Do the EU’s rules on standing square up to the principle of effective judicial protection? – Michael Rhimes

10 October 2016 by

scales of justice Old BaileyUnderstanding Standing: Post 3 of 3 of Article 263(4) TFEU

This is a final post in a series of three on standing in EU law. It will focus on whether the present position under Art 263(4) TFEU satisfies the principle of effective judicial protection.

Part I) Effective judicial remedies.

Effective judicial protection is of a long pedigree. We can trace an embryonic form of this right in the Magna Carta of 1215 which provides, in Article 29, that “no freeman is to be taken or imprisoned or disseised of his (…) liberties (…) save by lawful judgment of his peers or by the law of the land. To no-one will we sell or deny or delay right or justice” (See also Arts 11 to 13). It also emerged fairly early on in the jurisprudence of the European Union in the mid-1980s, with the CJEU starting to toy with the idea that the effectiveness of EU law could impose certain obligations at the domestic level in order to ensure that effectiveness, Case C-14/83 Von Colson and more famously Case C-410/92 Johnson. The principle can now can be found enshrined in Art 47 of the Charter, as follows: 

Right to an effective remedy and to a fair trial

Everyone whose rights and freedoms guaranteed by the law of the Union are violated has the right to an effective remedy before a tribunal in compliance with the conditions laid down in this Article. (…)

This Charter has equal status to the other two Treaties constituting the EU, the TEU and TFEU (see TEU, Art 6(1)) Thus, as has been stressed on many an occasion, the very applicability of EU law entails the applicability of the fundamental rights guaranteed by the Charter. In other words, effective judicial protection is a fundamental postulate of EU law – where there is EU law there must be effective judicial protection. 

Part II) National procedural autonomy.

What does effective judicial review have to do with standing and Art 263(4)? This requires a short detour. The EU operates on a decentralized model of enforcement. The EU provides certain rights, like, for example, those contained in anti-discrimination legislation or consumer protection. EU law thus grants Mr and Mrs Smith the right to equal pay for equal work; and it grants Mr Jones protection against certain abusive contracts. But it is up to the national courts to provide the remedies. It is these national courts who decide, for example, on the levels and modalities of compensation for Mrs Smith who claims to be discriminated on the basis of her gender, or on the consequences of Mr Jones’ contract falling foul of the abusive contract provisions. They, for example, will decide if Mrs Smith was indeed performing work of equal value to Mr Smith, or whether Mr Jones’ contract was void or merely voidable. This, in Eurospeak, is known as “national procedural autonomy”. 

Part III) National procedural autonomy and the principle of effectiveness.

However, national procedural autonomy is only half of the picture. In the scope of EU law, the fundamental principles consecrated in the Charter must be upheld. Therefore, the remedies provided by national courts, as per Art 47 of the Charter, must be effective.

This is powerful stuff. Why? In short, because it is a crowbar into national jurisdictions. Effective judicial protection thus circumscribes national procedural autonomy, and allows the CJEU to ensure that the EU rights are given practical effect. It may therefore require the UK to set aside national legislative limits on the amount compensation available to Mrs Smith where they prevent her from recovering, in full, the loss she suffered as a result of having been discriminated against (Case C-271/91 Marshall II). It may also require those courts to disregard time limits on bringing an action in relation to an abusive contract (Case C-63/08 Pontin on other facts). Thus, national procedural autonomy is subject to the principle of effectiveness. (It is also subject to equivalence – the vindication of EU rights cannot be made any more difficult than the exercise of like national rights. But we can leave this to one side.) 

The principle of effectiveness is thus a guillotine (to move on from the crowbar metaphor), on which many domestic norms have met their end. A good example is Case C-279/09 DEB. In Germany, the provision of legal aid in the Constitution was restricted to natural persons. As a result, DEB, an indigent company (a legal person) could not bring a case against the German state for economic loss allegedly suffered by reason of Germany failing to timeously implement a Directive. The CJEU found that a blanket exclusion of legal persons from legal aid constituted a violation of the principle of effective judicial protection. This was because it hampered DEB from bringing a claim to obtain redress for a breach of EU law (Germany’s failure to implement the Directive). Note that the national provision in question was not any humble national provision. It was the German Constitution, which reflected a particular understanding of legal aid as an emanation of the human nature of dignity. This necessarily excluded the granting of aid to companies. The principle of effectiveness could be used to “trump” a constitutional. Powerful stuff indeed. 

Unsurprisingly, effective judicial protection is not confined to legal aid, as in DEB. It has also been used to require the giving of reasons by domestic courts; the setting aside of strict limitation periods for bringing EU-related claims; to do away with limits on certain forms of remedies; to dissolve legislative ceilings on compensation and the award of interest; and, you guessed it, standing. Thus in Case C-12/08 Mono Car Styling the CJEU held that even though it is for national law to determine an individual’s standing, Union law nevertheless requires that the national legislation does not undermine the right to effective judicial protection.

Part IV) Judicial Effectiveness and EU standing.

So does Art 263(4) respect the principle of effectiveness? It is worth separating the analysis along two lines, the first focusing on the “Dilemma” we saw in Post II and the second focusing more broadly on whether indirect actions can truly safeguard judicial protection where a direct action is unavailable.

A: Judicial Protection and the Dilemma.

The Dilemma, as we saw above, is that some parties may have to break the law in order to challenge it. They would be placed in the invidious position where they would have to choose to break the law (not good) or suffer compliance with a potentially unlawful norm (also not good). This would occur when the challenge measure was self-executing, such that there were not national measures that could be challenged in domestic courts, and, therefore, no possibility of challenging the norm in front of the EU Courts. An aggrieved party would have to break the law, and challenge the contested measure in subsequent administrative or criminal proceedings flowing for breaking the law. This, as we have seen, falls short of the principle of effective judicial protection by the CJEU’s own admission in Case C-432/05 Unibet.

Is this Dilemma a thing of the past? No, it is not. It crops up in two areas:

  1. Self-executing legislative measures. First, legislative measures fall outside the scope of the third head and therefore are subject to the restrictive pre-Lisbon position. The Dilemma can therefore still arise in respect of legislative self-executing measures, like the one at issue in Case C-50/00 P Unión de Pequeños Agricultores (See the end of Post II).
  2. Where it is not possible to challenge the so-called “implementing measures”. Second, the Dilemma also arises where there, in practical terms, are no implementing measures that can be feasibly challenged in the national courts, but the CJEU nonetheless finds that the contested measure does entail implementing measures. If this seems strange, it is because it is. Recall that the CJEU has defined implementing measures very broadly. So broadly, in fact, that a party might not be able to challenge the vestigial implementing measures in domestic courts. A good example is Case C‑456/13 P T and L which we saw in Post II. Recall, further, that the CJEU held that there were implementing measures because the national authorities had to grant certificates in accordance with the detail of the sugar import scheme. It did not seem that the Portuguese legal system would have allowed them to challenge the granting of certificates unless the individual certificate was ultra vires the national authority’s power. This was not the case – the parties were not saying that national authorities were not carrying out the tariff scheme faithfully, they were attacking the legality of the scheme itself. Indeed, it seemed to have been accepted by the General Court Case T‑279/11 T and L (here at [63] and [65]) that the claimants could not challenge any of the implementing measures before the national courts. So they could neither bring an indirect challenge nor a direct challenge.

At this point, the reader must be thinking that the principle of effective judicial protection will save the day, as it would do if a comparable situation were to manifest itself in a domestic context in the scope of EU law. Spoiler: It does not. Although it is powerful stuff in relation to Member States – it seems less so in relation to the EU legal order. To push the guillotine metaphor, the judicial executioners in Luxembourg are far more squeamish when their own norms are up for the chop. Three arguments lie behind this.

1. “There is no Dilemma”

First, the Courts deny that the Dilemma exists. It is explained that the litigants aggrieved by an act that has no domestic implementing measures could simply contact the national authorities and get them to confirm that the act in question applied to those litigants. The litigants could then contest this confirmation in domestic courts. It was put thus by Advocate General Kokott in her Opinion for Inuit, after stating that having to break the law to challenge it falls short of judicial protection:

  1. […] However, such a situation [where a party must break the law to challenge it] is not to be feared in the system of the European Treaties with regard to EU legislative acts.
  2. Normally (…) it will fall to national authorities to monitor observance of (…) an EU legislative act. An individual is then free to write to the competent authority (…) and to request confirmation that the requirement or ban in question is not applicable to him. [This would be] open to review by national courts, which in turn may (…) refer the question of the validity of the underlying European Union act to the Court for a preliminary ruling.

So according to the soothing words of AG Kokott, we have nothing to fear – the Dilemma does not exist. You just need to write a letter to the national authorities.

The problem with this argument is that it seems to assume that in all 28 Member states, and in all cases, it would be possible to obtain and judicially review such acts. This is a tall order. And, indeed, as above, the cases suggest that there are still situations where the beastly Dilemma rears its head. It is difficult to adopt Kokott’s sanguine view as to the Dilemma’s extinction.

2. “We can’t solve the Dilemma”

There are two aspects to this.

Institutionally, the Courts cannot allow a direct challenge when the Dilemma arises. Why? Because the EU Courts would have to verify in each case whether the party truly had no ability to bring the case before their national court. The EU Courts are not competent to carry this out; they deal with EU law not domestic law.

Jurisdictionally, the Courts cannot ignore the admissibility criteria in Art 263(4). The second or third head must be satisfied – there is no residual head of standing for exceptional cases where the Dilemma arises. The principle of judicial protection cannot override the Treaty text. Any other view would force the Courts out of the bounds of their jurisdiction.

To some extent, these are fair points. But relaxing the standing requirements does not necessarily mean forging a residual head of standing for those parties caught on the horns of Dilemma. There are many other ways of relaxing the interpretation of the standing rules, as we have seen in the second Post. The italics are key. Jettisoning the text of Art 263(4) is not required, all that is required is a re-interpretation of the Court’s previous jurisprudence. Their interpretation is not ineluctably ordained by the Treaties, and the case-law is always open for modification.

I further stress that, the CJEU has, in the past, been willing to ignore the text of previous version of Art 263 to broadening standing rules. And, at any rate, it is not unfair to point out that the CJEU’s jurisprudence has not been marked with fastidious concern for respecting the textual limits of its own jurisdiction. It has been more than willing to adopt interpretations that have expanded its powers in other areas. The Courts’ sudden meekness in the face of accusations of ultra vires is difficult to understand.

To that extent, these arguments are unconvincing.

3. “It is not our job to solve the Dilemma”.

The Court repeatedly argues that the Dilemma does not require greater laxity in the admissibility criteria for direct actions; it can, and should, be solved by requiring national courts to interpret their procedural law to facilitate access to domestic courts. In effect, the Dilemma should be solved at the national level (i.e. by facilitating indirect challenges) rather than at EU level (through direct challenges) In so arguing, the courts often point to the new paragraph of Art 19(1) of the TEU, which reads that “Member states shall provide remedies sufficient to ensure effective legal protection in the fields covered by Union law”.

Again this is unconvincing. If the solution for the Dilemma were to be found at national level, then why bother adding an extra head to Art 263(4) in the Lisbon treaty? If all is hunky-dory when access to national courts is guaranteed, then there would be no need to expand the heads of standing in the Treaty of Lisbon. But this flies in the face of the understanding of the framers of the Lisbon Treaty, and the lessons from the half century of jurisprudence since C-25/62 Plaumann At any rate, it is questionable whether national courts can seize on Art 19(1) TEU to fashion access to domestic courts. As per Case C-583/11 P Inuit

neither the FEU Treaty nor Article 19 TEU intended to create new remedies before the national courts to ensure the observance of European Union law other than those already laid down by national law.

Quite what processes of legal alchemy, juridical zymurgy, or Treaty sorcery or combination thereof are to be required of a domestic jurisdiction in order to create access to national courts I do not know; but it is certainly a tall order to locate a universal solution to the Dilemma in 28 member states off the back of a general provision like Art 19(1) TEU – which, I add, makes no mention of standing, let alone national courts.

B: Judicial Protection and Indirect actions

What exactly would the principle of effectiveness require in relation to Art 263(4)?

As we have seen, the Court assumes the effectiveness of the Treaties because it is possible to bring indirect challenges through Art 267. The mere fact Art 267 exists seems to satisfy the needs of effectiveness.

But what would the CJEU say to a domestic court who argued that the fact that route A to enforce a parties’ rights was blocked did not matter because there was a route B which could also vindicate those rights – albeit in a more roundabout manner. This is exactly the situation we have here: the CJEU is saying that effectiveness is upheld because when direct actions (Route A) are not available, indirect challenges available under Art 267 (Route B). In short, is the principle of effectiveness upheld when a motorway was jammed but there are little country lanes that will still get you there?

The Court has given an answer to this in Case C-326/96 Levez. The UK legislation stipulated that claims for gender-based pay discrepancies could not result in more than two year’s worth of back salary in compensation, when such claims were brought in the Industrial Tribunal. Mrs Levez , however, was duped to as the salaries of her male counterparts and, therefore, only realized that she was paid less some time after. That said, although she could not bring a statutory claim in the Industrial tribunal for the salary dating back before two years, she could have brought a claim for fraud in the County Court (to which the above rule did not apply) to recover those arrears. The question was whether this satisfied the principle of effectiveness.

The CJEU, evidently, under the principle of national procedural autonomy left the final determination to the UK courts. But it explicitly directed the UK courts to consider the additional cost, delay and difficulty in bringing proceedings for fraud in the County Court.(See also, of this year, C‑184/15 and C‑197/15 Andrès [59] to [63] where the Spanish court was directed to consider questions of cost, duration and rules of representation). The UK courts were also directed to “take into account the role played by that provision in the procedure as a whole, as well as the operation and any special features of that procedure before the different national courts”.

Yet no similar analysis is ever carried out by the CJEU as to whether the Art 267 procedure of indirect enforcement are as effective in terms of their cost, duration and other features that would be required of national courts.

Consider the following, in response to a claim that the present restrictiveness of the standing rules in Art 263(4) is contrary to the principle of effective protection (Case T-174/11, Modelo Continente Hipermercados): (See also the citation from Telefonica in the first Post in this series)

32      [the claim that] that dismissal of the present action as inadmissible [for lack of standing] is tantamount to depriving it of effective judicial protection […] it must be borne in mind that the European Union is based on the rule of law and the acts of its institutions are subject to review of their compatibility with the Treaty and with the general principles of law, which include fundamental rights. Individuals are therefore entitled to effective judicial protection of the rights they derive from the European Union’s legal order. However, […]Even if the present action is declared inadmissible, there is nothing to prevent the applicant from requesting the national court, in the course of the domestic proceedings whose existence it alleges, in which pleas are raised putting in issue the absence of a recovery obligation which the applicant enjoys under the contested decision, to make a reference for a preliminary ruling under Article 267 TFEU on the validity of the contested decision in so far as it finds that the scheme at issue is incompatible […]

There is no way this one paragraph analysis is up to the standards of effectiveness as defined by the Courts. It simply asserts that the Union is founded on the rule of law, and directs the disappointed party to the Art 267 TFEU procedure. This totemic consideration far removed from searching scrutiny expected of domestic courts. The double standards are abundant; there is one level of effectiveness for the Member States and another for the EU.

Even a cursory examination of the indirect challenge shows that it does not confer effective judicial protection when compared with direct challenges. In terms of cost and duration, indirect challenges require proceedings in the national courts which are both expensive and time-consuming. In any case bear in mind that these proceedings are pointless as far as an individual litigant is concerned – the national courts cannot invalidate the contested measures (see C-314/85 Foto-Frost). In terms of other features remember that it is the national court who must decide whether to make reference under Art 267 in indirect challenges. This reference is not available as of right. Moreover, the party has no direct influence on the terms and substance of that reference. The court might not refer all of the parties’ arguments. It might phrase them in a way that the parties did not intend. The CJEU is also free to answer the question as it sees fit, and, in any case, the national court may well not make a reference. For all intents and purposes, the parties surrender their case to the vagaries of the national court, and, even if it is referred, they lose the ability to control the footings of their own challenge.

Many further points can be given. One that is particularly important focuses on the nature of Art 267 proceedings. In the words of the CJEU in Case C‑370/12 Pringle (one of the rare cases where all 27 judges heard the case),

the procedure provided for by Article 267 TFEU is an instrument for cooperation between the Court and national courts by means of which the Court provides national courts with the criteria for the interpretation of European Union law which they need in order to decide the disputes before them

Art 267 is thus a means to ensure the uniform application of EU law. It does so by fostering dialogue between national and supra-national legal orders. Most importantly, it seeks to furnish a useful answer to the national courts in the dispute before them where there is uncertainty surrounding the interpretation of EU law in that dispute. (See [84] of Pringle “interpretation of European Union law which will be of use to the national court”).

This is radically different from the adversarial procedure that the aggrieved litigants are seeking. It does not provide a forum for an individual litigant to expose, scrutinize and challenge the legality of a given measure of EU law, nor was it ever designed to. It does not open up the CJEU as an arena for legality challenges where parties may do battle over the validity of a given EU norm, nor was it ever designed to. It simply provides assistance to national courts in the disputes before them. It is not adversarial in nature, it is cooperative (see paragraph 4 of this neat Recommendation summarizing the whole Art 267 business). And so from a doctrinal perspective, it is difficult to see how an art 267 procedure could be said to act as a viable substitute for direct actions. They are chalk and cheese.

None of this should be taken as a critique of the Art 267 procedure, which has undoubtedly been used successfully to challenge pernicious (and unlawful) measures of EU law (See Case C-362/14 Schrems). It rather shows that the procedure cannot be a substitute for direct actions, least of all in terms of effective judicial protection. 

Part V: Conclusion

So to return to our initial question of whether Art 263(4) and Art 267 provide effective judicial protection, the answer must be a categorical no. It is fatuous to argue otherwise, and the CJEU’s circular and self-indulgent assertions that the Treaties are complete fly in the face of their own standards of judicial protection. The CJEU’s cosseted principle of judicial effectiveness is applied to EU standing rules in manner virtually unrecognizable to its application in relation to Member states’ domestic norms. It exhorts zealous scrutiny from national judicatures, yet only totemic consideration from the EU Courts.

The vision of the Treaties providing unfailing protection, a perfect scheme of remedial eutaxy, exists only in the mind of the Court. It is a vision built on blasé assumptions about the effectiveness of the indirect enforcement, glib references to the rule of law and wilful blindness to any argument that might relax the nearly impossible conditions in Art 263(4). It is a chimera, a tower of babel, a unicorn. And, yet, it lives on…

 

Michael is currently fourth référendaire at the Court of Justice of the European Union (CJEU), and this and the following two posts on the subject are summaries of what he has set out in an article in the European Journal of Legal Studies  The views he expresses are personal only, and the article was written before he took up his current responsibilities at the CJEU.  

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