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Electronic copy available at: http://ssrn.com/abstract=1804397
Jaanika Erne
Ph.D. Candidate, Adjunct Lecturer, Faculty of Law of the University of Tartu
Lecturer, Institute of Political Science and Governance, Tallinn University
Remedies for Breach of EU Law Revisited
KEYWORDS: remedies – judicial remedies – non-judicial remedies - breach of EU law
The article explains judicial and non-judicial remedies given to the natural or legal persons by
the Court of Justice of the European Union and by the European Commission.
1. Defining Remedy
“Remedy” is for the purposes of this article understood as a tertiary right arising from the
prescription of a judicial or non-judicial decision. An example of EU law: “If the action is
well founded, the Court of Justice of the European Union shall declare the act concerned to be
void”,1 in which example the remedy is the declaration to be void.
Figure 1. Relation between substantive rights and remedies
Primary rights
Secondary rights
Tertiary rights
Substantive rights
Rights to claim
Remedies
Rights arising from law,
legal acts.
Rights arising following a
breach of duty / Rights
arising from wrongs.
Rights arising from a judicial
or non-judicial prescription.
Source: Zakrzewski, R. 2005. Remedies Reclassified. Oxford: Oxford University Press, p. 53, with J.
Erne’s explanations.
1 Article 264 TFEU.
Electronic copy available at: http://ssrn.com/abstract=1804397
2
The author of the article classified the remedies available to the natural or legal persons for
breach of EU law in the Court of Justice of the European Union (Court of Justice) and the
European Commission. Concerning the judicial remedies, analysed were the remedies given
in response to the following direct actions presented by natural or legal persons: action for
annulment, action for failure to act, action for damages, civil service action. In the cases of
infringement of EU law by a Member State, a natural or legal person may apply for a remedy
in a national court or non-judicial body or, alternatively, submit a complaint to the European
Commission who may then start an infringement proceedings, in the framework of which
proceedings the Commission may bring an action of infringement against the State to the
Court of Justice. Against the model of classification of actions as coercive, declaratory, and
constitutive, also the remedies can be classified as coercive, declaratory, and constitutive.
In addition to the remedies in response to direct actions were analysed the remedies in
response to indirect actions - the plea of illegality, application for damages, and application
for interim measures, as well as the consequences of the requests for preliminary rulings,
appeals to the Court of Justice, and appeals to the General Court.
Of the non-judicial remedies were analysed the remedies given by the European Commission
in the competition proceedings, according to the division of those proceedings into two large
sectors – the competition sector, and the state aid sector. In the framework of the competition
sector are discussed the infringement and exemption remedies given in cartels cases, in
antitrust cases, and in merger cases. Separately are discussed the remedies available under the
state aid sector.
Remedies form part of remedial law. The formation of a remedy is influenced both by
substantive law, as well as procedural law. Thus, the person who gives a remedy must control
both the characteristics of the substantive law components, as well as procedural
acceptability. At the same time, although the basis of a remedy lies in substantive law,
substantive law itself is not remedy. Neither is procedural law, although a remedy is given in
the framework of a judicial or non-judicial proceedings.
2. Judicial Remedies for Breach of EU Law
Followingly will not be discussed the actions under Article 272 TFEU on an arbitration
clause contained in a contract concluded by or on behalf of the EU, under Article 273
relating to the subject matter of the Treaties and submitted under a special agreement
between the parties, and under Article 271 concerning fulfilment by Member States of
obligations under the Statute of the European Investment Bank and under the Treaties,
because those actions are not submitted by individuals.
.
2.1. Actions of infringement of EU law by the EU institutions
2.1.1. The action for annulment
3
The aim of this action is to review the legality of the EU institutions’ acts. The Member
States’ courts lack the competence to decide upon the validity of the EU acts, and the
possibility to ask for review of a EU institution’s act in the request for a preliminary ruling
does not substitute the natural or legal person’s action for annulment. The bases of the action
for annulment lie in Articles 263, 264 and 266 of the TFEU. The Court of Justice reviews
here the legality of legislative acts, of acts of the Council, of the Commission and of the
European Central Bank, and of acts of the European Parliament and of the European Council,
as well as of bodies, offices or agencies of the EU intended to produce legal effects vis-à-vis
third parties.2
The non-privileged applicants submitting the action for annulment are Member States, the
European Parliament, the Council or the Commission; the semi-privileged applicants are the
Court of Auditors, the European Central Bank and the Committee of the Regions. Natural or
legal persons are non-privileged applicants here - they can submit the action for annulment
against an act addressed to them or an act which is of direct and individual concern to them,
and against a regulatory act which is of direct concern to them and does not entail
implementing measures.3 Acts setting up bodies, offices and agencies of the EU may lay
down specific conditions and arrangements concerning actions brought by natural or legal
persons against acts of these bodies, offices or agencies intended to produce legal effects in
relation to them.4
For admissibility of the action for annulment, the grounds must be lack of competence,
infringement of an essential procedural requirement, infringement of the Treaties or of any
rule of law relating to their application or misuse of powers. The action must be submitted
within two months of the publication of the measure or of its notification to the plaintiff or, in
the absence thereof, of the day on which it came to the knowledge of the latter, as the case
may be.5
As the contemporary courses on Legal Writing teach derivation of the object of an action
from remedy, it is essential to know the remedies that the Court of Justice may give. The
remedies grow out of, but are not equal to the consequences of the actions. The consequences
of the action for annulment lie in Articles 264 and 266 TFEU - if the action is well founded,
the Court of Justice declares the act concerned to be void ex tunc and erga omnes, and
requires necessary measures to be taken to comply with the judgment. If the Court considers
this necessary, it may state, which of the effects of the act which it has declared void shall be
considered as definitive. The Court may also dismiss the action. As non-substantial
prescription in a court decision cannot include remedy, the remedies in the case of the action
for annulment are - declaratory: declaration of the act to be void, and coercive: necessary
measures to be taken to comply with the judgment. Those remedies are followingly presented
based on classification of actions into coercive, declaratory, and constitutive.6
2 Article 263 (1) TFEU.
3 Article 263 (4) TFEU.
4 Article 263 (5) TFEU.
5 Article 263 (6) TFEU.
6 See more on actions and their classification, for example, at Paulus, C. G. (2002). Tsiviilprotsessiõigus.
Kohtuotsuse tegemise menetlus ja sundtäitmine. Tallinn: Juura, pp. 35-37.
4
Figure 2. Remedies in response to the action for annulment
Remedies
Coercive Declaratory Constitutive
• necessary measures to comply • declaration of an act to be void
with the judgment (TFEU 266) (TFEU 264)
All the remedies indicated below may in principle be presented on the same figure.
2.1.2. The action for failure to act
The action for failure to act can be submitted when a EU institution failed to act, including
failure to address to a person an act, whereas EU law does not demand such act to have had
legal consequences.
The bases of the action for failure to act lie in Articles 265 and 266 TFEU. The Court of
Justice here reviews the acts (legality of failure to act) of the European Parliament, the
European Council, the Council, the Commission or the European Central Bank, as well as of
the bodies, offices and agencies of the EU. The Member States and the other EU institutions
are the privileged applicants. A natural or legal person is also here a non-privileged applicant
– it may complain to the Court that an institution, body, office or agency of the EU has failed
to address to that person an act.7 The criteria of admissibility of the action are that an act
foreseen in the Treaties was not performed or taken, but at the same time there was an
obligation to perform or take the act, and the relevant body or institution was called upon to
act. If, within two months of being so called upon, the institution, body, office or agency
concerned has not defined its position, the action may be brought within a further period of
two months.8
The consequences of the action for failure to act lie in Article 266 TFEU, according to which
Article the institution whose failure to act has been declared contrary to the Treaties is
required to take the necessary measures to comply with the judgment of the Court of Justice.
The court may dismiss the action. The remedies here are - declaratory: declaration contrary to
the Treaties of the failure to act, and coercive: necessary measures to comply with the
judgment.
2.1.3. The action for damages
The aim of the action for damages is to make the EU responsible for the damages caused by
its institutions or by its servants in the performance of their duties. The bases of the action lie
7 Article 265 (3) TFEU.
8 Article 265 (2) TFEU.
5
in Articles 268 and 340 TFEU. The applicant is the person who has beard loss, and the
respondent is the EU to make good the damage caused by its institutions or by its servants.
The criteria of admissibility of the action for damages are that the damage occurred as a
consequence of illegal act (infringement), infringed was EU law, the damage was essential,
the damage was quantitative, there existed direct causal connection between the infringement
and the damage. According to Article 46 of the Statute of the Court of Justice of the European
Union, proceedings against the EU in matters arising from non-contractual liability are barred
after a period of five years from the occurrence of the event giving rise thereto. The
application for damages can also be submitted as an incidental plea in main proceedings.
The consequences of the action for damages lie in Article 340 TFEU: The Court of Justice
prescribes damages for its institutions. The Court of Justice may demand damages from other
respondents, for example, if both the EU and a Member State caused damages to a natural or
legal person by breach of EU law, they must together make the damages good. The Court may
dismiss the action. The remedy here is coercive: damages.
2.1.4. The civil service action
The aim of this action is to solve the EU labour disputes. The basis of the action lies in Article
270 TFEU, according to which Article the Court of Justice has jurisdiction in the disputes
between the EU and its servants within the limits and under the conditions laid down in the
Staff Regulations of Officials and the Conditions of Employment of other servants of the EU.
The applicants here are the civil servants of the EU under the conditions laid down in the
Staff Regulations of Officials or other EU servants and applicants for EU service under the
Conditions of Employment of other servants of the EU. The respondent is the institution that
gave the act concerning the official’s or servant’s rights connected to the service.9
The criteria of admissibility of this action are that the civil servant or official first sought for
solution from the institution that issued the act.
As the consequence of the action, the Civil Service Tribunal annuls the act of the institution
or declares invalidity of the clauses in the applicant’s contracts or requires application of an
act, etc. – according to the case. When solving this action, the Court of Justice asks the parties
to reach an amicable settlement of the dispute. Since the amicable settlement is a procedural
act,10 such settlement does not contain remedy as defined for the purposes of this article. The
remedies here are - declaratory: declaration of the invalidity of the clauses in the applicant’s
contracts, coercive: annulment of the decision, application of an act, or other.
2.2. Actions of infringement of EU law by States
One can distinguish three different actions here – the European Commission’s action for
declaration of an infringement, the Member State’s action for declaration of an
infringement, and the European Commission’s action for compliance with the judgment of
9 Article 270 TFEU.
10 Paulus, supra note 6,.p. 104.
6
the Court of Justice. Excluded the Member State’s action for declaration of an
infringement, these actions are brought to the Court of Justice by the European Commission
following the administrative proceedings in the Commission. Solving these actions, the
Court of Justice controls the State, as well as the Commission. The Court of Justice does
not derive from the principle of party autonomy while solving these actions, but from EU
interest, and with the other EU institution – the European Commission – from the principle
of investigation, which means that the circumstances relating State infringement are
established by the EU institutions independently of States. The role of the complainant in
the infringement procedures mostly amounts to bringing a complaint to the European
Commission, and to receiving information about the course of the infringement procedure
in the Commission. The bases of the infringement actions lie in Articles 258-260 TFEU. As
the Member State’s action for declaration of an infringement does not concern individual’s
complaint, the article does not discuss that action in the following.
2.2.1. The European Commission’s action for declaration of an infringement
Prior to submission of the action under Article 258 TFEU, a preliminary infringement
proceedings, called also infringement procedure, takes place in the European Commission11
who may initiate that proceeding on:
1) it’s own initiative, or
2) the complaint of any other person.12
In the preliminary proceedings, the Commission first exchanges correspondence with the
concrete State and may meet the state officials in order to clarify the facts. The Commission
has the right to inter alia perform such administrative acts during the preliminary proceedings
as requests for information, and on-the-spot inspections – performing such acts, the
Commission must take into account the general principles of EU law. If the Commission
considers that the infringement persists, it sends a formal notice to the State, basing on which
document (if the State fails to submit its due observations within the period laid down by the
Commission) the Commission delivers a reasoned opinion. In the reasoned opinion, the
Commission indicates the substance of the infringement, the measure, and the period for
compliance. In its reasoned opinion the Commission cannot exceed the limits of the formal
notice. Since it is not possible to directly contest the reasoned opinion, the formal notice
cannot contain remedies as defined in the beginning of this article.
If the Commission considers that the State has not solved the problem according to the
reasoned opinion, the Commission’s Legal Service may bring an action to the Court of
Justice. The Commission’s action cannot constitute remedy either, but is asking for a remedy.
The Commission’s action and the proceeding for solving that action cannot exceed the limits
of the preliminary proceedings – it cannot alter or supplement the reasoned opinion. The
object of the Commission’s action for declaration of an infringement is declaration of
infringement of an obligation under the Treaties. But if the Commission brings the action on
the grounds that the Member State concerned has failed to fulfil its obligation to notify
measures transposing a directive adopted under a legislative procedure, the Commission may,
when it deems appropriate, at once specify the amount of the lump sum or penalty payment to
be paid by the Member State concerned which it considers appropriate in the circumstances.
The consequences of the Commission’s action for declaration of an infringement are that if
11 Article 258 TFEU.
12 Article 259 TFEU.
7
the Court of Justice finds that a Member State has failed to fulfil an obligation under the
Treaties, the State shall be required to take the necessary measures to comply with the
judgment of the Court. In the case a Member State has failed to fulfil its obligation to notify
measures transposing a directive adopted under a legislative procedure, the additional
consequences are imposition of a lump sum or penalty payment on that Member State. The
Court may dismiss the action. The remedies here are - declaratory: declaration that a Member
State has failed to fulfil an obligation, and coercive: necessary measures to comply with the
judgment, lump sum and penalty payment.
2.2.2. The European Commission’s action for compliance with the judgment of the
Court of Justice
The judgments of the Court of Justice are compulsory for enforcement and the competent
authorities of the concerned Member States must guarantee enforcement of the infringement
judgments. The object of the action submitted under Article 260 TFEU is declaration that the
Member State has not complied with a Court of Justice’s judgment. This action is also
submitted by the Commission after the Commission has given the State the opportunity to
submit its observations. If the State fails to submit its observations, the Commission may
bring the action before the Court. In this action the Commission specifies the amount of the
lump sum or penalty payment to be paid by the Member State concerned, which it considers
appropriate in the circumstances.
The consequences of the action for compliance with the judgment of the Court of Justice lie in
Article 260 TFEU - the Court of Justice declares that the Member State has not taken the
necessary measures to comply with the judgment, and may impose a lump sum or penalty
payment on the Member State concerned or dismiss the action. The remedies are -
declaratory: declaration that the Member State has not taken the necessary measures to
comply with the judgment,13 and coercive: lump sum14 and penalty payment.15
2.3. Indirect actions in the Court of Justice of the European Union
2.3.1. The plea for illegality
The aim of the plea of illegality is to enable extensive review of the validity of the acts of
general application (regulations in case of individuals) of the EU institutions. The basis of the
plea lies in Article 277 TFEU that enables, notwithstanding the expiry of the period laid down
in Article 263 (6), in the proceedings in which an act of general application adopted by an
institution, body, office or agency of the EU is at issue, any party to invoke before the Court
of Justice the inapplicability of that act. A natural or legal person is a non-privileged applicant
also here.
The consequences of that plea are that the Court of Justice declares the act inapplicable
toward the parties in casu, but does not declare the act void. The Court may also dismiss the
application. Although the plea for illegality of an act of general application is not an
13 Article 260 (2) TFEU.
14 Ibid.
15 Ibid.
8
independent action, the Court of Justice gives a remedy in answer to the plea, which is
declaratory: declaration of inapplicability of an act.
2.3.2. Application for interim measures
The bases for the application for interim measures lie in Articles 278 and 279 TFEU, but also
in Articles 83, 84, 86, 88-89 of the Statute of the Court of Justice of the European Union, and
in the Rules of Procedure of the Court of Justice and General Court. Article 278 TFEU enables
the Court of Justice to order that application of the contested act be suspended. Article 279
allows the Court of Justice to prescribe any necessary interim measures in any cases before it.
The aim of interim measures is to guarantee better application of law. Application can be
brought by a party in the main proceedings with regard to the question of its interest.
The criteria of admissibility of an application for interim measure is the existence of main
action, connection with the main proceedings, necessity, prompt need, balanced interests, and
that the measure must concern EU law.
As consequence of the application for interim measure, the Court of Justice gives an
enforceable interim order or dismisses the application. According to the text of Article 279,
the Court can prescribe any necessary interim measures. The remedies constitute of interim
measures, depending on a concrete case, for example, suspension of an act, arrest of an object
or money, etc.
2.3.3. Appeal to the Court of Justice on the decisions given by the General Court
The aim of an appeal to the Court of Justice on the decisions given by the General Court is the
review of the General Court in points of law. The bases of an appeal lie in Article 256 TFEU
and Articles 56-61 of the Statute for the Court of Justice, according to which Articles the final
decisions of the General Court and decisions of the General Court disposing of the substantive
issues in part only or disposing of a procedural issue concerning a plea of lack of competence
or inadmissibility may within two months of the notification of the decision appealed against
be appealed to the Court of Justice by any party, which has been unsuccessful in whole or in
part in its submissions.16
Decisions given by the General Court may be subject to a right of appeal to the Court of
Justice on points of law only. The grounds of an appeal are lack of competence of the General
Court, a breach of procedure before it which adversely affects the interests of the appellant as
well as the infringement of EU law by the General Court. The grounds of an appeal cannot be
only the amount of the costs or the party ordered to pay them.17
The consequences of an appeal are - if the appeal is well founded, the Court of Justice quashes
the decision of the General Court. The Court of Justice may itself give final judgment in the
matter, where the state of the proceedings so permits or refer the case back to the General
Court for judgment. When a case is referred back to the General Court, that Court is bound by
the decision of the Court of Justice on points of law. When an appeal brought by a Member
State or an institution of the EU which did not intervene in the proceedings before the General
16 Article 56 Statute of the Court of Justice of the European Union. OJ 2008 C 115, pp. 1-388.
17 Article 58 ibid.
9
Court is well founded, the Court of Justice may, if it considers this necessary, state which of
the effects of the decision of the General Court which has been quashed are considered as
definitive in respect of the parties to the litigation. The Court of Justice may dismiss the
appeal. The remedies here are: quash of the decision of the General Court, the final judgment,
reference of the case back to the General Court for judgment, or declaration of the effects of
the quashed decision of the General Court to be considered definitive in respect of the parties
to the litigation.
2.3.4. Appeal to the General Court on the decisions given by the Civil Service Tribunal
The General Court has jurisdiction to hear and determine actions or proceedings brought
against decisions of the specialised courts (today, the Civil Service Tribunal) under Articles
256 and 257 TFEU. The decisions of the specialised courts may be appealed on points of law
only or, when provided for in the regulation establishing the specialised court, also on matters
of fact.
The General Court may quash the decision or order of the Civil Service Tribunal, and may
give itself final judgment in the matter, or refer the case back to the Civil Service Tribunal for
judgment, or it may dismiss the appeal. The remedies respectively are: quash of the decision
or the order of the Civil Service Tribunal, the final judgment, reference of the case back to the
Civil Service Tribunal for judgment.
2.3.5. Request for a preliminary ruling
The aim of preliminary rulings is uniform application of EU law. Preliminary rulings are
requested by Member State’s courts. The bases of the preliminary rulings procedure lie in
Articles 267 and 256 (3) TFEU. Article 267 confers on the Court of Justice the power to give
preliminary rulings concerning the interpretation of the Treaties, or the validity and
interpretation of the acts of the institutions, bodies, offices or agencies of the EU.
The criteria of admissibility of a request for a preliminary ruling are that the ruling is applied
for by a Member State’s court or tribunal (a State institution established on the basis of law
with the aim to solve legal disputes and apply internal law). The Member State’s court or
tribunal against whose decisions there is no judicial remedy under national law is obliged to
bring the matter before the Court of Justice if this is necessary to enable it to give judgment.
All the Member States’ courts are obliged to request from the Court of Justice a preliminary
ruling in the questions of validity of EU law if this is necessary to enable them to give
judgment. The Court of Justice refuses the preliminary ruling if the interpretation of EU law is
unconditionally clear or if the Court of Justice has already given a preliminary ruling on an
identical matter, the question is political, too generally presented, the legal or factual
background is not sufficient, the matter concerns interpretation or validity of internal law or is
not necessary to enable the court to give judgment.
As a consequence, the Court of Justice gives a preliminary ruling that is further applied by the
requesting internal court. The Court of Justice’s preliminary ruling on validity of EU law has
erga omnes effect, obliging all the judges of the Member States to consider invalid the act that
10
was declared invalid in the preliminary rulings proceedings.18 The remedy is declaratory:
declaration of a EU act invalid or it can be interpretation of EU law.
3. Non-judicial Remedies for Breach of EU Law
3.1. Remedies under the competition sector
3.1.1. Infringement of Article 101 (1) TFEU
Article 101 (1) prohibits all such agreements between undertakings, decisions by associations
of undertakings and concerted practices which may affect trade between Member States and
which have as their object or effect the prevention, restriction or distortion of competition
within the internal market. The infringements of Article 101 (1) TFEU may be investigated by
the initiation of the Commission,19 of a Member State20 or as a response to the complaint
submitted by a natural or legal person. The latter two must demonstrate legitimate interest in
the complaint.21
As consequences of the proceedings, if the Commission finds that there has been an
infringement, it proposes appropriate measures to bring it to an end,22 it may by decision
require the undertakings and associations of undertakings concerned to bring such
infringement to an end,23 for this purpose it may impose on them any behavioural remedies or
structural remedies which are proportionate to the infringement committed and necessary to
bring the infringement effectively to an end. If the Commission has legitimate interest in
doing so, it may also find that an infringement has been committed in the past. If the
infringement is not brought to an end, the Commission records such infringement of the
principles in a reasoned decision.24 The Commission may impose fines25 and periodic penalty
payments26 on undertakings and associations of undertakings. The remedies are - declaratory:
establishment of an infringement, finding that an infringement has been committed in the
past; coercive: requirement to bring an infringement to an end, behavioural remedies,
structural remedies, fine, periodic penalty payment; and constitutive: recording the
infringement.
3.1.2. Declaration of inapplicability under Article 101 (3) TFEU
The basis of declaration of inapplicability lies in Article 101 (3) TFEU that allows declaration
of inapplicability of the provisions of Article 101 (1) in the case of certain agreements or
categories of agreements between undertakings, decisions or categories of decisions by
18 Craig, P., G. De Burça. 2008. EU Law. Text, Cases and Materials. Oxford: Oxford University Press, p. 572-
573.
19 Article 105 TFEU.
20 Article 105 TFEU. Article 7 (2) Regulation 1/2003/EC. OJ 2003 L 1, pp. 1–25.
21 Article 7 (2) Regulation 1/2003/EC.
22 Article 105 TFEU.
23 Article 7 (1) Regulation 1/2003/EC.
24 Article 7 (2) ibid.
25 Article 23 ibid.
26 Article 24 ibid.
11
associations of undertakings, and concerted practice or categories of concerted practices.
Applied for is a declaration of inapplicability basing on Article 101 (3) TFEU of the
provisions of Article 101 (1) or individual or group exemption. The applicant is an
undertaking or undertakings wishing to receive an exemption.
As consequences of these proceedings, the Commission may declare the provisions of Article
101 (1) inapplicable toward certain agreements or categories of agreements between
undertakings, decisions or categories of decisions by associations of undertakings, and
concerted practice or categories of concerted practices.27 Technically, it is possible to declare
inapplicable by an individual decision or individual exemption, and by a group decision or
group exemption. As an alternative, the Commission gives negative clearance in response of
appropriate undertakings on an agreement or practice between undertakings not infringing
Article 101 TFEU. In addition, Article 29 of the Regulation 1/2003 foresees the possibility that
the Commission may withdraw the benefit of such an exemption Regulation acting on its own
initiative or on a complaint when it finds that in any particular case an agreement, decision or
concerted practice to which the exemption Regulation applies has certain effects which are
incompatible with Article 101 (3) TFEU. The Commission may share the exercise of that
power with the competition authority of the relevant Member State.28 The remedies here are -
declaratory: declaration of the provisions of Article 101 (1) inapplicable, negative clearance,
and coercive: withdrawal of the benefit of an exemption Regulation.
3.1.3. Abuse of dominant position under Article 102 TFEU
The abuse of dominant position is regulated by Article 102 TFEU that prohibits abuse by one
or more undertakings of a dominant position within the internal market or in a substantial part
of it.
The Commission may itself initiate the proceedings for establishment of the infringement of
Article 102 TFEU29 as a response on the application of a Member State30 or a complaint of a
natural or legal person, the latter two must demonstrate legitimate interest.31
As consequences of the proceedings, if the Commission finds that there has been an
infringement, it shall propose appropriate measures to bring it to an end32 or by decision
require the undertakings and associations of undertakings concerned to bring such
infringement to an end.33 The Commission may impose on the undertakings any behavioural
or structural remedies which are proportionate to the infringement committed and necessary
to bring the infringement effectively to an end. If the Commission has legitimate interest in
doing so, it may also find that an infringement has been committed in the past.34 For
infringement of Article 102, the Commission may by decision impose on undertakings and
associations of undertakings fines,35 and periodic penalty payments.36 The remedies are -
27 Article 10 ibid.
28 See more precisely: Article 29 ibid.
29 Article 105 TFEU.
30 Ibid. Article 7 (2) Regulation 1/2003/EC.
31 Article 7 (2) ibid.
32 Article 105 TFEU.
33 Article 7(1) Regulation 1/2003/EC.
34 Ibid.
35 Article 23 (1) Regulation 1/2003/EC.
36 Article 24 ibid.
12
declaratory: finding an infringement, and finding that an infringement has been committed in
the past; coercive: bringing the infringement to an end, necessary remedies for bringing the
infringement to an end, behavioural remedies, structural remedies, fine, periodic penalty
payment.
3.1.4. Mergers under Articles 101 and 102 TFEU
According to the established case law of the Court of Justice here is important that in addition
to Articles 101, 102, 103 and 352 TFEU, toward mergers is applicable also the Regulation
No. 139/2004 (Merger Regulation).
The infringement proceedings may be initiated by the European Commission if the
concentration was not notified or one or more Member States may request the Commission to
examine any concentration that does not have a EU dimension that affects trade between
Member States and threatens to significantly affect competition within the territory of the
Member State or States making the request.37
The consequences of the infringement proceedings: if a concentration would not significantly
impede effective competition in the internal market or in a substantial part of it, in particular as
a result of the creation or strengthening of a dominant position, it would be declared
compatible with the internal market;38 if a concentration would significantly impede effective
competition in the internal market or in a substantial part of it, in particular as a result of the
creation or strengthening of a dominant position, it would be declared incompatible with the
internal market.39 Where the Commission finds that a concentration has already been
implemented and that concentration has been declared incompatible with the internal market or
has been implemented in contravention of a condition attached to a decision taken by the
Commission, or would not fulfil the criteria laid down in Article 81(3) of the TFEU, the
Commission may require the undertakings concerned to dissolve the concentration, in
particular through the dissolution of the merger or the disposal of all the shares or assets
acquired, so as to restore the situation prevailing prior to the implementation of the
concentration; in circumstances where restoration of the situation prevailing before the
implementation of the concentration is not possible through dissolution of the concentration,
the Commission may take any other measure appropriate to achieve such restoration as far as
possible or order any other appropriate measure to ensure that the undertakings concerned
dissolve the concentration or take other restorative measures as required in its decision.40
In certain cases41 the Commission may by a decision refer a notified concentration to the
competent authorities of a Member State concerned.42 The Commission may by decision
impose fines on undertakings or associations of undertakings,43 and periodic penalty
payments.44 Where the persons, undertakings or associations of undertakings have satisfied the
obligation which the periodic penalty payment was intended to enforce, the Commission may
fix the definitive amount of the periodic penalty payments at a figure lower than that which
37 Article 22 (1) Regulation 1/2003/EC. OJ 2004 L 24, pp. 1–22.
38 Article 2 (2) ibid.
39 Article 2 (3) ibid.
40 Article 8 (4) Regulation 139/2004/EC.
41 See Article 9 (1) ibid.
42 Article 9 ibid.
43 Article 14 ibid.
44 Article 15 ibid.
13
would arise under the original decision.45 In addition, the Commission may revoke the decision
on the concentration notified not falling within the scope of Regulation 139/2004 or its
declaration that the concentration is compatible with the internal market, where the decision is
based on incorrect information for which one of the undertakings is responsible or where it has
been obtained by deceit or the undertakings concerned commit a breach of an obligation
attached to the decision.46 In addition, the Commission may take interim measures appropriate
to restore or maintain conditions of effective competition.47
The remedies in the cases of infringements are - declaratory: declaration of a concentration
compatible with the internal market, declaration of a concentration incompatible with the
internal market; constitutive: dissolution of the concentration, dissolution of the merger;
coercive: disposal of all the shares, disposal of all the assets acquired, restoration of the
situation prevailing prior to the implementation of the concentration, measures appropriate to
achieve restoration of the situation prevailing prior to the implementation of the
concentration, appropriate measures to ensure dissolution of the concentration, restorative
measures, fine, periodic penalty payments, fixing the definitive amount of the periodic
penalty payments at a figure lower, revocation of the decision on the concentration. Different
interim measures.
Separately, an undertaking may apply for an exemption from prohibition of concentration. If
this is the case, the consequences of the application for an exemption are - the Commission
may grant derogation from prohibition of concentration,48 the Commission may refuse
derogation. The remedy in the case of application for an exemption is the exemption.
In addition, the Court of Justice has unlimited jurisdiction under Article 261 with regard to the
decisions with what the Commission has prescribed fines or penalty payments. The Court of
Justice may cancel, reduce or increase the fine or periodic penalty payment imposed.49 The
consequent remedies are coercive: cancellation of a fine / periodic penalty payment, reduction
of a fine / periodic penalty payment, increasing of a fine / periodic penalty payment.
3.2. Remedies under the state aid sector
Article 107 (1) TFEU prohibits any aid granted by a Member State or through State resources
in any form whatsoever which distorts or threatens to distort competition by favouring certain
undertakings or the production of certain goods in so far as it affects trade between Member
States.
Article 108 TFEU obliges the Commission exercise constant review over all systems of aid
existing in the Member States. Exercising such review, the Commission may take a decision
that the notified measure does not constitute aid,50 but also a decision that the measure is
compatible with the internal market („decision not to raise objections“ or „positive
decision“)51 which means derogation, and therefore is required the decision to specify which
45 Ibid.
46 Article 6 (1) Regulation 139/2004/EC.
47 Article 8 (5) ibid.
48 Article 7 ibid.
49 Article 16 ibid.
50 Article 4 (2) ibid..
51 Article 4 (3) ibid. (negative decision), Article 7 (3) ibid. (positive decision).
14
exception under the Treaty has been applied.52 The Commission may attach to a positive
decision conditions subject to which the aid may be considered compatible with the internal
market and may lay down obligations to enable compliance with the decision to be monitored
(„conditional decision“).53 Separate are the matters, where aid was not notified. The Court of
Justice is of opinion that non-notification in itself does not render aid incompatible, but the
Commission has to establish the compatibility of the aid.54 In the decision to initiate the
formal investigation procedure, the Commission gives its preliminary decision finding that the
doubts are raised as to the compatibility with the internal market of a notified measure.55 The
Commission closes the formal investigation procedure by means of a decision56 either on the
notified measure not constituting aid, on the doubts as to the compatibility of the notified
measure with the internal market have been removed and the aid is compatible or a
conditional decision on the aid being compatible with the internal market or a negative
decision on the aid not being compatible with the internal market.57 The Commission may
revoke a decision on the notified measure not constituting aid, on the doubts as to the
compatibility of the notified measure with the internal market have been removed and the aid
is compatible or its conditional decision where the decision was based on incorrect
information provided during the procedure which was a determining factor for the decision.
Before revoking a decision and taking a new decision, the Commission opens the formal
investigation procedure.58
If the Commission finds that aid granted by a State or through State resources is not compatible
with the internal market having regard to Article 107 or that such aid is being misused, it shall
decide that the State concerned must abolish or alter such aid within a period of time to be
determined by the Commission.59 Article (5) of the Regulation 659/1999 foresees that where
the Commission finds that the notified aid is not compatible with the internal market, it decides
that the aid cannot be put into effect (negative decision). Article 11 of the Regulation No.
659/1999 foresees that the Commission may adopt a decision requiring the Member State to
suspend any unlawful aid until the Commission has taken a decision on the compatibility of the
aid with the internal market (“suspension injunction”),60 as well as interim recovery of any
unlawful aid, and authorisation by the Commission of the Member State to couple the
refunding of the aid with the payment of rescue aid to the firm concerned.61 Where negative
decisions are taken in cases of unlawful aid, the Commission shall decide that the Member
State concerned takes all necessary measures to recover the aid from the beneficiary.62 The
recoverable aid includes interest.63
The remedies here are - declaratory: declaration that the notified measure does not constitute
aid, declaration of the aid not compatible with the internal market, declaration of the aid
compatible with the internal market, declaration that the doubts are raised as to the
52 Article 4 (3) ibid.
53 Article 7 (4) ibid.
54 Case C-301/87, France vs. Commission ECR 1990, p. I-307. Referred in Craig, Paul; De Búrca, Gráinne. EU
Law. Text, Cases and Materials. Fourth Edition. Oxford: Oxford University Press, 2008, p. 1104.
55 Article 4 (4) Regulation 139/2004/EC.
56 Article 7 ibid.
57 Article 7 (2) and (5) ibid
58 Article 9 ibid.
59 See also Article 18 ibid.
60 Article 1 (1) ibid.
61 Article 11 ibid.
62 Article 14 ibid.
63 Ibid.
15
compatibility with the internal market of a notified measure, declaration that the doubts as to
the compatibility of the notified measure with the internal market have been removed and the
aid is compatible with the internal market, declaration of the aid being misused; and the
coercive: abolishment of aid, alteration of aid, suspension of unlawful aid, interim recovery of
unlawful aid, coupling the refunding of the aid with the payment of rescue aid, recovery of
aid, interest, the aid shall not be put into effect.64
If the State concerned does not comply with the Commission’s relevant decisions within the
prescribed time, the Commission or any other interested State may, in derogation from the
provisions of Articles 258 and 259 TFEU, refer the matter to the Court of Justice direct. The
consequences of this action lie in Article 260 TFEU, and those consequences, as well as the
relevant remedies given by the Court of Justice, have been clarified afore.
Conclusions
EU law creates direct rights and obligations to natural and legal persons. Therefore, those
persons must know the claims available for protecting their interest in cases of infringements
of EU law, but on the other hand they should also be aware of the remedies that may be given
under EU law in order to protect the EU against the infringements of its laws by natural or
legal persons. Hopefully, the article helped clarify the complicated remedial system directly
or indirectly available to individuals in the cases EU law is breached.
64 Article 14 ibid.