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Published online by Cambridge University Press: 02 November 2020
Judicial review of EU soft law – Liberal-constitutionalism – Principle of effective judicial protection – The liberal-constitutional jurisprudence of the European Court of Justice – Action for annulment – Formalistic understanding of the concept of ‘legally binding effects’ – Preliminary ruling procedure – Limitations of the preliminary ruling procedure in granting effective judicial protection in relation to EU soft law – A plea for a liberal-constitutional reading of Articles 263 and 288 TFEU in relation to direct review of EU soft law
An earlier version of this paper was presented at the SoLaR Young Researchers Platform in March 2018. I would like to thank Alexander Türk, Oana Stefan, Emilia Korkea-aho and Mariolina Eliantonio for in-depth discussions on this topic. I also thank Marta Simoncini and the anonymous reviewers for their useful comments on earlier versions of this paper. Special thanks to Luigi Lonardo for his feedback along the process of writing this paper. The information included in this paper is up to date to 31 July 2020. All errors remain solely mine.
1 The notion of EU soft law is controversial. Snyder and Stefan developed a broad notion of soft law, defined as rules of conduct which, in principle, have no legally binding force but may have practical and legal effects. See F. Snyder, ‘Interinstitutional Agreements: Forms and Constitutional Limitations’, in G. Winter (ed.), Sources and Categories of European Union Law: A Comparative and Reform Perspective (NomosVerl-Ges 1996) p. 463; O. Stefan, ‘European Union Soft Law: New Developments Concerning the Divide Between Legally Binding Force and Legal Effects’, 75(5) MLR (2012) p. 279. See also F. Terpan, ‘Soft Law in the European Union – The Changing Nature of EU Law’, 21(1) European Law Journal (2015) p. 68.
2 See below.
3 O. Stefan, ‘COVID-19 Soft Law: Voluminous, Effective, Legitimate? A Research Agenda’, European Papers, European Forum, Insight of 3 June 2020, p. 1.
4 The Treaties provide for specific cases in which EU soft law may be adopted. See, for instance, Art. 36 TEU and Art. 46(6) TEU. In this respect, it is open to debate whether EU soft law allows an expansion of the regulatory powers of the EU institutions, to the detriment of member states’ competences. The potential adoption of EU soft law in any field of EU law was also acknowledged by O. Stefan, ‘Helping Loose Ends Meet? The Judicial Acknowledgement of Soft Law as a Tool of Multi-Level Governance’, 21 MJECL (2014).
5 Stefan highlights that EU Courts are also increasingly referring to EU soft law measures: O. Stefan, ‘European Competition Soft Law in European Courts: A Matter of Hard Principles?’, ⟨www.ucd.ie/t4cms/08_wish_paper_Oana_Stefan.pdf⟩, visited 13 October 2020.
6 Recent cases on EU soft law include Kotnik and Gauweiler, discussed below.
7 Tridimas has discussed the increasing uncertainty within the EU legal order: T. Tridimas, ‘Indeterminacy and Legal Uncertainty in EU Law’, in J. Mendes (ed.), EU Executive Discretion and the Limits of the Law (Oxford University Press 2019) p. 40 ff.
8 Arnull has also raised concerns regarding the review of EU soft law: A. Arnull, ‘EU Recommendations and Judicial Review – ECJ 20 February 2018, Case C-16/16, Kingdom of Belgium v European Commission’, 14(3) EuConst (2018) p. 609.
9 ECJ 27 February 2018, Case C-64/16, Associação Sindical dos Juízes Portugueses v Tribunal de Contas, para. 36.
10 It has been suggested in literature that the traditional division of state powers may not grasp the nuances of contemporary legal orders, including the international organisations such as the EU: C. Zilioli ‘Justiciability of Central Banks’ Decisions and the Imperative to Respect Fundamental Rights’, ECB Legal Conference 2017, 4-5 September 2017, p. 91.
11 R. Schütze, ‘Constitutionalism and the European Union’, in S. Peers and C. Barnard (eds.), European Union Law (Oxford University Press 2017) p. 86.
12 M. Loughlin, ‘What Is Constitutionalisation?’, in P. Dobner and M. Loughlin (eds.), The Twilight of Constitutionalism? (Oxford University Press 2010) p. 47. According to Loughlin, constitutionalism key principles are independence of the judiciary, separation of governmental powers, respect for individual rights, and the promotion of the judiciary’s role as guardians of constitutional norms.
13 US Supreme Court 24 February 1803, Madbury v Madison.
14 F.A. Hayek, Law, Legislation and Liberty, Vol. 1 Rules and Order (University Chicago Press 1978).
15 Hayek, supra n. 14, p. 1; see also V.J. Vanberg, ‘Liberal Constitutionalism, Constitutional Liberalism and Democracy’, 22 Constitutional Political Economy (2011) p. 1.
16 Hayek, supra n. 14.
17 R. Hamowy, ‘F.A. Hayek and the Common Law’, 23 Cato Journal (2003) p. 241.
18 The notion of liberal constitutionalism has been discussed also by Warren, who refers to the combination of constitutional devices – separation of powers, checks and balances, civil liberties, and civil rights – that protect against illegitimate political coercion against persons and which guarantee public influence over political decision makers. As for the previous authors, Warren’s liberal constitutionalism is also a system relying on limits to powers combined with flexible interpretation of the law, typical of common law systems: M. Warren, ‘Liberal Constitutionalism as Ideology: Marx and Habermas’, 17 Political Theory (1989) p. 511.
19 See the inclusion of the bill of rights in the US constitution, or the inclusion of the protection of fundamental rights among the objectives of the EU.
20 This is not undisputed. In the United States, fundamental rights do not apply in horizontal situations: S. Gardbaum, ‘The “Horizontal Effect” of Constitutional Rights’, 102 Michigan Law Review (2003) p. 387.
21 M. Simoncini, ‘EU Agencies in the Internal Market: A Constitutional Challenge for EU Law’ Sant’Anna Legal Studies Stals Research Paper 1/2017, ⟨www.stals.sssup.it/files/simoncini%20stals.pdf⟩, visited 13 October 2020.
22 A recently published research note by the ECJ has discussed the review of soft law in national Courts, and the challenges related to judicial control over these instruments: ⟨curia.europa.eu/jcms/upload/docs/application/pdf/2020-06/ndr-2017-007_synthese_en_neutralisee_finale.pdf⟩, visited 13 October 2020.
23 The effectiveness of current mechanisms to assert the accountability of EU institutions has recently been questioned, for instance, in relation to the supervision powers of the European Central Bank. For a discussion, see A.H. Türk and N. Xanthoulis, ‘Legal Accountability of European Central Bank in Bank Supervision: A Case Study in Conceptualizing the Legal Effects of Union Acts’, 26(1) Maastricht Journal of European and Comparative Law (2019) p. 138.
24 An example from EU law is given by the Ledra judgment, in which the ECJ declared that the Charter applies to the EU institutions when they operate under the ESM Treaty: ECJ 20 September 2016, Cases C-8/15 P to C-10/15 P, Ledra Advertising and Others v Commission.
25 E.g. the development of ‘principes généraux’ in French administrative law. A similar process has also taken place in Italian administrative law.
26 R. Arnold, ‘European Constitutional Law: its Notion, Scope and Finalities’, in A. Bakardjieva Engelbrekt (ed.), New Directions in Comparative Law (Edward Elgar 2009); J. Hunt, ‘The End of Judicial Constitutionalisation?’, 3(3) Croatian Yearbook of European Law and Policy (2007) p. 135 ff; D. Grimm, ‘The Democratic Costs of Constitutionalisation: The European Case’, 21(4) European Law Journal (2015) p. 460.
27 Both scholarship and EU case law acknowledge that the EU is a constitutional order. For EU case law, see ECJ 30 April 2019, Opinion 1/17, para. 57. Schutze has offered an analysis of the constitutionalisation and liberal-constitutionalist features of the EU; Schutze, supra n. 11.
28 E.g. ECJ Opinion 1/17 of 30 April 2019, ibid.
29 Among others, see Schultze, supra n. 11 and Arnold, supra n. 26.
30 Schultze, supra n. 11.
31 See Arnold, supra n. 26, p. 99. Constitutionalisation is the process through which a legal system not provided with a constitution acquires features of a constitutional order. This occurs, among other, through the establishment of constitutional doctrines and principles ‘to legitimise but also control […] authority’. See M. Poiares Maduro, ‘How Constitutional Can the European Union Be? The Tension between Intergovernamentalism and Constitutionalism in the European Union’, New York University Jean Monnet Working Paper No. 5/04 ⟨www.ssrn.com/abstract=1576145⟩, visited 13 October 2020.
32 ECJ 17 December 1970, Case C-11/70, Internationale Handelsgesellschaft mbH v Einfuhr-und Vorratsstelle für Getreide und Futtermittel; ECJ 18 July 2013, Case C-584/10 P, Commission and Others v Kadi.
33 ECJ 23 April 1986, Case C-294/83, Les Verts v European Parliament.
34 J.H.H. Weiler and J.P. Trachtman, ‘European Constitutionalism and Its Discontents’, 17(1) Northwestern Journal of International Law & Business (1997) p. 354.
35 T. Tridimas, General Principles of EU Law (Oxford University Press 2006); A. Cuyvers, ‘General Principles of EU Law’, in E. Ugirashebuja et al. (eds.), East African Community Law: Institutional, Substantive and Comparative EU Aspects (Brill 2017) p. 217–228.
36 The famous Kadi saga has shown the power of EU fundamental rights, which are to be complied with by the Council with issuing restrictive measures against individuals. See, in particular, Commission and Others v Kadi, supra n. 32
37 E.g. ECJ 15 May 1986, Case C-222/84, Johnston v Chief Constable of the Royal Ulster Constabulary; ECJ 22 November 2005, Case C-144/04, Mangold v Rüdiger Helm.
38 This view finds confirmation in the literature: T. Tridimas, ‘The General Principles of Law: Who Needs Them?’, 52(1) Cahiers de droit européen (2016) p. 419; C. Amalfitano, General Principles of EU Law and the Protection of Fundamental Rights (Edward Elgar 2018) p. 147 ff.
39 Juízes Portugueses case, supra n. 9. In this case, the Court of Justice interpreted the content of the general principle of effective judicial protection in the light of Art. 47 Charter, protecting, among others, the principle of judicial independence. Another case in which a general principle of EU law was strengthened by the presence of the Charter is Test-Achats ASBL (ECJ 1 March 2011, Case C-236/09, Association belge des Consommateurs Test-Achats ASBL, Yann van Vugt, Charles Basselier v Conseil des ministers). The Court found that national legislation providing for derogations to the EU principle of equal treatment for a potentially indefinite duration was not compatible with Arts. 21 and 23 of the Charter.
40 E.g. ECJ 8 November 2016, Case C-243/15, Lesoochranárske zoskupenie VLK v Obvodný úrad Trenčín; ECJ 26 July 2017, Case C-348/16, Sacko v Commissione Territoriale per il riconoscimento della Protezione internazionale di Milano.
41 This latter provision specifies that the Charter may be invoked against the member states whenever they are implementing EU law. Yet, the EU case law indicates that the Charter may be invoked against member states subject to the condition that national measures fall within the scope of EU law, without a strict interpretation of the implementation requirement. ECJ 23 February 2013, Case C-617/10, Åklagaren v Hans Åkerberg Fransson.
42 An example on the reach of the Charter in relation to national provisions which are not strictly implementing EU law is provided by the case law regarding member states’ procedural rules. See Sacko, supra n. 40.
43 Les Verts, supra n. 33.
44 Les Verts, supra n. 33, para. 23.
45 ECJ 22 May 1990, Case C-70/88, European Parliament v European Communities (Chernobyl case).
46 Chernobyl, supra n. 45, para. 21 ff. Both institutional balance and separation of powers are acknowledged to be aspects of the rule of law; e.g. R. Bellamy (ed.), The Rule of Law and the Separation of Powers (Routledge 2005); J. Alder, ‘Constitutionalism: The Rule of Law and the Separation of Powers’, in J. Alder (ed.), Constitutional and Administrative Law (Macmillan Education UK 1999) ⟨https://doi.org/10.1007/978-1-349-15077-9_4⟩ visited 14 October 2020.
47 ECJ 25 July 2002, Case C-50/00, UPA v Council, para. 38.
48 Emphasis added.
49 Juízes Portugueses, supra n. 9.
50 ECJ 31 March 1971, Case C-22/70, Commission v Council (ERTA), para. 42. It should be pointed out that the application for annulment of the act in question was rejected in so far as the Court of Justice found that the Council had not breached its duties under Community law.
51 This means that whenever the member states had attributed to the EU the duty to attain a certain goal, the EU institutions should have the relevant powers. This interpretation of the implied powers doctrine has been embraced in the ECJ 9 July 1987, C-281/85, Germany v Commission. A narrow reading of the implied powers doctrine provides that the provision of a given power in the Treaties entails the existence of any other power that is reasonably necessary for the exercise of the former: ECJ 16 July 1956, Case C-8/55, Fédération Charbonnière de Belgique v High Authority. For an analysis of the codification of the EU case law on the implied powers’ doctrine, see T. Konstandinides, ‘EU Foreign Policy under the Doctrine of Implied Powers: Codification Drawbacks and Constitutional Limitations’, 39(4) EL Rev (2014) p.1.
52 Stefan, supra n. 3.
53 The exact reference period is from 1 January 2019 to 8 June 2020. Data available at ⟨https://eur-lex.europa.eu/search.html?orFM_CODEDGroup=FM_CODED%3DRECO,FM_CODED%3DOPIN&qid=1598262303778&DTS_DOM=EU_LAW&typeOfActStatus=OTHER&type=advanced&lang=en&SUBDOM_INIT=LEGISLATION&date0=ALL:01012019%7C08062020&DTS_SUBDOM=LEGISLATION⟩, visited 13 October 2020.
54 Communication COM(2020) 112 final of 13 March 2020, from the Commission on a coordinated economic response to the COVID-19 outbreak.
55 European Commission, European Council, The Joint European Roadmap towards lifting COVID-19 containment measures; Council, Roadmap for Recovery, ⟨www.consilium.europa.eu/media/43384/roadmap-for-recovery-final-21-04-2020.pdf⟩, visited 13 October 2020.
56 Snyder, supra n. 1; Stefan, supra n. 1.
57 In Grimaldi, the Court has explained the circumstances in which recommendations may be adopted: they ‘are generally issued by the institutions of the Community when they do not have the power under the Treaty to adopt binding measures or when they consider that it is not appropriate to adopt more mandatory rules’: ECJ 13 December 1989, Case C-322/88, Grimaldi v Fonds des maladies professionnelles.
58 Interestingly, the EU judicature has considered these acts as deprived of legally binding effects. See below.
59 Art. 256 TFEU.
60 Art. 263 TFEU. The previous versions of this article do not contain any difference in this respect.
61 See below.
62 ERTA, supra n. 50.
63 ERTA, supra n. 50, para. 42.
64 ECJ 19 March 1996, Case C-25/94, Commission of the European Communities v Council of the European Union.
65 ECJ 16 June 1993, Case C-325/91, French Republic v Commission of the European Communities.
66 French Republic v Commission of the European Communities, supra n. 65, para. 9.
67 ECJ 11 November 1981, Case C-60/81, IBM v Commission.
68 GC 28 February 2017, Cases T-192/16, T-193/16 and T-257/16, NF and Others v European Council.
69 GC 16 October 2014, Case T-327/13, Mallis and Malli v Commission and European Central Bank and GC 28 June 2018, Case T-147/15, Czech Republic v Commission.
70 ECJ 10 February 2018, Case C-16/16, Belgium v Commission (appeal).
71 NF and Others v European Council, supra n. 68.
72 NF and Others v European Council, supra n. 68, para. 42.
73 ECJ 12 September 2018, Case C-208/17 P to C-210/17 P, NF and Others v European Council.
74 Mallis and Malli, supra n. 69.
75 Para. 15.
76 Para. 52.
77 ECJ 20 September 2016, Case C-105/15 P to C-109/15 P, Mallis and Others v European Commission and European Central Bank.
78 Para. 58.
79 Czech Republic v Commission, supra n. 69.
80 Para. 35.
81 Para. 35.
82 Para. 49.
83 ERTA, supra n. 50.
84 Case C-575/18, Czech Republic v Commission (pending).
85 Belgium v Commission (appeal), supra n. 70; Arnull, supra n. 8.
86 GC 27 October 2015, Case T-721/14, Belgium v Commission (first instance).
87 ECJ 13 February 2014, Case C-31/13 P, Hungary v Commission, para. 55.
88 Emphasis added.
89 Belgium v Commission (first instance), supra n. 86, para. 29.
90 ERTA, supra n. 50.
91 Les Verts, supra n. 33.
92 This category of acts was not included under Art. 173 EEC.
93 Paras. 42–43.
94 This approach might indicate that the Court is refusing to uphold the legitimacy of EU soft law, suggesting that member states and other operators are not bound by EU soft law measures.
95 ERTA, supra n. 50.
96 This was also acknowledged by Stefan, supra n. 4.
97 ECJ 28 June 2005, Case C-189/02, Dansk Rørindustri e.a. v Commission.
98 Stefan, supra n. 4.
99 Simoncini has offered a discussion of the judicial review of EU soft law measures, and concurs with the view that there is a gap in the judicial review of these acts: M. Simoncini, Administrative Regulation Beyond the Non-Delegation Doctrine (Hart Publishing 2018) p. 164.
100 The success rate of these actions is, however, limited by the complex judicial tests developed by the EU Courts to prove the subsistence of a damage. For a discussion on the case law on damages, see G. Gentile, ‘The ECJ as the EU Court of Appeal: Some Evidence from the Appeal Case-Law on the Non-Contractual Liability of the EU’, 13 Review of European Administrative Law (2020) p. 73.
101 There is ample debate on the nature of the Memorandum of Understanding. There is overall consensus that they have features of soft law in selected instances: T. Konstadinides and A. Karatzia, ‘The Legal Nature and Character of Memoranda of Understanding as Instruments Used by the European Central Bank’, 44(4) European Law Review (2019) p. 444; Ledra, supra n. 24.
102 Art. 267 TFEU.
103 Art. 277 TFEU. The ECJ is currently deciding an appeal concerning the alleged liability of the Euro Group for the issuance of public statements in the context of the bail-in of Cypriot Banks: Case C-597/18, Council v K. Chrysostomides & Co. and Others (pending).
104 A. Türk, ‘Liability and Accountability for Policies Announced to the Public and for Press Releases’, ECB Legal Conference (2017) ⟨https://www.ecb.europa.eu/pub/pdf/other/ecblegalconferenceproceedings201712.en.pdf⟩, visited 13 October 2020.
105 Ibid., p. 53.
106 In the context of this procedure, the ECJ has declared to have competence to also interpret non-mandatory instruments: ECJ 21 January 1993, Case C-188/91, Deutsche Shell AG v Hauptzollamt Hamburg-Harburg.
107 ECJ 27 October 2016, Case C-613/14, James Elliott Construction v Irish Asphalt Ltd.
108 ECJ 16 June 2015, C-62/14, Peter Gauweiler and Others v Deutscher Bundestag.
109 Para. 23.
110 Economic growth is one of the objectives of the EU.
111 Para. 54.
112 Remarkably, there is overall uncertainty as to the legal effects of these acts, in particular in the EU case law. In the jurisprudence from member states, we may find cases where instead EU soft law instruments are relied upon. For a study on this topic, see G. Zlatina, ‘Competition Soft Law in National Courts: Quo Vadis?’ Tilburg Law and Economics Centre Discussion Paper No. 2016-038 (2016).
113 Dansk Rørindustri, supra n. 97.
114 ECJ 13 December 2012, Case C-226/11, Expedia v Autorité de la concurrence and Others.
115 ECJ 13 December 1989, Case C-322/88, Salvatore Grimaldi v Fonds des maladies professionnelles.
116 ECJ 30 September 2016, Case C-526/14, Kotnik and Others v Državni zbor Republike Slovenije.
117 Expedia, supra n. 114.
118 See Grimaldi, supra n. 115 and Dansk Rørindustri, supra n. 97.
119 E.g. NF and Others v European Council, supra n. 68; Belgium v Commission supra n. 90.
120 For a detailed analysis of the notion of legal effects, see N. Xanthoulis, ‘Administrative Factual Conduct: Legal Effects and Judicial Control in EU Law’, 12 Review of European Administrative Law (2019) p. 39.
121 ECJ 27 November 2012, Case C-370/12, Pringle v Ireland, paras. 41-43.
122 Grimaldi, supra n. 115 and Dansk Rørindustri, supra n. 97.
123 Grimaldi, supra n. 115. However, Kotnik seems to have revised this case law, supra n. 116.
124 E.g. GC 15 March 2006, Case T-15/02, BASF v Commission; Dansk Rørindustri, supra n. 97, para. 211
125 For an analysis of the legal effects of the national measures implementing EU soft law, see G. Gentile, ‘“Verba Volant, Quoque (Soft Law) Scripta?” An Analysis of the Legal Effects of National Soft Law Implementing EU Soft Law in France and the UK’, in M. Eliantonio et al. (eds.), EU Soft Law in the Member States: Theoretical Findings and Empirical Evidence (Hart Publishing, forthcoming).
126 It is true that the ECJ has recognised the retroactive nature of preliminary ruling judgments. Yet, the Court has also not missed opportunity to mitigate this position and envisage the possibility to limit the ex tunc effects of preliminary rulings. ECJ 26 April 1994, Case C-228/92, Roquette Frères v Hauptzollamt Geldern; as well as the earlier judgment ECJ 15 January 1986, Case 41/84, Pinna v Caisse d’allocations familiales de la Savoie.
127 E.g. Arts. 48, 75, 78 TFEU.
128 Art. 19 TEU.
129 A list of possible legal effects of EU soft law is provided in Snyder, supra n. 1.
130 An interesting element of comparison is offered by national case law. After an initial period of resistance against the judicial review of soft law issued by national authorities, national courts are also engaging in scrutiny of these measures. See Directorate-General for Library, Research and Documentation of the European Court of Justice, ‘Admissibility of Court Actions Against “Soft” Law Measures’ (June 2017) ⟨https://curia.europa.eu/jcms/upload/docs/application/pdf/2020-06/ndr-2017-007_synthese_en_neutralisee_finale.pdf⟩, visited 13 October 2020.
131 For a discussion on the limited risks related to a more relaxed standing for individuals in the action for annulment, see A. Parfouru, ‘Locus Standi of Private Applicants Under the Article 230 EC Action for Annulment: Any Lessons to be Learnt From France?’, 14 Maastricht Journal of European and Comparative Law (2007) p. 364; M Rhimes, ‘The EU Courts Stand Tehri Ground: Why are the Standing Rules for Direct Actions Still So Restrictive?’, 9(1) European Journal of Legal Studies (2016) p. 156.
132 Ibid.
133 See M. Eliantonio et al., ‘Standing Up for Your Right(s) in Europe’ (2012) available at ⟨www.europarl.europa.eu/RegData/etudes/etudes/join/2012/462478/IPOL-JURI_ET(2012)462478_EN.pdf⟩, visited 13 October 2020.
134 This view is shared by the Venice Commission, ⟨https://rm.coe.int/respect-for-democracy-hu-man-rights-and-rule-of-law-during-states-of-e/16809e82c0⟩, visited 13 October 2020.
135 D. Curtin, ‘Linking ECB Transparency and European Union Accountability’, ECB Legal Conference 2017, 4–5 September 2017, p. 86.
136 Art. 19 TEU.
137 Lenaerts and Fons-Gutierrez have recently addressed the question of whether the Court of Justice of the EU is a judicially active Court. See K. Lenaerts and J.A. Gutiérrez-Fons, Les méthodes d’interprétation de la Cour de justice de l’Union européenne (Bruylant 2020) p. 61 ff.
138 It could even be argued that EU soft law would be subject to constitutionalisation, as the powers expressed therein would be put under judicial control. More broadly, constitutionalisation of EU soft law would ensure respect of the rule of law in the EU, whose essence is expressed through effective judicial review.