2.1.1 Vertical effect

15. Certain rules of Union law have direct effect in the sense that private parties can directly invoke a provision of Union law before a national court without having to resort to a norm of national law.1 In Van Gend & Loos the Court held that a clear and unconditional obligation that Union law imposes upon a Member State by its very nature “makes it ideally adapted to produce direct effects in the legal relationship between Member States and their subjects”.2 In other words, rules of Union law that are “legally complete” or “legally perfect”3 in itself are capable of having direct effect. Since legal relationships between Member States and their legal subjects are referred to as vertical legal relationships, the direct effect the Court acknowledges certain rules of Union law to have in Van Gend & Loos can be referred to as vertical effect or direct vertical effect.4

16. More specifically, direct vertical effect means that a rule of Union law can be directly invoked by a private party against a Member State to shape the vertical legal relationship. The notion of ‘a State’ is a denominator for State authorities and other emanations of the State; the term is interpreted broadly and includes all public bodies at all national, regional and local levels, public employers, as well as private law bodies that have been entrusted with a public task.5 For example, a private party may wish to directly invoke a rule of Union law to assess the compatibility of a provision of national origin with the particular rule of Union law. In line with the principle of supremacy6 and the principle of effectiveness, any provision of national origin that is in conflict with the rule of Union law must be set aside.7 After the disapplication of the problematic legislative provision, the infringed rule of Union law can be applied to determine the concrete legal consequences and to make the Member State comply with the obligations following from the particular rule infringed.8 Another example of direct vertical effect is provided by Fuû I.9 In this case the Court confirmed that an employee – a fire fighter – could directly invoke a provision in a directive against the fire brigade – the public employer – to modify the employment relationship. All in all, direct vertical effect is a tool for private parties to judicially enforce and effectuate their rights under Union law in vertical legal relationships.

17. When a private party has suffered damages due to the failure of a Member State to comply with Union law, the private party can bring a claim for Member State liability,10 which is to be distinguished from direct vertical effect. When a Member State is held liable it is obliged to compensate the damages suffered as a result of the infringement of a Union right. Member State liability thus has a different objective than direct vertical effect, which purports the application of a particular provision of Union law.11 For Member State liability to be established it is not required that the provision infringed has direct vertical effect. Member State liability thus has a broader scope of applicability as it is not confined to provisions that have direct vertical effect.