The INSOL Europe Academic Forum (IEAF) is inviting submissions for its 18th annual conference, taking place from 5-6 October 2022 in Dubrovnik (Croatia). Expressions of interest are invited for the delivery of research papers within the overall theme of the academic conference: “Insolvency Law in Times of Crisis”
The conference is intended to focus on, inter alia, the following overall topics:
The longer-term impact of the COVID-19 pandemic on insolvency and restructuring laws in the EU and elsewhere;
The impact of geopolitical crises and macro-economic uncertainties on insolvency and restructuring laws in the EU and elsewhere;
Reflections on the implementation of the Preventive Restructuring Directive 2019/1023 Directive;
Cross-border issues relating to the new restructuring frameworks, and
Reflections on the EU initiative for further harmonization of insolvency laws.
The IEAF board also invites submissions on other topics that fall with in the scope of the overall theme of the conference.
Conference methodology
In line with the practice established in our past academic conferences, the intention for the autumn conference is to have research papers that challenge existing approaches, stimulate debate and ask, and attempt to answer, comparative and interdisciplinary questions about the above-mentioned topics. Accordingly, proposals are invited that do more than just outline a topic of interest in respect of any given jurisdiction, but seek to understand, analyse and critique the fundamentals of insolvency and restructuring systems in ways that are relevant across jurisdictions and across fields of academic inquiry. All contributions must be in English.
Presenting at the IEAF conference
Expressions of interest in delivering papers within the conference theme should be sent by email on or before 15 June 2022 to the INSOL Europe Academic Forum’s Secretary. Authors of papers selected for presentation will benefit from a waiver of the participation fee for the academic conference, however, they will be responsible for their own travel and accommodation costs. A limited number of travel grants will be available to junior scholars invited to present.
from https://ec.europa.eu/futurium/en/ai-alliance-consultation/guidelines.1.html
The EU Commission’s proposal for the Regulation of Artificial Intelligence (the ‘AI Act’) will bring significant changes to standard-setting for high-risk systems, including medical AI. The proposal’s risk-based approach intends to balance the socio-economic benefits of medical AI and the need for harmonised standards for safety-critical applications in healthcare. From medical diagnostic systems to the robot surgeon, medical AI illustrates the need for interdisciplinary perspectives for the formal governance of these novel tools in a dynamic healthcare setting.
Setting the scene regarding ‘high-risk’ systems regarding medical AI
Accordingly, the current discourse on AI governance is framed as a balancing exercise, considering the EU’s future efforts regarding the EU New Legislative Framework (Annex II of the AI Act). However, this process of value-alignment currently stagnates, considering the role of transparency of medical AI systems, based on efforts to align the regulation of medical AI and its procedural alignment with other sectoral legislation, including the Medical Device Regulation (MDR).
Medical AI: a balancing exercise
The current EU Commission’s proposal follows the spirit of other sectoral legislation, including the MDR, reinforcing the modalities including the associated problems of medical AI to shape human usage and decision-making beyond the laboratory setting. The proposal, just as the MDR, is a legal tool protecting product safety. With the AI Act, the EU Commission’s vision of human-centric regulation becomes an “ecosystem of protecting functionality and intended uses of AI” as medical devices.
Consequently, this perspective brings about two interesting problems that deserve further attention. One aspect is that formal governance remains tied to the system’s performance, intended use, and functionality. The European Coordination Committee of the Radiological, Electromedical and Healthcare IT Industry does recognise this, claiming that international standards need to consider lifecycle changes to software as medical device on the ground, and subsequently inform and update the MDR (p.11-13). The problems of technical documentation tied to the lack of standarisation still exist and the AI Act does not include the requirement to verify the system supporting clinical outcomes including patient-centred care. Second, the AI Act’s progressive outlook on transparency in Articles 13-14 stagnates concerning the contribution covering only the algorithms’ functional revelations of foreseeable risks, leaving out the subject’s perception of the nature of risk undermining shared decision-making in a healthcare setting. This further reinforces gaps in the MDR to verify software as medical device via the levels of explanations for meaningful clinical outcomes.
Therefore, the considerations about AI technologies’ inherent, as well as distinct risks for fundamental rights and safety are transferred to the umbrella of the system’s innovative approach to outperform human judgement. Most requirements in the AI Act, including the ‘appropriate type and degree of transparency’, as well as the identification of technical safeguards for oversight (Article 13 (1); Article 14 (3) (a)) are left to the manufacturer. There is no appropriate involvement of the user, and the subject impacted by these novel technologies. Follow-up measures, such as post-market surveillance under both the AI Act and the MDR (Articles 61 and 89 respectively), will fulfil the function of monitoring life-cycle changes in product development, but do not provide the necessary confidence to develop safe and trustworthy systems considering EU values.
Value-alignment is key for legal certainty
What this shows is that we should not downplay the socio-economic impact of AI to a question of legislative competence but consider the question of safety-critical systems as being a task of value-alignment. Indeed, the significant overlap between the AI Act and MDR induces risks of double-standards at the cost of legal certainty, concerning the governance and enforcement of safety considerations. Nevertheless, what we need first is a risk-based approach that considers an interdisciplinary perspective of EU values into the modalities of AI systems, such as the use of Machine Learning approaches in healthcare. This way the focus on the analysis of prescriptive regulation of AI will shift to the formal governance of novel technologies in the long-term.
AI governance and medical AI: an interdisciplinary approach
The modalities of AI systems necessitate a new approach of standard-setting, which goes beyond a vision regarding the EU’s proactive approach restricted to an AI system’s functionality (p. 2). Restricting AI governance this way creates a false dichotomy stifling innovation, as well as rapid advancements of AI in “narrow” domains. An interdisciplinary approach to AI governance is tools testing a system’s operation on the ground, considering user perspectives of the tool’s reliability, a patient’s perception of risk, as well as core ethical values in decision-making including patient-centred care. This outlook will eventually provide a more consistent approach to AI governance in healthcare, as well as legal certainty.
(This blogpost is the author’s current work in progress. Please contact the author for the latest version of the work).
Details about the author
*Daria Onitiu is a Research Associate based at Edinburgh Law School. She researches at the Governance & Regulation Node within the UKRI Trustworthy Autonomous Systems Project. Her work intends to identify the transparency goals of medical diagnostic systems, and how to translate notions of accountability into a healthcare setting. Twitter @DariaOnitiu
[1] Huw Roberts, Josh Cowls, Emmie Hine, Francesca Mazzi, Andreas Tsamados, Mariarosaria Taddeo and Luciano Floridi, ‘Achieving a ‘Good AI Society’: Comparing the Aims and Progress of the EU and the US’ (2021) 27 (6) Science and Engineering Ethics 1, 6.
In March of 2021, the International Trademark Association (herein referred to as INTA) brought certain ‘amicus briefs’ before the Grand Board of Appeals (GBoA) of the European Union Intellectual Property Office (EUIPO) apropos of the three parallel appeals put forth by The Estate of The Late Sonia Brownell Orwell. These three appeals by the estate were filed against rejection from registration of the name: “George Orwell” and the titles of his acclaimed works: “1984” and “Animal Farm” as trademarks under classes 9, 16 and 41 of goods and services, as required under Article 33 of the European Union Trademark Regulations (EUTMR).
The rejection of applications by the Orwell estate instigated the INTA to submit their briefs recognizing the EU courts’ inconsistency on matters related to trademark registrations for famous names/phrases, a fact also acknowledged by the BoA in its decision while referring the matter to the GBoA.
The Orwell case and EUIPO’s approach
“George Orwell” is the nom de plume of late Eric Arthur Blair, an internationally acclaimed English novelist, journalist, and critic. He also published poems, and combative reportage, but is most known for his novels “Animal Farm” and “Nineteen Eighty-Four” or “1984”. Under European Union law, the copyright protection of published works of literature lasts until 70 years after the death of the authors following which the works fall under the public domain. In the case of George Orwell’s novels, the copyright protection for his works was expiring in 2021 and as such requests were made by the Orwell Estate (Estate of the late Sonia Brownell Orwell overseeing the author’s IPs) to file for trademark protection for the three names mentioned above. As a matter of fact, this is a fairly common practice typically resorted to as an alternate solution against misuse of intellectual properties (under specific classes of goods and services) no longer protected under IP laws.
In the present case, the name ‘George Orwell’, was rejected registration under classes 9 (video/audio multimedia and more), 16 (printed matter) and 41 (entertainment/cultural activities, etc.), under Article 7(1)(c) EUTMR– stating that the fame and repute of the author in the field of literature and journalism has rendered his name non-distinctive and descriptive in nature and that the general public may associate his name to the kind and quality of content/subject matter for which the trademark is sought. A similar reasoning was used by the EUIPO with respect to the application for ‘Animal Farm’ and ‘1984’.
Modern IP law even allows for audible signs and olfactory (smell/odor) marks to be registered as trademarks, given that the basic premise for their assessment remains the same: that a mark is not descriptive of the products/services it represents and that it is distinguishable for the purpose it serves under relevant classes of goods and services. Understandably, the primary problem with registering famous names/titles is that of usage (or over usage) which can negatively affect their distinctiveness as defined under law. (Article 7(1)(d) – EUTMR).
EUIPO’s approach to examination of marks for registration, in theory, gives appropriate weightage to the European Union Trademark Regulations, the legal precedents and the guidelines for examination. The problems, however, lay in the inconsistencies between the precedents and the guidelines when it comes to defining and applying the ‘degree of reputation’ angle to a case, which may affect the eligibility of a famous name or title on grounds of non-distinctiveness or descriptiveness. The guidelines recognize that the name of an individual person would be considered as distinctive (irrespective of its commonality) even when the name is a famous one, but an objection would be raised when the famous name being registered is non-distinctive ‘in relation to the class of goods and services it is being applied for’. (See- Section 4, Chapter 3 EUIPO Examination Guidelines, 2017)
This guideline was part of the reason why in 2011, Lionel Messi’s request for a trademark (logo + the word ‘Messi’) was rejected upon a counter appeal filed by a sportswear brand called ‘Massi’. The European Court of Justice, in 2020, overturned the decision, suggesting that taking Messi’s reputation and fame into account, the mark “Messi” would be considered ‘too well known to be misconstrued’ and that the public would not confuse it with anything else. (EUIPO v Messi Cuccittini)
Descriptive and distinctive marks under EU law
Within the meaning of Article 7(1)(b) EUTMR , the meaning of a distinctive trademark follows:
The mark’s ability to identify the product/service under its relevant category (i.e. the mark needs to be distinct in and among the group of items in a particular class) (see: Vorsprung Durch Technik& Eurohypo)
The mark’s perception in the public domain with regard to its relevant class/category. (eg. ‘Madonna’ being associated with items in class 9, audio-video multimedia)
The above observations are also used by the EUIPO and the EU courts with reference to Article 7(1)(c) EUTMR to define the degree of descriptiveness of a mark; and it is only when a mark is sufficiently, expressly and directly suggestive of the kind and quality of the goods/services does it come under the category of prohibition. (See: Streamserve v OHIM) In simpler terms, while applying the test of absolute grounds of rejection, a trademark’s descriptiveness should be adjudged restrictively leaving room for the benefit of the doubt to emerge in cases of famous names/titles rather than disregarding them completely owing to their fame.
As for the ‘Animal Farm’ case, ‘1984’ case and other such kind, the idea is that the titles can serve as trademarks so long as they are not describing the subject matter of the items they represent and be safely identified as the source of commercial origin of those items, i.e. the titles may not be so generic that they have ‘entered into the language’ and now the public perception of them goes beyond the title of a story/movie to refer to a whole genre of related items. Example: the word ‘thermos’ which is now synonymous with the item itself and could be considered as a name that has ‘entered the language’. This brings forth another angle of consideration: What happens to marks that have already entered into the language? (customary marks).
Customary marks
Marks (words, logos, etc.) that have been absorbed into the language and the linguistic culture to be seen as words of common use cannot be registered as per Article 7(1) (d) EUTMR; A relevant factor while deciding this is the fact that public perception can change over time. In case of famous names, the established precedent is that the name, so long as it isn’t seen to be associated with certain items/services to the point that it has become generic or absolutely descriptive, may be registered as a trademark even if it holds certain repute. This has been the case with many other famous writers and artists in the past such as ‘Janis Joplin’ and ‘F. Scott Fitzgerald’, both of which are registered trademarks already.
However, in the Orwell cases, EUIPO’s reasoned that the name ‘George Orwell’ and the book titles have already come to be recognized by the general public as part of a larger cultural phenomenon/trend (gained a symbolic value) and hence they would be perceived by the public as describing a genre of literary works based on the previously rejected trademarks for ‘PINOCCHIO’ (where the word ‘Pinocchio’ was considered to be too descriptive and almost synonymous with kinds of stories with morals linked with lies), and ‘THE JUNGLE BOOK’ (March 18, 2015, R 118/2014-1, The Jungle Book) (where the book, its title and its characters were perceived to have entered into the language and culture to be synonymous with media based on a jungle survival story). This anomaly in decision making is an unwarranted side-effect of the situational (case-by-case) approach adopted by the EU courts in deciding the extent of effects that fame would have over a name/title/phrase, etc. while getting a trademark.
INTA’s outlook
The INTA, in its briefs submitted before the GBoA, based its arguments in line with the statutory application and past recommendations of the EUIPO (in cases similar to the Orwell case) which explicitly acknowledged that famous names and titles can, in principle, be used as trademarks. They cited precedents on the matter such as the ‘ANNE FRANK’ case (the trademark ‘Le Journal d’Anne Frank’ was considered acceptable since “the expression ‘Anne Frank’ is in no way descriptive and strictly speaking does not mean anything”), to attempt to carefully lay down the issues that need to be tackled by the GBoA. (See- BoA R 2401/104-4 Anne Frank par. 26)
Furthermore, they also presented that an author’s name or book title do not necessarily describe any kind of goods or services – the average consumer will not understand the name or title as being a generic term for books or any kind of book, unless (in exceptional circumstances when) the title is purely descriptive of the subject matter of the book since this would make all famous marks ineligible for registration after they have acquired reputation. (See p. 17, Amicus Brief-INTA- ‘ANIMAL FARM’ & ‘1984’)
Their arguments stood in proposition with the Orwell Estate (the Estate of Late Mrs. Sonia Brownell) and went on to acknowledge how the registration of famous names/titles should happen on a case-by-case basis albeit with reasonable restraint. They also did not fail to emphasize the legal gravity of the matter before the board in terms of its undeniable impact over future cases of this kind.
Conclusion
It seems that in many ways the George Orwell case has once again opened a rare window of opportunity for the EU courts to tackle the discrepancies surrounding EU Trademark law with reference to famous titles/names/ etc. As it was in the case of ‘Messi’ where relative groundsof refusal (similar sounding trademark undertakings) came into play, absolute groundsof refusal, as per the EUIPO guidelines, also exist to maintain a balance in the marketplace and avoid misuse of trademarks that may offer an undue advantage to the operator.
A possible solution in the long run could involve creating a framework for adjudging the ‘degree of distinctiveness’ and the ‘degree of descriptiveness’ in cases related to famous marks to do away with some of the ambiguity, ease out the overall process and help the applicants better discern the scope of their signs/marks before applying to reduce the number of rejections that come attached with contentious reasoning. As the INTA also believes, the outcome of this case may very well be a game changer for the future of EU trademark law and the parties involved in it must treat it that way.
* Praneet Pandey & Kalhan Safaya are third-year students of Law (B.A. LL.B) at Hidayatullah National Law University, India
In his most renowned novel Neuromancer, the writer William F. Gibson has introduced the key concept of cyber space. The main character, Henry Dorsett Case, is a low-level hustler that aims to reconnect himself to the Matrix, a virtual reality computing platform sited, precisely in cyberspace. Moving from this fictionalized idea, in 1989 the writer and musician Jaron Lanier developed the concept of virtual reality, referring to it as a three-dimensional realities system implemented with stereo viewing goggles and haptic gloves.
Since those days virtual reality (VR) has typically been portrayed whether as a medium, like a telephone or television, and at the same time delved as a new kind of dimension in its philosophical meaning. In a few years of technological development, this new medium has rapidly reached a high level of commercialization, and the massive use of VR as gaming, educational, and entertainment standard methods, is still right behind the corner. Especially during the first part of COVID-19 pandemic period (from Feb. 2020 to May 2020), we assisted in a speedy utilization of these systems among geek and non-geek consumers. Even from the investors’ point of view, the outlooks seem to sound pretty good: in 2019, venture capitalists invested at least 4.1 billion in the VR industry, and these numbers seem to be destinated to grow up and scaling up faster than the last three years.
As soon as these systems have been starting to be commercialized for the entertainment industry, a huge number of professional sectors start to verify what types of business uses were possible introducing the VR inside the company productive process and internal activities. There are several successful user cases available, such as in the training and control activities carried on by QA operators or in education and law enforcement.
Despite the virtuous models studied, there is one professional category on the others whose absence seems a serious loss of opportunity: the legal services.
In this short contribution, we will delve into the meaning of virtual reality under the legal practice experience perspective. In particular we will try to examine on one hand if those kinds of technologies are effectively disruptive for the lawyer category and on the other hand what legal tech applications are concretely possible in order to place the legal industry into this new tech path.
2. Virtual Reality background
For the purpose of this post, “virtual reality” or “VR” is an immersive three-dimensional computer-generated environment. Secondly, as well as the environment definition, we need to reduce the scope or analysis regarding also on hardware basis. In order to maintain a commonly understandable level of debating, in this brief article we will take in consideration only systems constituted by a minimal corpus of particular machines. Considering this, the basic hardware infrastructure assumed as an example in this post is a pair of common VR eye goggles and wired clothing.
Therefore the VR system as defined consist in a computer generated environment, experienced within a tethered or standalone devices such as the previous ones described. One of the key factors of every VR experience resides in peripherals sensors. Sometimes these sensors are programmed with a dual purpose, such as to allow the user to interact with the real world also within a virtual dimension. Visual tools and motion detection set in a such smart way enable a high level of responsiveness and immersive user experience for several different types of possible applications. We will not examine deeply every hardware component of that systems, nevertheless also a high-response audio and a clear video setup are definitively others essential ingredients for a disruptive VR experience.
At this point is sufficient to focalize at least on these two fundamental points for the post scope: the importance of sensors to assure good quality feedback for users involved in a VR experience and the immersive value that the experience has to own itself in order to be introduce innovation trough work activity carried on. This last profile, already not examined, is delved in the next point through a legal tech point of view.
3. Legal tech and related outcomes
Changing perspective, Legal Technology (briefly known also as “Legal Tech”) represents another phenomenon that rapidly soared in a few years growth span. The term, born in the late 1980s, reached its current notoriety level through the studies published by Richard Susskind in his Tomorrow’s Lawyers: An Introduction to Your Futurebook. The Susskind’s main standpoint was that at least three innovation driving factors can fundamentally be identified with regard to lawyers’ typical activities: resizing tasks from more to less, full liberalization of legal business, and reinforcing alliance between legal matters and technology.
Starting from these three considerations, legal tech has rapidly evolved: from theory it becomes literally a new re-thinking way of the worldwide law professional area, introducing a massive automatization of legal process within code writing and developing new patterns to solve traditional legal problems.
The range of services offered is several. Some are facing typical legal issues, such as due diligence, invoicing methods, reports creations, assessment, gap analysis, etc.; others, more advanced indeed, are focused on contracts and provide computer code-switching systems able to manage different contracts templates as client’s needs. However, the most visionaries and disruptive services ideated from legal tech experts involved the field of artificial intelligence (AI) and blockchain, combining complicated algorithms for legal research or documents signing and transmission or rather for trial justice in courts activities.
Productivity plays an important role for the law firm overall efficiency real growth, but there are disadvantages also related to an adventuristic method of growth like this one. A software represents, more or less, a further level of intermediation between these two parts, and could annihilates the active interaction part which is one important phase of every good legal practice. How to solve it? VR can represent an opportunity.
4. Improving legal experience: VR scenarios and LT tools synergy
One of the possible ways to reduce the loss of immersivity as described above, should be sought in VR development.
Picture this: an area furnished according to medieval Japan style, with two historiated seats placed in the middle of the room and two digitalized avatars -a legal counselor and his client- arguing about an agreement or rather about due diligence if you preferred it, in a professional meeting. Imagine that their dialogue is being supported within several tools: figure if that the counselor, at a certain point, with a simple hand gesture detected by peripheral sensors, can turn on a new software window shown on the visual hub of both parts. The software chart shown could, of course, change depending on the argument chosen. For example, during a discussion for an agreement can be useful to show the electronic document version using a writing tool. Adding more variations is possible that some notes should be inserted during the dialogue, maybe with the help of a voice recognition software which summarizes all important statements that emerged during the meeting. In the meantime a legal research tool is scanning all the words provided in the agreement, verifying the percentage of the possible positive verdict in case of a claim or the amount of possible legal issues related to the meeting object.
The audio and visual impact plays a fundamental role as well. For this reason, coming back to our scenario, while both are dialoguing the software chart shown should be endowed with some audio alerts accorded to the complex passage of the legal writing or with the same visual evidence that shows possible interpretative issues or mistakes. A perspective like the one given can definitively raise the number of possible variations. The list of scenarios could be absolutely huge but in order to maintain a synthetic pattern we limit our vision to this one: a more accurate portrayal of human emotions by virtual characters can definitively help law firms to challenge any inherent bias within the firm and their clients’ businesses and boosting the identification of legal needs, preventing several judicial issues that could be delivered to Courts and discharging at the same time the jurisdiction system from useless trials as well as from others administrative costs.
It is evident that this unique synergy between Legal Tech and Virtual Reality represents a disruptive opportunity: the former add some tools that, if integrated, can definitively accelerate legal counseling activities, the latter demolish the immersivity absence of the first one joining the participants to wonderful scenarios that protect the touchy relationship between the client and his lawyer.
5.Current legal issues, risks and challenges.
Based on the facts exposed, it can be affirmed that a synergy between VR application and Legal Tech methods should represent a clear plus to enhancing the legal experience of the future. Nevertheless -especially regarding the EU area regulation- there are several legal issues related to this constantly evolving process, that deserve to be briefly delved.
First of all, there is an unsolved dilemma related to the preservation of a full confidentiality status between client and lawyer, considering both as categories. In other words: cybersecurity and how to preserve it.
In fact, regarding this aspect, some of the challenges that lawyers will face in this new environment will be familiar to the on-life one. These should include, just, for instance, concerns about the security of conversation and documents shared within the VR ambiance, retaining company secrets during the development process, and protecting communications in the virtual world. Is client confidentiality safe and secure, just as it is commonly presumed during on-life counseling?
On the other hand, a proper impact assessment for that hybrid VR/L-Tech system has to consider intellectual property rights protection, and facing this task is not easy at all. The aim to preserve Clients secrets from possible violations that occurred during several moments (such as integrations with external tools like documents software-based add-ons or research engines) is literally in contrast with the current VR based sharing methods, which currently are not covered with specific information security tools as antivirus or firewall dedicated. Naturally, their development could represent an easy obstacle to cross, even if information security history teaches us that hurried solutions for complex problems often represent a risk instead of a solution.
The third problem is related to cultural issues as well as legal, or rather the privacy-compliant adoption by clients as digitalized perspective of legal services. In fact, according to statistics, one of the most diffused concerns about VR systems used for different scope than gaming is related to data security and privacy: in 2020 more or less the 50% of subjects interviewed individuated it has the major problem for that systems, dropping that amount in comparison to 2019 (which provided a percentage number higher than 60).
Although the GDPR has already faced the problem within the article 22 provision, this is not sufficient at all to ensure a high level of protection for personal data processed through these virtual environments. Some of the main aspects that will definitively be delved in order to reach a proper level of processing security are, among others, targeted Data Protection Impact Assessment (DPIA) conduction (art. 35 GDPR), security measures individuation according to art. 32 GDPR provisions and data breach management such as enucleated by art. 30 of the Regulation mentioned.
Personal data are constantly involved in the VR process. From digitalization of bodies or avatar creation in the starting part of almost all software designed for social interaction in VR until the data collection during sessions of activities. Voice records, behavior profiling, and huge amounts of identifiable and sensitive data different for variety, volumes, and velocity of processing are continually used by algorithms in common software as well as VR applications. Privacy risks to VR users are particularly relevant, given the new information that Facebook -for instance- will be able to collect from its immersive VR platforms. These platforms currently track a user’s head movement and could potentially have the capability to track eye movement and, to one extent or another, also biometric information. Biometric issues are only part of the problem.
Conclusion
As virtual reality and legal tech software become normally used worldwide, lawyers that want to face the future challenges of law practice need to become used to innovation. Perhaps there are several legal and operative risks involved and not solved yet, but the immensity of VR systems blended with Legal Tech integration represents a path to cross, a morning star to strive for. Even if liabilities and privacy issues are still open, is our duty -and passion, for legal tech experts- to study and tailor a new body of law and practical guidelines where necessary, able to guide wisely this transition for another great era of human beings. The paradigm is already changed. Are we prepared for it?
Andrea Puligheddu – Privacy & Cybersecurity Lawyer. He held the role of Data Protection Officer for many primary public and private entities in the world of health software & technologies companies, internet service providers, Infosec, TELCO and hardware suppliers. Lecturer in photography and artistic production law for a national accredited media school. Lecturer in GDPR and Privacy Law at several EM (Executive Master’s of Law) on UNI ISO 11697:2017 e UNI PdR 43:2018 standard controls. Accredited as Cyber Security Auditor for international certifications authorities.
The Grand Chamber [GC] of the Court of Justice of the European Union (CJEU) inCG v The Department for Communities in Northern Ireland, pronounced a significant ruling on Union citizenship and equal treatment. The judgement deliberates on two issues, protection under European Union [EU] Law of an EU citizen who was conferred pre-settled status under United Kingdom [UK] law during the transition period, and whether the case is indicative of an expanding body of case law concerning EU citizens’ equal access to social assistance whilst residing in a host Member State.
The author in this article addresses the court’s rationale which exemplifies the CJEU’s conservative perception of the right to equal treatment of economically inactive EU citizens, which has been prevalent beforeDano v Jobcenter Leipzig. The author further addresses that CJEU’s resorting to the Charter of Fundamental Rights [herein after CFREU] to address the crevices in the diminishing right to equal treatment of economically inactive EU citizens, in an unanticipated and unfathomable approach.
The ‘Case’
The case concerns the young mother of two small children, ‘CG’, a European national, with dual Dutch-Croatian nationality, who came to Northern Ireland (UK) in 2018 to live with her partner, children’s father who holds Netherlands nationality. She has been residing in a women’s shelter and cares exclusively for her children since separating from her husband due to domestic violence accusations. She has never carried out any economic activity in her lifetime in the UK due to domestic violence and recent pregnancies. Therefore, she has no acquaintances to support her livelihood and her children. The UK Home Office gave her pre-settled status [PSS] in June 2020, implementing the Settlement Scheme, which was introduced in consideration of the UK’s obligations within Part 2 of the Withdrawal Agreement on citizens’ rights, and is included in Appendix EU of the UK Immigration Rules. This status authorizes EU citizens to continue to stay in the UK for another five years after the transition period ends.
Thereafter, she applied for a social assistance benefit known as Universal Credit, to the Department for Communities in Northern Ireland [DCNI]. The DCNI dismissed her application on the premise that she doesn’t meet the residential requisites. The DCNI contended that only individuals with a right to reside in the UK, as defined under Regulation 9(2) of the Universal Credit Regulations 2016, are perceived to have their habitual residence in the UK and are thus qualified to assert Universal Credit. The applicants who are Nationals of Member States, such as CG, who have a right of residence under the EU Settlement Scheme are excluded from the list of prospective Universal Credit recipients under Regulation 9(3)(d)(i) of the Universal Credit Regulations, 2016.
CJEU’s rationale
The question before the CJEU was, whether Article 18 of the Treaty on the Functioning of the European Union [TFEU] (the right to non-discrimination on the pretext of nationality and citizenship of Union) precludes the Member States from withholding equal accessibility to social assistance to Union citizens who have a right of residence under domestic legislation?
Jurisdiction
The CJEU on establishing its jurisdiction referred to Article 19(3)(b) TEU and Article 267 TFEU [Para 1 of the Article] that the Court has jurisdiction to give a preliminary ruling on the interpretation of EU law or the validity and interpretation of acts of the EU institutions. The Court held that the case’s concern falls in the realm of ratione temporis of EU law, according to Articles 126 and 127 of the Agreement on the withdrawal of the UK and the court has jurisdiction to issue a preliminary ruling on the referring court’s request, within the virtue of Article 86(2) of that agreement. However, the Court held that it lacks jurisdiction to rule on the first concern, which considers the interoperability of Regulations 9(3)(d)(i) of the 2016 Universal Credit Regulations with the UK’s obligations under the European Communities Act 1972 because that issue does not engage the understanding of EU law or the veracity of an act of the EU institutions within the connotation of the European Communities Act 1972.
The CJEU then proceeded on to the subject of whether EU citizens can be unilaterally prohibited from social assistance and so regarded diversely from nationals. The Court observed that in all circumstances arising within the ambit ratione materiae of EU law, every Union citizen can depend on the prohibition of discrimination based on nationality enshrined in Article 18 TFEU. These instances also include incorporating the exercise of Article 20(2) TFEU para (a) and Article 21 TFEU’s right to move and reside within the boundaries of the Member States. The Court reiterated its long-held approach that Article 18 TFEU is a comprehensive right to non-discrimination that cannot be invoked in instances where a more specific expression of the same right also applies established in Dano and Jobcenter Krefeld cases. The Court further referred to Nalini Chenchooliah v Minister for Justice and Equality and held that EU citizens who move to or reside in Member State apart from their national, as articulated in Article 3(1) and Article 24(1) of Directive (2004/38/EC), such individuals have the same right to equal consideration as nationals of the host Member State.
The Court taking the CG’s circumstances observed that it would fall in the realm of Article 24 of the Directive and Article 18 of TFEU won’t be applicable in the case. The Court held that the financial position of each individual ought to be determined, without taking consideration of claiming social benefits for examining whether the individual meets the requirement of having adequate resources [Article 7(1)(b) of the Directive]. Subsequently, as illustrated in the given scenario, CG doesn’t hold adequate resources, and it is plausible that she would become an unjustifiable responsibility on the UK’s social assistance structure. Therefore, the principle of non-discrimination enshrined in Article 24(1) of the Directive (2004/38/EC). In this instance, the order for reference directive cannot be relied forward upon.
Furthermore, even if the CG has the right to reside [temporarily] under national legislation, such right won’t be recognized as she doesn’t have any constitutional right under EU legislation [on the ground of Directive within the ambit of Article 24(1) of Directive]. The Court further held that the fact that national provisions regarding the right to reside of Union citizens which are more positive than those outlined in the Directive are unperturbed, does not imply that such regulations must be assimilated into the framework formulated by that directive, and it concludes, in specific, that it is up to each Member State to determine, as observed inTomasz Ziolkowski and Barbara Szeja and Others v Land Berlin.
In the determination of the Charter’s spectrum in Article 51(1), the Charter’s provisions are only directed to the Member States when they are enforcing EU legislation. The Court inTerveys- ja sosiaalialan neuvottelujärjestö (TSN) v Hyvinvointialan liitto held that, according to Article 51(2), the Charter does not broaden the extent of EU law further than the European Union’s authorities, nor does it provide the European Union with any additional powers or responsibilities, nor does it amend the powers and tasks specified in the Treaties.
In this instance, the order for reference indicates that the UK authorities accorded CG a right of residency even though she lacked adequate resources. In regards to the right of residence, those authorities used more favourable norms. Those authorities acknowledged the right of a national of a Member State to reside freely on its territory, which is guaranteed to EU citizens under Article 21(1) TFEU, without giving reliance on the criteria and constraints imposed by the Directive.
This signifies that a Member State’s authorities can only withhold Union citizens, such as CG and her children social assistance after considering that such a rejection would not represent an “actual and substantial risk of infringement of their fundamental rights.” Furthermore, the Court stresses the following three fundamental rights, Article 1 CFREU compels the host Member State to ensure that the Union citizen can live in dignity. Under Article 7 CFREU, the state must also defend citizens’ right to privacy and family life, along with taking the highest concerns of children into account under Article 24 CFREU. The court concludes that when a citizen lacks the financial resources to meet his or her own and his or her children’s necessities and is isolated, those authorities should ensure that, even if social assistance is rejected, that person can nevertheless live with his or her children in a dignified way. Those authorities may consider all means of support given by national legislation, from which the citizen in question and her children are legally entitled to benefit, during that assessment.
CJEU’s labyrinthine rationale
The Court’s rationale in the CG case is far mysterious, at one place, the court held that EU citizens who have been accorded the right to reside under domestic legislation are duly recognized within the preview of the Charter. Subsequently, the court’s rationale on the right to equal treatment is conditionally both stringent and unreasonable. A rigorous understanding of the Directive [primarily Article 7(1)(b)] states, the applicant does not have the right to reside in the EU. However, under domestic legislation, she does have the right to reside. This is consonant with the Directive, which is a mechanism for minimum synchronization and permits the Member States to place more favourable standards under Article 37 of the Directive. The Court has previously in María Martínez Sala v Freistaat Bayern ruled that even though a Union citizen has a right of residence in a host country exclusively under domestic legislation, he/she/they may proceed to exercise the fundamental EU right to non-discrimination.
‘Article 8(2) of the Treaty attaches to the status of citizen of the Union the rights and duties laid down by the Treaty, including the right, laid down in Article 6 of the Treaty, not to suffer discrimination on grounds of nationality within the scope of application ratione materiae of the Treaty.’ [Para 62; Martínez Sala]
The Court’s rationale in the CG’s case took a divergent approach and held, a union citizen who has only been provided with the right to reside under domestic legislation may not exercise the fundamental right to equal treatment under Article 18 TFEU. She may rather depend exclusively on the auxiliary right to non-discrimination [Article 24; Directive]. Nevertheless, since the EU citizen is not granted citizenship and is not a resident under the Directive, the citizen cannot exercise her right to non-discrimination under the same Directive. Thereafter, the Court concludes that a Union citizen with a recognized right to reside would not have the right to equal treatment in the jurisdiction of the host Member State. This narrow rationale of the court draws a delineation between EU citizens who have a fundamental right to reside under EU law and those who have a lawful right under domestic legislation.
Notwithstanding the Court’s errors to uphold the right to equal treatment, CG is not denied all EU constitutional protection. The Court holds that the UK must continue to adhere to the Charter. CG cannot be denied access to social assistance when doing so would violate her EU Charter rights. Significantly, the Court over-looks Article 21(2) CFREU, which also guarantees for the right to non-discrimination on the account of nationality, but instead emphasizes Articles 1, 7, and 24 CFREU, which must be protected by national authorities.
In CG’s case, the protections enshrined under the Charter are accorded because she has a legal right to reside under domestic legislation. As held in Dano, an applicant who lacks sufficient resources and has not been awarded a more preferential residency right under national legislation will be denied access to the Charter.
Article 51(1) of the Charter states that the provisions of the Charter are addressed ‘to the Member States only when they are implementing Union law’. [Para 67, Dano]
Therefore, the Charter does not provide Union citizens with a broader spectrum of protection, but rather is exclusively accessible to the limited group of Union citizens who have been granted the right to reside under domestic law. The Court’s apparent concern was to preserve the individuals in this case, CG and her two children, and to assure that they can proceed to live concludes in Northern Ireland in a dignified manner. Unfortunately, by adopting a very restricted approach, the Court seriously restricted the impact of this judgment on the protection of the greater population of Union citizens and continues to undermine the fundamental right to equal treatment conferred by Article 18 TFEU.
* Sarthak Gupta is an undergraduate B.A; L.L.B [Hons] law student at the Institute of Law, Nirma University, India. His scholastic interest follows Constitutional Law, Human Rights & Gender Studies, and International Law.
