Not Above the Law

Ezio Perillo 2021-12-13T18:45:44

In the joined cases EMA and ELA on the determination of EU agencies’ seats,
a decision of the EU-Court is pending very soon. According to AG Bobek’s
opinion, delivered on 6 October 2021, the decisions that the governments of
the Member States take by mutual agreement for determining the seats of the
European agencies seem to fall outside the EU Court’s judicial review. Following
the Sharpston-Council orders, which declared the former British Advocate General’s
action against the appointment of a new AG inadmissible, there seems to be a
pattern of refraining from judicial review of intergovernmental decisions.

I will say right away, in a tweet-fashion, that I cannot agree with this solution. The
Court has the duty to assure the effective judicial protection also in relation to
intergovernmental decisions when they do not respect the institutional balance as in
the present case.

Determining the seats of the institutions and

agencies: two different procedures
In November 2017, the governments of the EU Member States selected Amsterdam
as the new location for the seat of the European Medicines Agency (EMA) instead
of London. In June 2019, they decided that the newly founded European Labour
Authority (ELA) would have its seat in Bratislava. The Italian Republic, the City
of Milan and the European Parliament challenged these decisions before the
European Court of Justice. According to AG Michal Bobek, however, he Court has
no jurisdiction under Article 263 TFEU over intergovernmental decisions, as these
decisions are taken “outside the framework of the Treaties“ (paragraph 173).

There is no specific provision of EU law on the seats of European agencies similar

to that of Article 341 TFEU, according to which “the seat of the institutions of the
Union shall be determined by common accord of the governments of the Member
States”. And contrary to the Council’s opinion, Protocol No. 6 did not extend the
scope of Article 341 TFEU to include the location of the seats of agencies. Unlike all
the other 36 Protocols annexed to the Treaty (the introductory line of which is „The
High Contracting Parties … have agreed“), Protocol No. 6 begins with the words
„The representatives of the Governments of the Member States“, i.e. legal entities
which, in principle, are not entitled to adopt Protocols or amend or interpret the
Treaties. Protocol No. 6 therefore remains a mere implementation act pursuant to
Article 341 TFEU and can in no way constitute an appropriate legal source allowing
for an extensive interpretation of this article to include the location of the agencies.

The general competence for establishing European agencies is entrusted, on

a sector-by-sector basis, to the European Parliament and the Council, as EU
lawmakers, and, in a specific case, solely to the Council. Article 45 TEU, states

-1-
specifically that the „statute, seat and operational rules” of the European Defence
Agency are established by the Council and, therefore, not by the governments of the
Member States (see, in this regard, also the current Articles 85(1) and 88(2) TFEU
on Eurojust and Europol).

It follows that, according to the Lisbon Treaty, the basic, general rule is: „who has
the authority to establish an agency (the European Parliament and/or the Council),
has the authority to determine its seat as well“. In the cases of EMA and ELA, these
institutions had therefore the right to determine these agencies’ seats.

The set-up of the EU institutions: an inter-

governmental or a European matter?
Taking a look at the Sharpston-orders can help to understand the classification
problem of intergovernmental decisions in the EU. Here, too, the Court of Justice has
declared itself not competent because the decision to appoint members of the EU
Court appeared to have been taken outside the framework of the Treaties.

Ever since the Maastricht Treaty, the authority to appoint the members of the
institutions has moved from national governments, whose power was originally
recognized under the ECSC and EEC Treaties, to the EU institutions, which have
gradually been empowered of the relevant appointment procedures at an “EU level”.
Today, only the members of the European Council and the Council of the European
Union are appointed at national level. The appointments of members of all the other
institutions are exclusively of „EU origin“, i.e. decided by the competent European
institutions.

Alas, all the others except for one: the Court of Justice. The members of the EU
Court and the EU General Court are appointed through intergovernmental decisions.
The members of the specialised courts are, instead, directly appointed by the
Council, as an EU institution (see Art. 257 TFEU).

Sovereign decisions or obligations of European

origin?
The Masters of the Treaties, with the expression “by mutual agreement” in Article
255 TFEU, did not intend to leave the power to appoint the members of the EU
Court or the Commission to the free will of their governments. Article 253 TFEU,
for instance, currently provides that “every three years there shall be a partial
replacement of the Judges and Advocates-General”. Exactly a three-year term! Not
one that suits the respective governments best.

„The Community is a legal order and not a mere arrangement founded on

convenience“, stated Robert Lecourt, the eminent president of the EU Court, back
in 1976, pointing his finger at certain governments lagging behind. Indeed, „the
institutional provisions of the Treaties [those relating, in this case, to the appointment

-2-
of the EU judges], and the dates when they are to be applied are binding and leave
1)
no room for discretion“. See, Curia, Formal Hearings, 1976, p. 27.

The same, I would say, applies to the decision on the seats of the institutions.

In the process of fulfilling these obligations by mutual agreement, national

governments are therefore acting “collectively”, i.e. in their own name and on behalf
of the Masters of the Treaties, although in the exclusive interest of the Union. In this
regard, these decisions are „atypical Union law acts“.

The notion of “institutional balance” and the broad

interpretation of Article 263 TFEU
In its Post-Chernobyl judgment of 1990, the EU Court, reversing its own initial
case-law, stated that judicial review was required to „ensure preservation of the
institutional balance”, because this entails protecting the prerogatives which the
Treaties expressly have conferred on each of the institutions (paragraphs 21-23).
Thus, „the absence in the Treaties of any provision giving the Parliament the right to
bring an action for annulment may constitute a procedural gap, but it cannot prevail
over the fundamental interest in the maintenance and observance of the institutional
balance laid down in the Treaties“ (paragraph 26).

It follows that the list of challengeable acts in Article 263 TFEU, just like the list of
persons entitled to bring an action, is not comprehensive.

In the Sharpston, EMA and ELA cases, the acts challenged before the Court were
not acts by the institutions, as in Post-Chernobyl, but decisions taken, upon common
accord, by the national governments. But even considering this important difference,
I believe that our jurisprudential framework remains unchanged, which means that
these inter-governmental decisions are also subject to judicial review when they do
not respect, prima facie, the institutional balance.

Observance of the EU institutional balance is in fact an “autonomous” European

legal principle, which “requires that it should be possible to penalize any breach of
that rule which may occur“ (paragraph 22). Constitutionally speaking, institutional
balance means “separation of powers”, i.e. a legal system governed by constitutional
“checks and balances”. So, if it is for the institutions and the national governments
to respect the “EU Treaties balances”, it is for the EU Court to assure the due “EU
checks”.

Three examples of intergovernmental decisions

Let’s suppose that the governments of the Member States were to appoint, upon
common accord, not only some judges of the EU Court or of the EU General Court
(articles 253 and 254 TFEU), but, during the same intergovernmental meeting, also
certain judges of a specialised court.

-3-
The difference is obviously not formal. The decision to appoint the judges of a
specialised court is a decision of the Council, as such, and must be subject to an
action for annulment pursuant to Article 263 TFEU. On the contrary, any “all-in-one”
appointment decision by the national governments would not, at least on paper (or
according to the nomen auctoris criterion), be included among the acts specifically
provided for by that article.

The EMA and ELA cases are not much different.

In these cases, the national governments have in fact decided to set up the seat of
two EU agencies despite Article 341 TFEU verbatim providing such power only for
determining the seat of the EU “institutions”.

In these cases, the institutional balance has clearly not been observed, the Post-
Chernobyl judgment so dixit.

Ultimately, the national governments, acting in compliance with the obligations

referred to in Articles 253 and 341 TFEU, i.e. in “the fields covered by Union
law” (Article 19 TEU), are fully subject to the EU Court’s complete judicial review
process. And, in that context, it belongs only to the EU Court to ensure the crucial
“effective judicial protection” (Article 19 TEU) against breach of the institutional
balance at stake. Otherwise, such decisions would be deprived of any kind of judicial
review, since no other Court, whether national or international, such as the European
Court of Human Rights, could legitimately hold jurisdiction over the legality of EU
collective national governments acts.

This same conclusion shall also be drawn in cases where such governments
surreptitiously „claim“ entitlement to act under Article 341 TFEU when it comes to
setting up the seat of an agency, when in fact this is a prerogative, jure Unionis, of
the competent institutions of the Union.

In the interest of the Union

Observance of the institutional balance is a general rule designed to ensure the
proper functioning of the entire system for the distribution of competences created
within the Union’s legal system. Accordingly, “any breach of that rule” hast to be
subject to a sanction by the EU Court for the purpose of ensuring an “effective legal
protection”, notwithstanding any procedural shortcomings of Article 263 TFEU.

Ultimately, the combination of these two factors – observance of the institutional

balance and effective judicial protection – also strengthens the legality of Article 253,
254 and 341 TFEU decisions taken by common accord by the national governments
which, in Union law, cannot constitute “les faits du prince”, as, on the contrary, they
are acts taken in the exclusive interest of the Union and which must therefore be
adopted in compliance with rule-of-law and democracy values on which the entire
legal structure of the Union is built.

References

-4-
• See, Curia, Formal Hearings, 1976, p. 27.

-5-