The Court of Justice of the European Union (CJEU) was established in 1952 to insure member states and EU institutions abide by EU Law. In practice, the CJEU interprets EU Law, insuring that it is applied by all EU member states in the same manner. The CJEU also settles legal disputes between national governments and EU institutions and can also be used by “organizations, companies or individuals to take actions against EU Institutions in any case where they feel that their rights have been infringed upon”. Based in Luxembourg, the CJEU is comprised of 3 main bodies, the Court of Justice, General Court and the Civil Service Tribunal. The institution serves a key role in ensuring member states abide by EU agreements. (Source: European Union).
The CJEU Headquarters in Luxembourg (Photo source: Daily Mail UK)
Some recent CJEU cases are highlighted below to illustrate the court’s role of guardian of EU legislation and the rights of EU citizens and member states.
Case 1: Schrems v. Data Protection Commissioner (Case C-362/14) (2014)
This recent case defines the role of member states in protecting personal data exchanged internationally originating from residents of EU member states.
Max Schrems, who filed a case against Facebook regarding protection of personal data, stands in front of Irish Data Protection Commissioner (Photo source: PC World)
The Data Protection Directive applies to all countries of the European Economic Area (EEA), including all EU member states and non-EU countries Norway, Liechtenstein and Iceland. According to this directive, if personal data is transferred to countries outside the EEA special precautions must be taken. In relation to the United States, the Safe Harbour Privacy Principles were adopted enabling US companies to comply with privacy laws protecting European Union and Swiss citizens.
Challenge: Max Schrems, an Austrian citizen has been using Facebook since 2008. His data is transferred from Facebook’s Irish subsidiary to servers located in the United States where the data is actually processed. Mr. Schrems lodged a complaint to the Data Protection Commissioner (the Irish supervisory authority) concerning the disclosure of Edward Snowden in 2013 concerning the activities of the United States intelligence service. He was concerned with the insufficient protection against surveillance currently in place in the United States. The Irish authorities rejected the complaint, on the ground that, the “safe harbour” scheme provides an adequate level of protection of the personal data transferred. Mr. Schrems then filed his case with the CJEU.
Verdict: The CJEU found that the Irish Data Protection Commissioner, did not have the mandate to restrict the national supervisory authorities’ powers where a person calls into question whether the decision is compatible with the protection of the privacy and of the fundamental rights and freedoms of individuals. For this reason, the court declared that Safe Harbour decision is invalid, as such, the complaint of Mr. Schrems should be investigated by the Irish Supervisory authority, which then based on the directive, the transfer of data of Facebook’s European subscribers to the United States should be suspended on the ground that the United States does not offer the adequate level of protection of European subscribers’ personal data. As such, the CJEU decision forces reforms to the Safe Harbour regime, regulating the data flow of EEA citizens to the United States.
Source: Press release of Court of Justice of European Union
The public protesting in support of the Max Schrems case against Facebook (Photo source: Tech Times)
For the full case visit: http://curia.europa.eu/juris/document/document.jsf?docid=157862&doclang=EN
Case 2: Roman Bukovansky v Finanzamt Lörrach (2015)
This case addressed the issue of double taxation when a worker receives a salary originating from a member state, or states with bilateral tax agreements, they are not a citizen of, or reside in a third country.
Effective tax rates in select countries in 2012 show a German income tax of approximately 28% and Swiss income tax of approximately 12% (Photo source : The Economist)
Challenge: Roman Bukovansky, challenged his employer on the basis of discrimination, having been taxed in his country of residence (Switzerland) as well as the country where his salary originated from (Germany) which he was also a citizen of. The issue was whether the principles of non-discrimination and equal treatment, set out in the Agreement on the Free Movement of Persons, article 2 (entered into by the European Community and the Swiss Confederation), precluded a bilateral agreement on double taxation, like the German/Swiss Agreement. Under the German/Swiss Agreement, the right to tax the employment income of an individual employed by a German company who does not have Swiss nationality, but is resident in Switzerland, remains vested in Germany.
Verdict: The CJEU found that the difference in treatment resulted from the allocation of fiscal sovereignty between the parties to the agreement and was therefore an issue between the tax schemes of those parties (Germany and Switzerland). The ruling was therefore in favor of Finanzamt Lörrach, with the CJEU noting of the German-Swiss Agreement “under which the power to tax the employment income of a German taxpayer who does not have Swiss nationality, although he has transferred his residence from Germany to Switzerland, whilst retaining his place of employment in the first of those States, is vested in the State in which that income originates, namely the Federal Republic of Germany, whereas the power to tax the employment income of a Swiss national who is in an analogous situation is vested in the new State of residence, in this case the Swiss Confederation” (Source: EUR-Lex).
Source: Tax Journal
For the full case visit: http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A62014CJ0241
Case 3: Colloseum Holding AG v. Levi Strauss & Co., (2013)
This CJEU verdict clarified trademark rights within the EU, particularly, including distinctive features as part of the trademark, ruling in favor of the Levi Strauss company.
The Levi’s trademark dispute (Photo source: The Telegraph UK)
Challenge: Levi Strauss brought a claim in the CJEU against Swiss company, Colloseum, claiming that the brand had infringed on their trademark. The firm argued that “Colloseum breached its trademark rights by selling jeans with a similar rectangular red cloth bearing its own brand name stitched into the right seam of the back pocket.
“Levi Strauss argued that, through years of use, the red cloth “flag” would be recognised by consumers as a sign of “red tab” jeans made by Levi Strauss – even without the Levi’s brand logo which is printed on it.” Despite having the trademark for the red flag along, however, Levi Strauss had never used the red flag without the brand name.”
Verdict: In 2013, the CJEU ruled in favor of Levi Strauss, stating that the red tab was integral to the brand’s recognition and therefore fell within their trademark rights. This ruling had significant impact on the trademark rights of other brands with distinctive packaging, such as the Toblerone triangle.
Source: The Telegraph UK
For the full case visit: http://curia.europa.eu/juris/document/document.jsf?docid=136430&doclang=en