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The Role of the ECJ Beyond EU Law

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Abstract

When intended to complement EU law or to enlarge its application to Third Parties, international treaties can empower the ECJ with additional tasks beyond the realm of EU law. This paper explores both the potential and legal constraints of the ECJ’s extra powers, building upon some selected cases of practice. It argues that if one looks at this practice in depth through the prism of the purposes for which such special category of treaties were enacted and the reasons that led to them, the common denominator for involving the ECJ can be identified in the need to safeguard their consistency with the fundamental role the ECJ enjoys in the EU legal order under Article 19 TEU. The reference to the ECJ, both for solving disputes between themselves and for protecting individual rights as guaranteed by EU law (or by provisions which are identical in substance to it), is not just in line with the principle of institutional conferral. It is also a route the Contracting Parties are bound to take in order to respect the autonomy of EU law.

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Notes

  1. 1.

    I am essentially referring to Brussels Convention on the jurisdiction and the enforcement in civil and commercial matters, and to the Rome Convention on the law applicable to contractual obligations.

  2. 2.

    It reads as follows: “The Court of Justice shall have jurisdiction in any dispute between Member States which relates to the subject matter of the Treaties if the dispute is submitted to it under a special agreement between the parties”.

  3. 3.

    E.g. Mazzarini (2014), p. 2154 et seqq.

  4. 4.

    See Council No. 8457/14 EF 121 ECOFIN 342, 14 May 2014. This Agreement set out the international legal obligation to transfer the contributions raised at national level towards the Single Resolution Fund. Indeed, some Eurozone States did not agree to found that obligation upon the law of the Union. As a result, such obligation is established by the Agreement, which lays down the conditions upon which the Contracting Parties, in accordance with their respective constitutional requirements, have agreed to transfer the contributions that they raise at national level to the Fund.

  5. 5.

    For an in-depth analysis of the economic narrative of the Eurozone crisis, see Tuori and Tuori (2014), p. 61 et seqq.

  6. 6.

    Cf. Tuori and Tuori (2014), p. 101 et seqq. as regards the ECB’s contribution to combating the sovereign debt crisis; Baratta (2014a).

  7. 7.

    However the ESM Treaty, by granting of financial assistance to Member States that are experiencing severe financing problems, is in legal terms more innovative than the Fiscal Compact. By imposing a strict fiscal discipline, the latter is meant to reduce the risk of public debt crises but reflects to a large extent the normative content of EU secondary law. Yet they are linked because it was agreed that the granting of financial assistance in the framework of the new programmes under the ESM, is conditional, as of 1 March 2013, in the ratification of the Fiscal Compact “by the ESM Member concerned” (recital 5 of the ESM Treaty). For a comprehensive overview of the developments in the EU economic governance, see Borges (2012), p. 1 et seqq.; Smets (2012), p. 41 et seqq.; Viterbo and Cisotta (2012), p. 323 et seqq.; Adam (2013), p. 5 et seqq.; Tuori and Tuori (2014), p. 85 et seqq.; Tosato (2016), p. 223 et seqq.; Condinanzi (2016), p. 240 et seqq.; Daniele (2016), p. 253 et seqq.

  8. 8.

    It is worth noticing that the dispute settlement between the Contracting Parties covers the interpretation of the Agreement’s provisions, as well as the allegation by one Party that another Contracting Party has not complied with its obligations under the Agreement. The ECJ’s competence includes any disputes concerning the reimbursement the Contracting Parties owed to the Member State that is not participating in the Single Supervisory Mechanism and in the Single Resolution Mechanism (“non-participating Member State”) for the amount that that non-participating Member State has paid in own resources corresponding to the use of the general budget of the Union in cases of non-contractual liability and costs related thereto, in respect of the exercise of powers by the institutions of the Union under the SRM Regulation (see Articles 14 and 15 of the Agreement). Moreover, according to the preamble No. 18, the ECJ has been granted the power to verify the existence of any fundamental change of circumstances and the consequences deriving from it. The preamble considers it a dispute concerning the application of the Agreement for the purposes of Article 273 TFEU that can therefore be submitted to the Court of Justice by virtue of that provision.

  9. 9.

    ECJ 27 November 2012, Case C-370/12, Pringle. See Thym and Wendel (2012), p. 733 et seqq.; Craig (2013), p. 3 et seqq.; de Witte and Beukers (2013), p. 805 et seqq.; Munari (2015), p. 723 et seqq.

  10. 10.

    According to Article 37, para. 2, of the ESM Treaty, the Board of Governors is to decide “on any dispute arising between an ESM Member and the ESM, or between ESM Members, in connection with the interpretation and application of this Treaty, including any dispute about the compatibility of the decisions adopted by the ESM with this Treaty”. Under Article 37, para. 3, the dispute is to be submitted to the Court of Justice, if an ESM Member contests the decision of the Board of Governors. As is clear from recital 16 of the ESM Treaty, the Parties to the ESM Treaty based this role for the ECJ on Article 273 TFEU.

  11. 11.

    All Eurozone States are Members of the ESM Treaty. Even though it is open to non-Euro Member States, none of these has joined.

  12. 12.

    Article 1 of the ESM Treaty.

  13. 13.

    Conclusion of the European Council of 24–25 March 2011.

  14. 14.

    See Pringle ruling, cit., para. 175 and Tuori and Tuori (2014), p. 159, who agrees with the reasoning of the ECJ.

  15. 15.

    It seems worth adding that as a matter of principle an organisation-hood stems from possessing an its own distinct will, namely when its decision-making is based on majority voting, which is actually the way in which the ESM organs operate. Once its subjectivity is confirmed by the fact that it externally and effectively acts as an international legal subject, it should be considered as an entity different from its Members.

  16. 16.

    Klabbers (2009), p. 35 et seqq.

  17. 17.

    Article 3, para. 2, stipulates that “the rules mentioned under paragraph 1 shall take effect in the national law of the Contracting Parties at the latest 1 year after the entry into force of this Treaty through provisions of binding force and permanent character, preferably constitutional, or otherwise guaranteed to be fully respected and adhered to throughout the national budgetary process”.

  18. 18.

    Needless to mention that the Commission’s task was seen as a political necessity to counter the habit of mutual indulgence amongst the Eurozone Governments (Baratta 2013, p. 31 et seqq.). As is known, Member States are to a large extent unwilling to dispute amongst themselves, as the practice related to Article 259 infringements illustrates (see recently Kochenov 2015).

  19. 19.

    This is not to say that the Commission will be a party in the proceedings (de Streel and Etienne (2012), p. 182 et seqq.; Rossolillo (2012), p. 10 et seqq.; Ubertazzi (2013), pp. 83 and 85–86). Indeed, such an outcome would hardly be in compliance with the EU legal framework. Thus, only States collectively (Article 8, para. 1, second sentence) or unilaterally (Article 8, para. 1, third sentence)—and, in the latter case, regardless of the Commission’s report—have the legitimacy to lodge a case against another State. The dispute remains strictly intergovernmental even in the case where a Party persists in not taking the necessary implementing measures after the first judgement of the ECJ. Yet, this second action is not automatic and unilateral in nature (“a Contracting Party […] may bring the case before the Court of Justice […]”, Article 8, para. 2, first sentence). The problem is the overall coherence of the system as far as the six “Arrangements Agreed” are concerned. In fact, on 2 March 2012 all the Signatories agreed to annex to the Minutes of the Signing of the Treaty six “Arrangements Agreed” deemed to be applied in relation to Article 8, para. 1, second sentence, should the Commission conclude in a report to the Parties that one of them has failed to comply with Article 3, para. 2, of the Fiscal Compact. The aim of the Arrangements is to enhance the automaticity of the judicial control by construing the action as a collective and obligatory tool—within 3 months of the Commission’s report, the “Trio of Presidencies” (as set out in Annex I to Council Decision 2009/908/EU of 1 December 2009) will lodge an application “in the interest of, and in close cooperation with, all the Contracting Parties”. Minimising the politicisation of the dispute is the aim pursued by the Annex. In addition, the same Arrangements are to be used in relation to Article 8, para. 2, should the Commission assess that a Party has not taken the necessary measures to comply with the judgment of the ECJ provided for in Article 8, para. 1, of the Treaty. Stepped outside the documents to submit to ratification by national Parliaments, according to international customary law they are interpretative criteria of Article 8. They aim at enhancing the automaticity of the judicial control by construing the action as a collective and obligatory tool should the Commission conclude in a report that one of them has failed to properly implement the balanced budget rule into domestic law or, at a possible later stage, that a Party has not taken the necessary measures to comply with the judgement of the ECJ. Doubts however may be raised as to the consistency of the Arrangements with the nature (non automatic and unilateral) of the action laid down in Article 8, para. 2. See however Adam (2013), p. 39; Bartoloni (2013), p. 96.

  20. 20.

    Tizzano (1967), p. 244 (focusing on the objective nature of the connection with the EU law).

  21. 21.

    See Pringle ruling, para. 174.

  22. 22.

    Under the ESM Treaty, the agreement to be negotiated with the relevant State must be consistent with EU law and particularly with the measures taken by the EU in the area of coordination of economic policy. Consequently, the conditions to be attached to financial assistance are mostly determined by EU law (see Pringle ruling, paras. 173–174).

  23. 23.

    It has been remarked that “in spite of institutional separateness, a personal union between the ESM and the Union (euro-area) framework has been created” (Tuori and Tuori 2014, p. 95).

  24. 24.

    It is quite a weird and hybrid construction since the Agreement is tied, firstly, with the Single Supervisory Mechanism established by Council Regulation (EU) No. 1024/2013 (OJEU L 287, 29 October 2013, pp. 63 et seqq.). It confers specific tasks to the European Central Bank (ECB) with regard to policies relating to the prudential supervision of credit institutions, as well as, while acting jointly with the national competent authorities, some powers of supervision over the credit institutions established in the Member States whose currency is the Euro, and in the Member States whose currency is not the Euro which have established a close cooperation with the ECB for supervision purposes. Secondly, the Agreement is tied with the Directive (EU) 59/2014 of the European Parliament and of the Council establishing a framework for the recovery and resolution of credit institutions and investment firms, aimed at harmonising national laws and regulations on the resolution of credit institutions and certain investment firms, including the establishment of national resolution financing arrangements. The international Agreement on the Single Resolution Fund was considered as necessary on the (debatable) assumption that the participating Member States (that are charged with raising the contributions on the institutions located in their respective territories according to the BRR Directive and the SRM Regulation) remain nonetheless sovereign and competent to transfer those contributions towards the Fund. Thus, the obligation to transfer the contributions raised at national level towards the Fund derives from the international Agreement itself and not by EU law, though there is a clear substantial connection between these components.

  25. 25.

    I refer to Article 262 TFEU that allows the Council to confer jurisdiction on the ECJ in disputes relating to the application of acts in the field of European intellectual property rights. However, even the ECJ in its Opinion 1/09 (8 March 2011, Draft agreement on the creation of a unified patent litigation system) was not enthusiastic with the plan to set up a specialised body, most likely to be attached to the General Court (see Baratta 2014a, p. 296 et seqq.; Adam 2011, p. 277 et seqq.; Alberti 2012, p. 367 et seqq.).

  26. 26.

    As to the features of this unusual judicial construct and for further references, see Baratta (2014b), p. 101 et seqq.

  27. 27.

    See for instance the Monetary Agreement between the European Union and the Vatican City State (2010/C 28/05), OJEU C 28, 4 February 2010, p. 13 et seqq.; Monetary Agreement between the European Union and the Republic of San Marino (2012/C 121/02), OJEU C 121, 26 April 2012, p. 5 et seqq. See Maresceau (2014), pp. 151 et seqq., 186 et seqq.

  28. 28.

    Martucci (2016), p. 114 et seqq.

  29. 29.

    See Articles 8 of the Monetary Agreements with the Vatican City State and the Republic of San Marino. Balboni (2014), p. 405 et seqq., at 423.

  30. 30.

    See Articles 11 of the Monetary Agreements with the Vatican City State and the Republic of San Marino.

  31. 31.

    See Articles 10 of the Monetary Agreements with the Vatican City State and the Republic of San Marino.

  32. 32.

    Agreement between the European Community and the Swiss Confederation on Air Transport, OJEU L 114, 30 April 2002, p. 73 et seqq.

  33. 33.

    Article 4.

  34. 34.

    Article 15.

  35. 35.

    Article 20.

  36. 36.

    See Decision of the Council and of the Representatives of the Member States of the EU meeting within the Council of June 2006 (2006/682/EC), and the Multilateral Agreement, OJEU L 285, 16 October 2006, p. 1 et seqq., Articles 15, para. 3, and 20, para. 3.

  37. 37.

    Balboni (2014), pp. 407, 420 and 429–430.

  38. 38.

    Article 22 of the Agreement on the European Economic Aviation Area.

  39. 39.

    Article 3 of the Agreement on the European Economic Aviation Area.

  40. 40.

    Article 4 of the Agreement on the European Economic Aviation Area.

  41. 41.

    ECJ 12 November 2009, Case C-351/08, Grimme; 15 July 2010, Case C-70/09, Hengartner; 11 February 2010, Case C-541/08, FokusInvest.

  42. 42.

    Cit., para. 61.

  43. 43.

    Cit., para. 61.

  44. 44.

    Cit., para. 62. Baratta (2011), p. 297 et seq.

  45. 45.

    Tuori and Tuori (2014), p. 193 et seq.

  46. 46.

    Pringle ruling, cit., para. 67. See the critical remarks rightly addressed to this ruling by Munari (2015), p. 733 et seqq.

  47. 47.

    As it has been pointed out, it is “one of the most powerful high courts in the world” (Stone Sweet (2011), p. 121.

  48. 48.

    In any adjudicatory system, decision on compliance amounts to an issue of legality and legitimacy, which is vital even under international law (Huneeus 2013, p. 437 et seqq., at 440; and Kolb 2013, p. 810 et seqq., focusing on “les faiblesses de la sanction en droit international”).

  49. 49.

    Quite illustrative in that regard is the involvement of the Commission, an independent political institution, in the system of dispute settlement of the Fiscal Compact. Since the balanced budget rule (Article 3) plays a pivotal role in the architecture of that Treaty, the Contracting Parties needed to ensure its proper implementation by having recourse to a super partes assessment. See however Prete (2015), p. 81 et seqq. and 88. This author casts doubt about the effectiveness of Article 8 procedure, given the complexity of some of its wording. It should be recalled however that Article 8 is a compromise text that was hard to achieve. Moreover, complexity is not a unique feature of that provision. Unfortunately, uncertainties of legal texts are quite common in the EU secondary law for a number of reasons that cannot be summarised here (see Robinson (2014), p. 239 et seqq.; and therewith the contributions of M. Guggeis, R. Bray, R. Baratta, M. Mousmouti, H. Hanthaki and V. Voermans). It does not follow that these provisions are necessarily ineffective.

  50. 50.

    In this case Advocate General pointed out that “Since the allocation of tasks under Article 273 TFEU is dependent on a special agreement between the parties, it is moreover sufficient if the subject matter of such an agreement is related to the subject matter of the European Union Treaties. It is not a requirement that every single dispute arising from the ESM Treaty must imperatively be shown to be related to the European Union Treaties”, cit., para. 186.

  51. 51.

    This judicial remedy is instrumental to the proper application of the Stability and Growth Pact and namely to the related primary and secondary law. In that sense the balanced budget rule indeed shows a complementing link to the economic union, as Article 1, para. 1, of the Fiscal Compact further demonstrates as regards it as a whole.

  52. 52.

    See ECJ 14 December 1991, Opinion 1/91, Draft agreement between the Community, on the one hand, and the countries of the European Free Trade Association, on the other, relating to the creation of the European Economic Area, para. 61.

  53. 53.

    In these areas, leaving aside compliance with procedural rules, including the provisions of reasons, judicial control is essentially limited to assessing whether the Commission accurately stated the facts and whether manifest errors of evaluation or misuses of power occurred.

  54. 54.

    ECJ 10 June 2015, Case C-62/14, Gauweiler and others, para. 68 et seqq.

  55. 55.

    This prohibition also stems from Article 3, para. 2, TFEU, even though that provision, read with Article 216 TFEU, governs the competence of the EU for agreements with third countries or international organisations. In any case, this is the approach apparently adopted by the ECJ in the Pringle ruling, cit., para. 101.

  56. 56.

    Baratta (2013), Martucci (2016), pp. 763–764.

  57. 57.

    See however Ziller (2012), p. 115 et seqq., at 129–133; Ziller (2013), p. 609, who states that Article 8 circumvents Article 126, para. 10, TFEU; likewise, Adam (2013), p. 40. For a different perspective, de Streel and Etienne (2012), pp. 182–185, at 184; de Witte (2012a), pp. 14–17, at 17.

  58. 58.

    This is not to say that a difference cannot be made between the ECJ and other political institutions as regards the possibility to borrow the EU institutions under an international agreement (as noted by de Witte (2012b), p. 139 et seqq., at 155).

  59. 59.

    See Opinion 1/91 in which the Court noted that: “Admittedly, there is no provision of the EEC Treaty which prevents an international agreement from conferring on the Court of Justice jurisdiction to interpret the provisions of such an agreement for the purposes of its application in non-member countries. Neither can any objection on a point of principle be made to the freedom which the EFTA States are given to authorize or not to authorize their courts and tribunals to ask the Court of Justice questions or to the fact that there is no obligation on the part of certain of those courts and tribunals to make a reference to the Court of Justice” (paras. 59 and 60).

  60. 60.

    See Pringle ruling, cit., para. 170 et seqq.

  61. 61.

    See Opinion 1/09, cit., para. 82.

  62. 62.

    One could argue that for instance in the area covered by Article 273 TFEU, the ECJ is entitled to adjudicate an international dispute, which is outside the exclusive jurisdiction of the Court on disputes concerning the interpretation and application of the Treaties pursuant to Article 344 TFEU. Consequently, Member States would be empowered to confer with the ECJ but not obliged to do so. However, this perspective does not consider the underlying rationale of the ECJ involvement in inter se agreements as suggested above in the text.

  63. 63.

    See by analogy ECJ 18 October 1990, Joined Cases 297/88 and 197/89, Dzodzi, para. 37; 16 June 1998, Case C-53/96, Hermès, paras. 24–33; 14 december 2000, Joined Cases C-300/98 and 391/98, Parfums Christian Dior.

  64. 64.

    Pringle ruling, cit. para. 74.

  65. 65.

    See, in general, ECJ 10 April 1992, Opinion 1/92, Draft agreement between the Community, on the one hand, and the countries of the European Free Trade Association, on the other, relating to the creation of the European Economic Area, paras. 32 and 41; and 18 April 2002, Opinion 1/00, Proposed agreement between the European Community and non-Member States on the establishment of a European Common Aviation Area, para. 20; see also Opinion 1/09, cit. paras. 74-76.

  66. 66.

    Particularly in the case of Fiscal Compact, that approach was in principle considered viable, provided that any inconsistencies with the law and related principles of the EU (contra legem provisions) had to be avoided. The ECJ jurisprudence is clearly oriented in the sense that the effects of a multilateral mixed agreement on the bilateral relations between Member States cannot affect primary law, as well as the allocation of responsibilities defined in the treaties (see, in that regard, ECJ 30 May 2006, Case C-459/06, MOX Plant, para. 123; Opinion 1/91, cit., para. 35, and Opinion 1/00, cit., paras. 11 and 12.

  67. 67.

    Craig (2012), p. 231 et seqq.; Finscher-Lescano (2013), p. 9 et seqq.

  68. 68.

    Pringle ruling, cit., para. 101.

  69. 69.

    That seems necessary also as regards the ESM Treaty, as suggested by Munari (2015), p. 736.

  70. 70.

    See Articles 5 and 6 of the Fiscal Compact.

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Baratta, R. (2017). The Role of the ECJ Beyond EU Law. In: Daniele, L., Simone, P., Cisotta, R. (eds) Democracy in the EMU in the Aftermath of the Crisis. Springer, Cham. https://doi.org/10.1007/978-3-319-53895-2_19

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