Superobligatory transposition of directives and the scope of EU fundamental rights 1

Abstract

Do Member States have to respect EU law, especially the Charter of Fundamental Rights (CFR) when they transpose EU directives into national law and thereby go beyond the minimum standard the directives require? Or do they act beyond the scope of EU law and are free to legislate within their national legal framework? The fact that directives’ objectives are binding only to a limited extent on the one hand and the limited competences of the EU on the other hand do not allow an unequivocal answer. We try to develop a system based on general principles of primary EU law and the widely accepted baselines of the interpretation of Article 51(1)(1) CFR, which also corresponds to the partially contradictory case law of the European Court of Justice (ECJ). We show that, in some cases, Member States must fully respect EU fundamental rights when transposing directives superobligatorily; in others they are entirely unbound, and in others only bound by the fundamental right specified by the implemented directive. To do this, we will first introduce the undisputed cases in which the Charter applies to national law before we outline various opinions on the CFR review of superobligatory transposition. In doing so, we will substantiate which of the suggested criteria are useful and propose a test to determine whether a specific CFR fundamental right applies to superobligatory transposition. We hereby also seek to explain the system behind the findings of the ECJ.

1. Double standards in CFR application to national transpositions of directives?

The ECJ seems to make inconsistent decisions when measuring national law that exceeds the minimum of EU directives against the CFR (superobligatory transposition, also known as “supererogatory transposition” ² or “gold-plating” ³ ). Two examples in labour law will illustrate this:

The Working Time Directive 2003/88 guarantees four weeks of paid annual leave. National regulations offering more than four weeks are, in this respect, not reviewed for a breach of Article 31 CFR. ⁴

The ECJ interprets Transfer of Undertakings Directive 2001/23 in such a way that if a business is transferred to a new owner, clauses in employment contracts that refer to collective agreements are conveyed to the transferee in a static way. Thus references to collective agreements do not take into account future changes to these agreements. The ECJ has held a national rule that admits transferred clauses to be updated with changes to the collective agreement incompatible with the transferee's freedom to conduct business (Article 16 CFR). ⁵

In the first example, the ECJ did not examine whether the superobligatory transposition of the directive was compatible with the CFR, whereas in the second example the Court did. The reason is that both examples stand for different types of superobligatory transposition: the first example is a case of transposition we call horizontally superobligatory (others call it ‘autonomous harmonisation’ ⁶ ), in which Member States extend the personal, substantive, temporal or local scope of application. In contrast, the second example is a case of transposition we call vertically superobligatory (others call it ‘substantive overfulfilment’ ⁷ ), in which Member States supplement or amplify the legal consequences the directive stipulates within its scope. The first type of superobligatory transposition broadens the scope of a directive, whereas the second type strengthens or deepens an order set out by the directive.

Our aim in this study is to present a test that can help to understand under what circumstances the ECJ will apply the CFR to such cases. Therefore, we first present the general principles that govern the application of the CFR to Member States (section 2). We then look at the cases where Member States are bound by the Charter when transposing EU directives into national law (section 3), describing instances in which the adoption of the CFR is largely uncontroversial. In the main section (section 4) we take a closer look at cases of superobligatory implementation of directives – especially minimum harmonization directives (section 4.A). We will outline undifferentiated opinions on the CFR review of superobligatory transposition (section 4.B), which we will reject. Afterwards we will develop our own position on the basis of existing distinguishing opinions, which we will critically analyse and ultimately refine in a way that is compatible with the Treaties and the case law of the ECJ (sections 4.C and 4.D). We conclude our analysis with a summary (section 5).

2. Binding Member States to the CFR within the scope of EU law

First, we will look at the general principles that decide whether or not Member States must observe the CFR. Member States must comply with the Charter ‘only when they are implementing Union law’ (Article 51(1)(1) CFR). But under which circumstances do Member States implement EU law? The ECJ states that EU fundamental rights are ‘applicable in all cases governed by EU law’. ⁸ Thus the Charter is binding within the entire scope of EU law. According to the Fransson doctrine there is no case within the scope of EU law to which the Charter does not apply. ⁹ But when do Member States act within the scope of EU law?

According to the formula found in the Iida decision, this is dependent on ‘whether the national legislation at issue is intended to implement a provision of European Union law, what the character of that legislation is, and whether it pursues objectives other than those covered by European Union law, even if it is capable of indirectly affecting that law, and also whether there are specific rules of European Union law on the matter or capable of affecting it.’ ¹⁰ This formula, however, does not considerably increase precision. ¹¹

The case law of the ECJ shows that Member States must apply EU law where EU law imposes specific duties upon the Member States, ¹² whether by primary or secondary law or duties to enforce EU law (section 3.B). The Charter itself, however, cannot make EU law applicable. There is no self-activation of EU fundamental rights (Article 51(2) CFR). ¹³ Nor does mere legislative competence of the EU bring a certain matter within the scope of the CFR, unless the competence is actually exercised. ¹⁴

In our opinion and according to the ECJ, ¹⁵ it is irrelevant whether a Member State considers its legislation to be driven by EU law or by a different motivation. ¹⁶ It would be almost impossible to distinguish between these cases. And the chronological order of national and EU law does not matter either. Even if national law was enacted before the applicable directive, and hence falls within the scope of EU law predominantly by accident, the Member State is bound by the CFR. ¹⁷

3. Binding Member States to the CFR when transposing directives

Let us now take a closer look at cases where Member States transpose directives into national law. Each directive extends the scope of EU law and binds Member States to the Charter. But to what extent do directives make the Charter applicable to national transposition? First, we will outline the mostly undisputed baselines of this question: the application of the CFR within the direct scope of directives (section 3.A), when enforcing EU law (section 3.B) and when using options and discretionary powers (section 3.C). In the next section (section 4), we will focus on an extraordinary constellation: the application of the CFR when transposing directives superobligatorily.

A. Applying the CFR within the direct scope of duties

Member States often only transpose directives in precisely the way needed to meet the requirements of the directive. To this extent they undoubtedly implement EU law and the national law therefore falls within the scope of the CFR. ¹⁸ In principle, directives do not make the Charter applicable before their deadline for transposition has expired. ¹⁹ But once a directive is in force, Member States must not compromise attainment of the objectives of the directive. ²⁰ The ECJ has not yet decided whether a violation of this obligation is sufficient to apply the Charter. In particular, the Mangold case did not concern this question because general principles of EU law were made applicable by another directive that was already in force. ²¹ However, it would be plausible to argue that Member States who compromise attainment of the objectives of a directive are governed by an obligation under EU law and must therefore apply the Charter. What is clear is that before the end of the deadline for transposition, Member States are bound by the Charter if they choose to transpose directives ahead of time. ²²

Member States are doubly bound by the Charter through directives: on the one hand, transposition of the directive is an implementation of EU law (Article 51(1) CFR) and, on the other hand, the directive itself must be interpreted in conformity with the Charter (yet limited EU competences also constrain the possibility to interpret directives in accordance with the CFR, section 4.D). ²³

B. Applying the CFR when enforcing EU law

Member States implement EU law not only when they directly transpose directives, but also when they enforce rights conferred by directives. ²⁴ EU law should generally be enforced in accordance with national (procedural) law, but Member States must follow the EU principles of effectiveness and equivalence. ²⁵ Infringements of EU law must be sanctioned in an ‘effective, proportionate and dissuasive’ manner. ²⁶ These ‘collateral’ duties extend the scope of EU law further than the directive itself. Accordingly, the Charter can apply even in areas where the EU has no competence (for example, criminal law ²⁷ ). ²⁸

C. Applying the CFR when using options and discretionary powers

Do Member States implement EU law even if they have several options from which they can choose when transposing directives into national law? The ECJ says that their choice must comply with the Charter. ²⁹ The Charter may even limit the options of Member States to those which do not infringe upon fundamental rights. ³⁰

The Court also held that Member States must comply with the CFR when using discretionary powers conferred by secondary law. ³¹ In these cases, Member States are not acting based on their own original competence. Instead, EU law itself creates a power that grants a certain margin of manoeuvre, which is, therefore, governed by EU secondary law. When using this power, Member States must act in accordance with EU primary law and the CFR, because secondary law cannot authorize national transposition that is incompatible with the CFR. ³² Exceptions must be made if the EU is only competent for minimum harmonization (section 4.D).

4. In particular – binding Member States to the CFR in case of superobligatory transposition

Following this introduction to the requirements surrounding binding Member States to the CFR, it is now time to get down to business: the transposition of directives into national law that goes beyond their minimum requirements. Whilst the cases just mentioned have generally been resolved by plausible and mostly unchallenged ECJ jurisdiction, consensus ends with superobligatory transposition: the question is whether a directive can extend the scope of EU law, and thus that of the Charter, beyond its original scope. There are some unequivocal answers we don’t agree with (section 4.B). We argue that whether the CFR applies depends on whether the superobligatory transposition concerns the scope, the legal elements or the legal consequences of a directive (section 4.C). First of all, we must make it clear that this question only arises in the case of minimum harmonization directives (section 4.A). It should be noted that we won’t discuss undisputed cases where national law falls within the scope of EU law and the Charter, irrespective of a specific directive (for example, within the scope of fundamental freedoms, ³³ regulations or international agreements entered into by the European Union ³⁴ ). ³⁵

A. Focus on minimum harmonization directives

First we have to remember that there are two types of directive: on the one hand, there are directives which provide for maximum harmonization and do not allow Member States any deviation, not even a stronger pursuit of the objectives of the directive. Those directives are similar to regulations but require implementation into national law (Article 288(3) TFEU). Still, Member States remain permitted to regulate cases which are completely beyond the scope of the directive. ³⁶ They are therefore allowed to extend a maximum harmonization directive (only) horizontally, that is, to extend its personal, substantive, temporal or local scope of application. On the other hand, there are directives which only provide for minimum harmonization and allow Member States to go beyond their requirements horizontally and vertically, that is, to supplement or amplify the legal consequences laid down by the directives within their scope.

We will show that only minimum harmonization directives allow the type of superobligatory transposition that can make the Charter applicable. Maximum harmonization directives can only be superobligatorily transposed if the rule additionally created by the Member State falls beyond the scope of EU law. In these cases, however, EU law is not implemented, and the Charter never applies (section 4.C.1). These directives are therefore fairly uninteresting for our investigation, which is why we only look at directives that provide for minimum harmonization.

Whether a directive provides for maximum or minimum harmonization is first and foremost a question of its interpretation. ³⁷ In simple cases, directives contain clauses that explicitly allow Member States to exceed the provisions of the directive. Those minimum harmonization clauses can be declaratory or constitutive: in areas where the EU is only competent for minimum harmonization (for example, Article 153(4) TFEU in social policy, Article 169(4) TFEU in consumer protection, Article 193 TFEU in environmental policy), minimum harmonization clauses are declaratory (for example, Article 11(1) Insolvency Protection Directive 2008/94, Article 15 Tobacco Advertising Directive 2003/33). ³⁸ In areas where the EU is competent for maximum harmonization (for example, Articles 114, 115 TFEU for the internal market), minimum harmonization clauses are constitutive (for example, Article 8 Transfer of Undertakings Directive 2001/23). ³⁹ We will come back to this differentiation later when we outline which fundamental rights of the Charter do not apply in certain cases (section 4.D.2).

B. Undifferentiated opinions on applying the CFR to superobligatory transposition

We will now analyse two undifferentiated opinions on whether Member States have to apply the Charter when they go beyond the requirements of a directive: never and always.

1. No application of the CFR in the case of superobligatory transposition

Some reject the idea that Member States can be bound by the Charter at all when going beyond the minimum of a directive: in such instances, Member States would not be acting upon an authority conferred by the EU but would be exercising their own legislative competence. This would be different from cases in which the directive gives several options or discretion for transposition (section 3.C). ⁴⁰ In the case of vertically superobligatory transposition, these voices argue that Member States are not determined by requirements of the directive. Thus there would be no sufficient link between national and EU law to justify the application of the Charter. ⁴¹ If the Union has not created a certain rule, it would consequently not be obliged to ensure the protection of fundamental rights. ⁴² Accordingly, Member States would not implement EU law when they transpose directives superobligatorily. ⁴³ The ECJ shares this view only in the case of horizontally superobligatory transposition (see section 1). ⁴⁴

Even if this opinion highlights some key aspects, we will argue that the Charter should at least be applicable in some cases of vertically superobligatory transposition: it is true that minimum harmonization can only have a limited effect when fundamental rights of several persons collide. This is ubiquitous in private law where the rights of one are the duties of the other. In these cases, a directive can only establish a minimum level of protection for one of the fundamental rights at stake. ⁴⁵ If Member States go beyond the provisions of such a directive to the benefit of one person, the balance between conflicting fundamental rights shifts – the freedom of the entitled person detracts from the freedom of the obligated person. The directive does allow this shift, but only within the limits of the Charter.

In addition, minimum harmonization does not necessarily aim to protect only one specific fundamental right (for example, anti-discrimination law, as the Equality Directive 2000/78 – according to the interpretation of the ECJ – also protects the freedom to conduct business (Article 16 CFR) ⁴⁶ ) or any fundamental right at all (for example, environmental law). Instead, a directive prescribes an objective that Member States are entitled to pursue more ambitiously by vertically exceeding the programme of the directive. If Member States pursue the objective prescribed by EU law more vigorously, they – a fortiori – implement EU law (Article 51(1) CFR). ⁴⁷ In light of the Fransson case law, the requirements for the link between EU law and national law are not high. As vertically superobligatory transposition generally fulfils an obligation set out by the directive, it sufficiently refers to EU law, even if the national law enacted goes beyond the minimum and is therefore not predetermined by EU law in all details. ⁴⁸

2. Comprehensive application of the CFR in the case of superobligatory transposition

Some Advocates General argue that Member States are always bound by the Charter in cases of superobligatory transposition, whether vertically or horizontally. Member States would be exercising a power conferred by EU law, which is why the resulting national law is ‘linked’ to the directive and must comprehensively comply with EU law, including the CFR. ⁴⁹

In favour of this approach, the Advocates General refer to provisions on EU competences that also define the remaining margin of manoeuvre of the Member States: in labour law, Article 153(4) TFEU allows Member States to adopt ‘more stringent measures’, yet only if they are ‘compatible with the Treaties’. ⁵⁰ Similar wording appears in Articles 169(4) and 193 TFEU in the areas of consumer protection and environmental policy as well as some minimum harmonization clauses in secondary EU law (for example, Article 20(2) Fish Diseases Directive 93/53). Thus, when Member States are using minimum harmonization clauses, they would be bound by EU fundamental rights as an element of EU primary law. ⁵¹

We think this argument is based on a misunderstanding of the cited provisions. EU law can only make primary EU law applicable if the latter is applicable by itself. ⁵² Neither competence provisions in primary law nor minimum harmonization clauses in directives can make other primary law and the CFR applicable. Thus the argument of the Advocates General is circular. The question is whether Member States still implement EU law when superobligatorily transposing directives. The root of the problem is not the wording of minimum harmonization clauses. That is why the opinion that Member States are always bound by the Charter in cases of superobligatory transposition is not convincing. At least, Member States do not implement EU law when they transpose directives in a horizontally superobligatory manner (section 4.C.1).

C. Distinguishing between horizontally and vertically superobligatory transposition

As it was not possible to find an easy answer to the question of whether Member States must comply with the CFR when transposing directives superobligatorily, it is necessary to differentiate according to the way in which national legislation goes beyond directives. We will argue to distinguish the application of the Charter on the subject matter of superobligatory transposition ⁵³ (section 4.C.1), not on its objective (section 4.C.2).

1. Distinction according to scope, legal elements and legal consequences

When transposing a directive superobligatorily, Member States only implement EU law insofar as the directive is exceeded vertically, that is, national law provides stricter legal consequences than required by the directive. ⁵⁴ If a directive is, in contrast, exceeded horizontally, EU law is not implemented. A directive is exceeded horizontally, if its scope is extended or additional legal elements are covered. ⁵⁵ We will explain this in the following.

If national law covers an area that the directive does not regulate, national law only extends the scope and cannot conflict with the directive. ⁵⁶ Because of the principle of conferral and subsidiarity (Article 5(1–3) TFEU), Union law beyond its scope cannot impose obligations upon Member States. ⁵⁷ Accordingly, the ECJ has ruled that Member States do not have to comply with the Charter when regulating compulsory psychiatric placement for therapeutic purposes because the only relevant Directive 2016/343 concerning presumption of innocence only applies to criminal proceedings. ⁵⁸ Similarly, the payment of workers doing night work is not affected by the Charter because Working Time Directive 2003/88 only covers health and safety. ⁵⁹

If national law falls within the scope of a directive but addresses a legal element not covered by the directive, it can be assumed that national law cannot conflict with the directive. Therefore, it cannot be measured against the Charter. Accordingly, the ECJ did not review national anti-discrimination law that tackles discrimination attributes different to those covered by the equal treatment directives. ⁶⁰ Another example from ECJ case law: the above-mentioned Working Time Directive 2003/88 regulates not only night work but also the minimum leave of four weeks (first example, section 1) and establishes legal consequences regarding this issue (in particular, entitlement to time off with continued payment). This is why additional leave under national law may follow other rules without being subject to the Charter. ⁶¹ If a directive explicitly rules out a certain legal consequence for certain legal elements (for example, explicitly leaves those matters unregulated), it is fully harmonizing in this respect and superobligatory transposition is excluded. ⁶²

The Charter may apply if national law adds or reinforces legal consequences for issues covered by the directive. This vertically superobligatory transposition may interfere with the obligations the directive imposes upon Member States. ⁶³ An example for such ‘stricter protection’ is the tightening of requirements for justifying indirect discrimination. ⁶⁴ The EU itself is bound by the Charter and has therefore also weighed up interests and fundamental rights when enacting minimum harmonization directives. ⁶⁵ These parameters are inevitably shifted by vertically superobligatory transposition. ⁶⁶ Member States are permitted to do so because of opening or competence clauses (thereby being granted a certain ‘margin of discretion’), ⁶⁷ but they are bound by the Charter. ⁶⁸ Strengthening legal consequences is not subject to the Charter only if the quasi-maximum harmonization effect of the Charter would inadmissibly shift competences from the Member States to the EU (section 4.D). ⁶⁹ The ECJ adopts the suggested differentiation when denying that the Charter is made applicable by directives ‘where the provisions of EU law in the area concerned [i.e., scope] do not govern an aspect of a given situation [i.e., legal elements] and do not impose any specific obligation on Member States with regard thereto [i.e., legal consequences]’. ⁷⁰

The distinction between horizontally and vertically superobligatory transposition can be difficult to maintain in practice. Here is a rule of thumb: superobligatory transposition does not implement Union law in the sense of Article 51(1) CFR if national law can be conceptionally separated from the minimum transposition required by Union law without disregarding its obligation. ⁷¹ Admittedly, this cannot be formally understood in the sense that the Charter is always unapplicable if the national provision providing for transposition could be deleted without becoming deficient. Such a ‘blue-pencil test’ would leave the applicability of the Charter to the regulatory skill of the Member States ⁷² and lose sight of the reasons we gave for the differentiation.

2. Inadequate alternative – distinction according to objective

Lastly, we want to analyse another opinion: some authors suggest that whether or not Member States must comply with the Charter depends on the objective of superobligatory transposition. If superobligatory transposition pursues the same objective as the directive (vertically superobligatory transposition in the sense mentioned above), Member States would ‘of course’ have to be guided by the objectives of the directive. In contrast, when operating beyond the directive's area of regulation, there would be no objective established by Union law the Member States would have to consider. ⁷³

Although the identity of objectives is also a criterion in the ECJ’s Iida formula (see section 2), it is – in our opinion – nevertheless unsuitable for the issue of superobligatory transposition. It is difficult to determine the objectives of legal acts ⁷⁴ because legislature's intentions and actual results can differ. Even if one supposes that, at least for minimum harmonizing directives, targets can always be determined by interpretation, ⁷⁵ it remains unclear which national law also (sufficiently) serves these objectives. ⁷⁶ Does national law aim at ‘more intensive’ protection – not an aliud – and is it thus to be measured against fundamental rights of the Union? A reliable differentiation is hardly possible and that is why the subjective intention of the legislator cannot be the determining factor. ⁷⁷ Here is an example: in the Hernández case, the ECJ had to rule on a national regulation according to which dismissed employees can demand continued payment of wages from the state if their employer becomes insolvent during inadequately long dismissal proceedings and thus cannot continue to pay the wages. The Charter was deemed unapplicable because the national regulation intended to compensate for ‘irregularities in the administration of justice’, whereas the only relevant directive on insolvency, Directive 2008/94, only intended to protect employees in the event of the insolvency of their employer. ⁷⁸ This could have been judged differently, as the claim for wages was originally raised against the employer, and a claim for compensation against the state can also protect employees in the event of insolvency ⁷⁹ (nonetheless, such claims for compensation do not fall within the scope of the directive, and therefore the Charter is unapplicable). ⁸⁰

Essentially, the question is whether obligations under Union law – in particular, the programme of a directive – are affected by the relevant national law, or whether the possible interference is too indirect and hypothetical (analogous to the case law on the scope of fundamental freedoms). ⁸¹ Differentiating according to scope, legal elements and legal consequences (see section 4.C.1) gives more consideration to this, as the ECJ showed in its TSN decision (first example, section 1): the national rule under scrutiny did not govern the legal consequences of minimum leave required by Union law. It regulated an issue (additional leave) created in national law by exceeding the directive horizontally. Thus the case at stake was not governed by Union law. ⁸² If the Charter applied, when directive and national law follow the same objectives, the TSN decision might have been different, because additional leave pursues the same protective objective as minimum leave. ⁸³

D. Distinguishing between EU competences for minimum and full harmonization

We have explained that the Charter only applies to vertically superobligatory transpositions of directives. However, this could give the EU more power than is allowed under the Treaties. Therefore, some scholars argue that Member States are not bound by the Charter when superobligatorily transposing directives that are based on an EU power constrained to minimum harmonization. ⁸⁴ Apart from environmental protection (Article 193 TFEU) and consumer protection (Article 169(4) TFEU), ⁸⁵ this is generally the case in social policy including labour law (Article 153(4) TFEU). We disagree with the idea that the applicable EU competence is the sole determinant of whether a superobligatory transposition can be measured against the CFR. Horizontally superobligatory transposition never meets the criteria of Article 51(1) CFR (see section 4.C.1). However, we agree that in cases of vertically superobligatory transposition the applicable EU competence must be considered.

1. Shift of competence due to quasi-maximum harmonization effect of the Charter

The Charter may not change the competences of the EU (Article 51(2) CFR, Article 6(1) subsection 2 of the Treaty on European Union – TEU). Yet, if the Member States’ autonomy in areas where the Union only has the power to establish minimum standards were limited by the Charter, the allocation of competences would be shifted in favour of the Union. The minimum level of environmental, consumer and employee protection set by the EU limits the Member States’ legislative autonomy exclusively ‘downwards’. The Charter would supplement the directive’s minimum protection with maximum protection (quasi-maximum harmonization effect). ⁸⁶ This would often concern the countervailing freedom to conduct a business (Article 16 CFR), ⁸⁷ as in the second example (see section 1). Only within the corridor between the minimum of the directive and the maximum of the Charter could Member States pursue the objective of the directive more ambitiously, even if the EU only has the power to set minimum requirements in one direction.

This hidden shift of competence only occurs if minimum harmonization directives are based on an EU competence for minimum harmonization. However, competences cannot be shifted where the Union is competent for maximum harmonization anyway. Accordingly, the ECJ only examines vertically superobligatory transposition of a minimum harmonization directive for compliance with the Charter in its entirety if the Union could also have adopted the directive in a fully harmonizing manner. This is shown by the following case law: vertically superobligatory transposition of the Transfer of Undertakings Directive 2001/23, ⁸⁸ which is based on internal market competence for full harmonization of Article 115 TFEU (section 4.D.3), and vertically superobligatory transposition of Media Services Directive 2010/13, which is based on the competence for full harmonization established by Articles 62, 53(1) TFEU, ⁸⁹ were measured against the CFR.

In short: declaratory minimum harmonization clauses cannot bind Member States to the Charter when exceeding directives vertically, as Member States exercise their own original competence. In contrast, constitutive minimum harmonization clauses can bind Member States to the Charter, because in this case Member States derive the capacity for vertically superobligatory transposition from the EU. As the EU is always bound by the Charter, it can only authorize such regulations that comply with the Charter and could thus be enacted as EU law. ⁹⁰ In this context, the concrete wording of the minimum harmonization clause is irrelevant, ⁹¹ especially since directives lack the necessary terminological stringency. ⁹² What must, at last, be pointed out is that a shift in competences cannot occur if EU law is made applicable by a fundamental freedom instead of a specific directive. In these cases, the Charter is therefore fully applicable.

2. CFR review within the constraints of EU minimum harmonization competences

There is one final exception: the quasi-maximum harmonization effect does not exclude the application of every CFR fundamental right. Sometimes, the ECJ nevertheless reviews the superobligatory transposition of directives for a breach of the Charter, although the EU may only provide for minimum harmonization. In the Moro case, for example, the ECJ reviewed a vertically superobligatory transposition of Information Directive 2012/13 for compliance with the Charter, which was based on a mere competence for minimum harmonization (Article 82(2) TFEU for rights in criminal proceedings). ⁹³ The ECJ first scrutinized the national provision for compliance with the minimum the Directive set for the protection of the rights of the defence (finding no breach), but further examined whether the national law at stake also respected the rights of the defence under Article 48(2) CFR. The ECJ thus appears to have extended the scope of the Charter into an area that remains within the competence of the Member States. ⁹⁴

Nevertheless, this decision does not involve a hidden shift in competences to the disadvantage of Member States, because the Information Directive pursues the same objective as Article 48(2) CFR: the protection of the rights of the defence in criminal proceedings. If the objective of the minimum harmonization directive is identical to the objective of a Charter fundamental right, whereby the directive only specifies and purposefully protects the respective fundamental right, the application of the Charter only shifts the minimum standard required by EU law upwards. However, EU law still sets a minimum standard, which does not prevent the Member States from pursuing the respective regulatory concern further without a ‘cap’ ⁹⁵ under EU law. In this case, the application of the Charter does not have a quasi-maximum harmonization effect. ⁹⁶ Instead, CFR review is functionally the same as interpreting directives in accordance with fundamental rights. ⁹⁷

This means that the vertically superobligatory transposition of a directive that is based on an EU competence for minimum harmonization can only be reviewed for a breach of one fundamental right, namely the one specified and purposefully protected by the directive. Undisputedly, CFR review is relevant in this respect only if the minimum standard of the directive is met. To find out whether a CFR fundamental right can be applied when the EU is only competent for minimum harmonization, the following test must be adopted: could the rule created by the application of the CFR hypothetically be adopted as secondary EU law? If this is the case, CFR review does not interfere with EU competences.

Frankly, it would not be an honourable page of EU legislation if a national rule compatible with the minimum standard of a directive were to be deemed incompatible with the CFR, as this means that the directive itself is also deficient in its protection of fundamental rights. If the ECJ has to review the national rule against the Charter, it also has to examine whether the applicable directive must be declared invalid due to a breach of the Charter (Article 277 TFEU). An invalid directive cannot be implemented but makes the Charter applicable to national law as long as the EU has the competence for that directive. This is because Article 51 CFR primarily serves to protect the competences of the Member States. This aim is not threatened if a directive makes the Charter applicable to national law although it breaches the Charter. The basic requirement of Article 51 CFR is that the directive complies with EU competences. The application of equally directed fundamental rights should ultimately not prompt the EU to delegate its responsibility to protect fundamental rights to Member States. Conversely, Member States should not have to remedy the deficient fundamental rights compliance of EU directives during transposition. That, however, is already common and widely accepted when Member States are to comply with the CFR when transposing directives with several options. The CFR can exclude an option that is explicitly provided by the directive if the option infringes the CFR (see section 3.C). Therefore it seems acceptable to obligate Member States to correct a deficient standard of fundamental rights protection in secondary law during transposition. ⁹⁸

Let us explain this with another example: if, according to national law, maternity leave ended on the day after confinement, this would not infringe Article 8(1) of Directive 92/85 as it allows Member States to allocate the whole period of maternity leave before confinement. ⁹⁹ However, the ECJ could measure the national rule against the right to found a family (Article 9 CFR). Although the Directive rests on an EU competence for minimum harmonization (Article 153(2) TFEU ¹⁰⁰ ), a higher standard of protection of workers after confinement could have been set by secondary law. Hence CFR review in this case does not exceed EU competences but shifts the standard of protection of mothers upwards. In contrast, national law that obligates women to stay away from work throughout the entire maternity leave of at least 14 weeks (Article 8(1) Directive 92/85) goes beyond Directive 92/85, yet could not infringe women's right to engage in work (Article 15(1) CFR). Namely, the application of this fundamental right would limit the protection of pregnant women upwards, which exceeds the applicable EU competence, which is limited to minimum standards. ¹⁰¹

Finally, we would like to give another example for clarification: under Working Time Directive 2003/88, employees’ leave they were unable to take in the current year due to sick leave lapses after a carry-over period if this period is ‘substantially longer’ than the duration of the leave year. ¹⁰² If, under national law, employees could accumulate unlimited leave rights even during years of sick leave, this vertically superobligatory transposition could only be measured against the fundamental right to leave (Article 31(2) TFEU) ¹⁰³ because the applicable competence is limited to minimum harmonization. Applying the fundamental right to leave would only increase the protection of workers and the resulting rule could have been enacted as secondary EU law without exceeding the applicable competence (Article 153(2) TFEU). However, the transposition cannot be reviewed against the opposing freedom of employers to conduct a business (Article 16 CFR). Namely, leave entitlement of workers could not be limited by secondary EU law without infringing the applicable competence. Undisputedly, the provision in national law remains to be reviewed for compliance with national constitutional law. ¹⁰⁴

3. Identifying the applicable title of competence

Allocating a directive to the correct title of competence can thus be of utmost importance in determining whether the Charter is applicable to superobligatory transposition. Where the EU can only provide for minimum harmonization, directives sometimes use powers from similar areas to establish maximum harmonization – at least according to their preamble. Examples exist in labour law: one specific EU power in this area was not created until the Agreement on Social Policy surrounding the Maastricht Treaty. ¹⁰⁵ Prior to this, preambles of directives protecting workers’ rights referred to the internal market competence. ¹⁰⁶ When these directives – after the creation of specific social policy powers – were amended, references were ‘updated’ in some instances. For example, Directive 80/987 was consolidated by Insolvency Protection Directive 2008/94, which now mentions the precursor of Article 153 TFEU as the applicable title of competence. ¹⁰⁷ Nonetheless, in their preamble, some directives concerning workers’ rights continue to reference the internal market competences from Articles 114, 115 TFEU (for instance: Collective Redundancies Directive 98/59, Transfer of Undertakings Directive 2001/23 ¹⁰⁸ ) or the transport competence from Article 91 TFEU (for example, Directive 2020/1057 regulating working conditions of truck drivers involved in cross-border transport).

In order to determine the applicable title of competence of a directive, it is irrelevant which titles of competence are named in its preamble. Namely, the ECJ says that such designations are not constitutive, as their absence has no consequences if the applicable competence can be determined otherwise. ¹⁰⁹ If the above-mentioned directives thus inaccurately invoke competences for full harmonization instead of Article 153 TFEU, this does not make them invalid. Yet these directives have to comply with the limited degree of harmonization and the procedural requirements of Article 153 TFEU. ¹¹⁰ The substantively correct legal basis must be chosen based ‘on objective factors amenable to judicial review’. ¹¹¹ The objectives and content of the directive are decisive, which can also be determined considering its preamble and recitals. ¹¹² Some argue that if a directive falls within the scope of more than one competence, the more specific competence is applicable. ¹¹³ For example, Article 153 TFEU is deemed to be more specific than Articles 114, 115 TFEU because Article 114(2) TFEU requires European labour law to be primarily based on Article 153 TFEU. ¹¹⁴

However, the fact that Article 114(4–5) TFEU mentions the protection of the working environment, means that not all aspects of worker protection can be excluded from internal market competence. ¹¹⁵ Here, as always when identifying the applicable competence, it is decisive where the focus of the measure lies (for Article 153 TFEU on the protection of workers, for Articles 114, 115 TFEU on the functioning of the internal market). ¹¹⁶ In the case of Transfer of Undertakings Directive 2001/23, the ECJ seems to have recognized the realization of the internal market as the regulatory focus, otherwise it would not have been allowed to measure national transposition against Article 16 CFR because the Article 16 review creates a rule that could not have been enacted as secondary law (section 4.D.1). As the Directive protects employees when a business is transferred, an allocation to labour law could also be justified, as the ECJ expressed in the Somoza Hermo case. ¹¹⁷ However, the harmonization of employees’ rights in these situations can also eliminate distortions of competition, as the ECJ said in various cases. ¹¹⁸ Thus the Article 16 review the ECJ adopted in Alemo-Herron was at least defensible. In any case, the mere fact that a directive explicitly allows for more far-reaching measures does not necessarily mean that it is based on a minimum harmonization competence, since opening clauses can also be constitutive (see section 4.D.1).

5. Summary

We have developed a guide to determine whether Member States are bound by the CFR when they transpose directives beyond their minimum standards. The guide generally corresponds to the case law of the ECJ. It can therefore help Member States and their (constitutional) courts find the right legal standard to measure national transpositions of directives against fundamental rights. The guide can also be valuable in anticipating how the ECJ might further advance its jurisdiction on the application of the CFR to superobligatory transposition of directives. The guide is briefly summarized below.

When Member States transpose directives into national law, they are bound by EU fundamental rights only insofar as more far-reaching legal consequences are attached to issues covered by the directive (vertically superobligatory transposition). If Member States only extend the scope of a directive or pick up legal elements which are not regulated by the directive (horizontally superobligatory transposition), they are not bound by the Charter because they are in this respect not subject to any obligations under EU law and cannot affect objectives of the directive.

When Member States transpose directives in a vertically superobligatory manner, they must comply with the Charter within the constraints of the competences conferred upon the EU: EU fundamental rights cannot be comprehensively applied if the EU only has competence for minimum harmonization. If the fundamental rights were applied in this case, there would be a quasi-maximum harmonization effect. This would interfere with the remaining competences of the Member States contrary to Article 51(2) CFR. The Charter would only unlawfully ‘cap’ the Member States’ autonomy by applying those fundamental rights which are contrary to the objective of the directive (for example, the freedom to conduct a business under Article 16 CFR to the protection of workers intended by a directive). If, however, a fundamental right has the same objective as the respective directive, its national transposition can also be measured against that fundamental right without shifting competences in favour of the EU. Thus, if the EU is only competent for minimum harmonization, the CFR can only be applied if the resulting rule could also have been set as secondary law.

If the EU is competent for maximum harmonization and, nonetheless, only provides for minimum harmonization, Member States are comprehensively bound by EU fundamental rights when vertically exceeding the standards of the respective directive. In these cases, there is no risk of a hidden shift in competence in favour of the EU.