Court: European Court of Justice (ECJ)
Date: 1964
Key Legal Principle: Primacy of European Union Law over National Law
The case of Flaminio Costa v ENEL (1964) is a landmark decision by the European Court of Justice (ECJ) that fundamentally shaped the relationship between European Union (EU) law and the national laws of member states. The decision laid the foundation for the principle of the primacy of EU law, asserting that EU law takes precedence over national laws when there is a conflict. The case also confirmed the jurisdiction of national courts to enforce EU law and referred questions on its interpretation to the ECJ, emphasising the role of domestic courts in upholding the supremacy of European law.
This case became a cornerstone in the development of the EU’s legal framework and has been cited numerous times in the subsequent jurisprudence of the EU, making it an essential case for understanding the dynamics of EU law in national legal systems.
Facts of Flaminio Costa v ENEL
Flaminio Costa was an Italian citizen, a lawyer by profession, and a shareholder in the electricity supply company Edisonvolta, which was nationalised by the Italian government as part of a wider move to nationalise the electricity sector in Italy. Costa opposed the nationalisation process and believed it violated the Treaty of Rome, which had established the European Economic Community (EEC).
Costa had an existing contract with Edisonvolta, and when the company was nationalised, the Italian government transferred the management of the electricity supply to ENEL, a newly formed nationalised electricity company.
Costa refused to pay his electricity bill issued by ENEL, arguing that the transfer of his contract to ENEL was unlawful because it conflicted with the Treaty of Rome. He claimed that the nationalisation law violated both the Italian Constitution and the provisions of the Treaty of Rome.
The case began in the Justice of Peace of Milan, where Costa sought a ruling. The judge referred the case to the Italian Constitutional Court, asking whether the Treaty of Rome should prevail over the nationalisation law. In a significant ruling, the Italian Constitutional Court decided that national law should take precedence over the Treaty of Rome, applying the principle of lex posterior derogat legi anteriori (new law overrides old law). The Court held that the nationalisation statute, enacted in 1962, should prevail over the earlier Treaty provisions.
While the Italian Constitutional Court maintained the supremacy of national law, Costa continued his challenge. He contested the second bill from ENEL, and the case was again referred to the Justice of Peace in Milan. This time, however, the case was referred not only to the Italian Constitutional Court but also to the European Court of Justice (ECJ), as the judge sought clarification on the compatibility of the nationalisation law with the provisions of the Treaty of Rome, particularly regarding the right of establishment, competition, and state aids.
Legal Issues in Flaminio Costa v ENEL
The key legal issue in Flaminio Costa v ENEL (1964) was whether EU law, specifically the Treaty of Rome, should take precedence over national laws when there is a conflict. This case raised important questions about:
- The supremacy of EU law: Should the Treaty of Rome be considered dominant over conflicting national statutes of member states?
- Direct effect of EU law: Did the provisions of the Treaty of Rome relating to the single market and competition have direct effect, meaning could individuals directly rely on them in national courts to challenge domestic legislation?
- The role of national courts: Could national courts enforce EU law, even in cases where national legislation conflicted with EU law, and should they refer such cases to the ECJ for interpretation?
Flaminio Costa v ENEL Judgement
The European Court of Justice’s ruling in Flaminio Costa v ENEL (1964) was significant in affirming the primacy of EU law over national law and establishing the role of national courts in enforcing EU law.
- Supremacy of EU Law: The ECJ overturned the decision of the Italian Constitutional Court, which had ruled that national law would prevail over the Treaty of Rome. The ECJ affirmed that the Treaty of Rome created a unique legal order that was integrated into the national legal systems of the EEC member states from the moment it came into force. The EU law had a special nature, and member states had voluntarily limited their sovereignty in certain areas by signing the Treaty. Therefore, national laws could not override EU law without undermining the very foundation of the European Community.
The ECJ made it clear that the EU legal order was not simply a collection of international treaties but a self-contained system of law that was binding on the member states. EU law, because of its original and independent nature, could not be overridden by national legal provisions, no matter how recent or strongly enacted they were. The court held that allowing national laws to override the Treaty of Rome would strip the EU legal order of its character as community law. - Direct Effect of EU Law: On the question of whether the provisions of the Treaty of Rome regarding the single market, competition, and state aids had direct effect, the ECJ ruled that they did not. The ECJ clarified that these provisions could not be directly invoked by individuals to challenge national laws in domestic courts. However, the ECJ allowed that individuals could rely on EU law in national courts, especially in cases where national laws conflicted with EU provisions.
- Referral to the ECJ: The ECJ ruled that national courts had an obligation to ensure the application of EU law, and in cases where the national law appeared to conflict with EU law, national courts should refer the matter to the ECJ for interpretation. This case reinforced the idea that EU law was not just an obligation on national governments but also a direct obligation on national courts to uphold.
Conclusion
Flaminio Costa v ENEL (1964) remains one of the most significant cases in the history of EU law, as it established the primacy of EU law over national laws and clarified the role of national courts in enforcing and interpreting EU law. The case set a precedent that has been followed in subsequent rulings by the European Court of Justice, ensuring that the legal order of the European Community remains integral and enforceable across all member states.
This case solidified the notion that EU law is a unique and independent source of legal authority, overriding national laws where conflicts arise. As a result, Flaminio Costa v ENEL (1964) continues to play a critical role in shaping the relationship between national legal systems and the overarching framework of the European Union.
