Is Costa v Enel forgotten? CJEU trips over supremacy and direct effect in case concerning Art 41(2)(c) CFREU (C-313/12)

Dr Albert Sanchez Graells

This comment originally appeared on Albert’s personal blog http://howtocrackanut.blogspot.co.uk/

In its Judgment of 7 November in case C-313/12 Romeo, the Court of Justice of the EU issued an important ruling concerned with the extension of the obligation to state reasons derived from Article 41(2)(c) of the Charter of Fundamental Rights of the EU in purely domestic situations.

In the case at hand, the CJEU was especifically presented with a query regarding the compatibility with Article 41(2)(c) CFREU (and, more generally, with the case law on the duty to state reasons) of an Italian rule whereby faulty administrative decisions would not be quashed if the authorities supplemented their statement of reasons in subsequent court proceedings.

In my view, the reasons offered by the CJEU to decline jurisdiction to respond to the questions referred by the Italian court show a poor understanding of (or a lack of willingness to give effect to) the changed nature of the Charter after the entry into force of the Treaty of Lisbon. As very clearly stated, ‘the EU Charter of Fundamental Rights is now legally binding, having the same status as primary EU law‘ [for discussion, see S Douglas-Scott, ‘The European Union and Human Rights after the Treaty of Lisbon’ (2011) Human Rights Law Review 11(4): 645-682].

In that regard, keeping in mind that Article 6(1) of the Treaty on European Union now very clearly indicates that ‘The Union recognises the rights, freedoms and principles set out in the Charter of Fundamental Rights of the European Union of  […] which shall have the same legal value as the Treaties‘ (emphasis added), it is very hard to understand how the CJEU can have unblinkingly held that:

it cannot be concluded that […] Article 41(2)(c) of the Charter or indeed other rules of European Union law concerning the obligation to state reasons for acts have been made directly and unconditionally applicable (sic), as such, by [the relevant Italian rules], so that internal situations and situations relating to European Union law are treated in the same way. Therefore it must be held that, in the present case, there is no clear European Union interest in a uniform interpretation of provisions or concepts taken from European Union law, irrespective of the circumstances in which those provisions or concepts are to apply (C-313/12 at para 37, emphasis added).

I cannot get my head around the fact that, as no one would doubt, the CJEU has kept for time immemorial the position that the Treaties (now including the Charter of Fundamental Rights  for these purposes) are supreme and directly effective without any need for internal measures that receive them or recognise that they are directly and unconditionally applicable in all EU Member States–and, yet, it shows a stark resistance to apply these principles to the Charter (see also C-482/10 Cicala).

As very clearly summarised in Costa v Enel,

A Member State’s obligation under the [Treaty], which is neither subject to any conditions nor, as regards its execution or effect, to the adoption of any measure either by the States or by the Commission, is legally complete and consequently capable of producing direct effects on the relations between Member States and individuals. Such an obligation becomes an integral part of the legal system of the Member States, and thus forms part of their own law, and directly concerns their nationals in whose favour it has created individual rights which national courts must protect (6/64, summary, point 7).

This, together with Art 6(1) TEU surely determines the supremacy and direct effect of the Charter–as also supported by an a contrario interpretation of Protocol No 30 on the Application of the Charter of Fundamental Rights of the European Union to Poland and the United Kingdom (what would be the purpose of the Protocol if not precisely to exclude such supremacy and direct effect regarding the UK and Poland?). Then, if the CJEU has not forgotten Costa v Enel, the only relevant question is: how are Judgments like Cicala and Romeo possible? Why is the CJEU (suddenly) so averse to (continuying to) act as constitutional court at EU level?

6 thoughts on “Is Costa v Enel forgotten? CJEU trips over supremacy and direct effect in case concerning Art 41(2)(c) CFREU (C-313/12)

  1. I think you are really missing the point when it comes to this case. Understanding the rather peculiar facts of the case is essential to get it: The Italian legal provision concerning reasoning of public decisions refers to inter alia the principles of reasoning on the EU legal order as a relevant standard. In Romeo, a decision of a purely domestic nature – with not connection to EU law whatsoever it seems – was made by Italian authorities. However, due to the reference to EU standards in the relevant legislation concerning resoning of decisions, a preliminary ruling was requested by the Italian court.

    This brings us to the law as applied by the CJEU. The CJEU was unsure whether it had jurisdiction. And that for good reason: the contested decision was not made in implementation of Union law. When considering whether it had jurisdiction, the CJEU first observed that “According to settled case-law, the Court has jurisdiction to give preliminary rulings on questions concerning European Union provisions in situations where the facts of the cases being considered by the national courts are outside the scope of European Union law, but in which domestic law refers to the content of those provisions of European Union in order to determine the rules applicable to a situation which is purely internal to the Member State concerned” (para 21). This is key to understanding the judgment.

    The decisive question for the CJEU, in considering whether it had jurisdiction, was therefore whether the “renvoi made by the national law to European Union rules is direct and unconditional”. As we very clearly see, the “direct and unconditional” language is connected with the interpretation of Italian law, NOT the Charter. The direct effect of the Charter (when states are implementing EU law, see below) is NOT challenged, or even mentioned in the decision. The question was merely whether the Italian legislation made a “direct and unconditional” reference to concepts of EU law so that the ECJ would have jurisdiction to give a preliminary ruling in a case that is of a purely domestic nature – i.e. NOT governed by EU law.

    This is made pretty clear in paragraph 35-38: “In the present case […] it does not appear that the Italian legislature intended, as regards the obligation to state reasons, purely internal situations to be subject to the second paragraph of Article 296 TFEU and Article 41(2)(c) of the Charter rather than the specific rules of Italian law relating to the obligation to state reasons and the consequences of a breach of that obligation. […]

    In those circumstances, it cannot be concluded that the second paragraph of Article 296 TFEU or Article 41(2)(c) of the Charter or indeed other rules of European Union law concerning the obligation to state reasons for acts have been made directly and unconditionally applicable, as such, by Article 1 of Law No 241/1990, so that internal situations and situations relating to European Union law are treated in the same way. Therefore it must be held that, in the present case, there is no clear European Union interest in a uniform interpretation of provisions or concepts taken from European Union law, irrespective of the circumstances in which those provisions or concepts are to apply.

    Consequently, the Court does not have jurisdiction to answer the second and third questions referred.”

    And it is not only for the above-mentioned reason that your assertion that the CJEU is choosing not to act as a “constitutional court” is mistaken. What you see as the CJEUs is due to the provisions of the Charter itself, especially article 51(1), which very clearly limits the Charter’s field of application to the member states “only when they are implementing union law”.

    In reality, the tendency at the CJEU seems to be somewhat the opposite of what you suggest. In the recent case of Åkeberg Fransson (C-617/10), for example, the CJEU adopted a very narrow reading of article 51, and applied the CFR in domestic criminal proceedings that had a relatively remote connection to the implementation of Union law. The CJEU is therefore far from restrictive in its interpretation and application of the Charter.

  2. Thank you for your comment, with which I strongly disagree. I think that your position, equal to the one adopted by the CJEU, is excessively formal and open to criticism.

    In general and in maybe rather abstract terms, the CJEU did not take into account the fact that the administrative law provisions at stake apply equally to situations concerning Italian nationals and to any other individuals (either EU Citizens or third country nationals), as they generally regulate the way in which Italian public authorities adopt and motivate their decisions, regardless of the nationality of their addresee/beneficiary. Therefore, the accidental circumstance that the claimant in the specific case was an Italian national should have been duly contextualised (ie overseen) by the CJEU when deciding if there was an interest in advancing a common interpretation of the duty to state reasons. As you mention, it is not rare that the CJEU takes advantage of even more remote circumstances to hand down preliminary rulings when it sees fit. Therefore, the oddity of the self-restraint exercised in Romeo (and previously on Cicala).

    Moreover, the Romeo ruling continues to create a deeper and deeper environment of reverse discrimination whereby ‘strict’ nationals of a Member State are in a weaker legal position than other EU nationals interacting with precisely the same public authorities [that is, of course, assuming that Article 41(2)(c) CFREU offers a wider protection than the (Italian) domestic standard, which seems to be the case prima facie]. With Article 20 TFEU and the general principle of non-discrimination that is of the essence to EU law, this is plainly not acceptable.

    Now, specifically on the circumstances of the case, it was not contended that Article 1(1) of Law No 241/1990 clearly states that “Administrative action shall […] be governed by the criteria of economy, efficiency, impartiality, right of access and transparency in accordance with the rules set out in this law and other provisions governing separate procedures AS WELL AS BY THE PRINCIPLES DERIVED FROM THE [UNION] LEGAL ORDER”.

    When interpreting this provision, the CJEU strategically decided in Cicala that the latter reference (renvoi) was not sufficiently clear and unconditional. In paragraphs 23-27 of Cicala, it considered that the Italian law “makes a renvoi of a general nature to ‘principles derived from the [Union] legal order’, and not specifically to the second paragraph of Article 296 TFEU or Article 41(2)(c) of the Charter” (sic). The soundness and robustness of that finding is at least open to criticism and, in my view, it does not withhold the basic requirements of logical scrutiny.

    To begin with, the reference to the principles derived from EU law surely include the reference to the principle of good administration that the CJEU has been crafting for some time–and which, as made very clear in inter alia public procurement cases, does include the duty to state reasons. Secondly, for the longest time (ie, in the pre-Charter era, when the 1990 Italian Law was drafted), fundamental rights were (already) considered a general principle of EU law (also by the Court) so, in a non-ahistorical interpretation of Article 1(1) of Law No 241/1990, it can strongly be claimed that they were covered by the ‘general’ reference. Finally, it is at least debatable that there is (or indeed, can be) a need for Italian law to make reference to those principles “for the purposes of ensuring that internal situations and situations governed by European Union law are treated in the same way”. Given that EU law is internal law of the Member States (period), that would just have been a very silly goal for Italian law to pursue. In this context, it is for EU law to prevent the existence of discriminatory (including reverse-discriminatory) situations, not for domestic rules.

    Those (logical) flaws of Cicala are just carried on to Romeo. Saying something legally weak twice does not make it sounder, even if it is said by the CJEU. In my view, that is.

    Moreover, given the existence of doubts around the particular limits of the rights enshrined by Article 41(2)(c) CFRUE, it is again at least debatable that “there is no clear European Union interest in a uniform interpretation of provisions or concepts taken from European Union law, irrespective of the circumstances in which those provisions or concepts are to apply”. The interpretation of the CFREU should actually rank rather high in the (judicial) agenda of the CJEU and providing clarity and predictability on the redlines that the provision creates should be seen as a clearly of EU interest, regardless of the circumstances in which the opportunity to interpret them arises.

    I may be completely wrong, as you suggest, but I think that I have my reasons for what I say… In any case, thank you for reading and for promoting debate.

  3. Thank you for responding and elaborating! I think your criticism of the CJEUs analysis of Article 1(1) of Law No 241/1990 has merit. As you point out, the CJEU might be wrong in finding that the reference/renvoi was not sufficiently clear and unconditional. Your argument on this point at least seems convincing to me.

    However, in your blog post you did not focus on this, but rather attacked the CJEU for refusing to directly apply the treaties in a purely domestic matter. At least that is how I read it. For example you put emphasis on the “changed nature of the charter”, as a reason for attributing to it direct effect in a purely domestic setting. And you point to Costa v. ENEL as an authority for such direct effect. The critique in the original blog post thus came off as rather out of touch with the law as expressly laid down in the Lisbon treaty, as I commented above. But, at the same time, you write as if it is the CJEU that has made an obvious mistake in applying the law — showing a “stark resistance to apply” the Charter for reasons unstated (possibly political?).

    This is why I chose to post a reply. I wanted to “call you out”, partly to see why the post was written the way it was. Maybe there lay a normative critique of the CJEU behind the (erroneous) critique of misapplication of Charter? This was my bet. That you had an (hidden) normative critique of the CJEU that was covered up behind imprecise legal resoning.

    I was thus somewhat surprised to see that behind your original post there was an argument concerning the nature of Article 1(1) of Law No 241/1990, and the CJEU’s interpretation of the renvoi in that article. As far as I can see from the original post (which I might be reading in the worst possible way) this point was not mentioned at all. But thank you for adding it to this page in the comments section. Now it is much easier to understand what your position is. And I respect that position — frankly, I might even agree with you. But I would have to look into the “renvoi” jurisprudence of the CJEU before fully embracing your argument.

    Thanks for engaging in this small debate — and please tell me if I am beinf unclear or if I am misreading you. (I am not unaccustomed to doing the latter!)

  4. Hi,

    Thank you too for the follow up. Glad to read that (maybe) my position on Art 1(1) of the Italian law persuades you. For me, however, that approach is not really different from the general critique because it is the supremacy of the Charter–as a Treaty under Art 6(1) TFEU–what, in my view, makes the Italian domestic rule currently redundant.

    It may be hard for me to clearly spell this out in only so much words [and I understand the resistance on the basis of Art 51(1) of the CFREU itself] but the confines of the EU Treaties and what EU law means is increasingly blurry and I simply cannot accept (from a non-hidden normative perspective) that the CJEU declines to give the Charter full direct effect. The restriction derived from the bindingness of the Charter on Member States “only when they are implementing Union law” seems just too imprecise, particularly when we are discussing general principles of EU (administrative) law. At the end of the day, just as the Treaties are fully and directly applicable in the Member States without any domestic rule declaring their ‘reception’ in the domestic legal order (and, oftentimes, their application goes beyond what one could initially perceive as their ‘natural’ field of application), so must the CFREU be.

    And that, in my view, that direct effect (and supremacy) of the CFREU derives from its changed nature after Lisbon (apologies for insisting in what we already know we disagree about), (despite) the caveat in Article 6(1) TEU that “shall be interpreted in accordance with the general provisions in Title VII of the Charter governing its interpretation and application and with due regard to the explanations referred to in the Charter, that set out the sources of those provisions”. In the end, there are currently very few areas where domestic law is shielded from EU law and, consequently, there should not be areas where the CFREU is not applicable. Otherwise, the actual existence of a level playing field, a Europe for all and a common space for all EU citizens is just an illusion (and a not very well constructed one).

    Also by way of a different ellaboration, it may be worth stressing that domestic courts are currently confronted with three potentially conflicting standards in terms of fundamental rights protection: their domestic constitutional provisions, the ECHR and the CFREU. The horizontal coordination between the ECHR and the CFREU is sorted out by the CFREU itself [art 52(3)]. However, the coordination between CFREU and the constitutional protection in the Member States (which should be ECHR-compliant) is not equally sorted out (hence, the need for Protocol No 30, which legal effectiveness also raises issues of its own). The coordination is only ensured in a one-way direction–ie, by preventing the CFREU from lowering the domestic constitutional protection as per Art 53 CFREU: “Nothing in this Charter shall be interpreted as restricting or adversely affecting human rights and fundamental freedoms as recognised […] by the Member States’ constitutions”. However, the possibility of using the CFREU as a lever to boost constitutional protection at domestic level is not clearly regulated. In my view, the CJEU should not duck the [difficult] task of clarifying this issue (as clearly presented in Cicala and in Romeo) on the basis of (what I see as) a (questionable) technicality.

    Even beyond that, the rationale that ‘purely internal situations’ are outside the scope of EU law (particularly when they are regulated by exactly the same rules as cross-border situations) just does not hold water. Some areas of EU economic law have already (implicitly or quietly) moved beyond those restrictions (see the interpretation of corss-border effects in competititon law cases or of cross-border interest in public procurement cases). Hence, the resistance of the CJEU to do the same in areas more closely linked to social rights (where, precisely, the CFREU does say something different than the ECHR and, possibly, domestic constitutions) does not seem to stem so much from technical difficulties (as the ones raised in Cicala and Romeo), but from a different (let’s not qualify it) agenda.

    I know that I am drifting but, in my view, all of these considerations are relevant and the criticism to the CJEU surely should embrace them to the same extent that the CJEU often feels free to depart from orthodoxy when they aim to create a new test or standard that suits the (ultimate?) goal of furthering the internal market. In my opinion, this makes the debate more interesting.

    Also, apologies if the blog-format legal commentary I use is (maybe) imprecise. Often, I just aim at spurring debate more than at offering very thought-thorugh legal analysis. So far, it seems to work out rather well. 🙂

    As ever, thank you for reading and commenting,
    Albert

  5. Indeed! You certainly seem to have struck what you aimed for.

    Thanks for elaborating and providing some context and clarification to the rather provocative blog post. Even though I still do not fully agree with your critique, at least the different aspects of this issue has been clarified — hopefully to the benefit of other readers.

    Thanks for the (brief) debate, and have a splendid weekend!

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