Walter Rechberger, Renate Greindl, Hermann Hofmeister and Others v Republik Österreich.
Date: 1999-06-15
21 At paragraph 20 of that judgment, the Court held that the principle of State liability for loss and damage caused to individuals as a result of breaches of Community law for which the State can be held responsible is inherent in the system of the Treaty and that the conditions under which State liability gives rise to a right to reparation depend on the nature of the breach of Community law giving rise to the loss and damage. The Court also held, at paragraph 21, that individuals who have suffered damage have a right to reparation where three conditions are met: the rule of law infringed must have been intended to confer rights on individuals; the breach must be sufficiently serious; and there must be a direct causal link between the breach of the obligation resting on the State and the damage sustained by the individuals.
22 As to the first condition, the Court held, at paragraph 42 of the same judgment, that the result prescribed by Article 7 of the Directive entails the grant to package travellers of rights guaranteeing the refund of money that they have paid over and their repatriation in the event of the organiser's insolvency. It also held, at paragraph 44, that the persons having rights under Article 7 are sufficiently identified as consumers, as defined by Article 2 of the Directive, and that the same holds true of the content of those rights which consists in a guarantee that money paid over by purchasers of package travel will be refunded and that they will be repatriated in the event of the insolvency of the organiser.  In those circumstances, the Court held, the purpose of Article 7 of the Directive must be to grant individuals rights whose content is determinable with sufficient precision.
27 It must be borne in mind first of all that the purpose of Article 7 is to protect consumers against the risks arising from the insolvency of the organiser of the package travel. Those risks, inherent in the contract concluded between the purchaser and the organiser, stem from the payment in advance of the price of the package and from the spread of responsibilities between the travel organiser and the various providers of the services which, in combination, make up the package. Consequently, the result prescribed by Article 7 of the Directive entails the grant to the traveller of rights guaranteeing the refund of money that he has paid over and his repatriation in the event of the organiser's insolvency (Case C-364/96 Verein für Konsumenteninformation v sterreichische Kreditversicherungs [1998] ECR I-2949, paragraph 18).
38 In this connection, it is sufficient to observe that, as the Swedish Government and the Commission have pointed out and as is clear from paragraphs 28 to 31 of the judgment of the Court of today's date in Case C-321/97 Andersson [1999] ECR I-0000, the Court does not have jurisdiction, either under Article 177 of the Treaty or under the EEA Agreement, to rule on the interpretation of the EEA Agreement as regards its application by the Republic of Austria during the period prior to the accession of that Member State to the European Union.
44 As regards the Republic of Austria's obligation under Community law to implement the Directive after its accession to the European Union on 1 January 1995, it should be observed that, in Dillenkofer and Others, at paragraph 50, the Court held that, in order to ensure full implementation of Article 7 of the Directive, the Member States should have adopted, within the prescribed period, all the measures necessary to provide purchasers of package travel with a guarantee that, as from the date specified for implementation of the Directive, they would be refunded money paid over and be repatriated in the event of the organiser's insolvency.
50 According to the case-law of the Court, a breach is sufficiently serious where, in the exercise of its legislative powers, an institution or a Member State has manifestly and gravely disregarded the limits on the exercise of its powers. Factors which the competent court may take into consideration include the clarity and precision of the rule breached (Case C-392/93 The Queen v H.M. Treasury, ex parte British Telecommunications [1996] ECR I-1631, paragraph 42).
60 According to the actual wording of Article 7 of the Directive, that provision prescribes, as the result of its implementation, an obligation for the organiser to have sufficient security for the refund of money paid over and for the repatriation of the consumer in the event of insolvency (Dillenkofer and Others, paragraph 34).
64 It must therefore be held that national legislation properly transposes the obligations under Article 7 of the Directive only if, whatever may be the detailed rules laid down for its application, it achieves the result of providing the consumer with an effective guarantee of the refund of all money paid over and his repatriation in the event of the travel organiser's insolvency.
72 In this connection, it should be observed that, as the Court held in Joined Cases C-46/93 and C-48/93 Brasserie du Pêcheur and Factortame [1996] ECR I-1029, at paragraph 65, it is for the national courts to determine whether there is a direct causal link between the breach of the obligation resting on the State and the damage sustained by the injured parties.
74 Next, it should be pointed out that Article 7 of the Directive imposes an obligation of result, namely to guarantee package travellers the refund of money paid over and their repatriation in the event of the travel organiser's bankruptcy. Such a guarantee is specifically aimed at arming consumers against the consequences of the bankruptcy, whatever the causes of it may be.
75 In those circumstances, the Member State's liability for breach of Article 7 of the Directive cannot be precluded by imprudent conduct on the part of the travel organiser or by the occurrence of exceptional and unforeseeable events.
76 Such circumstances, in as much as they would not have presented an obstacle to the refund of money paid over or the repatriation of consumers if the guarantee system had been implemented in accordance with Article 7 of the Directive, are not such as to preclude the existence of a direct causal link.