CELEX: 62003CJ0333
Failure of a Member State to fulfil obligations
Failure to transpose Directive 98/50/EC
Transfer of undertakings
Safeguarding of employees' rights

By application lodged at the Court Registry on 30 July 2003, the Commission of the European Communities brought an action
under Article 226 EC for a declaration that, by failing to adopt the laws, regulations and administrative provisions necessary
to comply with Council Directive 98/50/EC of 29 June 1998 amending Directive 77/187/EEC on the approximation of the laws of
the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses
or parts of businesses (OJ 1998 L 201, p. 88, hereinafter ‘the Directive’) or, in any event, by failing to inform the Commission
thereof, the Grand Duchy of Luxembourg has failed to fulfil its obligations under the Directive.
Legal framework and pre-litigation procedure
Article 2 of the Directive provides:
‘1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this
Directive by 17 July 2001 at the latest …
2. When Member States adopt the measures referred to in paragraph 1, they shall contain a reference to this Directive or shall
be accompanied by such reference on the occasion [of] their official publication. The methods of making such reference shall
be laid down by Member States.
Member States shall inform the Commission immediately of the measures they take to implement this Directive.’
Council Directive 77/187/EEC of 14 February 1977 (OJ 1977 L 61, p. 26) was repealed by Council Directive 2001/23/EC of 12 March
2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event
of transfers of undertakings, businesses or parts of undertakings or businesses (OJ 2001 L 82, p. 16). According to Article
12 of Directive 2001/23, Directive 77/187, as amended, is repealed without prejudice to the obligations of the Member States
concerning the time‑limits for implementation set out in Annex I, Part B to Directive 2001/23. Annex I, Part B, provides that
the deadline for transposing Directive 98/50 is 17 July 2001.
Since no national measures transposing the Directive had been communicated to it, the Commission initiated the procedure for
failure to fulfil obligations laid down in Article 226 EC. Having given the Grand Duchy of Luxembourg formal notice to submit
its observations, it issued a reasoned opinion on 3 April 2003, calling on that Member State to take the measures necessary
to comply with the opinion within two months of the date of its notification.
As the Grand Duchy of Luxembourg did not reply to the opinion, the Commission decided to bring the present action.
The action
Arguments of the parties
The Commission states that the Grand Duchy of Luxembourg has failed to take the measures necessary to comply with the Directive,
or, in any event, has failed to inform the Commission thereof, and has thereby failed to fulfil its obligations under the
Directive.
The Grand Duchy of Luxembourg submits that draft law No 4896 regulating the safeguarding of employees’ rights in the event
of transfers of undertakings, businesses or parts of businesses, which was intended to transpose the Directive, was submitted
to the Chambre des députés (Chamber of Deputies) on 27 December 2001. Following two opinions issued by the Conseil d’État
(Council of State) in May and July 2003, the Labour and Employment Committee of the Chambre des députés decided on 7 July
2003 that the text of the draft law should be amended. Those amendments were approved by the Conseil de gouvernement (Government
in council) on 18 July 2003 and were forwarded to the Conseil d’État and the Chambre des députés. At its sitting of 7 July
2003, the committee decided to place the draft law on the agenda of the Chambre des députés in order that it might be adopted
in October 2003.
Findings of the Court
According to settled case-law, the question whether a Member State has failed to fulfil its obligations must be determined
by reference to the situation prevailing in the Member State at the end of the period laid down in the reasoned opinion (see,
inter alia, Case C-147/00
Commission
v
France
[2001] ECR I-2387, paragraph 26, and Case C‑173/01
Commission
v
Greece
[2002] ECR I-6129, paragraph 7).
It is not disputed that the Grand Duchy of Luxembourg failed to take the measures necessary to transpose the Directive within
the time-limit set by the reasoned opinion.
It must accordingly be held that, by failing to adopt the laws, regulations and administrative provisions necessary to comply
with the Directive, the Grand Duchy of Luxembourg has failed to fulfil its obligations under that directive.
Costs
Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been
applied for in the successful party’s pleadings. As the Commission has asked that the Grand Duchy of Luxembourg be ordered
to pay the costs and the latter has been unsuccessful, it must be ordered to pay the costs.
On those grounds,
THE COURT (Third Chamber)
hereby:
1.
Declares that, by failing to adopt the laws, regulations and administrative provisions necessary to comply with Council Directive
98/50/EC of 29 June 1998 amending Directive 77/187/EEC on the approximation of the laws of the Member States relating to the
safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of businesses, the Grand
Duchy of Luxembourg has failed to fulfil its obligations under that directive;
2.
Orders the Grand Duchy of Luxembourg to pay the costs.
Rosas
Schintgen
Colneric
Delivered in open court in Luxembourg on 10 June 2004.
R. Grass
A. Rosas
Registrar
President of the Third Chamber
–
Language of the case: French.