Keenan and Riches’BUSINESS LAW

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Membership of the court increased from 25 to 27 from
1 January 2007 as judges were appointed for the new
member states. The court will be able to sit as a Grand
Chamber of 13 judges rather than requiring plenary ses-
sions attended by all judges.


Other institutions


The Court of AuditorsThe Court of Auditors, which
sits in Luxembourg, is the Community’s financial
watchdog. Its job is to scrutinise and report on the
Community’s financial management and oversee the
implementation of the budget. It has 27 members from
1 January 2007, one from each member state, who are
appointed every six years by the Council in consultation
with the European Parliament. Since 1 May 2004 the
Court has been able to set up ‘chambers’ of a few mem-
bers in the interests of efficiency.


The Economic and Social Committee (ESC)The ESC
consists of representatives from all member states, drawn
from various categories of economic and social activity,
including employers, workers, professional bodies, con-
sumers, environmentalists, farmers and so on. It is an
advisory body whose opinion is sought by the Council
and Commission on proposed legislation and other
matters. The membership of the ESC rose from 317 to
344 from 1 January 2007.


The Committee of the RegionsThis advisory Com-
mittee was established by the TEU. It consists of repres-
entatives from each member state, drawn from regional
and local bodies. The Committee is consulted on pro-
posed legislation in such areas as education, culture and
public health to ensure that regional interests are con-
sidered. The membership of the Committee increased
from 317 to 344 from 1 January 2007.


The European Investment Bank (EIB)The EIB, which
is based in Luxembourg, is the Community’s bank. It
lends money to finance capital investment projects.


The EC OmbudsmanThis position was created by the
TEU. The EC Ombudsman, who is appointed by the
European Parliament for a five-year term of office, has
the task of receiving and dealing with complaints from
citizens of member states concerning maladministra-
tion by any Community institution or body, except the
European Court of Justice. The EC Ombudsman may
receive complaints direct from aggrieved individuals
and there is no limitation period on complaints. The EC
Ombudsman may also receive complaints from MEPs


or mount an investigation on his own initiative. Like his
UK counterpart, the EC Ombudsman has no power to
impose sanctions on institutions found guilty of malad-
ministration. He or she must rely on adverse publicity
and political pressure to secure an appropriate remedy.
He or she must submit an annual report to the Euro-
pean Parliament and a report in each case where malad-
ministration is found.

Sources of Community law
The nature and effect of Community law are summarised
in Fig 2.5. The main sources of EC law are as follows:
1 The treaties.The treaties are the primary source of
EC law. The foundations of the Community legal system
were laid in the original Treaties of Paris and Rome and
have been added to by further treaties, such as the Treaty
of Accession and the TEU. These treaties have not been
revised by the Amsterdam Treaty.
Under international law treaties are only binding on
states at a government-to-government level and cannot
normally be enforced by individuals in national courts.
Although the treaties themselves make no reference to
their effect and the rights of citizens to enforce treaty
obligations, the European Court of Justice has developed
the doctrine of ‘direct effect’ which enables an individual
citizen to enforce Community rights derived from the
treaties in domestic courts. The doctrine of direct effect
was established in the following case.

Part 1Introduction to law


30


N. V. Algemene Transport-en Expeditie
Onderneming van Gend en Loos
NVv Nederlandse Belastingadministratie
(1963)
This case concerned the payment of duty on chemicals
being imported from Germany to the Netherlands. Van
Gend en Loos, a Dutch transport company, brought an
action before a Dutch tribunal claiming that an increase
in the import duty being charged by the Dutch govern-
ment infringed Art 12 of the EEC Treaty (now Art 25 of
the EC Treaty). The tribunal referred the matter to the ECJ
for a preliminary ruling under Art 177 of the EEC Treaty
(now Art 234 of the EC Treaty) as to ‘whether Article 12 of
the EEC Treaty has direct application within the territory
of Member States, in other words whether nationals of
such a state can, on the basis of the Article in question,
lay claim to individual rights which the courts must pro-
tect’. The ECJ held that Art 12 was directly effective and
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