Unilateralism (PIL) and Union Citizenship: Difference between pages

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by ''[[Giesela Rühl]]''
by ''[[Norbert Reich]]''


== 1. Introduction ==
== 1. Interpreting economic freedoms as citizens’ rights ==


[[Private International Law (PIL)|Private international law (PIL)]] deals with the question of which law applies in cases that have connections to more than one legal order. To answer this question, essentially two methods are available: the unilateral method dating back to the Middle Ages on the one hand, and the multilateral method established in the 19th century by Friedrich Carl von Savigny on the other. The methods are fundamentally different. Whilst unilateralism begins with the norm and determines whether it demands application to a particular legal relationship, multilateralism begins from the legal relationship and assigns it to a particular legal order with the help of choice of law rules. In Europe, the multilateral method has dominated since the 19th century. The unilateral method is predominant in the United States.
The [[Fundamental Freedoms (General Principles)|fundamental freedoms]] of the [[Treaty on the Functioning of the European Union (TFEU)]], in particular those with a personal content, have been broadly interpreted in the early case law of the ECJ as also applying to economically non-active citizens. This has happened via a broad understanding of the prohibition on [[Discrimination (General)|discrimination]] based on nationality according to Art 18 TFEU/12 EC. A similar tendency can be seen in extending economic freedoms to include recipient rights (so-called ‘passive freedoms’) which can also be invoked by private persons. Thus the scope of application of EU law has been greatly widened and transformed into ‘citizens’ rights beyond the market’. Some examples from the ECJ case law demonstrate this tendency:


=== a) Theoretical departure point ===
EU tourists’ right to non-discriminatory access of museums (Case C-45/93 – ''Commission v Spain'' [1994] ECR I-911); the prohibition of restrictive entry conditions or additional enrolment fees for EU students in institutions of higher education and professional training (Case 293/83 – ''Gravier'' [1985] ECR 593; Case 24/86 – ''Blaizot'' [1988] ECR 379), excluding, however, a right to equal treatment with regard to stipends and other support payments (Case 197/86 – ''Brown v Secretary of State for Scotland'' [1988] ECR 3205; Case 39/86 ''Lair v University of Hannover'' [1988] ECR3161); the prohibition of discrimination in victim compensation (Case 186/87 – ''Cowan'' [1989] ECR 195); the freedom to go to another Member State to obtain services (including health care) without restrictions in relation to payment (joined Cases 286/82 and 26/83 – ''Louisi & Carbone'' [1984] ECR 377).


The distinction between unilateralism and multilateralism finds its origin in the understanding of the nature and the function of private law: for unilateralism, private law—like public law—is an expression of state sovereignty. It effectuates state interests and fulfils social functions. Cases with ties to multiple legal orders are, from this perspective, conflicts between states and state interests. It follows almost inevitably that determination of the applicable law must start from the statutory provisions in question and refer to the values and functions of substantive law as well as the intentions of the legislature. The situation looks different from the perspective of the multilateral method: for multilateralism private law—unlike public law—is neutral and apolitical. It does not incorporate state interests and has no socially constitutive functions. Instead, it orders personal activities and freedoms and regulates interests of private parties. Cases with ties to multiple legal orders are, therefore, not a matter of conflicts between states and state interests but clashes between private intentions and individual spheres of freedom. The determination of the applicable law is thus a balancing of private interests and is undertaken with the help of general choice of law rules without consideration of legislative intent or the function of the respective substantive laws. And even though multilateralism determines the reach of domestic and foreign law, it does not at the same time impair the sovereignty of the relevant states. Since private law is free of state interests, deter- mination of the reach of foreign norms cannot injure state interests. Given the neutrality of private law, the relevant rules are fundamentally equal and exchangeable.  
Directives 90/365, 90/364 and 93/96 codified these rights to some extent for retired persons, all other citizens and students, but they are primarily directed against the state or state institutions such as universities, social security bodies and municipalities. The directives do not have specific private law content.


=== b) Practical implications  ===
A certain exception with regard to the state-directed content of non-discrimination rules can be seen in the provisions on names, which usually belong to private law and are coordinated between different jurisdictions by rules on [[Private International Law (PIL)|private international law (PIL)]]. The case of ''Konstandinis'' (ECJ Case C-168/91 [1993] ECR I-1191) concerned the spelling of the name of a Greek citizen who was doing business in Germany. The competent German authority required a Latin transcription which would have distorted the name as used in public. Whereas AG Francis Jacobs, in his opinion of 9 December 1992 (para 40), argued in favour of an EU citizen’s broad fundamental right to one’s own name ([[Law of Names|law of names]]), the Court somewhat fictitiously referred to the [[Freedom of Establishment|freedom of establishment]] and a self-employed person’s right to be free from rules on transcription which could result in a distortion of his name and confusion in contacts with potential clients.


The distinction between unilateralism and multilateralism has more than mere theoretical meaning. The founder of the multilateral method, Friedrich Carl von Savigny, assumed that multilateralism would regularly come to the same result as the unilateral method. But for the judges trusted with the determination of the applicable law, the differences are enormous. On the basis of unilateralism, the judge determines the applicable law in two steps: in the first step he must decide which law demands application by interpreting the relevant substantive norms. Since the determination of each law takes place separately, it might happen that the laws of various states claim applicability. In such a case the judge must establish which of these laws has priority. On the basis of multilateralism, the judge ascertains the applicable law largely in one step starting from the legal relationship. With the help of general, previously determined criteria, he assigns this legal relationship to a particular substantive law without asking whether this law demands application.
== 2. ‘Union citizenship’ as a fundamental right of economically inactive EU citizens ==


All things considered, unilateralism thus poses greater challenges and practical difficulties for the judge than multilateralism. This is because a court seized in a cross-border case must look into all potentially applicable laws and determine those laws’ interest in being applied. However, courts have neither the necessary (comparative law) education nor the necessary resources. Unilateralism, therefore, runs the risk of producing arbitrary and, for the parties, hardly foreseeable results. The multilateral method, in contrast, avoids these problems. It therefore contributes to legal certainty and can claim greater practicality.  
A certain generalization and extension followed the Community ''acquis ''with regard to the establishment of a Union citizenship in Art 8 EC (1992) in its Maastricht version. In its original version it read: ‘Citizenship of the Union is hereby established. Every person holding the nationality of a Member State shall be a citizen of the Union. Citizenship of the Union shall complement and not replace national citizenship’. Article 20 TFEU/17 EC in the Amsterdam version added para 2 which reads: ‘Citizens of the Union shall enjoy the rights conferred by this Treaty and shall be subject to the duties imposed thereby’. Article 20 TFEU/17 EC as revised (OJ C 290 of 30 November 2009) provides: ‘Citizenship of the Union shall be additional to and not replace national citizenship’.


== 2. Historical development ==
Art 21 TFEU/18 EC guarantees a right to free movement ‘subject to the limitations and conditions laid down in this Treaty and by the measures adopted to give it effect’. Article 22 TFEU/19 EC concerns the right to vote and stand as a candidate in municipal and EU elections, Art 23 TFEU/20 EC the right to diplomatic protection, Art 24 TFEU/21 EC the right to petition the European Parliament which is extended to all residents in Art 227 TFEU/194 EC.


=== a) The medieval statutists’ method ===
As the citizen concept did not limit the Member State competence to determine nationality, the ‘fathers’ of the Maastricht Treaty and most legal authors did not realize its importance in implying a mutual recognition of multiple citizenship by all Member States (ECJ Case C-369/90 – ''Micheletti'' [1992] ECR I-4239; see however ECJ Case C-135/08 ''Rottmann'' (not yet reported) concerning limitations on a Member State’s right to withdraw citizenship in light of the principle of proportionality). It seemed obvious at this time that the citizenship concept only expressed a very obvious idea without imposing additional rights or duties. There was agreement that citizenship did not have any relevance in the sector of private law.


Unilateralism in private international law finds its origin in the medieval statutists’ method. It was developed in the 12th century by Upper Italian courts and scholars to determine the applicable law in disputes between citizens of various northern Italian states. On the basis of the [[Corpus Juris Civilis|''Corpus Juris Civilis'']] and the ''lex cunctos populos'' set out therein, it was assumed that the spatial reach of local norms, the so-called statutes, was limited. The jurists tried to determine the reach of local norms by creating different categories of norms. To begin with, they distinguished between norms pertaining to the person (''statuta personalia'')'' ''and norms pertaining to the territory (''statuta realia''). Provisions pertaining to the person were to be applied to the citizens of a state, even independent of their location. Provisions concerning the territory were applicable to persons who remained for six months within the relevant city walls. Later, mixed provisions (''statuta mixta'')'' ''were added, which could not be unequivocally categorized.
== 3. Union law guarantees of Union citizenship ==


The statutists’ method dominated European private international law—with differences in detail—up until the 19th century. Nevertheless, it did not manage to create generally accepted criteria for categorizing local norms. The Upper Italian courts and scholars—just like their French and Dutch successors—took account of the wording of the respective local laws. In part, the categorization was even made on the basis of the first word. Later, the attempt was to honour the actual or supposed intention of the legislature. But, even here, no agreement about the process in individual cases could be achieved. The criteria for the determination of the jurisdictional reach of local laws, therefore, differed from province to province and from town to town. Although private international law was seen as universally valid, there were no universally valid solutions.  
Only the ECJ case law after ‘Maastricht’ conferred the status of a fundamental right on Union citizenship. The ''Grzelczyk'' judgment of 20 September 2001 (ECJ Case C-184/99 [2001] ECR I-6193) stated that: ‘Union citizenship is destined to be the fundamental status of nationals of the Member States, enabling those who find themselves in the same situation to enjoy the same treatment in law irrespective of their nationality, subject to such exceptions as are expressly provided for’ (para 31). This general prohibition of discrimination could be invoked by a French student who had received certain social benefits in Belgium (minimex) to finish his studies there, the benefits originally being limited to Belgian citizens. The Belgian state could therefore not require repayment as ‘unjustified enrichment’. The Court did not say anything regarding the effects of its judgment on private law relations, similar to later judgments which usually were concerned with litigation about residence rights, tax and social benefits. Its later ''Baumbast'' judgment (ECJ Case C-413/99 [2002] ECR I-7091, para 84) held that the rules on citizenship enjoy direct effect, which shows their importance in the rhetoric of EU law as Union citizenship consequently enjoys the same status as the other free movement rights.  


=== b) The classical theory of private international law ===
An indirect importance for private law can be shown in the area of name rights, similar to the situation before the introduction of the citizenship concept itself. The case ''García Avello'' (ECJ Case C-148/02 [2003] ECR I-11613) concerned a name change for a child with dual Belgian and Spanish citizenship. Belgian law required either the name of the father or the mother; unlike Spanish law it did not allow for using both names. The Court found a non-justified discrimination because children with dual nationality suffered a disadvantage which could not objectively be justified. As a result, persons with dual nationality have a right to choose between two jurisdictions concerning their name; thereby the respective aims of the otherwise non-harmonized national PIL rules on names are rendered obsolete.


The multilateral method can be traced back to Friedrich Carl von Savigny, the founder of the classical theory of private international law. Its basis is to be found in his conviction—corresponding to the spirit of the 19th century—that private law is not a subset of state law and an expression of state power, but a product of civil society. For Savigny, the delineation of various legal orders could, therefore, not start from the substantive law in question. Instead, the analysis had to begin with the legal relationship. After all, if private law is neither part of the state order nor an expression of state power, but rather an expression of the people and of individual will, conflicts between legal orders do not appear as conflicts between sovereign states, but as conflicts between areas of individual will or spheres of freedom. And if law is an expression of the people and of individual will, legal relationships must fit spatially into a particular legal area. They must have—in Savigny’s words—a ‘natural home’ (''natürliche Heimat''), a ‘seat’ (''Sitz''). For Savigny, the task of private international law was, therefore, to allocate each legal relationship to the legal order where it has its rightful place or ‘seat’. And since he considered private law as a product of civil society, free of state interests and legislative purposes, he aimed at locating legal relationships in the spatially optimal jurisdiction with the help of general criteria but without regard to the content, function and values of substantive law.  
A more recent case, ''Grunkin and Paul'' (ECJ Case C-353/06 [2008] ECR I-7639), concerns the conflict between the Danish PIL rules on names based on ''ius soli'' and the German ones based on ''ius sanguinis''. The child of German parents was born in Denmark where he could use the names of both parents. This was rejected when he returned to live in Germany because German PIL requires German citizens to take either the name of the father or of the mother; double names for children should be avoided because of the resulting confusion of the public. Although both AG F Jacobs in the first reference proceeding (ECJ Case C-94/04 – ''Standesamt Niebüll'' [2006] ECR I-3561) and AG Sharpston in the final case, with reference to ''Konstantinidis'' and ''García Avello'', wanted to avoid a general conflict with German PIL rules, they argued for an opening of the strict German rules prohibiting double names of children. It is, in their opinion, not so much a problem of non-discrimination according to Art 18 TFEU/12 EC, but relates more to a ‘general principle of equal treatment’ and to free movement under Art 21 TFEU/18 EC ([[General Principles of Law|general principles of law]]). The ECJ followed this argument by saying: ‘None of the grounds put forward in support of the connecting factor of nationality for determination of a person’s surname, however legitimate those grounds may be in themselves, warrants having such importance attached to it as to justify, in circumstances such as those of the case in the main proceedings, a refusal by the competent authorities of a Member State to recognise the surname of a child as already determined and registered in another Member State in which that child was born and has been resident since birth’ (para 31).


The multilateral method presides over the conflicts law in the European legal order up until today. It also applies in the [[European Community]]’s recently created choice of law rules. In a slightly altered linguistic form, they state that conflicts between various legal orders are to be solved through application of the law ‘with the closest connection’ to the case. Thus, unlike the United States, where the classical theory of private international law could not, at least not for long, endure and where it only glimmers through in the ‘most significant relationship’ of § 6 Restatement (Second) of the Conflict of Laws ([[Restatements|restatements]]), multilateralism has held its ground in Europe.  
It remains to be seen whether this broad definition of the free movement principle has importance beyond the specific cases on the PIL of Member States in general. The tendency of the ECJ seems to be to avoid strict rules on mandatory connecting factors in cross-border situations and to substitute them with a more flexible rule allowing a broader choice of the persons protected by EU law (for a more narrow reading see however case C-391/09 ''Malgozatza Runevic-Vardyn and others v Vilniaus miesto savivaldybes administracia'' (not yet reported) concerning the transcription of foreign names).


=== c) The political school of private international law ===
== 4. ‘Horizontal direct effect’ of Union citizenship? ==


Whilst the multilateralism of the Savigny brand continues to dominate in Europe, unilateralism enjoys considerable popularity on the other side of the Atlantic. In particular, it formed the basis for the so-called political school of [[Private International Law (PIL)|private international law]], which was founded in the course of the American Conflict of Laws Revolution by Brainerd Currie in the middle of the 20th century. With respect to its structure and orientation, the understanding of private law is, as with Savigny, of decisive significance. Unlike the classical theory, the political school does not see private law as a neutral and apolitical legal zone, free of state interests and social functions. Under the influence of American legal realism, it rather emphasizes its socially formative and purposive character, which assists states in realizing their interests and intentions. For private international law doctrine, this understanding of private law—different from the understanding underlying classical theory—means that conflicts between various legal orders are conceived of as conflicts between various states and their interests. The central problem that private international law must solve is therefore not the discovery of the legal order in which the relevant dispute has its seat. Rather, the concern is the discovery of the legal order with the largest interest in the application of its substantive norms. The determination of the applicable law is therefore—as with the medieval statutists’ theory—dependent on an assessment of the intention of the relevant substantive norms. However, unlike the statutists’ theory, which classified the relevant provisions of substantive law according to their demand to be applied, the political school foresees a judicial investigation and balancing of the affected state interests.  
It is a debated question whether Union citizenship takes ‘horizontal direct effect’ in private law relations, but this has not yet been expressly decided by the ECJ. The above-mentioned cases (which have not been analysed in their totality) only apply to the relations between the citizen and a Member State, either concerning restrictions on free movement, access to benefits, or restrictive public law rules on names as determined by PIL. As fundamental rights, they are applicable not only in favour of ‘foreign’ but also of ‘home’ EU nationals if they are in a situation covered by EU law like in the case ''Grunkin and Paul''.


The political school of private international law influences US conflicts law up until today. Next to Brainerd Currie, leading proponents include David Cavers, Robert Leflar, Albert Ehrenzweig, Arthur von Mehren, Donald Trautmann and Russell Weintraub. In Europe, in contrast,'' ''the political school has not achieved widespread acceptance. As shown by a glance at the Member States’ private international laws and the provisions issued by the European Union in private international law, the classical theory is dominant. Nevertheless, the political school has left its traces, as it led to a politicization and instrumentalization of multilateral choice of law rules. This is obvious in provisions such as Arts 5 and 6 Rome Convention as well as Arts 6 and 8 Rome I ([[Consumer Contracts (PIL)|consumer contracts (PIL)]]; [[Employment Contracts, Individual (PIL)|employment contracts, individual (PIL)]]). These provisions elevate political intentions as well as values and functions of substantive law to the level of private international law and, thus, contribute to their enforcement with the help of multilateral choice of law rules.
A horizontal direct effect in a situation similar to Union citizenship has been accepted by the ECJ in the case ''Phil Collins'' (ECJ Joined Cases C-92 and 326/92 [1993] ECR I-5145). It concerned a discrimination against art performers with regard to their protection in the marketing of copyrighted music. The ECJ directly applied the prohibition against discrimination of then Art 7 EEC, which is now Art 18 TFEU/12 EC. It wrote: ‘The Court has consistently held that the right to equal treatment ... is conferred directly by Community law ... That right may, therefore, be relied upon before a national court as the basis for a request that it disapply the discriminatory provisions of a national law which denies to nationals of other member States the protection which they accord to nationals of the State concerned’ (para 34).


== 3. Modern trends ==
It is a disputed question in legal writing whether this ruling can be generalized or is only applicable for the exercise of intellectual property rights. This author proposes a ‘compromise’ solution. A horizontal direct effect can be seen as existing in similar situations as has already been recognized for the fundamental freedoms. This concept corresponds to the equal status of economic freedoms and citizens’ rights ([[European Internal Market|European internal market]]). The recent case law of the ECJ recognizes horizontal direct effect of the [[Fundamental Freedoms (General Principles)|fundamental freedoms]] when they originate from a ‘collective regulation’ where freedom of contact does not exist (ECJ Case C-438/05 –'' ITWF and others'' ''v Viking Line'' [2007] ECR I-10779, paras 56–66) or from employment relations (ECJ Case C-94/07 – ''Raccanelli v Max Planck-Gesellschaft'' [2008] ECR I-5939, para 43). It is not yet clear whether this case law also applies to areas beyond an economic objective, for instance to by-laws of amateur sport organizations limiting access of EU-citizens in a discriminatory manner, provisions restricting the freedom of members of non-professional associations and unjustified social action with harmful consequences for third parties. Details of such a broad concept and its justifications under EU law still have to be determined. The main idea behind this extension of the effects of the citizenship concept to relations governed by private law is a functional'' ''one: restrictions on free movement rights can originate not only from the state, but also from private associations if they act in a collective manner. This is also justified by the different rules of Member States in distinguishing between public and private law, a function which cannot be simply taken over by EU law; an autonomous link has to be found which relates to power structures imposed on EU citizens.


The fact that multilateralism prevails in Europe—both at the level of the individual Member States and at the level of the European Union—up until today, does not mean that unilateralism has made no impact here. On the contrary, the penetrating state regulation undertaken in the course of the 20th century has increased the number of overriding mandatory provisions and the number of legal areas in which the determination of the applicable law is not dependent on the seat of the legal relationship but on a reading of the legislative intent behind the relevant laws. Since globalization and Europeanization have intensified this trend, the unilateral islands in the sea of multilateral international private law have grown in the last years.  
With regard to Union citizenship, this implies that collective restrictions or discrimination against Union citizens fall under the scope of application of the TFEU and have to be evaluated under Arts 18, 20, 21 TFEU/12, 17, 18 EC; they must be justified in order to be compatible with EU law. The following are examples of non-justified discrimination: (i) as in'' ''professional sports, unreasonable selection rules of associations concerning participation in sport matches by ‘semi professionals’ or amateurs (ECJ Joined Cases C-51/96 and 191/97 – ''Deliège and others v ASBL'' [2000] ECR I-2549); (ii) discriminatory entrance rules for private higher education institutions which have been accredited by public bodies;'' ''and (iii) clauses in [[Standard Contract Terms|standard contract terms]] putting EU nationals at a disadvantageous position, like higher tariffs for foreigners in insurance cover or higher costs for cross-border banking services as opposed to national transactions).


=== a) Overriding mandatory provisions ===
== 5. No direct horizontal effect of Directive 2004/38 ==


Unilateral elements manifest themselves in European conflicts law primarily in the form of overriding mandatory provisions (''Eingriffsnormen''<nowiki>;</nowiki>'' loi d’application immédiate''<nowiki>;</nowiki>'' legge di applicazione necessaria''). Friedrich Carl von Savigny'' ''had already identified them, ‘as laws of strictly positive, compulsory nature’, and they are recognized by the private international laws of the Member States and the European Union—as is shown by Art&nbsp;9 Rome&nbsp;I (Reg 593/2008) and Art&nbsp;16 Rome&nbsp;II (Reg 864/2007). They stand out in that they determine their own sphere of application and do so independent of the applicable law that is otherwise established with the help of general choice of law rules.
Directive 2004/38 of 20&nbsp;April 2004 on the free movement and residence of EU citizens consolidates and codifies the free movement rights of EU citizens and their family members, but from its wording it has only a ‘vertical direct effect’ against the state, not a horizontal direct effect against restrictions instituted by private law relations. The general prohibition on discrimination in Art&nbsp;24 of Dir&nbsp;2004/38 has been shaped similarly to primary law and has a similar effect. There are however four possible cases for a horizontal direct effect:


Exactly when a norm can be categorized as an overriding mandatory norm and thereby, in the manner of unilateralism, determine its own scope of application is a question which eludes a conclusive and generally applicable answer. Basically, overriding mandatory norms can be recognized in that they try to express a public interest in the broadest sense, and, other than norms of classical private law, they do not serve merely to reconcile private interests. Often they are of an economic and socio-political nature and are aimed at regulation of individual areas of social life. In consonance with this broad description, Art&nbsp;9(1) Rome&nbsp;I Regulation defines overriding mandatory provisions as ‘provisions the respect for which is regarded as crucial by a country for safeguarding its public interests, such as its political, social or economic organization, to such an extent that they are applicable to any situation falling within their scope, irrespective of the law otherwise applicable’. Classic examples are currency mandates and import and export embargoes.
(i)&nbsp;The concept of ‘family member’ is defined in Art&nbsp;2(2) and includes the marriage of a Union citizen with a third country national seeking asylum in a Member State, even if the latter did not have a residence right (ECJ Case C-127/08 – ''Blaise Baheteb Metock'' [2008] ECR I-6241).  


=== b) International economic law ===
(ii)&nbsp;The notion of ‘family member’ includes partnership relations under the dual condition that they are registered in the state of origin and put on an equal standing with a marriage in the state of residence. This is important with regard to the prohibition of discrimination with regard to sexual orientation, encompassed by Dir 2000/78 (see ECJ Case C-267/06 – ''Tadao Maruko'' [2008] ECR I-1757). Recital 31 refers to Art&nbsp;21 of the Charter on Fundamental Rights which does not require dual recognition of same sex partnerships.


In the context of the essentially multilateral European private international law, overriding mandatory norms constitute ‘classic’ gateways for unilateralism. Nevertheless, from a methodological point of view they represent exceptions that prove the rule, namely the validity and supremacy of multilateralism. However, this is not the case in international economic law. Here, unilateralism was largely established in the 20th&nbsp;century and, thus, has displaced the multilateral method. The backdrop to this development was, on the one hand, a changing understanding of the state and its role, and, on the other, insights into the limits of the market. Whereas the liberalism of the 19th&nbsp;century, during which the multilateral method of the Savigny school flourished, assumed the unlimited capacity of the market, the events at the beginning of the 20th&nbsp;century brought an awareness of the dangers of an unregulated market. The resulting insight into the necessity of a framework ordering economic activity led to state intervention not only to protect the economy as an institution, but also to protect the individual from the workings of the economy. Since these regulatory interventions were politically motivated and therefore robbed private law of its neutrality, the multilateral method lost currency. The unilateral method, therefore, gained significance in the entirety of international economic law and is today supreme in determining the application of the relevant norms. It is particularly widespread in the area of competition law ([[Competition Law (International)|competition law (international)]]). However, large parts of labour law, social law and transport law are also influenced. In contrast to overriding mandatory norms, which—at least theoretically—represent only isolated incidences of unilateral influence, international economic law is widely seen as the territory of unilateralism.
(iii)&nbsp;Directive 2004/38 does not recognize a right of access to or a supply of goods and services available to the public by Union citizens who reside legally in another Member State. This is quite different from Art&nbsp;11(1)(f) of the Third Country National Residence Directive&nbsp;2003/109. Since it cannot be imputed that the EU legislature wanted to put Union citizens in a less favourable position than third country nationals, Art&nbsp;11 can be applied by analogy in favour of Union citizens as well.  


=== c) Secondary Union law ===
(iv)&nbsp;Art&nbsp;35 transforms the prohibition of the abuse of rights, as known to private law, also into the sphere of residence rights, particularly in cases of marriages of convenience, thus following the case law of the ECJ (Case C-109/01 – ''Akrich'' ECR [2003] I-9607, para&nbsp;57). Recital 28 defines ‘marriage of convenience’ as ‘relationships contracted for the sole purpose of enjoying the right of free movement and residence’. It is an open question whether this broad power of Member States corresponds to the guarantee of marriage and family as fundamental rights under Arts&nbsp;7/9 of the Charter ([[Human Rights and Fundamental Rights (ChFR and ECHR)|human rights and fundamental rights (ChFR and ECHR)]].
 
The unilateralist trend, which is apparent in international economic law, is being seamlessly extended into other areas. Unnoticed by many, unilateralism has infiltrated the secondary private law of the EU. A recent study by Stéphanie Francq into [[Regulation|regulations]] and [[Directive|directives]] in the areas of competition, transport, consumer, labour and trade representative law shows that the pertaining provisions—expressly or implicitly—define their own spatial reach. In the area of transport law, the Regulation on the air carrier liability in the event of accidents (Reg 2027/1997, altered by Reg&nbsp;889/2002), for example, mandates that it applies to all companies that are in possession of a licence to operate from a Member State. And in consumer contract law, the Package Holiday Directive (Dir 314/1990) determines that it applies to all package holidays sold within the [[European Union]].  
 
From the viewpoint of conflicts methodology, secondary Union law thus regularly adopts a unilateral approach even in areas not categorized as international economic law. Against this backdrop, a cursory glance at the activity of the European legislature reveals a methodological dualism: while multilateralism prevails in areas that directly deal with the application of laws, unilateralism holds sway in areas that are directly concerned with substantive matters. In this context two points are noticeable: first, unilateralism in secondary Union law is one-dimensional as it only considers and enforces the prescriptions of secondary Union law—and not the prescriptions of national laws. Secondly, unilateralism in secondary Union law is not in accord with the multilateralism of conflicts law regulations. Therefore, the relationship between the unilateralism of Union private law and the multilateralism of Union conflicts law is unclear. Is the current trend towards multilateralism in Union conflicts law inconsistent? Must the role of multilateral choice of law rules in Europe be reconsidered? Which norms take precedence where there is ambiguity? Are the provisions of secondary Union law to be understood as ‘conflicts rules’ of Union law which, according to Art&nbsp;23 Rome&nbsp;I Regulation and Art&nbsp;27 Rome&nbsp;II Regulation, take priority over the choice of law rules fashioned in the Savigny mould? Answers to these and other questions must be found in the coming years. It is, however, clear that the dichotomy between multilateralism and unilateralism has not become irrelevant. Consequently, it will continue to colour the future discussion on methodology in private international law.  


==Literature==
==Literature==
Brainerd Currie, ''Selected Essays on the Conflict of Laws'' (1963); Christian Joerges, ''Zum Funktionswandel des Kollisionsrechts'' (1971); Henri Battifol, ‘Le pluralisme des méthodes en droit international privé’ (1973) 139 Recueil des Cours 75; Jürgen Basedow, ‘Wirtschaftskollisionsrecht. Theoretischer Versuch über die ordnungspolitischen Normen des Forumstaates’ (1988) 52 RabelsZ 8; Friedrich K Juenger, ''Choice of Law and Multistate Justice'' (1993); Jürgen Basedow, ‘Conflicts of Economic Regulation’ (1994) 42 Am J Comp L 423; Rudolfo de Nova, ‘Historical and Comparative Introduction to Conflict of Laws’ (1996) 118 Recueil des Cours 433; Symeon C Symeonides (ed), ''Private International Law at the End of the 20th&nbsp;Century'':'' Progress or Regress?'' (2000); Stéphanie Francq, ''L’applicabilité du droit communautaire derivé au regard des méthodes du droit international privé'' (2005); Stéphanie Francq, ‘The Scope of Secondary Community Law in the Light of the Methods of Private International Law—or the Other Way Around? (2006) 6 Yearbook of Private International Law 333; Horatia Muir Watt, ‘Private International Law’ in Jan M Smits (ed), ''Elgar Encyclopedia of Comparative Law'' (2006) 566.</div>
Torsten Körber, ''Grundfreiheiten und Privatrecht'' (2004); Grainne de Búrca (ed),'' The EU and the Welfare State—In Search of Solidarity'' (2005);'' ''Nicola Rogers and Rick Scannell, ''Free Movement of Persons in an Enlarged Union'' (2005); Ferdinand Wollenschläger, ''Grundfreiheit ohne Markt'' (2006);'' ''Matthew J Elsmore and Peter Starup, ‘Union Citizenship’ (2007) 26 Yearbook of European Law 57; Francis Jacobs, ‘Citizenship of the EU—A Legal Analysis’ (2007) 13 ELJ 591; Dagmar Schiek, Lisa Waddington and Mark Bell,'' Non-Discrimination Law'' (2007); Norbert Reich, ‘Free Movement v Social Rights in an Enlarged Union—the Laval and Viking Cases before the ECJ’ (2008) 9 German Law Journal 125; Jürgen Basedow, ‘Der Grundsatz der Nichtdiskriminierung im europäischen Privatrecht’ (2008) 16 ZEuP'' ''230; Eleanor Spaventa, ‘Seeing the Wood Despite the Trees? On the Scope of Union Citizenship and its Constitutional Effects (2008) 45 CMLR 13; Juri Borgmann-Prebil, ‘The Rule of Reason in European Citizenship’ (2008) 14 ELJ 328; Norbert Reich, ‘The Interrelation between Rights and Duties? Reflections on the state of liability law in the multilevel governance system of the Union: Is there a need for a more coherent approach?’ (2010) 29 Yearbook of European Law 112; Norbert Reich, ‘The Public/Private Divide in EC Law’ in Hans-W Micklitz and Fabrizio Cafaggi (eds), European Private Law After the Common Frame of Reference (2010).</div>




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Latest revision as of 17:39, 5 June 2025

by Norbert Reich

1. Interpreting economic freedoms as citizens’ rights

The fundamental freedoms of the Treaty on the Functioning of the European Union (TFEU), in particular those with a personal content, have been broadly interpreted in the early case law of the ECJ as also applying to economically non-active citizens. This has happened via a broad understanding of the prohibition on discrimination based on nationality according to Art 18 TFEU/12 EC. A similar tendency can be seen in extending economic freedoms to include recipient rights (so-called ‘passive freedoms’) which can also be invoked by private persons. Thus the scope of application of EU law has been greatly widened and transformed into ‘citizens’ rights beyond the market’. Some examples from the ECJ case law demonstrate this tendency:

EU tourists’ right to non-discriminatory access of museums (Case C-45/93 – Commission v Spain [1994] ECR I-911); the prohibition of restrictive entry conditions or additional enrolment fees for EU students in institutions of higher education and professional training (Case 293/83 – Gravier [1985] ECR 593; Case 24/86 – Blaizot [1988] ECR 379), excluding, however, a right to equal treatment with regard to stipends and other support payments (Case 197/86 – Brown v Secretary of State for Scotland [1988] ECR 3205; Case 39/86 Lair v University of Hannover [1988] ECR3161); the prohibition of discrimination in victim compensation (Case 186/87 – Cowan [1989] ECR 195); the freedom to go to another Member State to obtain services (including health care) without restrictions in relation to payment (joined Cases 286/82 and 26/83 – Louisi & Carbone [1984] ECR 377).

Directives 90/365, 90/364 and 93/96 codified these rights to some extent for retired persons, all other citizens and students, but they are primarily directed against the state or state institutions such as universities, social security bodies and municipalities. The directives do not have specific private law content.

A certain exception with regard to the state-directed content of non-discrimination rules can be seen in the provisions on names, which usually belong to private law and are coordinated between different jurisdictions by rules on private international law (PIL). The case of Konstandinis (ECJ Case C-168/91 [1993] ECR I-1191) concerned the spelling of the name of a Greek citizen who was doing business in Germany. The competent German authority required a Latin transcription which would have distorted the name as used in public. Whereas AG Francis Jacobs, in his opinion of 9 December 1992 (para 40), argued in favour of an EU citizen’s broad fundamental right to one’s own name (law of names), the Court somewhat fictitiously referred to the freedom of establishment and a self-employed person’s right to be free from rules on transcription which could result in a distortion of his name and confusion in contacts with potential clients.

2. ‘Union citizenship’ as a fundamental right of economically inactive EU citizens

A certain generalization and extension followed the Community acquis with regard to the establishment of a Union citizenship in Art 8 EC (1992) in its Maastricht version. In its original version it read: ‘Citizenship of the Union is hereby established. Every person holding the nationality of a Member State shall be a citizen of the Union. Citizenship of the Union shall complement and not replace national citizenship’. Article 20 TFEU/17 EC in the Amsterdam version added para 2 which reads: ‘Citizens of the Union shall enjoy the rights conferred by this Treaty and shall be subject to the duties imposed thereby’. Article 20 TFEU/17 EC as revised (OJ C 290 of 30 November 2009) provides: ‘Citizenship of the Union shall be additional to and not replace national citizenship’.

Art 21 TFEU/18 EC guarantees a right to free movement ‘subject to the limitations and conditions laid down in this Treaty and by the measures adopted to give it effect’. Article 22 TFEU/19 EC concerns the right to vote and stand as a candidate in municipal and EU elections, Art 23 TFEU/20 EC the right to diplomatic protection, Art 24 TFEU/21 EC the right to petition the European Parliament which is extended to all residents in Art 227 TFEU/194 EC.

As the citizen concept did not limit the Member State competence to determine nationality, the ‘fathers’ of the Maastricht Treaty and most legal authors did not realize its importance in implying a mutual recognition of multiple citizenship by all Member States (ECJ Case C-369/90 – Micheletti [1992] ECR I-4239; see however ECJ Case C-135/08 Rottmann (not yet reported) concerning limitations on a Member State’s right to withdraw citizenship in light of the principle of proportionality). It seemed obvious at this time that the citizenship concept only expressed a very obvious idea without imposing additional rights or duties. There was agreement that citizenship did not have any relevance in the sector of private law.

3. Union law guarantees of Union citizenship

Only the ECJ case law after ‘Maastricht’ conferred the status of a fundamental right on Union citizenship. The Grzelczyk judgment of 20 September 2001 (ECJ Case C-184/99 [2001] ECR I-6193) stated that: ‘Union citizenship is destined to be the fundamental status of nationals of the Member States, enabling those who find themselves in the same situation to enjoy the same treatment in law irrespective of their nationality, subject to such exceptions as are expressly provided for’ (para 31). This general prohibition of discrimination could be invoked by a French student who had received certain social benefits in Belgium (minimex) to finish his studies there, the benefits originally being limited to Belgian citizens. The Belgian state could therefore not require repayment as ‘unjustified enrichment’. The Court did not say anything regarding the effects of its judgment on private law relations, similar to later judgments which usually were concerned with litigation about residence rights, tax and social benefits. Its later Baumbast judgment (ECJ Case C-413/99 [2002] ECR I-7091, para 84) held that the rules on citizenship enjoy direct effect, which shows their importance in the rhetoric of EU law as Union citizenship consequently enjoys the same status as the other free movement rights.

An indirect importance for private law can be shown in the area of name rights, similar to the situation before the introduction of the citizenship concept itself. The case García Avello (ECJ Case C-148/02 [2003] ECR I-11613) concerned a name change for a child with dual Belgian and Spanish citizenship. Belgian law required either the name of the father or the mother; unlike Spanish law it did not allow for using both names. The Court found a non-justified discrimination because children with dual nationality suffered a disadvantage which could not objectively be justified. As a result, persons with dual nationality have a right to choose between two jurisdictions concerning their name; thereby the respective aims of the otherwise non-harmonized national PIL rules on names are rendered obsolete.

A more recent case, Grunkin and Paul (ECJ Case C-353/06 [2008] ECR I-7639), concerns the conflict between the Danish PIL rules on names based on ius soli and the German ones based on ius sanguinis. The child of German parents was born in Denmark where he could use the names of both parents. This was rejected when he returned to live in Germany because German PIL requires German citizens to take either the name of the father or of the mother; double names for children should be avoided because of the resulting confusion of the public. Although both AG F Jacobs in the first reference proceeding (ECJ Case C-94/04 – Standesamt Niebüll [2006] ECR I-3561) and AG Sharpston in the final case, with reference to Konstantinidis and García Avello, wanted to avoid a general conflict with German PIL rules, they argued for an opening of the strict German rules prohibiting double names of children. It is, in their opinion, not so much a problem of non-discrimination according to Art 18 TFEU/12 EC, but relates more to a ‘general principle of equal treatment’ and to free movement under Art 21 TFEU/18 EC (general principles of law). The ECJ followed this argument by saying: ‘None of the grounds put forward in support of the connecting factor of nationality for determination of a person’s surname, however legitimate those grounds may be in themselves, warrants having such importance attached to it as to justify, in circumstances such as those of the case in the main proceedings, a refusal by the competent authorities of a Member State to recognise the surname of a child as already determined and registered in another Member State in which that child was born and has been resident since birth’ (para 31).

It remains to be seen whether this broad definition of the free movement principle has importance beyond the specific cases on the PIL of Member States in general. The tendency of the ECJ seems to be to avoid strict rules on mandatory connecting factors in cross-border situations and to substitute them with a more flexible rule allowing a broader choice of the persons protected by EU law (for a more narrow reading see however case C-391/09 Malgozatza Runevic-Vardyn and others v Vilniaus miesto savivaldybes administracia (not yet reported) concerning the transcription of foreign names).

4. ‘Horizontal direct effect’ of Union citizenship?

It is a debated question whether Union citizenship takes ‘horizontal direct effect’ in private law relations, but this has not yet been expressly decided by the ECJ. The above-mentioned cases (which have not been analysed in their totality) only apply to the relations between the citizen and a Member State, either concerning restrictions on free movement, access to benefits, or restrictive public law rules on names as determined by PIL. As fundamental rights, they are applicable not only in favour of ‘foreign’ but also of ‘home’ EU nationals if they are in a situation covered by EU law like in the case Grunkin and Paul.

A horizontal direct effect in a situation similar to Union citizenship has been accepted by the ECJ in the case Phil Collins (ECJ Joined Cases C-92 and 326/92 [1993] ECR I-5145). It concerned a discrimination against art performers with regard to their protection in the marketing of copyrighted music. The ECJ directly applied the prohibition against discrimination of then Art 7 EEC, which is now Art 18 TFEU/12 EC. It wrote: ‘The Court has consistently held that the right to equal treatment ... is conferred directly by Community law ... That right may, therefore, be relied upon before a national court as the basis for a request that it disapply the discriminatory provisions of a national law which denies to nationals of other member States the protection which they accord to nationals of the State concerned’ (para 34).

It is a disputed question in legal writing whether this ruling can be generalized or is only applicable for the exercise of intellectual property rights. This author proposes a ‘compromise’ solution. A horizontal direct effect can be seen as existing in similar situations as has already been recognized for the fundamental freedoms. This concept corresponds to the equal status of economic freedoms and citizens’ rights (European internal market). The recent case law of the ECJ recognizes horizontal direct effect of the fundamental freedoms when they originate from a ‘collective regulation’ where freedom of contact does not exist (ECJ Case C-438/05 – ITWF and others v Viking Line [2007] ECR I-10779, paras 56–66) or from employment relations (ECJ Case C-94/07 – Raccanelli v Max Planck-Gesellschaft [2008] ECR I-5939, para 43). It is not yet clear whether this case law also applies to areas beyond an economic objective, for instance to by-laws of amateur sport organizations limiting access of EU-citizens in a discriminatory manner, provisions restricting the freedom of members of non-professional associations and unjustified social action with harmful consequences for third parties. Details of such a broad concept and its justifications under EU law still have to be determined. The main idea behind this extension of the effects of the citizenship concept to relations governed by private law is a functional one: restrictions on free movement rights can originate not only from the state, but also from private associations if they act in a collective manner. This is also justified by the different rules of Member States in distinguishing between public and private law, a function which cannot be simply taken over by EU law; an autonomous link has to be found which relates to power structures imposed on EU citizens.

With regard to Union citizenship, this implies that collective restrictions or discrimination against Union citizens fall under the scope of application of the TFEU and have to be evaluated under Arts 18, 20, 21 TFEU/12, 17, 18 EC; they must be justified in order to be compatible with EU law. The following are examples of non-justified discrimination: (i) as in professional sports, unreasonable selection rules of associations concerning participation in sport matches by ‘semi professionals’ or amateurs (ECJ Joined Cases C-51/96 and 191/97 – Deliège and others v ASBL [2000] ECR I-2549); (ii) discriminatory entrance rules for private higher education institutions which have been accredited by public bodies; and (iii) clauses in standard contract terms putting EU nationals at a disadvantageous position, like higher tariffs for foreigners in insurance cover or higher costs for cross-border banking services as opposed to national transactions).

5. No direct horizontal effect of Directive 2004/38

Directive 2004/38 of 20 April 2004 on the free movement and residence of EU citizens consolidates and codifies the free movement rights of EU citizens and their family members, but from its wording it has only a ‘vertical direct effect’ against the state, not a horizontal direct effect against restrictions instituted by private law relations. The general prohibition on discrimination in Art 24 of Dir 2004/38 has been shaped similarly to primary law and has a similar effect. There are however four possible cases for a horizontal direct effect:

(i) The concept of ‘family member’ is defined in Art 2(2) and includes the marriage of a Union citizen with a third country national seeking asylum in a Member State, even if the latter did not have a residence right (ECJ Case C-127/08 – Blaise Baheteb Metock [2008] ECR I-6241).

(ii) The notion of ‘family member’ includes partnership relations under the dual condition that they are registered in the state of origin and put on an equal standing with a marriage in the state of residence. This is important with regard to the prohibition of discrimination with regard to sexual orientation, encompassed by Dir 2000/78 (see ECJ Case C-267/06 – Tadao Maruko [2008] ECR I-1757). Recital 31 refers to Art 21 of the Charter on Fundamental Rights which does not require dual recognition of same sex partnerships.

(iii) Directive 2004/38 does not recognize a right of access to or a supply of goods and services available to the public by Union citizens who reside legally in another Member State. This is quite different from Art 11(1)(f) of the Third Country National Residence Directive 2003/109. Since it cannot be imputed that the EU legislature wanted to put Union citizens in a less favourable position than third country nationals, Art 11 can be applied by analogy in favour of Union citizens as well.

(iv) Art 35 transforms the prohibition of the abuse of rights, as known to private law, also into the sphere of residence rights, particularly in cases of marriages of convenience, thus following the case law of the ECJ (Case C-109/01 – Akrich ECR [2003] I-9607, para 57). Recital 28 defines ‘marriage of convenience’ as ‘relationships contracted for the sole purpose of enjoying the right of free movement and residence’. It is an open question whether this broad power of Member States corresponds to the guarantee of marriage and family as fundamental rights under Arts 7/9 of the Charter (human rights and fundamental rights (ChFR and ECHR).

Literature

Torsten Körber, Grundfreiheiten und Privatrecht (2004); Grainne de Búrca (ed), The EU and the Welfare State—In Search of Solidarity (2005); Nicola Rogers and Rick Scannell, Free Movement of Persons in an Enlarged Union (2005); Ferdinand Wollenschläger, Grundfreiheit ohne Markt (2006); Matthew J Elsmore and Peter Starup, ‘Union Citizenship’ (2007) 26 Yearbook of European Law 57; Francis Jacobs, ‘Citizenship of the EU—A Legal Analysis’ (2007) 13 ELJ 591; Dagmar Schiek, Lisa Waddington and Mark Bell, Non-Discrimination Law (2007); Norbert Reich, ‘Free Movement v Social Rights in an Enlarged Union—the Laval and Viking Cases before the ECJ’ (2008) 9 German Law Journal 125; Jürgen Basedow, ‘Der Grundsatz der Nichtdiskriminierung im europäischen Privatrecht’ (2008) 16 ZEuP 230; Eleanor Spaventa, ‘Seeing the Wood Despite the Trees? On the Scope of Union Citizenship and its Constitutional Effects (2008) 45 CMLR 13; Juri Borgmann-Prebil, ‘The Rule of Reason in European Citizenship’ (2008) 14 ELJ 328; Norbert Reich, ‘The Interrelation between Rights and Duties? Reflections on the state of liability law in the multilevel governance system of the Union: Is there a need for a more coherent approach?’ (2010) 29 Yearbook of European Law 112; Norbert Reich, ‘The Public/Private Divide in EC Law’ in Hans-W Micklitz and Fabrizio Cafaggi (eds), European Private Law After the Common Frame of Reference (2010).

Retrieved from Unilateralism (PIL) – Max-EuP 2012 on 14. November 2025.

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