The European Court of Justice's ruling in Van Gend en Loos v Nederlandse Administratie der Belastingen establishes the principle of direct effect, one of the most important, if not the most important, decisions in the development of European Union law.

The European Court of Justice (ECJ): Guardian of EU Law

The European Court of Justice (ECJ), often referred to as simply "the Court of Justice" and known in French as the Cour de Justice européenne, stands as the supreme judicial authority within the European Union's unique legal order. It is a fundamental component of the broader Court of Justice of the European Union (CJEU), which also includes the General Court. The primary mission of the ECJ is to ensure the consistent interpretation and uniform application of European Union law across all 27 EU member states, fostering legal certainty and preventing divergent national interpretations that could undermine the integrity of the EU legal system.

Established in 1952, the Court's historical roots lie in the Treaty of Paris, which created the European Coal and Steel Community (ECSC). Its seat has remained in Luxembourg since its inception. The ECJ is composed of one judge from each member state, totaling 27 judges, a structure designed to ensure representation of every national legal system and to enhance the Court's understanding of diverse legal traditions. While each member state appoints a judge, cases are typically heard by smaller panels of three or five judges for standard matters, or by a Grand Chamber of fifteen judges for particularly complex or politically sensitive cases. Since 2015, the Court has been presided over by President Koen Lenaerts, who plays a crucial role in the administration and judicial work of the institution.

Jurisdiction and Relationship with National Courts

The ECJ holds ultimate authority in matters pertaining to European Union law, but it is critical to understand its distinct relationship with national legal systems. It is not an appellate court for national judgments; therefore, individuals cannot directly appeal decisions of national courts to the ECJ. Instead, the Court primarily interacts with national judiciaries through a unique mechanism known as the preliminary ruling procedure, outlined in Article 267 of the Treaty on the Functioning of the European Union (TFEU).

The Preliminary Ruling Procedure (Article 267 TFEU)
This procedure represents a vital dialogue between the ECJ and national courts. When a national court faces a case that requires the interpretation of EU law or an assessment of the validity of an EU act, it may, and in certain circumstances must, refer the question to the ECJ for a preliminary ruling. This ensures that EU law is interpreted consistently throughout the Union. Once the ECJ provides its authoritative interpretation, the national court then applies this ruling to the specific facts of the case before it. This mechanism underpins the principle of the supremacy of EU law, ensuring its consistent and effective application across all member states.
Obligation to Refer
While any national court may refer questions of EU law to the ECJ, courts of final appeal (those whose decisions cannot be appealed further under national law) are generally obliged to do so when a question of EU law arises and is necessary for them to give judgment. This obligation helps prevent the emergence of conflicting interpretations of EU law at the highest national levels.

Judicial Review and Annulment Powers

Beyond its interpretative role concerning EU law, the ECJ also functions as a constitutional and administrative court within the EU's institutional framework. Under Article 263 TFEU (Actions for Annulment), it possesses the power to review the legality of acts adopted by EU institutions, bodies, offices, and agencies. This means the Court can annul or invalidate unlawful acts – such as regulations, directives, or decisions – that violate EU treaties, fundamental rights, or procedural requirements. This power of judicial review ensures that EU institutions operate within the bounds of their conferred powers and respect the rule of law, protecting both member states and individuals from unlawful actions by the Union's bodies.

Landmark Case: Van Gend en Loos and the Principle of Direct Effect

One of the most pivotal judgments delivered by the European Court of Justice, fundamentally shaping the landscape of EU law, was Van Gend en Loos v Nederlandse Administratie der Belastingen (Case 26/62), decided in 1963. This landmark ruling established the groundbreaking principle of "direct effect."

The Case Background
The case arose from a dispute in the Netherlands concerning a reclassification by the Benelux countries of a chemical product, which led to an increase in customs duties for the Dutch transport company Van Gend en Loos. The company argued that this higher customs charge violated Article 12 of the Treaty Establishing the European Economic Community (EEC Treaty), which required member states to progressively reduce customs duties among themselves. The Dutch Tax Authority disputed Van Gend en Loos's right to invoke this Treaty provision directly before a national court.
The ECJ's Revolutionary Ruling
In response to preliminary questions referred by the Dutch Tariefcommissie (tax tribunal), the ECJ ruled that the EEC Treaty was not merely an agreement between states, but created a new legal order for the benefit of which states had limited their sovereign rights, and the subjects of which comprise not only member states but also their nationals. The Court held that provisions of the Treaty were capable of creating legal rights that could be directly enforced by both natural and legal persons (such as individuals and companies) before the national courts of the Community's member states, without needing separate national implementing legislation. This ruling meant that individuals could directly rely on EU law to challenge national measures that contravened treaty provisions.
The Principle of Direct Effect
This judgment introduced the principle of direct effect, a cornerstone of European Union law. It empowers individuals and companies to directly invoke and enforce EU law in their national courts, significantly enhancing the effectiveness of EU legislation and providing citizens with concrete rights derived from the Treaties. Van Gend en Loos is widely regarded as one of the most important, and arguably the most famous, developments in the history of European Union law, transforming it from a system solely governing relations between states into a dynamic legal order that directly impacts and protects individuals.

Frequently Asked Questions about the European Court of Justice

What is the difference between the ECJ and the CJEU?
The European Court of Justice (ECJ) is the highest court within the European Union's legal system, specifically handling preliminary rulings and actions against EU institutions. The Court of Justice of the European Union (CJEU) is the overarching judicial institution that comprises two main courts: the European Court of Justice (ECJ) and the General Court. The General Court primarily handles actions brought by individuals or companies against EU institutions, as well as certain specific areas of law like competition and trade marks.
Where is the European Court of Justice located?
The European Court of Justice is based in Luxembourg, a Grand Duchy that also hosts several other significant EU institutions and bodies.
Can individuals directly bring cases before the ECJ?
Generally, individuals cannot directly bring a case before the European Court of Justice. Their primary interaction with the ECJ is usually indirect, through the preliminary ruling procedure when a national court refers a question of EU law to the ECJ. However, individuals or companies can sometimes bring direct actions, primarily before the General Court (part of the CJEU), for instance, to challenge an EU act that directly affects them.
How many judges are on the European Court of Justice?
The European Court of Justice comprises one judge from each EU member state, meaning there are currently 27 judges. This composition ensures that all national legal systems are represented within the Court.
What is the significance of the principle of direct effect?
The principle of direct effect, established by the ECJ in the Van Gend en Loos case, is profoundly significant because it allows individuals and companies to directly invoke and enforce provisions of EU law before their national courts. This ensures that EU law is not merely an agreement between states but a source of rights and obligations for citizens, making EU law more effective and accessible.