Costa v Enel judgment: 60 years on – The making of the doctrine of primacy of EU law

Summary:

Sixty years ago, the European Court of Justice (ECJ) ruled on the conflict between a rule of Community law, part of the Treaty establishing the European Economic Community (EEC) ('EEC Treaty'), and a subsequent rule of national law, part of a legislative act adopted by a Member State parliament. The ECJ ruled that such a conflict should be resolved in line with the primacy of EU law principle that national courts must apply. The Costa v Enel case concerned an Italian nationalisation law, which created a national electricity enterprise – 'Enel' –transferring all existing electricity enterprises operating in Italy to it, upon compensation ('Enel Law'). Nicolino Flaminio Costa, a Milan advocate, was a customer of one of the electricity companies affected by the nationalisation. Urged by Professor Gian Galeazzo Stendardi, his colleague from the Milan Bar Council and an astute supporter of the primacy and direct effect of Community law, Costa did not allow Enel employees to check his energy meter, and refused to pay his first bill from Enel. Two lawsuits before a local small claims court followed, where Stendardi represented Costa. In the first, judge Antonio Carones made a preliminary reference only to the Italian Constitutional Court (ICC), asking it to evaluate the Enel Law's conformity with the Italian Constitution and the EEC Treaty. The ICC not only confirmed the Enel Law's constitutionality but also declared that a later Italian law must prevail over earlier Community law. When a second bill arrived, Costa sued again. This time, the case came before judge Vittorio Emanuele Fabbri, who filed two preliminary references, to the ICC and the ECJ.

Before the ECJ, the Italian government argued that judge Fabbri's reference was 'absolutely inadmissible' because a later Italian law must prevail over the EEC Treaty. However, the ECJ declared the reference admissible, stating that a rule of Community law having direct effect must prevail over any national law that contravenes it. The ECJ argued that, if an opposite view were accepted, the uniformity of Community law across the Member States would be adversely affected, as any state could simply derogate from a selected Treaty rule by passing a domestic law. On the substance, the ECJ found that most Treaty rules invoked by the Italian judge did not have direct effect, so could not affect the case, save for two: the freedom of establishment and the prohibition on monopolies. It was left to the national judge to decide whether the latter of them was possibly breached.

• Alternative Source 1