European Commission v Czech Republic.
Date: 2010-01-14
25. In that regard, it should be borne in mind that the Court may of its own motion examine whether the conditions laid down in Article 226 EC for bringing an action for failure to fulfil obligations are satisfied (Case C‑362/90 Commission  v Italy  [1992] ECR I‑2353, paragraph 8; Case C‑439/99 Commission  v Italy  [2002] ECR I‑305, paragraph 8; and Case C‑98/04 Commission  v United Kingdom  [2006] ECR I-4003, paragraph 16).
26. It is clear from Article 38(1)(c) of the Rules of Procedure of the Court of Justice and from the case-law relating to that provision that an application must state the subject-matter of the proceedings and a summary of the pleas in law on which the application is based, and that that statement must be sufficiently clear and precise to enable the defendant to prepare its defence and the Court to rule on the application. It is therefore necessary for the essential points of law and of fact on which a case is based to be indicated coherently and intelligibly in the application itself and for the heads of claim to be set out unambiguously so that the Court does not rule ultra petita  or indeed fail to rule on an objection (Case C‑195/04 Commission  v Finland  [2007] ECR I‑3351, paragraph 22 and the case‑law cited, and Case C‑412/04 Commission  v Italy [2008] ECR I‑619, paragraph 103).
39. In that connection, with regard to the assertion that there is no institution for occupational retirement provision located in the Czech Republic, it must be pointed out that, according to the settled case-law of the Court, the fact that an activity referred to in a directive does not yet exist in a Member State cannot release that State from its obligation to adopt laws or regulations in order to ensure that all the provisions of the directive are properly transposed (Case C‑214/98 Commission  v Greece  [2000] ECR I‑9601, paragraph 22; Case C‑372/00 Commission  v Ireland  [2001] ECR I‑10303, paragraph 11; and Case C‑441/00 Commission  v United Kingdom  [2002] ECR I‑4699, paragraph 15; and judgment of 8 June 2006 in Case C‑71/05 Commission  v Luxembourg , paragraph 12).
40. Both the principle of legal certainty and the need to secure the full implementation of directives in law and not only in fact require that all Member States reproduce the rules of the directive concerned within a clear, precise and transparent framework providing for mandatory legal provisions (see, to that effect, Case C‑339/87 Commission  v Netherlands  [1990] ECR I‑851, paragraphs 22 and 25, and Commission  v Greece , paragraph 23).
41. Such an obligation applies to Member States in order to anticipate any change in the situation existing in them at a given point in time and in order to ensure that all legal persons in the Community, including those in Member States in which a particular activity referred to in a directive does not exist, may know with clarity and precision, what are, in all circumstances, their rights and obligations (see, to that effect, Commission  v Greece , paragraph 27; Commission  v Ireland , paragraph 12; Case C‑441/00 Commission  v United Kingdom , paragraph 16; and Commission  v Luxembourg , paragraph 13).
42. According to case‑law, it is only where transposition of a directive is pointless for reasons of geography that it is not mandatory (see Commission  v Italy , paragraph 13 and Case C‑441/00 Commission  v United Kingdom , paragraph 17).
45. For the purposes of carrying out such cross‑border activities, Directive 2003/41 requires Member States, as follows from recitals 7 and 20, to apply to the institutions for occupational retirement provision located within their territory various minimum prudential rules with respect to their activities and conditions of operation in order to ensure a high degree of security for future pensioners who are to enjoy their benefits.
51. Such development of the national retirement pension system can in no way be regarded as impossible or purely hypothetical, as the Czech Republic claims, on the ground that it would entail a change to the applicable legal framework and not solely the removal of an obstacle of a factual nature. All legislation can be amended. In the present case, it follows, moreover, from that Member State’s own pleadings that draft legislation intended to introduce a second pillar into the national retirement pension system was drawn up in the Czech Republic before Directive 2003/41 was adopted in 1993, when the Minister for Employment and Social Affairs presented a legislative proposal to that effect to the Czech Government, which ultimately chose another option, namely the adoption of a law on supplementary pension insurance benefiting from a State contribution, and in 2001, when the Government presented to the Chamber of Deputies of the Czech Parliament a legislative proposal on occupational pension insurance. Moreover, at the hearing, the Czech Republic conceded that a second pillar could be introduced in the future if the political will to do so were to emerge.
63. Admittedly, such a prohibition in national law must comply with the rules on free movement laid down in the EC Treaty, in particular, the provisions on freedom of establishment which include the prohibition, in principle, of restrictions on the exercise of that freedom (see, to that effect, inter alia, Case C‑372/04 Watts  [2006] ECR I‑4325, paragraph 92 and the case‑law cited, and Case C‑228/07 Petersen  [2008] ECR I‑6989, paragraph 42), unless they can be justified on the grounds set out in the Treaty or by overriding reasons in the public interest, which include, in particular, the risk of seriously undermining the financial equilibrium of the social security system (see, to that effect, inter alia, Case C‑158/96 Kohll  [1998] ECR I‑1931, paragraph 41, and Case C‑350/07 Kattner Stahlbau  [2009] ECR I‑0000, paragraph 85).
66. In that regard, under the first indent of Article 137(4) EC, the provisions adopted pursuant to that article ‘shall not affect the right of Member States to define the fundamental principles of their social security systems and must not significantly affect the financial equilibrium thereof’.
67. It is clear, first, that Directive 2003/41, which is the subject of this action, was not adopted on the basis of Article 137 EC, which constitutes the legal basis in the Treaty for the approximation of national legislation in the field of social policy. As already indicated in paragraph 43 above, that directive has as its legal bases Articles 47(2) EC, 55 EC and 95 EC, which seek to establish the internal market by means of freedom to provide services and freedom of establishment.