In the first of two posts considering the relationship between the UK courts and their EU and ECHR counterparts, Rhodri Thompson QC reminds us of the fundamental constitutional structure of the EU and sets out some of the oft-overlooked similarities between domestic courts and the European courts. In a second post, Rhodri will consider some of the differences between them and the implications for lawyers appearing before the supra-national courts. The text of these posts is based on a speech given to the Butterworths’ Commercial Judicial Review and Regulatory Proceedings Conference 2012.
The relationship between the UK and European Courts, whilst well-trodden ground, has generated a great deal of heat and political controversy, at least in some quarters, and is undoubtedly one of the central legal issues of our time, as English lawyers in an age both of globalisation and of Euroscepticism.
Whether or not one is a fervent supporter of “ever closer union” between the peoples of Europe, there is no doubt that the United Kingdom is a European state, that the national economies of Europe are increasingly interlinked and that legal issues arising over a very wide field are now heavily influenced by the EU Treaties and the European Convention on Human Rights.
In addition, in the narrower context of public law in the commercial field, EU law has a central importance:
- much of the regulation governing UK commercial life is, directly or indirectly, based on the law of the European Union:
- The general framework of private competition law is to a large extent derived from the rules established in 1957 in the Treaty of Rome.
- Many of the sectoral regimes governing the major utilities are either prescribed in EU regulations or heavily influenced by sectoral directives agreed between the Member States.
- Other important areas of the economy, for example the regulation of medicinal products, are in practice governed by pan-European legislation.
- Yet other regimes, for example for the free movement of persons, are a complex hybrid of rules that have been agreed at the EU level and residual national competences that are jealously guarded in the United Kingdom by successive national governments.
- Even where distinctive UK regimes are retained, for example the merger and market investigations regimes governed by the Enterprise Act 2002, there are common issues of principle, and on occasion overlaps of jurisdiction, which require consideration of the interaction between UK and EU legal norms.
- Moreover, where distinctive national legal principles remain, there may be difficult issues to resolve as to whether they may have an unintended impact on issues governed by EU law, as for example where the common law restraint of trade doctrine may be said to be in potential conflict with EU competition law.
More generally, the approach of the ECJ to administrative law, imposing a common framework of adherence to the general principles of Community law, including norms of international law and protection of fundamental rights, is now increasingly familiar to UK judges. In parallel, the standard approach in judicial review has developed rapidly under the influence of the Human Rights Act 1998. That Act of course introduced the structured framework of analysis under the Convention as an integral part of domestic judicial review, rather than as an exotic variant only to be considered on the relatively rare occasions where a point arising under the Convention was specifically raised. That framework is essentially the same as the structure of justification of measures engaging the various qualified rights protected by EU law. As a result, the two systems of “European law” have, to a degree at least, been mutually reinforcing over the past decade.
Here, I do not intend to be dragged into the debate over whether it is right to be “sceptical” about the institutions of the European Union of the Council of Europe, including its Courts. Nor do I feel tempted to follow the critical stance that has been adopted by various experienced lawyers and judges in making adverse comparisons between the methods of reasoning of the common law courts and those followed in Luxembourg or Strasbourg.
Although it is certainly true that it is possible to find instances of judgments of the European Courts that are poorly reasoned or hard to understand, that can also be said of some well-known judgments of our own courts, particularly on issues of EU law. Indeed, I will mention some notable examples of cases where our domestic judges have been shown over time to have misjudged the development of EU law.
For present purposes, I am going to stay at a somewhat high level of generality, using the binoculars rather than the microscope, and addressing three broad points:
- the links between the UK national courts and their European counterparts;
- the main similarities and differences between the UK and European courts; and
- certain practical consequences of these areas of difference.
As indicated by the title of this piece, these are personal observations of an EU practitioner. They make no pretensions to exhaustive academic rigour or scholarly accuracy. In addition, I will not attempt to say anything about the relationship between the UK courts and other national courts.
Links between UK national courts and their European counterparts
Looking first at the constitutional structure of the European Union, for all the many changes that have been made, its fundamental legal structure can still be summarised for my preliminary purposes under three very general and familiar propositions:
- Judicial review of national administrative action is for the national courts of the Union; whereas actions against the EU institutions under the EU Treaties are for the ECJ.
- The ECJ is also the final arbiter of the validity and interpretation of EU legislation, including the Treaties.
- Where they conflict, EU law takes precedence over national law.
The central mechanism for ensuring that these principles can, over time, generate a coherent body of law, is the preliminary ruling procedure under what is now Article 267 of the Treaty on the Functioning of the European Union. This procedure enables issues of EU law, including questions as to the validity of EU legislation and administrative action raised in national courts, to be determined by the Court of Justice. It thus makes it possible for the national courts of the Union to discharge their role without leading to fragmentation of the Union legal order.
The other core principle of EU law that protects the cohesion of the EU legal system is the “duty of sincere cooperation” binding on the national courts. Apart from the preliminary ruling procedure itself, which obviously depends on a degree of competence and good faith at the national level if it is to work effectively, the most important aspect of this duty is the Marleasingprinciple, requiring national courts to interpret their own legal order “so far as possible” to cohere with the requirements of EU law.
This principle of interpretation has been incorporated into UK law, not only in the field of EU law itself under the European Communities Act 1972, but also in an extended but somewhat diluted form in sections 2 and 3 of the Human Rights Act 1998. As is well known, whereas the 1972 Act is unconditional in its acceptance of the supremacy of law deriving from the EU Treaties as defined in that Act, and treats the rulings of the ECJ as binding on issues of European Union law, the 1998 Act gives Parliament the final word on the protection of the Convention rights identified in section 1 of the Act and retains the autonomy of the UK Courts in relation to the interpretation of those rights.
Even in relation to the far-reaching provisions of the 1972 Act, the recent Assangeruling of the Supreme Court (at paras 207 ff) reminds us that, although the provisions of that Act are unconditional, they are not unlimited in scope – the statutory obligation to give effect to EU law and to treat the judgments of the ECJ as binding does not extend beyond the scope of the Treaties defined in the 1972 Act itself. Outside that statutory boundary, EU law is to be regarded as part of international law and thus binding only where specifically incorporated into UK law.
In the context of competition law, it is worth reminding ourselves that there is also a narrower statutory link between national and EU competition law in section 60 of the Competition Act 1998. Section 60 requires the UK courts to follow rulings of the ECJ and to take note of statements of the EU Commission, on issues of competition law that are parallel under the Competition Act and Articles 101 and 102 of the TFEU. This provision could potentially lead to two interesting legal questions:
- When would it be appropriate for the Competition Appeal Tribunal (CAT) or Court of Appeal to make a reference for a preliminary ruling in respect of a case arising under the 1998 Act but involving a contested issue of EU competition law, for example as to the scope of Article 101 TFEU in relation to information exchange arrangements or the meaning of “appreciability” requirement, or the precise legal test for abusive pricing, for example “predation” or “margin squeeze”?
- Would section 60 require the CAT or Court of Appeal to follow the approach of the ECJ on issues of rights of defence or the protection of fundamental rights, or would the Human Rights Act 1998 require the actions of the OFT or the sectoral regulators to be scrutinised by the (possibly more stringent) standards of the ECHR?
This latter question is of course part of a much wider debate as to the relationship between the EU and the ECHR, a topic that goes well beyond the scope of this piece. However, as I will discuss in a little more detail in a moment, there are good reasons why the approach of a national court, the ECJ and the European Court of Human Rights might be expected to be subtly different on this sort of issue, reflecting the different priorities of each institution and its particular place in the constitutional structure of Europe and its Member States.
Beneath these broad constitutional provisions establishing the hierarchy of EU law and national law, there are of course a host of specific statutory provisions, particularly those adopted under section 2(2) of the 1972 Act, that give effect to the obligations of the United Kingdom to implement EU legislation into national law. Any one of those provisions can generate issues of construction of the national and EU legislation at issue, but can also generate more general issues of EU administrative law, for example issues of equality of treatment, proportionality of penalties or legal certainty. These may in turn raise issues under the ECHR and the Human Rights Act.
A well-known example of an early case illustrating the uncertain scope and interaction of the issues arising in this area is the International Roth litigation concerning fixed and automatic statutory penalties for the transport of “clandestine entrants” into the United Kingdom, backed by powers of confiscation where the penalties were not paid:
- That case was treated by the Court of Appeal as a case raising issues under Articles 6 of the Convention and Article 1(1) of the First Protocol, the rights to a fair hearing and to the free enjoyment of property. Viewed in that light, the “declaration of incompatibility” made by the Court of Appeal has been criticised (notably in the dissenting judgment of Laws LJ) as representing an excessive interference in decisions properly belonging to the UK Parliament. Under the restrictive principles laid down by the Human Rights Act in relation to primary legislation, that is an understandable point of view.
- However, the case, which involved strict liability penalties and the confiscation of lorries used to provide transport services from other Member States to the United Kingdom, could readily have been interpreted to concern restrictions on the freedom to provide transport services within the European Union, and the proportionality of automatic fixed penalties (backed by confiscatory powers) where those restrictions were infringed. Those issues (which were accepted as an alternative ground of criticism by Sullivan J at first instance) were difficult ones that could readily have been the subject of the preliminary ruling procedure, and where the balance between the public interest and the rights of individuals might have appeared significantly different in Luxembourg rather than in London.
Similarities and differences between the UK and the European Courts
I turn now to the similarities and differences between the UK and European Courts, again adopting a “bird’s eye” view. Many of the points made here are elementary but they are of sufficient importance to be restated once again.
So far as common features go, the first, obvious but perhaps most important, common feature is that all three legal systems are strongly committed to that set of legal principles that is now generally referred to as “the rule of law”. As Lord Bingham reminded us in his last major contribution to our legal culture, these principles have deep historical roots in the common law and are now entrenched in English statute. However, the same essential principles are deeply embedded both in the EU Treaties and in the case law of the Court of Justice:
- the Treaties have required the ECJ to ensure that “the law” is observed ever since the creation of the European Communities in the 1950s;
- the Court of Justice has taken that obligation very seriously, using it not only as a guide to its general case load but specifically as the basis for the establishment of the “general principles” of EU law and the protection of fundamental rights; and
- the inclusion of a quasi-constitutional charter of fundamental rights was evidently intended by its proponents further to enhance this aspect of the EU legal system and has been treated as such by the Court of Justice since the entry into force of the amended Treaties.
Similarly, although the European Convention on Human Rights is an international instrument, and therefore lacks some aspects of the constitutional significance of the English common law and the EU Treaties, it is no less clear that it presupposes and requires the existence of national constitutional arrangements founded on the rule of law, perhaps most obviously in the general requirement that restrictions on fundamental rights should be “prescribed by law” and also in its consistent refusal to accept “arbitrary” interference with such rights.
The second common feature of English law and European judicial review is that each exercises a form of “supervisory” jurisdiction over public bodies to ensure that they have acted lawfully within the scope of the limited powers vested in them. Although there are differences of emphasis between the English, EU and ECHR courts as to how they should exercise that supervisory jurisdiction, to which I will come in a moment, there is a common understanding that the role of the administrative law judge is to act as a control over the exercise of public power rather than to substitute their views for those of the executive.
Thirdly, there is, to a much greater degree than is sometimes acknowledged, a common understanding of the three broad areas where the administrative courts can intervene: lack of legal power; procedural unfairness; and substantive error. In this respect, it is worth recalling the grounds for judicial review laid down by Article 263 of the TFEU:
“lack of competence, infringement of an essential procedural requirement, infringement of the Treaties or of any rule of law relating to their application, or misuse of powers”.
Fourthly, and relatedly, there is recognition of a “sliding scale”, particularly in respect of substantive error, whereby the level of scrutiny can vary widely depending on the nature of the issues before the Court and their amenability to judicial appraisal. Good examples of this are the case law of the Court of Justice in respect of “complex economic appraisals”, where the Court will intervene only in cases of “manifest error”, and of the Court of Human Rights in cases involving policy decisions and interference with property rights, for example in the field of tax law. I will return to this issue in a moment as there are certainly differences of emphasis here.
Fifthly and finally, particularly in respect of the EU Courts, there is a far greater respect for precedent and statements of principle in earlier case law than is sometimes recognised. One of the most elementary characteristics of the common law is the respect that is paid to judgments of earlier courts and the extent to which they are treated as binding in subsequent cases. However, it is perhaps less often recognised that the ECJ has been forced to develop its case law, particularly in the field of judicial review, by reference to broad principles derived from the common constitutional traditions of its Member States rather than from any detailed codification of rules. As a result, the Court has necessarily sought to follow a consistent pattern of reasoning and to trace the foundations for its later judgments to broad issues of principle established in its earliest judgments. That is a process that any common lawyer should appreciate, even where he or she may find it difficult in practice to understand how the later judgment has been derived from the earlier one.
A similar evolutionary approach has been followed by the Court of Human Rights, where again it is working with a small number of interlocking principles set out in the Convention, and is seeking to impose a rational structure of reasoning to permit the consistent application of its founding document to the very wide range of factual situations and political structures found in its contracting States. Although English common lawyers might disagree with the approach that has been adopted by the Strasbourg courts to concepts such as the “margin of appreciation” or the perception of the Convention as a “living instrument”, they could hardly object to the general approach of seeking to develop a consistent set of principles by reference to earlier case law.
In a second post, Rhodri will consider some of the differences between them and the implications for lawyers appearing before the supra-national courts.