2.5 Effect within the legal order of the signatories
The EEA Agreement is an agreement under international law. There are no express provisions in the Agreement providing that the law flowing from the agreement shall have legal effects within the legal orders of the signatories, regardless of what those legal orders provide. On the contrary, Article 7 EEA presupposes that the regulations and directives included in the EEA Agreement may have to be transposed into domestic, law in order to take effect within the legal orders of the contracting parties. The preamble to the Agreement is also quite unequivocal when it states that the Agreement “does not restrict the decision-making autonomy or the treaty-making power of the Contracting Parties”, and Protocol 35 to the Agreement has, as its starting point, that the EEA Agreement does not require any of the contracting parties to transfer legislative powers to any of the EEA Institutions.
The case law of the EFTA Court is also unambiguous on this point: EEA law has neither direct applicability, nor direct effect, by virtue of EEA law.(1) See to this effect case E-4/01, Karlsson, pargraph 28.A dissonant note is however found in the ECJ’s decision in case C-431/11, UK v Council, in which it held that regulations adopted by the EEA Joint Committee have, by virtue of EEA law, direct applicability within the legal orders of the EFTA States. This dissonance should be treated as exactly that: a dissonance. The EFTA Court has made clear that it does not share the view of the ECJ on this issue. Thus, the EFTA Court has found it necessary to make it absolutely clear that neither direct effect nor direct applicability are features of EEA law:
“Under Article 7 EEA, the Contracting Parties are obliged to implement into their legal order all acts referred to in the Annexes to the EEA Agreement, as amended by decisions of the EEA Joint Committee. The Court points out that the lack of direct legal effect in Iceland of acts referred to in decisions from the EEA Joint Committee, makes timely implementation crucial for the proper functioning also in Iceland of the EEA Agreement.”(2)Case E-11/14, ESA v Iceland, paragraph 17. Judgment 28. January 2015. See also the other judgments delivered that date.
In its seminal advisory opinion in Sveinbjörnsdóttir,(3)Case E-9/97, Sveinbjörnsdóttir. the EFTA Court found that the EEA Agreement requires that an EEA State –whether an EU member state or an EFTA state – is obliged to provide compensation for loss and damage caused to individuals as a result of breaches of obligations under the EEA Agreement that are deemed sufficiently serious. The EFTA Court also held that this principle must be seen as an integral part of the main part of the EEA Agreement, and that “it is natural to interpret national legislation implementing the main part of the Agreement as also comprising the principle of State liability”.(4) Case E-9/97, Sveinbjörnsdóttir, paragraph 63. We see that while the principle is maintained that the EEA Agreement has to be implemented into domestic law in order to take effect there, principles based on quite innovative interpretations of the agreement are held as having been implemented through the implementation of the Agreement in the domestic legal order, thus blurring the edges of the principle that obligations under the EEA Agreement only take effect in the domestic legal orders of the parties to the agreement subject to the provisions of those legal orders.
Still, the principle remains that it is a matter for the legal orders of the parties to the EEA Agreement to decide how EEA law is to take effect in those legal orders.
Treaties concluded by the European Union are, by virtue of Article 216(2) TFEU, binding upon the institutions of the Union and on its Member States. It is established case law that individuals may rely on provisions in such agreements, on the condition that those provisions must «appear as regards their content to be unconditional and sufficiently precise and their nature and broad logic must not preclude their being so relied on».(5) Cited from case C-135/10, SCF, paragraph 43. Thus, it is fair to assume that provisions of EEA law that mirror provisions found in the TFEU or EU secondary legislation will have the same effect in the legal orders of the EU member states as have the legislative acts which they mirror.
Turning to the EFTA-pillar, the effect of EEA law in the legal orders of the EEA-EFTA states depends on those legal orders, i.e. Icelandic, Liechtenstein and Norwegian law respectively. Thus, in respect of the effect within the legal orders of the EEA states, we will have four doctrines: one with regard to the EU-pillar, and one for each of the EFTA states party to the EEA Agreement.