Экзамен зачет учебный год 2023 / Ramaekers, EU Property Law

5.1.Inter-Institutional Agreement on a ‘Toolbox’ for European

6.5.Preliminary Conclusions – an Optional Instrument for EU

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Chapter 1

PURPOSE AND METHOD OF THE STUDY

‘Les précautions méthodologiques sont certes utiles mais elles n'offrent qu'une garantie relative: une recherche originale oblige celui qui la parte à construire les outils qui lui sont nécessaires et à pratiquer un certain bricolage méthodologique.’1

INTRODUCTION

Property law was traditionally seen as a nationally-oriented area of law and too politically sensitive to be part of the harmonization debate that was ongoing at the level of the European Union.2 The differences between English property law, which for the largest part deals with land law,3 and the continental systems of property law, which deal with immovables and movables equally, were considered to be so large that convergence between the national systems was hardly conceivable.4 It is sometimes difficult to discern whether such differences are historical ‘accidents’ or whether they were conscious choices reflecting national preferences and policy decisions.5 It is not just the supposedly unbridgeable differences between the national systems of property law which have placed property law largely outside the development of European private law. The close link between property law and a country’s tax policies and bankruptcy policies contributes to Member States’ reluctance to accept regulation by the European Union in the field of property law, since such regulation might also encroach upon tax law and insolvency law.6 More

1Thunis 2003, p. 11. (Methodological precautions are certainly useful, but they only offer a relative guarantee: original research obliges he who commences it to construct the tools which are necessary for him and to engage in a certain methodological do-it-yourself.) [translation ER]

2See e.g. Van Erp & Akkermans 2010, p. 173; Smits 2010, p. 430; Watson 2000 at para. VIII; Drobnig 1997, p. 492.

3Van Erp 2006a, p. 1057 et seq.

4See e.g. Goode 1998, p. 456.

5Keirse & Veder 2010, p. 43-44.

6Goode 1998, p. 455. See also Akkermans 2008, p. 398. The Commission’s 2005 Green Paper on Mortgage Credit in the EU provides an example of the close link between property law and

à

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Purpose and Method of the Study

generally speaking, the recent credit crisis seems to have renewed feelings of ‘economic nationalism’.7 Something is certainly also to be said for Israël and Saarloos’s statement, that discrepancies between national private laws only become noticeable once an internal market has been created, for private law’s primary function is not to ensure access to a country’s national market but rather to regulate the relations between market participants.8

Over the last fifteen years, however, the scene has been changing. The European Union has started to concern itself with areas of property law. Several measures have been enacted that have a direct property law relevance, such as the Financial Collateral Directive,9 the Late Payments Directive10 and the Directive on the return of cultural objects unlawfully removed from the territory of a Member State.11 The recently published Draft Common Frame of Reference (DCFR) should also be mentioned, although it must be noted that this was an academic study rather than EU legislation.12 The DCFR contains three books on property law: Book VIII on Acquisition and loss of ownership of goods, Book IX on Proprietary security rights in movable assets and Book X on Trusts.13 It can be seen that, although the EU promulgates legislation in certain specific areas which relate to property law, the picture is very fragmented.

Member States have their reasons to oppose involvement by the EU in property law, but it is not entirely clear what the stance of the EU itself is with regard to property law. As will be seen in Chapter 3, Article 345 of the Treaty on the Functioning of the European Union (TFEU) – which states that nothing in the Treaties shall prejudice the Member States’ system of property ownership – is interpreted by the EU institutions as not removing property law from the scope of application of EU law. On the other hand, EU legislation that contains or affects property law does not seem to be created in a consistent and coherent manner.

The central research question of this study consists of three parts: To what extent has the European Union already created property law? Can and should the European Union harmonize (certain areas of) property law? If so, what would be the best way to do this?

The first aim of this project is therefore to map out the landscape of EU property law. This will include primary and secondary EU law, case law of the European Court of Justice and policy documents.14 The second step will be to investigate the possibilities for harmonizing property law within the European Union in a more

tax law, and how action by the EU in one area might affect the other area; COM(2005) 327 final, p. 12 at 43.

7Mission letter from the President of the European Commission, J.M. Barrosso, 20 October 2009, Pres(2009)D/2250: ‘The recent crisis has shown that there remains a strong temptation, particularly when times are hard, to roll back the Single Market and seek refuge in forms of economic nationalism.’ To be found at: http://ec.europa.eu/bepa/pdf/ monti_report_final_ 10_05_2010_en.pdf>.

8Israël & Saarloos 2007, p. 650.

9Dir. 2002/47/EC, [2002] OJ L 168/43.

10Dir. 2011/7/EU, [2011] OJ L 48/1.

11Dir. 93/7/EEC, [1993] OJ L 74/74.

12For an overview of the DCFR see Van Erp, Akkermans & Ramaekers 2012.

13See Van Erp 2008b, p. 20.

14Cf Van Erp & Akkermans 2010, p. 174.

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structured manner than is currently the case. In doing so, attention will be paid both to the most suitable form in which to shape EU property law and to its content. The ultimate aim of this project is to propose a framework for further conceptualization and integration of EU property law.

The starting point for this project will not be comparative research of the national systems of the Member States, but the acquis communautaire, which will be analysed to see what existing EU law there is that touches upon property law. This is also why the term ‘EU property law’ is used, as opposed to ‘European property law’. The latter may be interpreted as meaning the property law of various European countries and their differences and similarities, while the former means property law as created by or emanating from the EU. In this study, the term ‘property law’ is used in the private law sense, not in the constitutional sense, meaning that, for instance, Article 1 of the First Protocol to the European Convention on Human Rights – protecting the right to property – will not be dealt with. The analysis of the acquis communautaire in the field of property law aims to clarify what problems, (conflicting) solutions and/or gaps there are in EU property law. The final goal of the project is to create a framework that can be used for the future development of EU property law with an aim to increase coherence and consistency in this field of law. National systems of law are set up as internally coherent systems. Whenever EU law is created, the Member States, when implementing that law, somehow have to weave it into the national system. Property law in particular is very systematic and said to be a delicately balanced system. It is therefore important, in the development of EU property law, to strive for coherence and consistency. That way, disruption of the national legal systems is bound to be less, and there will be less need for national law to fill gaps in the European system, which should prevent discrepancies in implementation from Member State to Member State and guarantee the effet utile of the European rules. This in turn should promote predictability and legal certainty for parties who are subject to the European rules on property law.15 One must keep in mind, however, that coherence in a European context may not necessarily mean the same as coherence in a national context, given that European law is of a different nature than national law.

Possible methods for the implementation of such a framework for the development of EU property law will be looked into as well. Implementation may, for instance, be possible in the form of an optional or mandatory instrument. In that regard, the question will be raised what the competences, if any, of the European Union are to legislate in the area of property law. It is already clear from the European Court of Justice’s famous Tobacco judgment that Article 114 TFEU, which is the legislative basis for measures concerning the internal market, cannot be used as a general harmonization tool. It can only form a legal basis for harmonization if an actual obstacle to free movement within the internal market can be shown, that is a direct result of a lack of harmonizing measures.16 Harmonization in the area of

15Cf Strese 2006, p. 193, where she refers to the Vorhersehbarkeitsinteresse (interest in predictability) of market participants: ‘Privatrechtsunterschiede [führen] zu einer mangelnden Forhersehbarkeit der Abläufe ausländischen Rechts.’

16Case C-491/01, para. 61. See also Zimmermann 2006, p. 544.

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Purpose and Method of the Study

property law at the level of the European Union can therefore only take place if a link to the internal market can be established.

The emphasis of this research project lies on the question whether the European Union can harmonize property law and, if so, what the best way would be to do that. However, an adjacent question is whether harmonization is at all needed and desirable.17 It has, for instance, been argued by several authors that harmonization, from an economic perspective, might have more negative than positive results.18 That literature provides a law and economics perspective to the question of desirability of harmonization. Other starting points to answer the question of desirability can be the cultural perspective – harmonization suppresses local legal diversity – or the perspective of multi-level governance (on which level is a particular area of law best regulated).19 This thesis only touches upon the desirability question from the point of view of the internal market. It will be argued below and in more detail in Chapter 2, that a degree of harmonization in the field of property law is necessary to improve the functioning of the internal market, given that the differences between the property law systems can and do obstruct free movement.

The current chapter provides the background to the reasons for harmonization and the necessity of this research project and contains an outline of the methodology that will be applied in the following chapters.

1.Reasons for the Development of Property Law by the European Union

The submission that there is a need to evaluate the possibilities for harmonizing property law in Europe rests on two pillars. The first pillar concerns the interface between European free movement law and property law; the second pillar concerns the overlap between property law and other areas of private law, especially contract law which has been the object of quite extensive harmonization already.

The differences between the national systems of property law and their mandatory nature, combined with the application of the private international law rule of lex rei sitae – pointing to the law of the place where an object is situated as the applicable property law, making it impossible for parties to choose the applicable law to their proprietary relationship – lead to obstacles to the free movement of goods, capital and – to a lesser extent – services and persons. This is the main reason and justification for legislative action in the area of property law by the EU. There is however another important reason. The academic Draft Common Frame of Reference was presented to the Commission in 2009. It contains three books on property law: Book VIII on Acquisition and loss of ownership of goods; Book IX on Proprietary security in movable assets; and Book X on Trusts. These books have

17Cf Dijck & Heuvel 2004, who discuss the role of the ‘can you do it-question’ (kan het-vraag) and the ‘should you do it-question’ (moet het-vraag) in any discussion about the future of property law.

18See e.g. Van Gerven 2002, p. 163; Wagner 2002, particularly the concluding paragraph at p. 1011 et seq.

19Cf Weatherill 2004a, p. 13-15.

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been criticized for being incomplete – they do not deal with immovable property20 – and their quality is arguably affected by the time constraints placed on the project by the Commission.21 It seems unlikely that the Commission will implement these parts of the DCFR in legislation in the near future. The Commission’s Proposal for a Common European Sales Law (CESL), which is based on the work conducted for the DCFR, only implements some of the parts of the DCFR dealing with contract law, but property law is explicitly excluded.22 However, contract law and property law are – in some legal systems more than in others – inextricably linked with one another, as will be shown below in section 1.2 (Harmonization of other areas of private law). The EU has been active in the field of contract law for several decades, but property law (or indeed other areas of private law) are left behind in these developments. The interrelationship between different areas of private law, however, makes it an illusion to believe that development of European contract law can continue completely separately from any development in adjacent areas of private law. But before it can be discussed whether and to what extent the EU should develop property law, it is necessary to gain an overview of the status quo of EU property law. How much EU property law is already there and what does it consist of? Specific parts of property law in an EU context have been the object of study,23 but as of yet there is no general overview of the whole with a proposal how to move forward in harmonizing European property law in a coherent manner. This study purports to provide such an overview and make a proposal for the future development of EU property law.

1.1.The Relationship between Free Movement Law and Property Law

The existing discrepancies between the national property law systems sometimes cause, or may potentially cause, obstacles to the four freedoms within the internal market. The following examples illustrate the type of problems that feature in relation to each of the four freedoms.24 The interface between free movement law and property law will be further analysed in Chapter 2.25

1.1.1. Free Movement of Goods

In Germany it is possible to include an extended reservation of ownership clause in a contract, which is called a Verarbeitungsklausel. Such a clause allows a seller to reserve ownership, not just of the original goods delivered to the buyer but also of the new product manufactured with those goods. In this manner, the seller is protected against non-payment by or insolvency of the buyer. Consider the case in

20Van Erp, Akkermans & Ramaekers 2012, p. 5 at footnote 13.

21Van Erp, Akkermans & Ramaekers 2012, p. 7.

22COM(2011) 635 final; Preamble at Recital 27.

23E.g. security rights on movables: Van Erp & Akkermans 2012, Chapter 10; Kieninger 2008a; Kieninger 2006; Kreuzer 1990.

24See also Milo 2003, p. 121.

25See Van Erp & Akkermans 2010, p. 185: ‘The rules on property law of the Member States, it can be concluded, are potentially also subject to negative harmonization. A view on European property law would, therefore, be incomplete without such a perspective.’

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which a German seller sells goods to a Dutch buyer under such a reservation of ownership clause, and the Dutch buyer uses these goods to manufacture a new product. Subsequently, the Dutch buyer goes insolvent and the German seller attempts to retrieve the newly manufactured product from the insolvent estate of the buyer. According to the private international law rule of lex rei sitae, an object is governed by the law of the country where it is located. Therefore, a Dutch judge having to decide on the question who is owner of the new product will apply Dutch property law including the Dutch numerus clausus, or closed list, of property rights. Dutch law stipulates that the manufacturer of a new product becomes the owner of that new product.26 It does not know an extended reservation of ownership clause like German law does, and therefore a Dutch judge will not enforce the Verarbeitungsklausel in the contract of sale between the German seller and the Dutch buyer. Through the combination of a rule of private international law – the lex rei sitae rule27 – and a rule of national property law, the German seller loses his ownership of the new product and is unprotected against the insolvency of the buyer.

The reverse situation is also possible. A Dutch seller can include a Verarbeitungsklausel in a contract of sale with a German buyer, which becomes valid the moment the goods cross the border into Germany. This is a result of Article 128(2) of Book 10 of the Dutch Civil Code, which allows parties, in deviation from the lex rei sitae, to choose the law of the country of destination as the applicable law to a reservation of ownership clause. Such a choice of law is only effective if the object is actually imported into the country of destination. In case of insolvency of the German buyer, a German judge, having to decide who the owner of the goods is, will apply German law in accordance with the lex rei sitae rule and will acknowledge the Verarbeitungsklausel in the contract. The Dutch seller remains the owner of the goods and is protected against insolvency of the German buyer. The result is that it is less attractive for a German seller to export goods to the Netherlands than it is for a Dutch seller to export goods to Germany. The German manufacturer may demand an alternative and probably more costly, security right, or choose not to demand security but raise the price of the product to compensate for the higher risk.28 This situation constitutes an obstacle to the free movement of goods as prohibited under Article 34 TFEU,29 given that the Court of Justice of the European Union (CJEU) has decided that any measure that is liable to hinder or make less attractive the free movement of goods is prohibited.30

It might be argued that these kinds of situations are so remote that one cannot conclude that there is in fact an obstacle to the free movement of goods. The CJEU judgment in Krantz,31 which will be discussed in Chapter 2, certainly went in that direction. These arguments can be contested. There is a long line of case law from

26Art. 16 of Book 5 of the Dutch civil code.

27The lex rei sitae rule and its place in the EU’s internal market are discussed more in depth in Chapter 5.

28Von Bar & Drobnig 2002, Doc. No. SANCO B5-1000/02/000574, at no. 733.

29Art. 28 EC reads: ‘Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited between Member States.’

30Unless certain justification requirements are fulfilled; Case C-55/94, Gebhard v Consiglio dell’Ordine degli Avvocati e Procuratori di Milano [1995] ECR I-4165, para. 37.

31Case C-69/88, [1990] ECR I-583.

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the CJEU that clearly indicates that there is no so-called de minimis requirement when it comes to deciding whether a measure forms an obstacle to the free movement of goods.32 This is also in line with the CJEU’s original interpretation of Article 34. In the case of Procureur du Roi v Dassonville, the CJEU interpreted what was then Article 28 EC as follows: ‘All trading rules enacted by Member States which are capable of hindering, directly or indirectly, actually or potentially, intra-community trade are to be considered as measures having an effect equivalent to quantitative restrictions’.33 In the years following this judgment, the CJEU has mitigated the term ‘trading rules’ in the sense that trading is no longer emphasized and rules can be any kind of measure, even non-binding ones.34

The conclusion to be drawn from the example given above is that the combination of the lex rei sitae rule and the closed and mandatory nature of the different national property laws makes it less attractive for a national from one Member State

– in this case Germany – to trade with a national from another Member State – in this case the Netherlands – than it is the other way around. Whether one calls this infringement direct or indirect, actual or potential, is irrelevant given the Dassonville judgment.

1.1.2. Free Movement of Capital

The purchase of immovable property by a national of one Member State in the territory of another Member State is considered to be a capital movement.35 National property law rules concerning the acquisition of immovable property have been the subject of CJEU rulings.36 Areas of Member States that are attractive for winter and summer tourism are targeted by persons wanting to buy holiday homes. These Member States sometimes issue regulations requiring an official statement from the person wishing to buy immovable property in those areas that the property will be used as the primary residence. Through these regulations Member States attempt to avoid the formation of ‘tourist colonies’. The CJEU has held such regulations to be in conflict with the free movement of capital. This means that the rules on free movement of capital have a direct impact on the national law concerning acquisition of immovable property.

1.1.3. Free Movement of Services

In the context of services, one should primarily think of the creation of security rights. The CJEU recognizes that the grant of a mortgage loan constitutes the provision of a financial service, which is connected to a capital movement.37 The

32Barnard 2007, p. 96. See further case C-448/98, Guimont [2000] ECR I-10663, paras. 17-24.

33Case 8/74, Dassonville [1974] ECR 837, at 5.

34Barnard 2007, p. 92-93.

35Case C-515/99, Reisch [2002] ECR I-2157, para. 29. See also the Nomenclature of capital movements, attached as Annex I to Dir. 88/361/EEC for the implementation of Art. 67 EEC Treaty (free movement of capital), at II – Investments in Real Estate.

36See cases such as Trummer v Mayer, Konle and Albore, which are discussed in Chapter 2, section 4.3. Obstacles to the free movement of capital.

37Case C-222/95, SCI Parodi v Banque Albert de Bary et Cie [1997] ECR I-3899, para. 8.

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Purpose and Method of the Study

differences between national mortgage laws can form an obstacle for persons acquiring immovable property in a host Member State, particularly due to the additional costs for the bank granting the loan in acquiring information about mortgage law in the host Member State.38 These costs are passed on to the person applying for the loan. Proposals such as the Euromortgage – about which more in Chapter 6 – attempt to remove such obstacles. Directive 2006/48/EC relating to the taking up and pursuit of the business of credit institutions (recast) regulates certain aspects of cross-border mortgage loans.39 The Directive removes those aspects from the scope of application of the free movement of services. All aspects of cross-border mortgage loans not regulated by the Directive continue to be governed by the free movement of services, though.40

Free movement of services also comes into play when someone acquires a second residence in another Member State (which, as was seen above, is a capital movement). If that person attracts maintenance or construction services or provides tourism services or rents out the property to others, then those activities are considered to fall within the scope of the free movement of services.41 National rules governing the acquisition of immovable property will therefore have to comply with the free movement of services, as well as with the free movement of capital.

1.1.4. Free Movement of Persons

Citizens of the European Union enjoy the right to move and reside freely within the territory of the Member States under Article 21 TFEU.42 The rules on the free movement of persons will be at stake in case of a private individual acquiring a primary or secondary residence in another Member State.43 Again, national rules governing the acquisition of immovable property may not only come into contact with the rules on free movement of capital and services but also with those on the free movement of persons.

1.2.Harmonization of other Areas of Private Law

For several decades, work has been ongoing in the harmonization of contract law, mostly in the context of the consumer acquis. Certain areas of contract law directly interlink with property law, like cogwheels. Contract law cannot be strictly separated from property law and making changes in contract law will often also affect property law, as was established, inter alia, in detail in Von Bar and Drobnig’s Study on Property Law and Non-contractual Liability Law as they relate to Contract

38Von Bar & Drobnig 2002, at no. 527.

39[2006] OJ L 177/1. The Directive is discussed in more detail in Chapter 2, section 5.1.

40Akkermans 2012a, p. 225.

41A-G Geelhoed’s Opinion in Joined Cases C-515/99 and C-527/99 to C-540/99, Reisch, at paras. 31-33.

42Art. 21 TFEU: ‘Every citizen of the Union shall have the right to move and reside freely within the territory of the Member States, subject to the limitations and conditions laid down in the Treaties and by the measures adopted to give them effect.’

43A-G Geelhoed’s Opinion in Reisch, at para. 31.

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