Internationale Handelsgesellschaft (1970): EU Law Supremacy vs. Fundamental Rights

“EU law prevails even over Member States’ constitutions.” This provocative statement captures the essence of the Internationale Handelsgesellschaft judgment.

Hello, students of European law. Today we examine Internationale Handelsgesellschaft (1970). When I first encountered this case, I wondered: “Can EU law really stand above national constitutions?” A German company argued that a Community regulation violated Germany’s Basic Law (constitution). The case pushed the principle of EU law supremacy to its limits while simultaneously raising the question of fundamental rights protection. Let’s unpack what this judgment means.

Contents

Background and Facts Core Issue: EU Law vs National Constitutions The Court’s Decision and Reasoning Impact on the EU Legal Order Criticism and Scholarly Debate Contemporary Significance and Takeaways

Background and Facts

The German company Internationale Handelsgesellschaft challenged a security-deposit system linked to grain export licences. Under then EEC rules, exporters had to lodge a deposit that would be forfeited if licence conditions were breached. The company argued that such forfeiture violated the German Basic Law (Grundgesetz), specifically the fundamental rights to freedom to choose one’s occupation and protection of property. In other words, the constitution and Community law were in direct conflict.

Core Issue: EU Law vs National Constitutions

At the heart of the case: Can a Member State’s constitution prevail over EU law? Because Germany’s Basic Law robustly protects fundamental rights, the clash was seen not merely as statute vs statute, but as a confrontation between constitutional values and Community norms.

Side	Claim	Core Reasoning
Internationale Handelsgesellschaft	Constitutional primacy	The EEC measure violates fundamental rights in the German Basic Law and is therefore invalid.
EEC / CJEU	Primacy of EU law	Even national constitutions cannot stand above Community law.

The Court’s Decision and Reasoning

The Court of Justice unequivocally reaffirmed EU law’s supremacy. Member States, having voluntarily transferred sovereign powers, cannot place their constitutions above Community law. At the same time, the Court stressed that fundamental rights form part of the general principles of Community law and will be respected and protected within the EU legal order. Key points:

• EU law prevails even over national constitutions to ensure uniform and effective application.
• If constitutions took priority, EU law would fragment and the Community project would collapse.
• Nevertheless, fundamental rights are safeguarded within EU law as general principles.

Impact on the EU Legal Order

The judgment clarified the absolute primacy of EU law, extending it to conflicts with national constitutions. At the same time, it catalyzed the development of fundamental rights protection within EU law. This trajectory led to cases like Nold and eventually the Charter of Fundamental Rights. The case marks a pivotal moment in balancing the EU legal order with a coherent fundamental rights regime.

Criticism and Scholarly Debate

Reactions were mixed. The ruling ensured uniformity of the EU legal order, but critics warned that it could threaten the authority of national constitutions and their fundamental-rights guarantees. The debate can be framed as follows:

Viewpoint	Main Argument
Critical	EU primacy can erode constitutional guarantees of fundamental rights.
Supportive	Fundamental rights are protected at EU level through general principles, allowing conflicts to be reconciled.

Contemporary Significance and Takeaways

This case still occupies a central place in EU law scholarship because it first exposed the tension between EU law supremacy and fundamental rights protection. Its takeaways:

• Explicit confirmation that EU law’s primacy extends even over national constitutions.
• A turning point introducing fundamental-rights protection within the EU legal framework via general principles.
• The starting point for tensions and dialogue with national constitutional courts, later reflected in the Solange line of cases.

Frequently Asked Questions (FAQ)

Q What was the Internationale Handelsgesellschaft case about?

A German company claimed that the EEC deposit requirement infringed fundamental rights under the German Basic Law, forcing a head-on clash between the national constitution and EU law.

Q What was the core issue?

Whether a Member State’s constitution can take precedence over EU law, and how fundamental rights protection resolves such conflicts.

Q How did the CJEU rule?

EU law prevails even over national constitutions, while fundamental rights are protected as general principles of EU law.

Q Why is this case important?

It confirmed EU law’s primacy even in direct constitutional conflicts and articulated, for the first time, a fundamental-rights protection principle within EU law.

Q What happened with Germany’s Federal Constitutional Court afterwards?

Solange I conditioned deference to EU law on sufficient protection of fundamental rights at EU level, keeping the dialogue—and tension—alive.

Q Does the case still matter today?

Yes. It is a touchstone whenever we discuss the balance between EU law supremacy and fundamental-rights protection.

In Closing

Internationale Handelsgesellschaft (1970) always prompts me to ask: “How strong can EU law be?” The declaration of primacy over constitutions was startling, while the promise to safeguard rights within EU law sought a balance. Without this case, later developments—like the Solange jurisprudence or the EU Charter of Fundamental Rights—might not have emerged. What do you think? Can EU law’s primacy over national constitutions always be justified in practice? Share your views—we can cross-examine perspectives and dig deeper together. 🙂