On February 13, AG Ćapeta delivered her Opinion on case C-417/23, Slagelse Almennyttige Boligselskab, Afdeling Schackenborgvænge. The case concerns the Danish laws on ‘ghettos’—areas where certain socio-economic indicators point to social problems and where, crucially, at least a 50% of the residents are classified as ‘non-Westerners’ or ‘descendants of non-Westerners’. The case, now pending final judgment by the Grand Chamber, is the ninth reference on the interpretation of the Race Equality Directive (RED), the second from Denmark.
This posts analyzes the two central aspects of the Opinion: Whether the distinction ‘Westerner’/’non-Westerners’ is an expression of ethnic origin, and if the Danish law amounts to direct discrimination. It connects the Opinion with the oral submissions of the interveners before the Court (apart from the Danish Government, the Commission and the plaintiffs, the Danish Institute for Human Rights and two UN Special Rapporteurs intervened at the hearing).
Facts of the case
Denmark’s Law on Social Housing (Almenboligloven) mandates the development of plans to reduce social housing in areas deemed to have difficulties with integration. To this end, housing areas can be classified as ‘ghettos’ or ‘hard ghettos’. The legislation has recently changed the terms to ‘parallel societies’ and ‘transformation areas’, but the cases in the main proceedings date back to when the old terminology was still in place.
The classification as ‘parallel society’/’ghetto’ consists of two steps. First, the area should fall under two of four criteria related to the residents’ attachment to the labor market, criminal records, educational attainment and average income. Secondly, at least 50% of the residents are classified as ‘non-Western immigrants’ or ‘descendants of non-Western immigrants’ (where none of the parents is both Danish and born in Denmark). Residential areas remain ‘transformation area/hard ghetto’ if classified as ‘ghetto’ for five consecutive years.
The categories of Western/non-Western were developed by Danmarks Statistik (Danish Institute for Statistics) for statistical purposes. The legislator later adopted them without changes. ‘Western countries’ include the EU, Andorra, Australia, Canada, Iceland, Liechtenstein, Monaco, New Zealand, Norway, San Marino, Switzerland, the UK, the USA and the Vatican. ‘Non-Western countries’ include the rest of Europe, all countries in Africa, the Americas, Asia, Oceania and stateless persons. At the hearing, the Danish Government explained that with this classification, Danmarks Statistik tried to isolate some circumstances in which countries, and people coming from them, resemble each other in socio-economic and other ways, though the Danish Government could not explain how. On a question of AG Ćapeta on why the Danish legislator kept the criteria unchanged, the Danish representative just said that these criteria were ‘objective’, and denied any ethnic connotation. He added that ‘people emigrate with a background’ and these indicators allow to see ‘the contribution to Denmark’ made by incoming migrants.
In ‘ghettos’, the Government can mandate the development of plans to reduce public housing to 40%, which can include the demolition or reconversion of buildings, and the subsequent termination of rental contracts. Following the development plans of Schackenborgvænge (Slagelse) and Mjølnerparken (Copenhagen), some residents’ rental contracts were terminated. The litigation before the national court led to a reference to the Court, with the central question of whether the Danish rules entail discrimination on grounds of ethnic origin contrary to the RED.
The Opinion of AG Ćapeta
Ethnic origin and the distinction ‘Western’/’non-Western’
The interveners before the Court held no doubts as per the ethnic character of the distinction ‘Western’/’non-Western’. Furthermore, the Danish Institute of Human Rights and the plaintiffs cited numerous policy documents from the Danish Government where the ethnic component of the legislation was apparent. This seems particularly relevant, as several judges and the AG inquired about the travaux préparatoires of the Danish legislation during the hearing.
For the Danish Government, relying on the Court’s decision in Jyske Finans (para. 24) the ‘Western’/’non-Western’ distinction is based solely on the criteria of nationality, excluded from the RED (Article 3(2) RED). Furthermore, as the term ‘non-Western’ encompasses over 90% of the population, the ‘disfavored’ group is not homogeneous, which, again relying on the (unfortunate) drafting of Jyske Finans (para. 27), Denmark considers conditio sine qua non for any finding of discrimination. Indeed, in that case the Court seemed to understand the phrase ‘particular disadvantage’ in Article 2(2)b) RED as meaning that it is ‘particularly’ persons of a given ethnic origin who are disadvantaged by the unfavorable treatment (para. 27), so that a requirement applicable without distinction to all persons born outside of the EU/EFTA could not triggered the Directive. Albeit somehow unclearly formulated, this was the main point of defense of the Danish Government before the Court.
AG Ćapeta rejected both arguments in her Opinion.
The Opinion starts off with the case’s obvious difficulty: The RED does not include a definition of ethnic origin and instead bans, without defining it, discrimination on grounds of racial and ethnic origin. To her mind, this means that the term ‘ethnic origin’ needs to be interpreted in connection with the term ‘race’. As the RED clearly indicates that the Union rejects the theories establishing the existence of different races (recital 6), AG Ćapeta argues that both terms, race and ethnic origin, must be interpreted as ‘social constructs’ referring to ‘a perception in a given society of the existence of a group that is recognizable as different on the basis of certain socio-cultural characteristics, such as language, literature, music, customs or similar (para. 69).’
The Court’s (scarce) case-law directly dealing with the term ethnic origin would seem to support this interpretation. In CHEZ (para. 46), the Court stated that the concept of ethnicity, ‘has its origin in the idea of societal groups marked in particular by common nationality, religious faith, language, cultural and traditional origins and backgrounds’, so it obviously applied to the Roma community experiencing the adverse treatment in Bulgaria. The non-exhaustive list of ‘markers of ethnicity’ in CHEZ included nationality. The Court again listed nationality, together with religious faith, language, cultural and traditional origins and backgrounds as indicators of ethnic origin in Jyske Finans (para. 17), stating expressly that a sole criterion could not suffice to establish ethnic origin.
Unlike CHEZ, this case involves a diverse group of ‘non-Westerners’ encompassing over a hundred nationalities, with distinct customs, histories, religions, and languages. As AG Ćapeta aptly noted, ‘what unites that group (…) is not a commonality of factors that form ‘ethnicity’ within the group; it is rather the perception by the Danish legislature that this group does not possess the characteristics of the other group, that is, of ‘Westerners’’ (para. 86). The Danish legislator effectively positions ‘Westerners’ as a homogeneous group aligned with Danes: the shared culture, traditions, and beliefs facilitate smooth integration into Danish society—an ease not extended to ‘non-Westerners’. The legislation draws a blunt ‘us’ versus ‘them’ distinction, where ‘non-Westerners’ face unfavorable treatment due to their ‘perceived ethnic otherness’ (para. 92). This divide is driven by the legislator’s belief that ‘non-Westerners’ lack the traits attributed to ‘Westerners’ that would enable smooth integration. Despite persistent questioning from the Judges, including President Lenaerts, the Danish representative could not explain why the Danish Government had never tried to apply these measures without taking into account the ‘Westerners’/’non-Westerners’ distinction.
This case differs in one more aspect from the previous cases before the Court in that all non-Western ethnic groups received a disadvantaged treatment par rapport to Danes and ‘Westerners’. In previous cases, only one ethnic group was disadvantaged. For AG Ćapeta, an interpretation of the Directive consistent with its objectives must conclude that it also applies to situations where multiple groups are placed at a disadvantage, if the criterion for distinction is their ethnic origin. The fact that Danish legislation frames ‘non-Westerners’ as lacking certain ‘ethnic characteristics’—rather than as a group sharing them—does not negate that the distinction ‘Westerners’/’non-Westerners’ is based on grounds of ethnic origin. According to the AG, this is the only plausible interpretation of the Court’s decision in Feryn.
In Feryn, an NGO sued an employer for stating in an interview that he would not hire ‘foreigners.’ Nothing in Ferynsuggested that ‘foreigners’ were a homogeneous group, yet this did not prevent the Court from finding discrimination, even without an identified victim. The AG interprets this as a tacit acknowledgment that the RED applies even when the disadvantaged group is not homogeneous, as long as the distinction is based on ethnic origin. The Commission similarly supported this interpretation in its oral pleadings.
Direct discrimination and stigmatization
AG Ćapeta presents a lengthy and detailed argumentation to support that the Danish legislation gives rise to direct discrimination on grounds of ethnic origin. Before fully developing her argument, however, she makes a preliminary point worth restating. As mentioned, not all tenants affected by the development plans and the unilateral termination of leases are ‘non-Westerners’, and the implementation of the plan itself once the area has been declared a ‘ghetto’ or ‘hard ghetto’ is not based on ethnic grounds. This fact, however, is immaterial to the potential finding of discrimination, as what matters is whether a person is discriminated on grounds of ethnic origin, regardless of whether they belong to that ethnic group (see Coleman).
AG Ćapeta identifies two levels of adverse treatment: The ‘first and obvious’ is the unilateral termination of leases imposed on the tenants; the second is the stigmatization of the affected ethnic groups.
Regarding the first point, AG Ćapeta conducts a standard discrimination analysis. The less favorable treatment—the forced and unilateral termination of leases—is evident. The appropriate comparator for assessing this treatment is tenants in public housing located in areas classified as ‘vulnerable’, which meet at least two of the socioeconomic criteria, but without reaching the threshold of 50% ‘non-Western’ residents. Unlike tenants in ‘ghettos’, tenants in vulnerable areas do not face the risk of losing their homes. Thus, tenants in ‘ghettos’ are treated less favorably, the sole distinction between the two groups being the ethnic origin of residents in a ‘ghetto’ area. According to established case-law of the Court, demonstrating direct discrimination requires only showing that ethnic origin influenced the decision to impose the different, less favorable treatment (CHEZ, para. 76).
The second point, discrimination arising as a result of stigmatization, will allow the Court to elaborate on CHEZ. AG Ćapeta understands stigmatization ‘to mean that members of an ethnic group are attributed socially reproachable characteristics solely on the basis of their membership or perceived membership of that group’ (para. 148). She recalls that in CHEZ the Court identified the offensive and stigmatizing nature of the practice as one of the reasons to find discrimination (paras. 84-87). AG Ćapeta argues that the same can be true of legislation based on ‘generalized stereotypes and prejudices about an ethnic group’. Several international reports highlight the stigmatizing effect of the legislation.
In the view of the AG, the Danish legislature unfairly generalizes these ‘negative and unacceptable’ characteristics, attributing them to ‘non-Westerners’ and their descendants. Remarkably, the Danish Government presented no empirical evidence to support the existence of ‘parallel societies’ in Denmark. Moreover, when repeatedly asked to clarify the criteria used to determine whether a person is not integrated into Danish society, the Danish representative could only reiterate the guidelines for designating an area as vulnerable, adding the lack of Danish language proficiency. It is a leap to suggest that these criteria indicate an unwillingness to integrate into Danish society—and an even greater leap to conclude that such integration challenges are exclusive to ‘non-Westerners’.
Indirect discrimination as an alternative
If the Court does not find direct discrimination, the Opinion argues that it should at least find indirect discrimination. The argument aligns with the Commission’s view that the case is better classified as indirect discrimination, as merely developing a plan has no inherent negative consequences for residents.
Nevertheless, although the provision appears neutral—selecting residents for rent termination on socio-economic criteria—evictions occur only in areas previously classified as ‘ghettos’, a designation tied to the previous categorization of residents as ‘non-Westerners’. Since indirect discrimination occurs ‘when statistically one ethnic group is affected by a neutral rule more than other groups (para. 164)’, it is evident that ‘non-Westerners’ face a significantly higher risk of adverse treatment.
Indirect discrimination can be justified if it pursues a legitimate aim through appropriate and necessary means. While the parties accepted integration as a legitimate goal, they disagreed on the measure’s effectiveness. The plaintiffs and the UN Rapporteurs argued that it hindered integration and the Danish Government should have implemented positive measures instead.
The Commission took no firm stance on the justifications, emphasizing that the national court, with the guidance of the Court, should decide. When pressed by the Court and AG on how the measures concretely promoted integration, the Danish Government merely reiterated the need for integration and emphasized Denmark’s (mostly economic) ‘efforts’ to achieve it.
The Opinion offers clear guidance on the proportionality analysis for the referring court. The national court must first define ‘successful integration’ in Danish society. According to AG Ćapeta, the Danish Government cited three factors, which may serve as benchmarks for assessing proportionality: workforce participation, a clean criminal record, and Danish proficiency. While leaving this assessment to the national court, the AG stresses that policies driven by prejudice rather than solid evidence—which the Danish Government failed to provide – should be critically scrutinized.
If the aim is considered legitimate, the national court must assess whether the measure is necessary for integration, or if less restrictive alternatives exist. This may require a closer examination of the Danish Government’s claim that other measures were attempted but failed—though in the hearing, the Danish representative implied that integration measures were never applied without considering ethnicity. Finally, the national court must assess the measure’s proportionalitystricto sensu. AG Ćapeta takes a somewhat deferential approach, but ultimately reiterates that she is ‘skeptical’ that the Danish rules can be justified.
The way ahead?
Given the limited case-law on the RED, this case offers the Court an ideal opportunity to clarify the scope of protection against racial and ethnic discrimination in the EU. The Court will need to define the contours of ethnic discrimination, disentangle direct and indirect discrimination on grounds of race and ethnicity, and assess possible justifications for the latter. AG Ćapeta provides a solidly argued Opinion to support this task, thoroughly demonstrating that the ‘ghetto laws’ fall within the RED and constitute direct discrimination. Throughout, she builds on CHEZ and Feryn, while distancing herself from the flawed reasoning in Jyske Finans.
The Opinion zeroes in on the core issue before the Court: the existence of discrimination based on ethnic origin. However, the Court also asked the parties to address additional topics during the hearings. Specifically, the Court inquired about the relevance to this case of the European Court of Human Rights’ decision in Biao, as well as the role of reports by international organizations to prove discrimination. While the Opinion does not address the former, it implicitly responds to the latter by extensively citing and integrating these reports into the reasoning. One can only hope the Court will seize this opportunity to further explore the connections between the case-law of Luxembourg and Strasbourg and to reflect on the need for greater engagement with reports from other international bodies—especially when, as in this case, those bodies intervene in Luxembourg.
Furthermore, the AG responded to the Commission’s and the Danish Government’s calls to provide guidance to the referring court. Her proportionality test strikes a careful balance, maintaining the division of competences required in a preliminary reference procedure while offering a clear answer to the national court. It remains to be seen whether the Court will similarly choose to provide clear guidance, as it has in previous cases (e.g., CHEZ), or whether it will continue its increasingly deferential approach toward national courts, even in potential cases of racial and ethnic discrimination. The former approach appears preferable.
No party at the hearing disputed that integration might be a legitimate aim. Nor was there disagreement that integration challenges should be openly discussed. As AG Ćapeta aptly noted: ‘In a pluralist, democratic society, there should not be any taboo topics. Recognizing the existence of a structural disadvantage of an ethnic group within a given society is, in fact, a necessary step in achieving real equality.’ Yet, regardless of how well-intended they might be, integration measures need to respect the relevant legal frameworks. After all, ‘the road to hell is paved with good intentions’.
If the Court follows its AG, more developments may follow. The rehousing of residents outside the so-called ‘ghettos’ is perhaps the most visible aspect of Denmark’s ‘ghetto laws,’ but it is not the only component. In recent years, the Danish Government has embarked on a mission to eliminate so-called ‘parallel societies’ in Denmark by 2030, employing measures that range from increased criminal sentences to limits on family reunification for those living in ‘ghettos.’ This case might be extreme, but Denmark is certainly not alone in proposing measures ostensibly aimed at promoting integration and social cohesion.
Ultimately, the Court is tasked with determining the reach of the RED within the realm of integration policies at a time when migration is both highly salient and intensely politicized. Simply put, the question before the Court is: What can be legitimately pursued in the name of integration—or perhaps under its pretext? If Luxembourg falls short, Strasbourg may be willing to step in.
Lucía López Zurita is an Assistant Professor at MOBILE, Center of Excellence for Global Mobility Law at the University of Copenhagen. Before that, she worked as a postdoc in iCourts, Centre of Excellence for International Courts. Lucía defended her PhD at the European University Institute (EUI) in Florence. Her main areas of interest lie in the intersection of law and politics and include judicial decision-making, especially at the Court of Justice of the European Union, EU procedural law, individual rights and free movement law. Her research uses empirical methods.
