Second Test – 19 January 2023

Excercise on the Basics of European Union Law

Winter term 2023/24

SURNAME NAME

MATRIKELNR POINTS

Introductory remark:
In this model solution, statements in brackets are to be regarded as mere additional
information that was not required to achieve the full amount of points for a
(sub-)question.
Disclaimer:
In the case of similar questions in the MP Introduction to International Law
(MP Einführung in das internationale Recht), the number and weighting of points
awarded may vary.
1. Question: Institutions (3 P)
A proposal for a directive is to be voted on in the Council of the EU. The relevant legal
basis requires a qualified majority for the decision defining the Council’s position.
France, Germany and Italy, which together represent more than 35% of the EU
population, have announced that they will vote against adopting the decision.
a) Which majority requirements apply in principle for qualified majority voting in the
Council? (1 P)
55% of the Council Members (0,5 P) representing at least 65% of the EU population
(0,5 P) have to vote in favour.

b) In such a case, can (only) France, Germany and Italy prevent the Council from
adopting a decision? Why (not)? Also state the relevant legal basis. (2 P)
No (0,5 P), because a blocking minority (0,5 P) must include at least four MS / MS
representing at least 35% of the population +1 MS (0,5 P), otherwise the qualified majority
shall be deemed attained pursuant to Art 16 (4) TEU / Art 238 (3) (a) TFEU(0,5 P).

Cf. Jaeger, Introduction to European Union Law (2021), p. 69.

2. Question: Sources of EU Law (2 P)

Please state one of the main differences between a delegated act and an implementing
act of EU law.
Alternatively:
 E.g.: While implementing acts may only further specify a legislative act (1 P), delegated
acts may also supplement or amend non-essential elements of a legislative act (1 P);
 E.g.: While the author of delegated acts is always the Commission (1 P), implementing
acts may also be adopted by the Council in certain cases (1 P);
 E.g. While draft implementing acts are controlled in the so-called comitology procedure by
committees (set up of representatives of the MS and the Commission) (1 P), draft
delegated acts are controlled by the EP and the Council (they each have a veto-right) (1 P)

Cf. Jaeger, Introduction to European Union Law (2021), pp. 46-48.

3. Question: True or False (5 P)
Comment on the following statements and indicate whether they are true or false. Give
reasons for your answer!
0,5 P were awarded for the correct answer, whether the statement is true or false. 0,5 P were
awarded for one of the possible alternative explanations listed under each statement.
a) The so-called three pillar model was introduced with the Single European Act. (1 P)
False (0,5 P).
Possible explanations (0,5 P):
 The three pillar model was introduced with the Treaty of Maastricht.
 With the Single European Act, a significant extension of the EEC’s competences took
place.
 With the Single European act, qualified majority voting in the Council was introduced
in important areas.
 With the single European act, the European Parliament was substantially
strengthened (the “consent procedure” was introduced).
Cf. Jaeger, Introduction to European Union Law (2021), pp. 36-38.

b) The state liability in damages recognised for the first time in the Francovich case
is a contractual liability, because it is based on the EU treaties. (1 P)
False (0,5 P).
Possible explanations (0,5 P):
 It is a non-contractual / tortious liability.
 It was inferred from the vertical loyalty principe (Art. 4 (3) TEU) / (the judicial branch
of) the principle of effectiveness (Art. 19 (1) TEU) by the ECJ.
 There is no explicit legal basis for the state liability claim in the treaties.
Cf. Jaeger, Introduction to European Union Law (2021), pp. 174 et seq.

c) Third country nationals can invoke the Free Movement of Goods when importing
goods from one MS to another. (1 P)
True (0,5 P).
Possible explanations (0,5 P):
 The nationality of the importer is irrelevant in the context of the Free Movement of
Goods.
 Whether the “personal” scope of that fundamental freedom is given depends on
whether the imported goods have “Union status” or not.
Cf. Jaeger, Introduction to European Union Law (2021), p. 193.
d) In the case Dassonville, the ECJ formulated an exception from the “Keck-Formula”.
(1 P)
False (0,5 P).
Possible explanations (0,5 P):
 In the case Keck, the ECJ formulated an exception from the Dassonville-Formula.
 In the case Dassonville, the ECJ provided for a definition of the term “measure having
equivalent effect to quantitative restrictions (= the Dassonville-Formula)
Cf. Jaeger, Introduction to European Union Law (2021), p. 194-199.
e) An agreement between undertakings that meets the criteria of the cartel prohibition
and is not justified is automatically void. (1 P)
True (0,5 P).
Possible explanations:
 As much is provided in Art 101 (1) TFEU.
 If such an agreement is justified, the consequence of nullity does not apply.
 The conditions for the cartel prohibition to apply are an (unjustified) agreement or
concerted practice between undertakings that restricts or distorts competition and
has an effect on trade between the MS.
Cf. Jaeger, Introduction to European Union Law (2021), p. 232 et seq.
3. Case Study – Enforcement of EU-Law (6 P)
One morning, Stella, a student, is approached by Manuel, a representative of the
University of Vienna’s Language Center at the “Schottentor” metro station.
Manuel offers her an Italian course at the Language Center at a discount price and Stella
signs the contract. The next day, she has second thoughts and asks the Language
Center by e-mail to cancel the contract under Art 9 of the EU Consumer Rights
Directive. This provision provides for a possibility to withdraw from contracts
concluded outside the business premises of a company within a period of 14 days.
She immediately receives the reply that Austria has not yet implemented that directive,
although the transposition period has already expired. Therefore, the principle of
"pacta sunt servanda" would apply and even if Stella does not attend the course, she
would be obliged to pay the course fee.
Although the Language Center is organised as a private company, it is wholly owned
by the public University of Vienna.
Can Stella withdraw from the contract under EU Law and if so, why?

Stella can only withdraw from the contract if the relevant provision of the directive has direct
effect (0,5 P). Direct effect means that an individual can directly invoke an EU law provision
(before a national court or administrative authority) (0,5 P bonus).
The conditions for direct effect of directives have to be met:
 There has to be an error in transposition – in this case, the directive was not transposed
at all (1 P)
 The transposition period must have already expired – which is the case here (1 P)
 There has to be a vertical situation (1 P), as only the MS are directly addressed by
directives (0,5 P bonus). As a private company wholly owned by the University, a state
institution, the Sprachenzentrum is covered (0,5 P) by the broad concept of state / as an
emanation of the state (0,5 P)
 The relevant provision has to be sufficiently clear, precise and unconditional / justiciable
(1 P). The provision in this case is in no way vague / a national court seized with the
matter would immediately know how to apply it (0,5 P). Therefore, this condition is fulfilled.
Cf. Jaeger, Introduction to European Union Law (2021), p. 155 et seq., 159 et seq.
4. Case Study: Judicial Protection, Fundamental Freedoms (14 P)
After winning the lottery, Irish pharmacy student Saoirse is looking for a way to make
a living from the money she has won. She ultimately decides to abandon her studies in
Dublin without graduating and to buy 100% of the shares of the Apo-GmbH, a company
that operates two small pharmacies in Vienna. After the transaction is finalised, she
appoints herself as managing director of the company, because she does not want to
hire an expensive manager.
Saoirse is shocked when she receives a letter from the responsible Viennese
Magistrate’s department ordering her to close the two pharmacies immediately, as
under the Austrian Law on Pharmacies, only fully qualified pharmacists may act as
managing directors of pharmacies. This is intended to ensure that the provision of
medicinal products to the public is reliable and of good quality.
Saoirse considers that this law violates a fundamental freedom of the TFEU and notifies
the European Commission via its online complaint form. The Commission is of the
same opinion and decides to initiate proceedings against Austria to rectify the
situation.

a) Which type of proceedings is meant here? Please also name their legal basis (1 P).
Infringement proceedings (0,5 P) pursuant to Art 258 TFEU (0,5 P)

Cf. Jaeger, Introduction to European Union Law (2021), p. 88.

b) Do you think that the Commission is right on the merits? Please assess whether or
not there is an infringement of a free movement provision of the TFEU!
When doing so, please also briefly state the decisive criterion as to why another
Fundamental Freedom that could be thought of here is not applicable. (13 P)
There could be an interference with the Freedom of Establishment (1 P) regulated in
Art 49 TFEU (0,5 P).
Also (and additionally) counted as correct: There could be an interference with the Free
Movement of Workers (1 P) regulated in Art 45 TFEU (0,5 P).
Free Movement of Capital would only apply if it was purely an investment, without gaining
control over a company / dominant influence on its management (=the decisive criterion)
(1 P).
By acquiring 100% of the shares, Saoirse definitely gains control over the Apo-GmbH
(0,5 P).
Also (and additionally counted as correct): Free Provision of Services would only apply in
case of the temporary provision of a service in another MS (1 P)
Personal scope of the FoE/FMW:
EU citizens (0,5 P) and (FoE) companies established in the EU (0,5 P bonus) are covered.
 As an EU citizen, Saoirse is covered (0,5 P).
Material scope of the FoE:
The measure stems from the responsible Viennese Magistrate’s department, an
emanation of the state / the Austrian law on pharmacies stems from the Republic of
Austria, a Member State (1 P)
The cross-border element is fulfilled (0,5 P) as Saoirse moves from Ireland to Austria
(0,5 P).
The activity protected by the Freedom of Establishment is taking up or pursuing a
permanent self-employed economic activity / (starting to) offer goods or services on the
market on a permanent basis (0,5 P)  operating pharmacies is covered (0,5 P).
Also (and additionally) counted as correct: The activity protected by the Free Movement
of Workers is seeking/taking up employment / engaging in paid employment (0,5 P) 
being engaged as the manager of a company is covered (0,5 P).
Interference?
The requirement that only fully qualified pharmacists may act as managing directors of
pharmacies is an indiscriminate restriction (0,5 P) that renders the exercise of the freedom
of establishment / free movement of workers less attractive / is hindering market access
(0,5 P).
Not all indiscriminate obstacles for establishment, but only certain ones (hindering market
access) fall within the scope of the FoE; the so-called “modified country-of-destination-
principle” applies (0,5 P bonus).

Justification?
As there is no direct discrimination (on grounds of nationality) (0,5 P), the measure may
be justified by both the written grounds contained in Art. 52 TFEU / Art. 45(3) TFEU (0,5 P)
and unwritten grounds for justification (= mandatory requirements / the rule of reason)
(0,5 P).

In this case, public health / consumer protection could be a ground for justification (0,5 P).

The measure is suitable (0,5 P) to reach the aim of protecting public health / consumers
/ it is possible to reach that aim with that measure (0,5 P).
Possible explanations (0,5 P)
- e.g. because it seems less likely that people would be sold wrong medication in
pharmacies operated by fully qualified pharmacists
- e.g. because it seems less likely that a fully qualified pharmacists would buy medicines
of poor quality at the wholesale market
- e.g. because it seems less likely that a fully qualified pharmacist would put his or her
own profit over people’s health
However, the measure is (not) necessary (0,5 P), because it is (not) the least intrusive
conceivable measure (0,5 P), e.g. as it would (not) suffice that the staff actually selling
these medicines has to be fully qualified (0,5 P).
 There is an/no infringement of the Freedom of Establishment.
Cf. Jaeger, Introduction to European Union Law (2021), p. 209 et seq., 215 et seq.
Cf. ECJ, C-531/06, Commission/Italy.