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EU Law I: Francovich case

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Francovich case (C-6/90)

According to a European Directive, the Member States are obliged to offer a minimum standard to the employees in case a company's insolvency. To achieve this, the states should set up a public fund.

Mr. Francovich, a worker who's company had to close, did not receive this minimum standard as Italy had not implemented this Directive in time. The European Court of Justice, then, ruled that states may be held liable if they do not implement it in time. It stated:

"The full effectiveness of Community rules would be impaired and the protection of the rights which they grant would be weakened if individuals were unable to obtain reparation when their rights are infringed by a breach of Community law for which a Member State can be held responsible."[1]

Consequently, the possibility of holding the state liable is given, even though it is bound on certain conditions:

"In the case of a Member State which fails to fulfil its obligation under the third paragraph of Article 189 of the Treaty to take all the measures necessary to achieve the result prescribed by a directive the full effectiveness of that rule of Community law requires that there should be a right to reparation where three conditions are met, that is to say, first, that the result prescribed by the directive should entail the grant of rights to individuals; secondly, that it should be possible to identify the content of those rights on the basis of the provisions of the directive; and thirdly, that there should be a causal link between the breach of the State' s obligation and the loss and damage suffered by the injured parties." [2]

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