The Gazette 1992

JUNE 1992

GAZETTE

Requirements for direct effect, 33 Advocate General Mischo and the Court attempted to first determine their content before going on to identify to whom the rights were given and upon whom duties were imposed under the directive. 34 Since the latter group could not be divined from the text of the directive, the Court had to consider the second question. 35 Advocate General Mischo argued that Member States are required to give full effect to Community law, although it is up to national law to determine how this duty is to be discharged. This obligation extends to all provisions having the aim of conferring rights upon, or protecting the interests of, individual persons, even where those measures do not give rise to direct effect. Member States which fail to, or inaccurately, implement a directive are in breach of both the general obligation to ensure the full effect of Community law and the specific obligation laid down in Articles 5 36 and 189(3) 37 of the EEC Treaty. Where, as a result of an action taken against a Member State, the Court of Justice finds there has been a breach of this obligation, the Member State is obliged to take all appropriate measures to put its house in order. This may require payment of compensation for damage sustained by private persons arising from the failure to implement Community legislation. Such claims for compensation may be

For as long as a directive has not been properly transposed into national law, individuals are unable to ascertain the full extent of their rights, notwithstanding a judgment of the Court of Justice that the Member State has failed in its obligations or that the provisions of the directive have direct effect. Since only the proper transposition of a directive will bring that state of uncertainty to an end, until such time as a directive has been properly incorporated a defaulting Member State may not rely on an individual's delay in initiating proceedings to protect rights conferred thereon by a directive. Time will not begin to run against a plaintiff until the Member State has effectively implemented the directive in question. 29 "Rarely has our Court had to judge a matter in which the negative consequences of the non-transposition of a directive were, for the individuals in question, as serious as they were in this case." 30 The objective of Council Directive 80/987 of 20 October 1980 31 is to protect employees in the event of an employer's insolvency, in particular as regards the recovery of unpaid earnings. To this end Member States are required to take such measures as are necessary to ensure that guarantee institutions, as created or designated thereby, can ensure the payment of outstanding claims for earnings prior to an employer's insolvency. What constitutes an act Francovich

of insolvency for the purposes of the directive is to be chosen by each Member State from among three options. On 2 February, 1989, the Court condemned Italy for its failure to transpose Directive 80/987 into its domestic law by 23 October, 1983. 32 Having only received part of his salary during 15 months employment, Mr. Francovich obtained judgment for 6 million Italian Lire (c. IR£3,000) but was unable to recover this amount from his employer. He commenced proceedings against Italy seeking either to obtain the benefit of the guarantees provided for by Directive 80/987 or an award of an equivalent sum in damages. Mrs. Bonifaci's employers went into receivership on 5 April, 1985, owing 253 million Lire (c. IR£126,500) to some 34 employees. After four years of fruitless waiting, they took the same road as Mr. Francovich. T\vo issues of Community law arose. Could the rights created by Directive 80/987 be invoked by the plaintiffs in an Italian court notwithstanding Italy's failure to transpose the directive into Italian law? If not, could the plaintiffs recover damages for the losses they sustained by reason of Italy's failure to implement the directive?

To see whether the rights established by Directive 80/987 satisfied the

Doyle Court Reporters Principal: Áine O'Farrell Court and Conference Verbatim Reporting Specialists in Overnight Transcription 2, Arran Quay, Dublin 7. * Tel: 722833 or 862097 (After Hours) Fax: 724486 r E?(cettence in Sporting since 1954

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