Did the ECJ show common sense in upholding Daily Mail?

Abstract

Daily Mail remains a very controversial ruling. Subsequent case law on the freedom of establishment has not always logically followed the rationale established in this case. The most contentious area is the definition of the connecting factors. Nevertheless, the legal reasoning adopted in subsequent case law could to some extent to be reconciled with Daily Mail by adopting the distinction between primary and secondary establishment. Certain clarification in this respect was provided in Cartesio. Apart from deficiencies in legal reasoning, the results achieved by the ECJ by upholding Daily Mail are not entirely satisfactory. The total home State regime is not desirable from a regulatory point of view as it can lead to discriminatory results and can distort competition. On the other hand, as aptly noticed by Weatherill, the bland overturning of Daily Mail would not necessarily produce more satisfactory results as a more sophisticated solution is needed. Furthermore, the ECJ when considering AG Maduro’s recommendation to overrule Daily Mail had to consider many political issues. The ECJ moved on from its activist role in ‘regulatory competition’ and its new role is centred primarily on signalising the need for legislative action for the legislature. This new role has been met and the ECJ clearly raised such justifications in Cartesio. Therefore, the decision to uphold Daily Mail and the clarification of case law shows that the ECJ did adopt a common sense approach. This was clearly demonstrated in Cartesio where the ECJ masterfully struck “a difficult balance between a political decision which is not competent to take and a previous ruling which is too bold and unimaginative to work as a precedent.”