3.1 Introduction

36. From amongst others Walrave and Koch, Bosman and Donà1,it is clear that Article 45 TFEU “not only applies to public authorities but extends to rules of any other nature aimed at regulating gainful employment in a collective manner“.2 In Laval and Viking the Court of Justice confirmed that this approach also applies to the freedom to provide services and the freedom of establishment, respectively.3 The Court’s rulings primarily build upon the effectiveness of the free movement provisions in conjunction with the collective character of the scope of action of private parties in question.4 In Angonese the Court held that also private employers are bound to Article 45 TFEU. Hence, these fundamental freedoms directly confer rights upon private parties, which rights can be invoked as such against other private parties.5

37. Considering the content and scope of application of the free movement of workers and the freedom to provide services, their direct horizontal effect is particularly relevant in relation to 1) private employers6, and 2) private parties that are responsible for the regulation of a large amount of (collective) legal relationships involving private parties, such as insurance companies, pension funds, trade unions and private law-bodies that in the same manner as a Member State can restrict a fundamental freedom7, insofar as these bodies do not qualify as an emanation of the State8.9

38. As regards the free movement of goods, some authors argue that in Fra.bo10 the Court of Justice has clarified that, by derogation from earlier rulings,11 also this freedom has direct horizontal effect.12 On the other hand, one can argue that the case of Fra.bo is very specific and exceptional and that, for that reason, it is doubtful whether this judgment should indeed be considered as a general acknowledgement of direct horizontal effect of the free movement of goods.13 Yet, also for the free movement of goods it can be argued that the question whether it imposes obligations upon private parties is relevant only when the private party in question can restrict the free movement of persons in a way similar to measures imposed by a Member State.14 Thus far the Court of Justice has not delivered a ruling on the horizontal effects of the free movement of capital. It is unlikely that the Court would adopt an approach that is considerably different from the approach taken in relation to the other freedoms.15

39. A lot has been written about how the fundamental freedoms apply to horizontal legal relationships16, but the contrary is true as regards the concrete legal consequences of infringements of a fundamental freedom by a private party against another private party. This chapter focuses on the horizontal effect of free movement of workers and the freedom to provide services and the remedies for infringements of these freedoms in horizontal legal relationships. The private parties in the cases referred to in the preceding paragraphs had acted contrary to Article 45 TFEU. Because Union law, save certain specific situations17, does not regulate the legal consequences of infringements of free movement provisions by a private party, the legal consequences of such an infringement have to be sought in national law. As these cases were settled by the parties, the Court of Justice’s rulings were not followed up by national rulings.18

40. To illustrate how infringements of a direct horizontally effective fundamental freedom in a horizontal legal relationship can be solved by the application of national law this chapter firstly provides for a case study on Angonese. In Angonese the Court of Justice confirmed the former case law on the effect of Article 45 TFEU in horizontal legal relationships, and extended the scope of this effect in the sense that also private employers are bound by Article 45 TFEU.19 The Court ruled that in this case the private employer’s conduct was in conflict with Article 45 TFEU. The rulings of the Italian courts illustrate how such an infringement of Article 45 TFEU by a private party can be remedied by the application of instruments in national private law. The rulings include both the fate of juridical acts that infringe Article 45 TFEU as well as the civil liability of the private party that infringed this Treaty provision. This case study is therefore a source of inspiration for both contractual and non-contractual legal relationships in which a private party has infringed another private party’s fundamental freedom.

41. The second case study is in the realm of fundamental freedoms is Laval. In Laval the Court of Justice held for the first time that also Article 56 TFEU on the freedom to provide services is directly effective in horizontal legal relationships. The Court of Justice held that both the collective actions by the trade unions and the Swedish legislation were incompatible with Article 56 TFEU. Consequently, this case study illustrates both the direct horizontal effect and a form of indirect horizontal effect – namely the legality review of national legislation in the context of the horizontal proceedings – of the freedom to provide services. The Arbetsdomstolen, the highest Labour Court in Sweden, pays considerable attention to both forms of horizontal effect and delivered a fascinating ruling which has been both applauded and lamented.