A. The Fundamental Rights of Companies: A General Survey

In the eighteenth century when the US Constitution and Bill of Rights were adopted, extremely few businesses were incorporated. Consequently, these instruments were not drafted with companies in mind. Some of the fundamental rights enshrined in the US Constitution have been held to apply for the benefit of corporations; others have not. It has been said that ‘[n]o unified theory governs when or to what extent the Constitution protects a corporation’.Footnote ¹⁸ According to the Supreme Court in First National Bank of Boston v Bellotti, whether a particular constitutional provision has this quality will depend on its ‘nature, history and purpose’.Footnote ¹⁹ Whilst this approach appears manifestly sound, precisely what it means is uncertain. As we shall see, the Court of Justice has similarly failed to lay down a coherent approach to this important question.

Corporations enjoy some fundamental rights, but not others.Footnote ²⁰ As is only to be expected, they enjoy the right to property under the Fifth Amendment.Footnote ²¹ Apart from that, they can reap the benefits of freedom of speech under the First Amendment.Footnote ²² The Supreme Court's stance is justified by two forceful considerations: that, if this right were confined to individuals, then it would be an empty letter, since the corporations which publish their writings could be gagged; and that, to ensure ‘the market place of ideas’ which is indispensable for democracy, the right of the ‘hearer’ is at least as important as that of the ‘speaker’.Footnote ²³ Companies also enjoy Fourth Amendment rights so that ‘unreasonable searches and seizures’ cannot be ordered against them without a warrant, which can only be issued if ‘probable cause’ is shown;Footnote ²⁴ but ‘corporations can claim no equality with individuals in the enjoyment of a right to privacy’.Footnote ²⁵ In addition, the rule against double jeopardy under the Fifth Amendment applies to them.Footnote ²⁶ In view of its importance in the present context, the prohibition in the same Amendment on compelling a person ‘in any criminal case to be a witness against himself’ will be considered separately in Part IIIB below.

At all events, all these provisions initially applied only to acts of the federal authorities, but were subsequently extended to the several states by the Due Process Clause of the Fourteenth Amendment, according to which states may not ‘deprive any person of life, liberty, or property, without due process of law’. Moreover, corporations are ‘persons’ for these purposes.Footnote ²⁷ They are also ‘persons’ for the purposes of the Equal Protection Clause of the Fourteenth Amendment which prohibits every state from ‘deny[ing] to any person within its jurisdiction the equal protection of the laws’.Footnote ²⁸

For completeness, a brief mention of the Lochner era is in order, even though it ended around 80 years ago. In its ‘now infamous’ judgment in Lochner v New York (1905),Footnote ²⁹ the Supreme Court struck down a labour law of the State of New York prohibiting bakers from employing staff for more than 60 hours per week, on the grounds that it constituted an unreasonable interference with the liberty of the person and the freedom of contract contrary to the Due Process Clause of the Fourteenth Amendment. Countless judgments followed, in which the Court invalidated a variety of economic regulations adopted at state level, principally concerning labour laws, price regulations and restrictions on entry into business.Footnote ³⁰ At the same time, the Supreme Court adopted a highly restrictive interpretation of the Commerce Clause in Article 1, Section 8 of the Constitution, which empowers Congress to ‘regulate Commerce … among the several States …’. For instance, in Adair v United States Footnote ³¹ it found that federal legislation protecting union membership fell outside the concept of ‘commerce’; and in Hammer v Dagenhart Footnote ³² it quashed a federal prohibition on the interstate transport of goods manufactured in factories employing child labour, on the grounds that it regulated ‘manufacturing’, not ‘commerce’.Footnote ³³ The Lochner era came to an abrupt end in the 1930s,Footnote ³⁴ when the Supreme Court finally accepted President Roosevelt's New Deal to combat the Depression, and began to uphold measures of this kind taken at both state and federal level.Footnote ³⁵

Why mention Lochner now? The answer is that this is not merely of historical interest. According to Cass Sunstein, the demise of Lochner is not so complete as is generally supposed, because much important case law which is still valid today is founded on the same premise, which he describes as follows: ‘Governmental intervention was constitutionally troublesome, whereas inaction was not: and both neutrality and inaction were defined as respect for the behaviour of private actors pursuant to the common law, in light of the existing distribution of wealth and entitlement.’Footnote ³⁶

B. The Privilege against Self-Incrimination

Corporations cannot rely on the privilege against self-incrimination in the Fifth Amendment according to which ‘no person’ shall be ‘compelled in any criminal case to be a witness against himself’.Footnote ³⁷ The Supreme Court has explained the rationale behind this rule as being to prevent the use of ‘[p]hysical torture and other less violent but equally reprehensible modes of compelling the production of incriminating evidence’ and the draftsmen of the Fifth Amendment ‘cannot be said to have intended the privilege to be available to protect economic or other interests of such organizations so as to nullify appropriate governmental regulations’.Footnote ³⁸ It is also worth noting that in Hale v Henkel, the antitrust case in which the principle was first established, the Court declared that, if it were otherwise, ‘the privilege claimed would practically nullify the whole act of Congress’ (the Sherman Act).Footnote ³⁹ Having said that, any stakeholderFootnote ⁴⁰ can of course plead the Fifth Amendment to protect herself.

This reasoning is by no means new: since the Middle Ages, the prevention of torture has been one of the main reasons for the privilege against self-incrimination.Footnote ⁴¹ This strongly suggests that the privilege should not be extended to corporations, since they cannot be physically tortured. Of course, there is always the possibility—fortunately theoretical in all or most Western jurisdictions—that a company which refuses to confess will suffer persecution of the kind meted out to Yukos by the Russian authorities, leading to its demise. But such reprehensible treatment itself entails various breaches of fundamental rights which are relatively easy to prove.

For good measure, it should also be pointed out that historically the second basis for the privilege was the individual's right to confess his wrongdoings to a priest in private to save his soul, without being compelled to divulge them in public.Footnote ⁴² Leaving aside the fact that this point may have less resonance today, this rationale is plainly not relevant to companies either.

Finally, the privilege was grounded in the belief that the prosecution should be able to obtain a conviction without enlisting the help of the accused.Footnote ⁴³ Alone of the three reasons this is equally valid for legal persons,Footnote ⁴⁴ but in the absence of improper coercion it carries relatively little weight in any event.

C. Discrimination

As already mentioned, corporations may rely on the Equal Protection Clause of the Fourteenth Amendment.Footnote ⁴⁵ An interesting example occurred in City of Richmond v Croson Co. Footnote ⁴⁶ There, the Supreme Court struck down a plan requiring contractors with city construction contracts to subcontract at least 30 per cent of the value of their contract to minority-owned businesses. The Court held that this plan violated the Equal Protection Clause because the city had failed to demonstrate a compelling government interest to justify the plan, and the plan was not ‘narrowly tailored’ to remedy the effects of prior discrimination against minority businesses. In short, the Court found that a measure which treated companies differently on the basis of the race of their owners would be unconstitutional in the absence of some highly exceptional justification. In a sense, since companies themselves are bereft of any racial origin, this involved piercing the veil of incorporation, although the Court did not speak in those terms. Surely, this is wholly warranted, as the discrimination was really targeted at the stakeholders.Footnote ⁴⁷ Precisely the same principle applies where corporations suffer discrimination on the basis of the gender of their stakeholders.Footnote ⁴⁸ As we shall see, the position in EU law is very similar.

D. Political Donations: Citizens United

As we noticed earlier, the First Amendment provides in material part that ‘Congress shall make no law … abridging the freedom of speech’; and the States are subject to the same rule by virtue of the Due Process Clause of the Fourteenth Amendment.

Ever since Buckley v Valeo,Footnote ⁴⁹ it has been established that making a political donation is a form of ‘speech’ for these purposes.Footnote ⁵⁰ By equalizing participation in the political realm, the government argued, campaign finance reform did not undermine, but promoted free speech. The Court dismissed this claim on the basis that ‘the concept that government may restrict the speech of some elements of our society in order to enhance the relative voice of others is wholly foreign to the First Amendment’.Footnote ⁵¹ This ruling has encountered considerable criticism,Footnote ⁵² not least from Cass Sunstein, who sees it as ‘a direct heir to Lochner’.Footnote ⁵³

Limits on ‘contributions’ (payments made directly by or to candidates or parties, or money spent in their support and under their control and coordination) are generally treated favourably, whereas the contrary applies to ‘independent expenditures’. The rationale for this distinction is said to be that ‘contributions’ merely involve ‘a general expression of support for the candidate and his views, but [do] not communicate the underlying basis for the support’, whereas ‘independent expenditures’ are directly related to the expression of political views.Footnote ⁵⁴ To what extent this distinction is sound and whether it is really possible to ensure that candidates are not involved either directly or indirectly with ‘independent expenditures’ are not issues which require our consideration here.

In Bellotti,Footnote ⁵⁵ the Supreme Court struck down a Massachusetts law prohibiting corporate expenditure for the purpose of influencing the vote on any referendum submitted to the voters other than one materially affecting the property, business or assets of the corporation. The majority belittled the dangers of undue influence of corporations on the political process, declaring: ‘To be sure, corporate advertising may influence the outcome of the vote; this would be its purpose. But the fact that advocacy may persuade the electorate is hardly a reason to suppress it.’Footnote ⁵⁶ They saw no reason to favour the ‘speech’ of individuals over corporate speech. Four members of the Court dissented. Justice White, with whom Justices Brennan and Marshall joined, declared: ‘[W]hat some have considered to be the principal function of the First Amendment, the use of communication as a means of self-expression, self-realization and self-fulfilment, is not at all furthered by corporate speech.’Footnote ⁵⁷ Justice Rehnquist was equally pointed in his dissent.

Because Bellotti concerned a referendum, there was no danger of corruption. The same cannot be said of Citizens United v Federal Election Commission.Footnote ⁵⁸ Citizens United was a conservative group organized as a non-profit corporation, a political action committee (PAC). In 2008, it produced and released a feature-length documentary criticizing Hillary Clinton, who was seeking the Democratic nomination for President of the United States. To promote this film, it produced various advertisements which fell foul of a federal prohibition on ‘electioneering communications’ by corporations and unions within 30 days of a primary election.Footnote ⁵⁹ A bare majority of the Supreme Court found this provision to be in breach of the First Amendment. Delivering the judgment for the majority, Justice Kennedy described the contested provision as an ‘outright ban’ on free speechFootnote ⁶⁰ by ‘certain disfavoured speakers’, namely corporations and unions.Footnote ⁶¹ With more than a touch of hyperbole, he added: ‘The censorship we now confront is vast in its reach.’Footnote ⁶² In his view, the corporate identity of the ‘speaker’ was irrelevant.Footnote ⁶³ Thus limits on ‘independent expenditures’ by corporations are unlawful. Although Citizens United was a non-profit corporation, this ruling would seem to apply equally to commercial entities: the Court spoke of ‘corporate identity’, which covers both these categories.Footnote ⁶⁴

For the minority, Justice Stevens pointed out the key characteristics of corporations which natural persons do not share, notably limited liability, ‘perpetual life’ and the fact they can be controlled by foreign interestsFootnote ⁶⁵—as well as the fundamental fact that they cannot run for office or vote.Footnote ⁶⁶ In short, ‘although they make enormous contributions to our society, corporations are not actually members of it’.Footnote ⁶⁷ At great length, he listed the numerous public interest reasons for upholding the restriction, including: a distortion of the political process; the risk of corruption; and the need to ensure that the electors’ voices on political issues are not drowned by corporate interference. None of these considerations weighed with the majority.

From these judgments it is plain that, in the absence of exceptional circumstances, corporate donors must be subject to no greater restrictions than human donors.Footnote ⁶⁸ Predictably, even though various restrictions on electoral expenditure by natural and legal persons remain,Footnote ⁶⁹ these rulings, together with others striking down limits on political donations,Footnote ⁷⁰ have led to inordinately high electoral spending.Footnote ⁷¹ Apart from the ills listed by Justice Stevens, this saps the political process in another way: it requires politicians to devote a considerable part of their working day to raising funds to be re-elected, when they should be fulfilling the duties of their office.Footnote ⁷² No doubt, the marked increase in the appointment of political fundraisers to US ambassadorshipsFootnote ⁷³ is also a consequence of Citizens United.

E. Religious Freedom and Hobby Lobby

The opening words of the First Amendment to the US Constitution read: ‘Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof’. The first limb is known as the Establishment Clause, but we are concerned here with the second limb, the Free Exercise Clause, which was subsequently extended to acts of the states by the Due Process Clause of the Fourteenth Amendment. According to settled law, one category of corporate persons, namely churches,Footnote ⁷⁴ can rely on the Free Exercise Clause,Footnote ⁷⁵ as one would expect. Prior to Hobby Lobby, the Supreme Court had never been called upon to decide whether a company enjoys the freedom of religion.

For an understanding of the issues raised in that judgment, it is necessary to give brief consideration to three earlier cases, namely Sherbert v Verner,Footnote ⁷⁶Wisconsin v Yoder Footnote ⁷⁷ and Employment Division v Smith. Footnote ⁷⁸ In Sherbert, it was held that the State could not deny a Seventh-Day Adventist unemployment benefits when she declined an offer of a job which would have required her to work on Saturdays, her Sabbath. In Yoder, the respondent had been fined for refusing to send his children aged 14 and 15 to school in accordance with his religious belief as a member of the Old Order Amish; this was contrary to the law of Wisconsin, which required school attendance up to the age of 16. This was held to be a breach of the Free Exercise Clause, as only interests ‘of the highest order’ could justify restrictions on the free exercise of religion.

On the other hand, the Supreme Court will not entertain a challenge to taxation on the grounds that public funds are spent in a manner contrary to the litigants' religious beliefs: as it pointed out, the tax system could not function if the tax system was open to challenge on such grounds.Footnote ⁷⁹ Subsequently, the Court explained this ruling on the basis that ‘[b]ecause of the enormous variety of government expenditures funded by tax dollars, allowing tax-payers to withhold a portion of their tax obligations on religious grounds would lead to chaos’.Footnote ⁸⁰ The same applies to an employer's obligation to make social security payments for her staff.Footnote ⁸¹

In stark contrast to these cases (other than those concerning tax or social security for employees), in Employment Division v Smith, the prohibition imposed by Oregon on the possession and consumption of a drug known as peyote was held to be compatible with the Free Exercise Clause, although it was part of the religious ritual of the Native American Church, of which Mr Smith was a member. The Supreme Court found against him. Since restricting the exercise of religion was not the object but merely the incidental effect of a ‘generally applicable and otherwise valid provision’, the court held, there had been no interference with the free exercise of religion within the meaning of the First Amendment.Footnote ⁸²

Such was the hostility provoked by the latter judgment that the Religious Freedom Restoration Act 1993 (‘the RFRA’) was adopted for the express purpose of reversing it and of restoring the rulings in Sherbert v Verner and Wisconsin v Yoder. Section 3(a) RFRA lays down the principle whereby ‘Government shall not substantially burden a person's exercise of religion even if the burden results from a rule of general applicability’. According to the exception enshrined in section 3(b), government may impose such a burden if ‘it demonstrates that the application of the burden to the person (1) is in furtherance of a compelling governmental interest and (2) is the least restrictive means of furthering that compelling governmental interest’. The RFRA creates a rule of construction deemed to apply even to subsequent legislation, in the absence of a clear indication to the contrary.Footnote ⁸³

The Affordable Care Act 2010, familiarly known as ‘Obamacare’, requires employers to cover certain preventive-health services without any contribution being made by the beneficiaries.Footnote ⁸⁴ These services include contraception by all the methods approved by the Food and Drug Administration. The legislation is subject to certain exceptions. In particular, churches were exempted, as were employers with fewer than 50 full-time employees. Failure by a non-exempted employer to pay for such coverage gave rise to the obligation to pay a substantial penalty.

Hobby Lobby Stores Inc. is a national chain of 500 arts and crafts stores with more than 13,000 employees. The five individuals who own the company (‘the Green family’) are devout Christians and maintain a sincere conviction that human life begins at conception. Although they do not oppose contraception as such, they have a profound objection to four out of the twenty methods of contraception approved by the FDA, since they consider those four methods to be a form of abortion.Footnote ⁸⁵ No doubt, many of its employees do not share these beliefs, as the company is required by law to refrain from religious discrimination in its recruitment policy.Footnote ⁸⁶

According to the Dictionary Act,Footnote ⁸⁷ unless the context indicates otherwise, the word ‘person’ includes ‘corporations, companies, associations, firms, partnerships, societies, and joint stock companies, as well as individuals’.Footnote ⁸⁸ Consequently, the question before the Supreme Court in Hobby Lobby was whether the context indicated that commercial companies were not persons for the purposes of section 3 of the RFRA.

By a majority of five judges to four, the Supreme Court found for the company. The Green family, it held, did not ‘forfeit all RFRA protection when they decided to organize their businesses as corporations rather than sole proprietorships or general partnerships’.Footnote ⁸⁹ Congress provided protection for people like the Greens by treating corporations as ‘persons’ within the meaning of the RFRA; ‘the purpose of this fiction is to provide protection for human beings’ and a corporation is ‘simply a form of organization used by human beings to achieve desired ends’.Footnote ⁹⁰

Equally, the majority dismissed the contention that a commercial entity could not ‘exercise’ a religion. In the Court's view, it could perfectly well have a dual purpose, namely to make a profit and to promote certain values such as environmental protection or particular religious beliefs.Footnote ⁹¹ On this basis, the Court did not appear to see any material distinction between companies and churches.

With respect, this reasoning appears flawed on several counts. Most importantly, it fails to take into account the crucial fact that a company is a legal entity in its own right which grants its owners the immense benefit of limited liability and which can outlive its owners. In return for these invaluable advantages, the owners have to be prepared to forfeit certain rights of their own. As we shall see, it may well be justified to pierce the veil of incorporation for the benefit of a company's stakeholders, where the company suffers discrimination by reason of their gender, race, religion or other characteristic; but that is another matter. Second, churches are fundamentally different from companies: the purpose of the former is to practise and disseminate their particular religion, whereas companies exist for the purpose of making profits; any other values or beliefs which they may seek to promote must be regarded as secondary to that overarching purpose.Footnote ⁹² It is submitted that corporations can no more exercise a religion (or profess to be a freethinker or an atheist, for that matter) than they can have a race or a gender.

Hobby Lobby Stores Inc. was a ‘closely held corporation’ (ie a private company owned by a very small group of individuals). The majority of the Court did not exclude the possibility that publicly quoted companies might also be able to rely on the RFRA, but merely stated that they were ‘unlikely’ to assert such claims.Footnote ⁹³ This is not convincing. In any case, as Justice Ginsburg pointed out,Footnote ⁹⁴ not all ‘closely held corporations’ are small: Mars Inc. and Cargill Inc. fall into this category but each has a turnover of several billion dollars.

The majority claimed that employees of companies with religious objections could continue to receive the necessary health coverage for the contraceptives concerned, the most straightforward way of achieving this being simply for the Government to assume the cost itself.Footnote ⁹⁵ Apparently, the majority were oblivious to the competitive advantage gained by such companies.Footnote ⁹⁶ They went on to rule that the contested measure did ‘substantially burden the exercise of religion’ within the meaning of section 3(a) RFRA but did not fall within the exception in section 3(b) because less restrictive alternatives were available.Footnote ⁹⁷ Accordingly, it was unlawful as being contrary to that statute. In these circumstances, there was no need to consider the Free Exercise Clause of the First Amendment.Footnote ⁹⁸

Finally, the majority claimed that their judgment was limited to the measure in issue in the case at hand: in other circumstances, different considerations would apply. Justice Ginsburg was not convinced that the repercussions of this ruling are so restricted.Footnote ⁹⁹

In her forceful dissenting opinion, Justice Ginsburg, with whom Justice Sotomayor concurred, took issue with the majority on every significant point. In particular, she spoke of the ‘havoc’ which the majority judgment would create.Footnote ¹⁰⁰ Justices Breyer and Kagan also agreed with this dissenting opinion except on the point which interests us here, namely the question as to whether companies can rely on the RFRA; they found it unnecessary to decide that point in Hobby Lobby.

In short, five judges found in favour of the company on this crucial point, while only two endorsed the opposite view. Of course, the Court had the luxury of being able to decide this case, knowing that the RFRA or the Act of 2010 could be amended with relative ease—unlike the First Amendment. The outcome might well have been different under the Free Exercise Clause, since the test is not the same; but crucially the Court's ruling that a company may ‘exercise’ a religion would appear to apply equally to that Clause.Footnote ¹⁰¹

A. The Link between Union Law and the European Convention on Human Rights

Although all its 28 Member States are party to the European Convention on Human Rights (‘the ECHR’ or ‘the Convention’), the EU itself is not yet. Article 6(2) TEU requires the EU to accede to the Convention and an accession Agreement was duly signed.Footnote ¹⁰² However, on 18 December 2014, the Court of Justice held this Agreement incompatible with the EU Treaties in several respects.Footnote ¹⁰³ The Agreement will therefore require substantial renegotiation, a process which can be expected to take several years.

In any case, ever since 1974—long before the Treaty on European Union came into existence—the Court has constantly had regard to the ECHR. Indeed, the Court has repeatedly stated that the ECHR holds ‘special significance’ for EU law.Footnote ¹⁰⁴ Now Article 6(3) TEU provides: ‘Fundamental rights, as guaranteed by the [ECHR] … and as they result from the constitutional traditions common to the Member States, shall constitute general principles of the Union's law.’ In addition, the Charter of Fundamental Rights of the European UnionFootnote ¹⁰⁵ contains a number of provisions which mirror those of the ECHR; and according to Article 52(3) those provisions in the Charter have the same meaning and scope as their counterparts in the Convention. Consequently, the ECHR must be the starting point for any consideration of fundamental rights in Union law.

B. Fundamental Rights of Companies under the ECHR

The ECHR, which was concluded under the auspices of the Council of Europe, is not linked to any kind of political union. Although it innovated in providing for the right of individual petition, it is unquestionably an instrument of classic international law. Consequently, it differs profoundly from the American Constitution and from EU law. Needless to say, the former is the constitution of a sovereign State, while the EU Treaties aim to create ‘an ever closer union among the peoples of Europe’Footnote ¹⁰⁶ founded on ‘a new legal order of international law for the benefit of which the states have limited their sovereign rights, albeit within limited fields, and the subjects of which comprise not only Member States but also their nationals’.Footnote ¹⁰⁷

At all events, unlike the American Constitution, the ECHR, which was opened for signature in 1950, contains various indications that some of its provisions apply for the benefit of companies.Footnote ¹⁰⁸ First, Article 10 contains a sentence stating: ‘This Article shall not prevent States from requiring the licensing of broadcasting, television or cinema enterprises’.Footnote ¹⁰⁹ Second, Article 34 of the Convention provides: ‘The Court may receive applications from any person, non-governmental organisation or group of individuals’. This has been interpreted widely to cover companies. What is more, Article 1 of Protocol 1 to the Convention, which was opened for signature in 1951, contains a sentence which reads: ‘Every natural or legal person is entitled to the peaceful enjoyment of his possessions.’Footnote ¹¹⁰

The very first case in which a company succeeded in an action before the European Court of Human Rights (‘the ECtHR’ or ‘the Strasbourg court’) was Sunday Times v United Kingdom, where that Court found a breach of Article 10 on the freedom of expression,Footnote ¹¹¹ taking its cue from the above-mentioned ruling in New York Times v Sullivan.Footnote ¹¹² Since then, the ECtHR has applied several other provisions of the Convention in favour of companies.Footnote ¹¹³ What is more, in Airey v Ireland, the ECtHR held that, while the rights enshrined in the Convention are ‘essentially civil and political’, ‘many of them have implications of a social or economic nature’.Footnote ¹¹⁴ At the same time, as one would expect, the Court has repeatedly asserted that economic rights are less deserving of protection than political and civil rights.

This is clearly illustrated by the case law on Article 8 ECHR, the first paragraph of which reads: ‘Everyone has the right to respect for his private and family life, his home and his correspondence.’ A series of public interest exceptions is contained in Article 8(2). In Niemietz v Germany,Footnote ¹¹⁵ the ECtHR held a police search in the offices of a self-employed lawyer where he also lived to be an interference with his ‘home’; but it added that the discretion enjoyed by the Contracting Parties under Article 8(2) ‘might well be more far-reaching where professional or business activities or premises were involved than would otherwise be the case’.Footnote ¹¹⁶ This was followed by Société Colas Est v France, where it was held that the concept of a ‘home’ in Article 8(1) extended to a company's offices.Footnote ¹¹⁷ Whilst this interpretation may seem questionable as a matter of English, the Court pointed out that it is fully consonant with the French text, since the word ‘domicile’ has a broader connotation than the word ‘home’ and may extend to a professional person's office.Footnote ¹¹⁸ However, the Court suggested that, under the public interest exception in Article 8(2) ECHR, the Contracting Parties might have broader powers to conduct inspections on such premises than in the home of a natural person, at least when she is acting in a personal capacity.Footnote ¹¹⁹

Another example relates to freedom of expression under Article 10 ECHR. Whilst this provision has been held to extend to commercial expression (ie advertising and promotion), the ECtHR has repeatedly stressed that political expression, including expression on matters of public interest and concern, qualifies for a higher level of protection.Footnote ¹²⁰

That is not to say, however, that companies always enjoy more limited rights under the Convention than natural persons; nor should they. As we saw at the outset, the Yukos Footnote ¹²¹ case graphically illustrates how companies cannot function at all if they are deprived of their right to property under Article 1 of Protocol 1 or the right to a fair trial under Article 6. Generally speaking, there is no reason why they should be less favourably treated as regards these rights than natural persons, since otherwise they cannot enforce such substantive rights as they have.

C. The Fundamental Rights of Companies under Union Law Generally

The founding treaties of what is now the EU were concluded in the 1950s. Their focus was exclusively economic, but with successive treaty amendments social policy has assumed increasing importance,Footnote ¹²² and a host of other policies such as consumer protection and environmental protection have been added. Today, Article 3(3) TEU provides that the Union ‘shall work for … a highly competitive social market economy, aiming at full employment and social progress’. What is more, the Treaties contain a plethora of ‘mainstreaming’ provisions which require the Union to take account of various needs in all its policies and activities. Examples include: social policy, education and health (Article 9 TFEU); environmental protection (Article 11 TFEU); and consumer protection (Article 12 TFEU). No doubt, in the most unlikely event that the Court of Justice were ever minded to pursue an approach in any way similar to that in Lochner, these provisions would preclude it from doing so. Having said that, by its very nature, EU law remains far more focused on economic rights than the ECHR.

The founding treaties contained no provisions on fundamental rights. However, following its seminal judgment in Internationale Handelsgesellschaft,Footnote ¹²³ the Court of Justice began to build up its own body of fundamental rights law, based on ‘the constitutional traditions common to the Member States’.Footnote ¹²⁴ Beginning with Nold,Footnote ¹²⁵ it also had regard to the ECHR. As we saw in Part IVA above, Article 6(3) TEU now requires the EU to respect both the ECHR and the constitutional traditions common to the Member States as general principles of law. Furthermore, this body of case law is now largely enshrined in the Charter, which was first ‘solemnly proclaimed’ in 2000Footnote ¹²⁶ and then again in an amended form in 2007.Footnote ¹²⁷ On the entry into force of the Lisbon Treaty in December 2009, it became binding with the same value as the Treaties: Article 6(1) TEU.

The Charter contains both ‘rights’ and ‘principles’. ‘Rights’ are directly enforceable, whereas ‘principles’ only take effect once the requisite implementing acts are in place: Article 52(5). The language of each article may give an indication as to whether it provides for a right or a principle, as may the official Explanations to the Charter,Footnote ¹²⁸ which the courts are required to take into account by virtue of Articles 6(1) TEU and 52(7) of the Charter. The core freedoms in Titles I and II of the Charter such as the right to life (Article 2), freedom from torture (Article 4), respect for private and family life (Article 7) and freedom of religion (Article 10), expression (Article 11) and association (Article 12) are ‘rights’ in this sense. The same applies to such economic rights as the right to conduct a business (Article 16) and the right to property (Article 17). In contrast, it now seems clear that Article 26 of the integration of persons with disabilities and Article 27 on workers’ rights to information and consultation by their employer are mere ‘principles’;Footnote ¹²⁹ and the same probably holds true for most of the articles relating to social and labour lawFootnote ¹³⁰ as well as environmental and consumer protection. Arguably, then, the Charter leans more heavily towards economic rights than the Treaties themselves; but naturally the Treaties and the Charter must be read as a coherent whole.

Indeed, the four fundamental freedoms enshrined in the Treaties (free movement of goods, persons, services and capital), which are generally not regarded as constituting fundamental rights as such,Footnote ¹³¹ can weigh as heavily—or sometimes more heavily—than some rights enshrined in the Charter. At least, that is the picture which emerges from the hotly debated judgments in Viking Footnote ¹³² and Laval,Footnote ¹³³ where it was held—to simplify somewhat—that, while workers enjoy the right to take collective industrial action under Article 28 of the Charter, that must not be taken so far as to thwart the essence of free movement.

According to Article 51(1) of the Charter, this instrument applies to the EU's institutions and bodies as well as to the Member States, but ‘only where they are implementing Union law’.Footnote ¹³⁴ As already mentioned, Article 52(3) provides that, insofar as the Charter contains rights which correspond to rights guaranteed by the ECHR, the meaning and scope of those rights shall be the same. However, it also states that Union law may provide more extensive protection than the ECHR. Given that by its very nature the Union is more concerned with economic activities than the ECHR, Union law naturally tends to give greater prominence to fundamental rights in the economic sphere. That is precisely what occurred in DEB,Footnote ¹³⁵ where the Court of Justice held that in some circumstances companies enjoy the right to legal aid under the third paragraph of Article 47 of the Charter.Footnote ¹³⁶

At all events, the Charter contains no provision indicating which articles apply to legal persons—which is all the more surprising when it is recalled that it came 50 years after the ECHR and the German constitution or Basic Law.Footnote ¹³⁷ Exceptionally, Articles 42 to 44 of the Charter (on the rights to access to documents, to submit a complaint to the Ombudsman and to petition the European Parliament, respectively) expressly confer rights on them; but these are hardly the most important rights.Footnote ¹³⁸

The first sentence of Article 1 states: ‘Human dignity is inviolable.’ Plainly, only natural persons fall within the scope of this provision.Footnote ¹³⁹ This follows not only from the word ‘human’, but also from the fact that this sentence is lifted word for word from the opening sentence of Germany's Basic Law; and, as we shall see in Part V below, the latter provision does not extend to legal persons. The official ExplanationsFootnote ¹⁴⁰ state: ‘The dignity of the human person is not only a fundamental right in itself but constitutes the real basis of fundamental rights’. Despite this highly authoritative statement, companies enjoy a number of fundamental rights under the Charter, although they are not underpinned by Article 1.

Unsurprisingly, companies may rely on the right to property in Article 17.Footnote ¹⁴¹ That is not least because the official Explanations state that Article 17 is based on Article 1 of Protocol 1 to the ECHR; and, as mentioned earlier, the latter provision is expressed to apply in favour of companies. Equally, as is only to be expected, they enjoy the freedom to conduct a business under Article 16 of the Charter.Footnote ¹⁴² Other provisions of the Charter which confer rights on companies include: the first paragraph of Article 47 (the right to an effective judicial remedy),Footnote ¹⁴³ the first paragraph of Article 48 (presumption of innocence)Footnote ¹⁴⁴ and the second paragraph of the same article (rights of defence).Footnote ¹⁴⁵

The Court took a more nuanced approach in Schecke, a case relating to the protection of personal data. The applicants challenged EU measures which provided for the publication of the names of the beneficiaries of funds paid under the Common Agricultural Policy and the amounts which they had received. As regards natural persons, this was held to be in breach of Articles 7 (respect for private life) and 8 (protection of personal data) of the Charter. As to companies, the Court ruled that they could only claim to the extent that their ‘official title’ identified one or more natural persons.Footnote ¹⁴⁶

The Court has yet to develop a systematic approach to the question as to which provisions of the Charter apply in favour of companies and, if so, in what circumstances. The closest it has come to doing so was in DEB,Footnote ¹⁴⁷ a preliminary reference from a German court which related to the third paragraph of Article 47. That paragraph reads: ‘Legal aid shall be made available to those who lack sufficient resources in so far as such aid is necessary to ensure effective access to justice.’ This provision relates exclusively to civil proceedings, as criminal legal aid is governed by Article 48.Footnote ¹⁴⁸ The Court held that this provision applied in favour of companies, although it indicated that they are less deserving of legal aid than natural persons and non-profit entities.Footnote ¹⁴⁹ It gave two reasons for finding that companies could rely on the provision in question.

1. (1) In the German version, all the paragraphs of Article 47 use the word ‘Person’ which can apply to both natural and legal persons. In contrast, numerous other provisions of the Charter such as Articles 1, 2, 3, 6, 29, 34 and 35 employ the word ‘Mensch’ which refers exclusively to human beings. This might be an indication that legal persons are within the scope of Article 47, the Court held.

2. (2) Article 47 is to be found in Title VI of the Charter, which relates to justice and which contains various provisions applying both to natural and to legal persons. This was an indication that the provision on legal aid extended to legal persons, according to the Court.

While this reasoning was appropriate to the instant case, it cannot be regarded as a comprehensive approach adapted to all circumstances. The first of these criteria is of limited value, as the Court itself acknowledged by saying that this ‘may’ be an indication as to the personal scope of the provision. When construing a provision of Union law, the Court never relies on one language version alone. In any case, some provisions of the Charter use neither ‘Person’ nor ‘Mensch’. For instance, many provisions such as Articles 49(1) and 50 use the word ‘niemand’ (no-one), while Article 48 speaks of ‘jeder Angeklagter’ (every accused). The second criterion, in contrast, appears to be of general application and could be added with profit the ‘nature, history and purpose’ test devised by the US Supreme Court in Bellotti.Footnote ¹⁵⁰

Naturally, in view of the inherent complexity of the subject matter, devising an appropriate general formula can only be the first step. Of greater concern is the fact that, apart from the judgments in Schecke and DEB, there is little evidence that the Court has directed its mind to the need to proceed with great caution when called upon to decide whether to extend to individuals existing case law on the fundamental rights of individuals. The same may fairly be said of the Advocates-General. A welcome recognition of this need may be found in SGL Carbon, where AG Geelhoed asserted that it is ‘not possible simply to transpose the findings of the European Court of Human Rights [on natural persons] without more to legal persons and undertakings’.Footnote ¹⁵¹ However, it is by no means obvious that this view is generally shared by the other AGs.Footnote ¹⁵²

D. The Freedom to Conduct a Business

Article 16 of the Charter reads as follows: ‘The freedom to conduct a business in accordance with Union law and national laws and practices is recognised.’Footnote ¹⁵³ This right has no counterpart in the ECHR or its protocols,Footnote ¹⁵⁴ but derives from the Constitutions of a number of Member States.Footnote ¹⁵⁵ It was first recognized by the Court of Justice in Nold.Footnote ¹⁵⁶ The overwhelming majority of arguments based on this right have been dismissed,Footnote ¹⁵⁷ but in two recent cases the Court has ruled in favour of litigants relying on it. In both cases, the facts were extreme.

Scarlet Extended Footnote ¹⁵⁸ concerned unauthorized file-sharing on the Internet contrary to various provisions of EU law. The Belgian copyright society obtained a judicial injunction against Scarlet Extended, an ISP, requiring it to monitor all electronic communications made on its services and, if necessary, to block them at its own expense and for an unlimited period. In view of its disproportionate nature, this injunction was held to contravene Article 16.

Alemo-Herron,Footnote ¹⁵⁹ related to Council Directive 2001/23 on safeguarding employees' rights in the event of transfers of undertakings.Footnote ¹⁶⁰ The UK Supreme Court asked whether ‘dynamic clauses referring to collective agreements’ were compatible with the Directive and with fundamental rights. These are clauses which have been agreed between the employees and the transferor employer to abide by the conditions set out in future collective agreements, even where the employer cannot be a party to the negotiations leading to that agreement. The Court of Justice stated that, by virtue of Article 16, the transferee of the business must be able to assert its interests in a contractual process and to negotiate the aspects determining changes in the working conditions of its employees. Where the transferee could not do so, the very essence of its freedom to conduct a business was liable to be adversely affected. Accordingly, the Directive must be interpreted as precluding Member States from providing for dynamic clauses in such a situation.

E. The Privilege against Self-Incrimination

As we noticed in Part IIIB above, it is settled law in the United States that corporations cannot rely on the privilege against self-incrimination. Moreover, the same is the case in Germany, as we shall see in Part V below. In contrast, the Court of Justice adopted a stance which is more generous to undertakings under investigation for breaches of EU competition law, without fully applying the privilege to them. Articles 101 and 102 TFEU prohibit anti-competitive measures taken by ‘undertakings’, a concept which covers ‘every entity engaged in an economic activity regardless of the legal status of the entity and the way in which it is financed’.Footnote ¹⁶¹ Typically, they take a corporate form, but they may also be unincorporated partnerships or even one or more individuals running a business together.Footnote ¹⁶² We are concerned here with enforcement proceedings by the Commission or a National Competition Authority, since they can lead to the imposition of substantial fines and are therefore of a quasi-criminal nature.Footnote ¹⁶³

No provision of the ECHR or the Charter expressly mentions the privilege against self-incrimination. However, according to the consistent case law of the ECtHR,Footnote ¹⁶⁴ notably Saunders v United Kingdom,Footnote ¹⁶⁵ it falls within the broad terms of Article 6 ECHR on the right to a fair trial, which corresponds to Article 47 of the Charter. In keeping with US law, the rationale for the rule was stated to be ‘the protection of the accused against improper compulsion by the authorities thereby contributing to the avoidance of miscarriages of justice and to the fulfilment of the aims of Article 6’.Footnote ¹⁶⁶ The ECtHR has cast this right very broadly: ‘the right not to incriminate oneself cannot reasonably be confined to statements of admission of wrongdoing or to remarks which are directly incriminating’, it held, as even exculpatory information might be relied on by the prosecution.Footnote ¹⁶⁷ Equally, an individual cannot be compelled to provide documents, at least if they are incriminating.Footnote ¹⁶⁸ On the other hand, the Court has made it clear that the right ‘does not extend to the use in criminal proceedings of material obtained from the accused through the use of compulsory powers but which has an existence independent of the will of the suspect such as, inter alia, documents acquired pursuant to a warrant, breath, blood and urine samples and bodily tissue for the purpose of DNA testing’.Footnote ¹⁶⁹

Crucially, however, all these cases concern natural persons. As yet there is no authority from the ECtHR as to whether legal persons enjoy the privilege against self-incrimination. Although Article 6 ECHR applies to companies, it does not by any means follow that they can necessarily rely on this privilege.

In EU competition law, the locus classicus is the ruling in Orkem.Footnote ¹⁷⁰ At the time, as the Court of Justice indicated,Footnote ¹⁷¹ the Strasbourg court had not yet determined whether the privilege against self-incrimination was enshrined in the ECHR, even as regards natural persons. The Court of Justice also noted that ‘[i]n general, the laws of the Member States grant the right not to give evidence against oneself only to a natural person’.Footnote ¹⁷² Accordingly, it rejected the claim that companies are entitled to a fully-fledged privilege against self-incrimination. Nevertheless, it found that the rights of defence require certain limitations on the Commission's powers of investigation: the Commission could compel an undertaking to disclose documents, even if such information or documents might be used to establish the existence of a breach of EU competition law;Footnote ¹⁷³ and the Commission could also compel the undertaking to answer factual questions so long as this did not require it to admit infringing EU competition law.Footnote ¹⁷⁴ Accordingly, questions requiring Orkem to explain the purpose of the step which it had taken were held to be unlawful.Footnote ¹⁷⁵

This ruling has been applied and confirmed on several occasions.Footnote ¹⁷⁶ In particular, in PVC II the Court of Justice revisited Orkem in the light of the Strasbourg judgments just discussed, and found that it was still good law.Footnote ¹⁷⁷

This issue arose once again in SGL Carbon. After making the statement cited above,Footnote ¹⁷⁸ AG Geelhoed referred to United States v White,Footnote ¹⁷⁹ and to the fact that the ECtHR has been known to grant a lower level of protection to legal persons than to natural persons as regards other rights, as mentioned above. Moreover, recalling that the enforcement of EU competition law is of crucial importance to the internal market, he described the interplay between the fundamental rights of legal persons and competition enforcement as a ‘balancing exercise’.Footnote ¹⁸⁰ On this basis, he concluded that the existing case law should be maintained. Similarly, the Court refused to depart from, or reverse, its ruling in Orkem.Footnote ¹⁸¹

Although the subtle distinction drawn by the Court in Orkem between self-incriminating and purely factual information may be difficult to apply in practice,Footnote ¹⁸² its subsequent approach—and the comments of AG Geelhoed—deserve a warm welcome, when the rationale for the privilege against self-incrimination is borne in mind.Footnote ¹⁸³ In Orkem the Court already appears to have been more generous to undertakings than it need have been, and to go any further would jeopardize the enforcement of competition law for no good reason. Those who criticize this body of case law as contrary to fundamental rightsFootnote ¹⁸⁴ do so on the doubtful premise that Saunders and its progeny necessarily apply to legal persons. Moreover, it should be borne in mind that the enforcement of competition law is ‘essential for the accomplishment of the tasks entrusted to the [Union] and, in particular, for the functioning of the internal market’.Footnote ¹⁸⁵

F. Double Jeopardy

The rule against double jeopardy (also known as ne bis in idem) is enshrined both in Article 4 of Protocol 7 to the ECHR and Article 50 of the Charter, albeit in different terms. Within the confines of the case law of the ECtHR on the former provision,Footnote ¹⁸⁶ the Court of Justice has construed this rule relatively narrowly in the field of competition law.Footnote ¹⁸⁷ On the other hand, under the Schengen AgreementFootnote ¹⁸⁸ on free movement of natural persons, the Court has applied the rule very generously in their favour. For example, it held in Gözütok that a settlement whereby a prosecution is barred once the accused has paid a sum to the prosecutor in one Member State precludes prosecution in another.Footnote ¹⁸⁹

In Toshiba,Footnote ¹⁹⁰ the AG suggested that the Schengen approach should be extended to undertakings when applying competition law, simply because it was ‘detrimental to the unity of the EU legal order’ to have more than one test of double jeopardy in EU law.Footnote ¹⁹¹ In stark contrast to AG Geelhoed in SGL Carbon,Footnote ¹⁹² she failed to point out that the case law relating to the fundamental rights of natural persons might not be appropriate for undertakings; nor did she allude to the fact that the wording of the Schengen provision is quite different from the language of Article 50. Moreover, neither the case law of the ECtHR nor the wording of Article 50 require the Court to take this step.

In the event, the Court did not heed the AG's advice. That is fortunate because otherwise the effective enforcement of competition law would have been impeded. Simplicity, as Leonardo da Vinci famously declared, is the ultimate sophistication. Obviously, the courts should strive for a simple solution where that is possible; but other considerations should prevail in this instance, it is submitted.

G. Discrimination

Article 21(1) of the Charter prohibits discrimination on a number of grounds, including sex, race and ethnic origin,Footnote ¹⁹³ and religion or belief; for present purposes it is not necessary to consider the other grounds here. The first paragraph of Article 23 reads: ‘Equality between men and women must be ensured in all areas, including employment, work and pay.’ This provision supplements Article 3(2) TEU and 8 and 157 TFEU, which also concern the promotion of equality between the sexes.

Article 19(1) TFEU empowers the Union to take legislative action to combat discrimination on the basis inter alia of the factors just mentioned. Amongst the directives based on this provision are the Gender Equality in Goods and Services DirectiveFootnote ¹⁹⁴ and the Race Equality Directive.Footnote ¹⁹⁵ As is plain from its title, the first of these instruments prohibits (subject to exceptions) ‘discrimination based on sex in access to and supply of goods and services’, while the second extends to racial discrimination relating to the ‘access to and supply of goods and services which are available to the public, including housing’ (Article 3(1)(h)). What if a company is refused goods or services because it is owned, run or staffed largely by women (or men) or individuals of a particular race? Manifestly, companies are bereft of both gender and race; but anyone discriminating against a company by reason of the gender or race of its stakeholders is in reality targeting them. Consequently, it is submitted that they and/or the company should be able to rely on the Charter read with whichever of the two Directives is in point—subject of course to the exceptions set out there.Footnote ¹⁹⁶

On this view, if a company suffers discrimination on such grounds in the award of a large-scale public procurement contract covered by the Public Procurement Directives, that will also be a breach of those Directives.Footnote ¹⁹⁷

As to discrimination on the basis of the religion or belief of the stakeholders, a Commission proposal for a DirectiveFootnote ¹⁹⁸ covering such discrimination as regards the supply and purchase of goods or services has yet to be adopted. On the other hand, if the award of a large-scale contract covered by one of the Public Procurement DirectivesFootnote ¹⁹⁹ is involved, that would appear to be a breach of that Directive. By virtue of Article 51(1) of the Charter, Article 21(1) of the same instrument can only apply if one of the Public Procurement Directives is engaged, since otherwise the transaction will fall outside the scope of EU law.

Whichever of these provisions is applied, the corporate veil will in a sense be pierced in favour of the stakeholders, even if the action is brought by the company—just as in City of Richmond v Croson Co.Footnote ²⁰⁰

H. Political Donations

Neither the ECtHR nor the Court of Justice has been called upon to devote much time to limits on electoral spending and donations. No doubt, that is largely due to the broad consensus in Europe as to the need for such limits so as to avoid giving an unfair advantage to those with the deepest pockets.

As regards the ECHR, two provisions come into play: Article 10 on the freedom of expression and Article 3 of Protocol 1 on the right to free elections. The most relevant case before the Strasbourg court appears to be Bowman v United Kingdom.Footnote ²⁰¹ English law strictly limited electoral expenditure by candidates and their agents, and prohibited third parties from spending more than £5 on communicating information, immediately before or during an electoral campaign, with a view to promoting a particular candidate for Parliament. Mrs Bowman was an anti-abortion activist, who distributed a large number of leaflets calling upon electors to vote for anti-abortion candidates to be distributed in constituencies throughout the United Kingdom. She was charged with an offence under this legislation. Her claim that the provision in issue was contrary to Article 10 ECHR was upheld by the ECtHR, which declared the legislation to be a ‘total barrier to Mrs Bowman's publishing information with a view to influencing the voters of Halifax in favour of an anti-abortion candidate’.Footnote ²⁰²

Nevertheless, this judgment contains several statements which are strongly supportive of limits on electoral spending. What is more, Bowman directly concerned communications; and nothing in the ruling indicates that the ECtHR would necessarily consider statutory limits on electoral donations would fall under either Article 10 ECHR or Article 3 of Protocol 1.Footnote ²⁰³

In EU law, no general provision is made for free elections. This is a matter for the Member States, which are all party to the ECHR. However, Article 39(2) of the Charter reads: ‘Members of the European Parliament shall be elected by direct universal suffrage in a free and secret ballot.’ Those elections are governed by the Act of 1976,Footnote ²⁰⁴ Article 2B of which states: ‘Each Member State may set a ceiling for candidates’ campaign expenses.’ Moreover, it follows from Article 6 of Regulation 2004/2003 of the European Parliament and the Council on European political parties and their funding as amendedFootnote ²⁰⁵ that such parties may not accept donations exceeding €12,000 from any natural person or company.

In short, the position in European law is a far cry from that in the US, and the legality of restrictions on political expenditure by companies has not even arisen.

I. Freedom of Religion

Unsurprisingly, the ECtHR has recognized the right of churches to rely on Article 9 ECHR on ‘freedom of thought, conscience and religion’ and ‘belief’;Footnote ²⁰⁶ but it has not had the opportunity to rule on whether the same applies to companies.

However, there is case law from the European Commission of Human Rights, which was merged with the ECtHR in 1998 with the entry into force of Protocol 11 to the ECHR. In one case, that body held that a private non-religious association engaged in the rehabilitation of young drug abusers could not claim the freedom of conscience under Article 9.Footnote ²⁰⁷ Two other cases concerned Finland and Switzerland, where at the material time companies were required to pay taxes to the established church or churches.Footnote ²⁰⁸ Both actions were rejected on the basis that commercial entities could not rely on Article 9.Footnote ²⁰⁹

The position advocated in this article is precisely that companies can have neither a religion, nor ‘thought’, ‘conscience’ or ‘belief’ within the meaning of Article 9 ECHR. At the same time, for companies to be required to pay taxes to churches (or indeed organizations of freethinkers or atheists) seems objectionable, since churches serve spiritual and/or philosophical ends wholly alien to the purely economic rationale for which companies are established. Just as it seems exorbitant for a company to claim an exemption from a legal obligation on the basis of a religious belief (as in Hobby Lobby), so it appears unacceptable for a public authority to thrust such a belief on a company or treat it as though it could have one. That is why the solution reached by the German Constitutional Court on very similar facts is welcome.Footnote ²¹⁰ The ruling of that Court, which is discussed in Part V below, would indicate that such a tax might be contrary to Article 8 ECHR, a provision not pleaded in the two actions just mentioned.Footnote ²¹¹

As for EU law, Article 17(1) TFEU provides: ‘The Union respects and does not prejudice the status under national law of churches and religious associations or communities in the Member States.’ Similarly, Article 17(2) states: ‘The Union equally respects the status under national law of philosophical and non-confessional organisations.’ Furthermore, the freedom of conscience, thought and religion is enshrined in Article 10 of the Charter, which corresponds to Article 9 ECHR.Footnote ²¹² Although this provision is expressed to benefit ‘everyone’ (‘jede Person’ in the German version), it is hard to imagine that the Court of Justice would ever interpret it as extending to companies. Instead, the choice of ‘Person’ rather than ‘Mensch’ could be explained by the obvious need to include churches.

References to religion in EU legislation are few and far between.Footnote ²¹³ Perhaps the most important is Council Directive 2000/78, generally known as the Framework Employment Directive, which prohibits discrimination on the grounds of religion or belief, disability, age or sexual orientation as regards employment and occupation.Footnote ²¹⁴ One of the exceptions is contained in Article 4(2), which authorizes the continued application of national measures whereby ‘a difference of treatment based on a person's religion or belief shall not constitute discrimination where, by reason of the nature of these activities or of the context in which they are carried out, a person's religion or belief constitute a genuine, legitimate and justified occupational requirement, having regard to the organisation's ethos’. This provision is expressed to apply to employment or occupation within ‘churches and other public or private organisations the ethos of which is based on religion or belief’.

Behind this cumbersome and convoluted language, which is too long to cite here in full, lurk some particularly thorny issues; and there appears to be no case law on it to date. On the one hand, is it compatible with Article 10 of the Charter to confine the benefit of this provision to pre-existing national measures and practices? On the other, the class of organizations to which Article 4(2) applies is unusually broad. Nevertheless, it scarcely seems conceivable that the Court would go so far as to regard an employer such as Hobby Lobby as an organization whose ethos is based on its Christian beliefs for the purposes of this provision. Quite apart from that, such an employer would quite clearly not be entitled pursuant to Article 4(2) to recruit only those sharing its particular religious beliefs, any more than it could in the United States: this would not be a ‘genuine, legitimate and justified occupational requirement’.

In any case, discrimination against certain female employees in their health care coverage would not fall within the scope of Article 4(2). A company in that situation would therefore have to rely directly on Article 10 of the Charter—with little chance of success. The same would apply if a company were to attempt to opt out of a health insurance scheme for its employees without their suffering any disadvantage, as the US Supreme Court envisaged in Hobby Lobby. In particular, the Court of Justice would be loath to accept the competitive advantage gained by a company exempted from health care payments in this way: creating a level playing field, in so far as possible, is central to the single market, which lies at the heart of the EU Treaties.