As a result of the Norwegian Supreme Court’s ruling in a case concerning the general application of a collective yard agreement, the competence of the EFTA Court has been challenged, and a conflict seems to be developing between the Norwegian Supreme Court and the EFTA Court. The Supreme Court set aside the Advisory Opinion of the EFTA Court, made its own interpretation of EEA law, and passed a completely opposite judgment.
In March 2013, the Norwegian Supreme Court pronounced its judgment in a case concerning the so-called general application of a Norwegian collective yard agreement. The Court found that the general application of the agreement did not violate EEA law or the freedom to provide services in the Internal Market under Article 36 of the EEA Agreement.
The purpose of the EEA Agreement between the European Union and the three EFTA members—Norway, Iceland, and Liechtenstein—is to include these states in the Internal Market under the Four Freedoms by implementing relevant EU legislation into their national laws.
To maintain a uniform interpretation and application of EU law in the EFTA states, the Agreement established the EFTA Court. Under Article 34 of the Surveillance and Court Agreement, the EFTA Court has jurisdiction to give Advisory Opinions on the interpretation of the EEA Agreement when requested by national courts.
The EFTA Court had provided an Advisory Opinion in the collective yard agreement case, concluding that the general application of the agreement did violate EEA law and the freedom to provide services. However, the Norwegian Supreme Court reached the opposite conclusion, effectively setting aside the Advisory Opinion.
This move was surprising because, although Advisory Opinions are not binding, the Supreme Court had previously held that they should carry significant weight in cases involving EEA law. In this case, the Court emphasized that national courts are free to make their own assessment, even when an Advisory Opinion has been obtained.
The political context also played a role. Prior to the decision, there was unrest in Norway, and the Norwegian Confederation of Trade Unions signaled that its support for the EEA Agreement might be withdrawn if the Supreme Court ruled in line with the EFTA Court’s Opinion. Ultimately, the Supreme Court justified its decision on grounds of social protection of workers and public order.
The ruling sparked debate about whether the EFTA Court or national courts have the final say in interpreting EEA law. Dr. Carl Baudenbacher, then President of the EFTA Court, criticized the judgment in the Norwegian legal journal Lov og Rett. He warned that allowing national courts to overrule EFTA Advisory Opinions could lead to diverging interpretations, undermining the uniformity of the Internal Market.
He also pointed to Article 31 of the Surveillance and Court Agreement, which allows the EFTA Surveillance Authority (ESA) to bring a case against a member state if it fails to fulfill its obligations under the EEA Agreement. Following the Supreme Court’s ruling, ESA received a complaint against the Norwegian State, which the government is still considering.
