## Facts

- A French brewery sought damages from Germany, alleging that German beer purity rules unlawfully restricted importation and marketing of beer with additives contrary to EU free-movement rules.
- Spanish-owned fishing companies sought damages from the United Kingdom for losses caused by nationality-based vessel registration requirements under the Merchant Shipping Act 1988, previously found incompatible with EU law.
- In both actions, national courts questioned whether, and on what conditions, EU law required Member States to compensate individuals for damage caused by national legislation that breaches EU law.
- The references were joined because they raised the general doctrine of Member State liability in damages for EU-law breaches attributable to the legislature.

## Issues

1. Whether EU law requires Member States to compensate individuals for damage caused by legislative breaches of EU law, and on what basis.
2. What substantive conditions govern such liability, including the required level of seriousness and causation.
3. Whether liability depends on the breached EU rule having direct effect or on a prior EU judgment declaring the national measure unlawful.
4. How far national law may control remedies and procedure for such damages actions consistent with EU-law constraints.

## Decision

- The Court held that Member State liability in damages for breaches of EU law is required as a general principle, applying to breaches attributable to any State organ, including the legislature.
- The Court set three cumulative conditions for liability: (1) the infringed EU rule is intended to confer rights on individuals; (2) the breach is sufficiently serious; and (3) there is a direct causal link between the breach and the damage.
- For legislative action involving wide discretion, the “sufficiently serious” requirement turns on whether the State “manifestly and gravely disregarded the limits” of its discretion; relevant factors include the clarity of the rule, discretion, intent, excusability, and persistence despite contrary EU case law or a judgment.
- The Court ruled that neither direct effect nor a prior EU judgment is a prerequisite to damages liability, though persistence after a judgment or settled case law is strong evidence of a sufficiently serious breach.
- The Court held that national rules may regulate procedural and remedial modalities only if they satisfy equivalence and effectiveness; Member States may not restrict compensation to loss occurring only after a declaration of infringement.

## Legal Principles

- Member State liability for damage caused by breaches of EU law is inherent in the EU legal order and applies regardless of which State organ committed the breach, including the legislature.
- Liability requires: (1) a rights-conferring EU rule; (2) a sufficiently serious breach; and (3) a direct causal link between breach and damage.
- In fields of broad policy discretion, a sufficiently serious breach is established where the State manifestly and gravely exceeded the limits of its discretion; seriousness is assessed by contextual factors, including disregard of EU judgments or established case law.
- State liability does not depend on direct effect of the infringed provision and does not require a prior ruling that the national measure violated EU law.
- National procedural autonomy is limited by equivalence and effectiveness; national rules must not make EU-law-based damages claims practically impossible or excessively difficult, nor systematically curtail compensation.

## Conclusion

The Court confirmed a general EU-law remedy in damages against Member States, including for legislative acts, governed by a three-part test centered on a sufficiently serious breach and constrained by equivalence and effectiveness in national remedial and procedural rules.


Brasserie du Pêcheur SA v. Bundesrepublik Deutschland (Joined Cases C-46/93 & C-48/93), [1996] E.C.R. I-1029 (C.J.E.U. 1996)