before that was not the main thought. The main thought was to control two things:
Carbon
Steel
o They wanted to control the start of WW3 because if you wanted that war then you
needed Carbon and Steel. With the ECL you could control the Energy, Carbon and steel
together.
- Rapidly increasing number of private /commercial law rules
o B2b and b2c
- More and more directives in the field of European commercial law and private law came up.
- Recognition as a separate body of law (acquis communautaire)
o This is a separate law that did not come from the national states but the European Union.
o Acquis Communautaire: the legal body that derives from the Eu and not from the
national states anymore
Overview: ECL in primary law
- Gaps in ECL/ not one complete code
o Mainly because they don’t have competence.
- EU Law covers private/commercial law matters in
o Primary law
o Secondary law
o ECJ Jurisprudence
- What is primary law
o TEU: Treaty of the European Union
o TFEU: Treaty of the Functioning of the European Union
o EU Charta of Fundamental Rights
o All have equal standing (art 1(3) TEU)
- The primary law have been signed by the member states.
- Primary law has often a public law nature. Public law is vertical law (state, citizen) while private
law is horizontal (b2b, c2c, b2c)
- Contains several norms relevant to ECL
o Basic Freedoms in TFEU
Free Movement of Goods (Art 28 ff., 34 ff. TFEU)
Free Movement of Services (Art 56 ff/ TFEU)
Free Movement of Persons (Art 45(3), 52(1) TFEU)
Freedom of establishment (Art 49 ff. TFEU)
Free movement of capital (Art 63 TFEU)
- Seem almost like part of the fundamental rights of traditional national constitutions (vertical law)
- It’s mainly vertical law (public law nature) but they also have an impact on private autonomy
because they are prerequisite of the freedom of contract/but also sometimes direct horizontal
effect of basic freedoms (art 101 (2) TFEU).
- Problem: What happens if a state is not respecting basic freedoms?
o Can individuals refer directly to the basic freedoms resp? a violation of it?
See HvJEU Van Gend en Loos
“The Community constitutes a new legal order of international law for the
benefit of which the states have limited their sovereign rights, albeit within
limited fields and the subjects of which comprise not only member states
but also their nationals. Independently of the legislation of member states.
The community law therefore not only imposes obligations on individuals
but is also intended to confer upon them rights which become part of their
legal heritage. These rights arise not only where they are expressly
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, granted by the treaty, but also by reason of obligations which the treaty
imposes in a clearly defined way upon individuals as well as upon the
member states and upon the institutions of the community.”
Confirmed and further elaborated in HvJEU Costa v ENEL
ECL in secondary law – regulations
- Secondary law: is in practice more significant for ECL (as it ‘transforms’ TEU + TFEU (especially the
basic freedoms to b2b or b2c-situations in the EU)
- Secondary law = law rendered on basis of primary law
- Two legislative instruments (see art 288 TFEU)
o Regulation:
Definition: ‘A regulation shall have general application. It shall be binding in its
entirety and directly applicable in all member states (art 288(2) TFEU)
Features:
Directed to citizens directly
Direct horizontal effect
Function like national studies
Originally not often used in substantive ECL (exception: specific legal areas).
Examples of conflict of Laws Regulations
Passenger Rights Reg. No. 261/2004 (Air)
Passenger Rights Reg. No. 1371/2007 (Train)
Passenger Rights Reg. No. 181/2011 (Bus)
Passenger Rights Reg. No. 1147/2010 (Sea)
Examples of Conflict of Laws Regulations:
Regulation No. 593/2008 on the Law applicable to contractual
obligations (Rome I)
Regulations No. 864/2007 on the Law applicable to non-contractual
obligations (Rome II)
Both regulations great practical relevance
But times are changing: Increasing importance of regulations regulating (also)
private law (> creation of legal hybrids)
General Data Protection Regulation (EU) 2016/679 (GDPR)
Proposal for an AI regulation (AI-act)
Digital Service Act (DSA)
Digital Markets Act (DMA)
o Directive
Most used legal instrument in ECL
Definition:
‘ a directive shall be binding, as to the result to be achieved, upon each
Member State to which it is addressed, but shall leave to the national
authorities the choice of form and methods.’ (art 288(3) TFEU)
Features:
Directed to member states only
No direct horizontal effect for b2b, b2c or c2c-situations
Contains ‘only’ sector-specific rules
Can aim at minimum or full/maximum harmonisation (increasing
importance of the latter) > do you know the difference?
- How does the EU choose the “right” instrument
o It can be either regulation of directive
o It has to be proportional. If there is a milder safeguard to have a purpose then it has to be
a directive
o Arguments for directives
You can implement it or as a separate act but after the directive law has been
implemented it looks like a national law
Regulations: use often leads to systematic frictions within national legal systems.
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