EU Judicial Review

The Maastricht treaty amended the TFEU to enable the court to impose sanctions on the MS that fail to comply with a judgement under Articles 258 & 259.

The Lisbon Changes are as follows:

-          260(2) simplified the pre-litigation procedure to just a formal letter, and no longer requires a second reasoned opinion.

-          260(3) allows in specific case where the MS has failed to notify measures transposing a legislative directive, the commission may even at the stage of the original infringement suggest the court impose a penalty. This is called the 2010 Communication.

Article 263 TFEU sets out the principles and structures underlining the annulment proceedings. Essentially there are four pivotal points that the court will examine when an action for annulment is brought. These are:

1.      Compliance with the time limit for bringing the action

2.      The reviewability of the act

3.      The standing of the applicant – where the applicable rules vary significantly depending on whether the applicant is classified as “privileged, semi-privileged” or “non-privileged”.

4.      The existence of possible grounds for the annulment of the act.

The first three refer to the admissibility of the action whereas the last one refers to the substantive challenge to the act. 

Standing – Privileged (MS, EP, Council, Commission all have automatic right to bring proceeding so no need for locus standii) and Semi-Privileged (court of auditors, euro central bank, committee of regions can only bring actions when their prerogatives are at stake).

Non-Privileged persons are natural and legal persons who face strict conditions. The three situations where they have locus standii are if they are the addressees of the act, if they are not addressee they must be directly and individually concerned by it and if they are not addressee and wish to challenge a regulatory act they will have to show they are directly concerned by it.

In UPA the Court of Justice considered that it would be possible to ‘envisage a system of judicial review of the legality of Community [Union] measures of general application different from that established by the founding Treaty’. However, the Court concluded that any changes to the Treaty to broaden access to the Court for judicial review were a matter for the Member States and could only be made by a process of Treaty revision.

Following on from the Opinion of Advocate General Jacobs and the debate which took place within the Constitutional Convention with regard to the future operation of Article 230 EC (now Article 263 TFEU) the Member States in the Treaty of Lisbon agreed a revised version of Article 230 EC (now Article 263 TFEU) which appears to have widened the scope of judicial review by an individual of ‘a regulatory act which is of direct concern to them and which does not entail implementing measures’. This would appear to remove the need for an applicant to demonstrate individual concern and therefore avoids the difficulties applicants face with establishing that a measure affects them in some unique way as per Plaumann. Thus where a regulatory act produces a legal effect Article 263 TFEU would appear to grant locus standi. However, Article 263 TFEU represents only a partial reform and the changes do not go as far as those proposed by Advocate General Jacobs in UPA in which he argued that an applicant should be able to seek judicial review of an act of general application in circumstances where it had an effect upon his legal position.

1.      You can start a challenge on a regulatory act, this is different from an address act or one of direct and individual concern which you can challenge on Plaumann grounds. This is slightly odd; as many people have asked what a regulatory act is.

2.      If a measure produces a legal effect, it may give rise to LS:

The general court identified in Federolio identified the three situations when these actions would be admissible:

1.      Where a legal provision grants the association a series of procedural rights

2.      Where their members are themselves directly and individually concerned

3.      Where the own interests of the association are affected and in particular its position as negotiator is affected by the EU act in question.

These conditions are noticeably difficult to satisfy.

Once an applicant has managed to prove standing it is necessary to show that there is a suitable ground to challenge the legality of an EU act. Article 263(4) lists fur grounds of annulment:

i.                    Lack of competence – EU institutions are subject to the principle of conferral, so they can only act in areas provided for by the treaties.

ii.                  Infringement of an Essential Procedural Requirement – whenever an EU institution has not complied with a rule of procedure in the adoption of the contested act. For example a failure to consult the EP

iii.                Infringement of the treaty or any rule of law relating to its application – a breach of primary sources of EU law (treaty/international provisions and general principles of law)

iv.                Misuse of Powers – rarely successful due to the high standard of proof.

Article 263(4) TFEU provides that any person may institute proceedings not only against an act that is addressed to that person or of direct and individual concern to them, but also against a regulatory act that is of direct concern to them and does not entail implementing measures. As a result, regulatory acts can now be challenged without the applicant having to show individual concern. Due to the requirements of “direct concern” and absence of “implementing measures”, Directives will remain exempt from direct challenge, but Regulations will normally meet these conditions as they are directly applicable (art.288(2) TFEU).

Therefore, the central question is which kinds of Regulations fall under the term “regulatory act”. It is common ground that it covers non-legislative acts of general application and thus implementing and delegated Regulations adopted under arts 290 and 291(2) TFEU; arguably, it also includes Decisions of general application… in cases such as Jégo-Quéré,16 where the Regulation at issue was an act adopted under delegation, a challenge by private applicants would now be possible. However, in cases such as Unión de Pequeños Agricultores,17 where the Regulation in dispute would qualify as a legislative act under art.289(3) TFEU, this is somewhat doubtful.

The purposive approach often followed by the ECJ33 also supports the argument that “regulatory acts” include legislative acts as well. It is common ground that the “individual concern” requirement of art.230(4) EC had to be interpreted in light of the principle of effective judicial protection,34 and a fortiori this must apply to the interpretation of the term “regulatory acts”. Article 6(1) TEU recognises the binding force of the Charter of Fundamental Rights…. These principles include the right to effective judicial review,35 and the ECJ has repeatedly held that the requirement of judicial control reflects a “general principle of law” based on the constitutional traditions common to the Member States36 that gives individuals a right to complete and effective judicial protection.37 This case law suggests that art.263(4) TFEU should be interpreted broadly and thus include Regulations even where they are legislative acts.

The principle of legal certainty is a fundamental principle of EU law that requires, in particular, that rules should be clear and precise, so that individuals may ascertain unequivocally what their rights and obligations are and may take steps accordingly.63 The principle of proportionality requires that measures implemented by the European Union should be appropriate for attaining the objective pursued and must not go beyond what is necessary to achieve it.64 Finally, under the principle of equal treatment or non-discrimination, comparable situations must not be treated differently and different situations must not be treated in the same way unless such treatment is objectively justified…

The abovementioned principles allow a wide-ranging review of EU legislation by the ECJ, but the Court has indicated that it will exercise judicial self-restraint. With regard to the proportionality principle, the ECJ has said that the legislature must be allowed broad discretion in areas that involve political, economic and social choices on its part, and in which it is called upon to undertake complex assessments.66 Consequently, the legality of a measure adopted in those fields can be affected only if the measure is “manifestly inappropriate” having regard to the objective that the competent institution is seeking to pursue.67 This judicial self-restraint will continue to make it rather difficult to challenge the validity of EU legislative acts provided that the procedural requirements are observed.

UNDER THE SECOND PARAGRAPH OF ARTICLE 173 OF THE TREATY PRIVATE INDIVIDUALS MAY INSTITUTE PROCEEDINGS FOR ANNULMENT AGAINST DECISIONS WHICH, ALTHOUGH ADDRESSED TO ANOTHER PERSON, ARE OF DIRECT AND INDIVIDUAL CONCERN TO THEM, BUT IN THE PRESENT CASE THE DEFENDANT DENIES THAT THE CONTESTED DECISION IS OF DIRECT AND INDIVIDUAL CONCERN TO THE APPLICANT… PERSONS OTHER THAN THOSE TO WHOM A DECISION IS ADDRESSED MAY ONLY CLAIM TO BE INDIVIDUALLY CONCERNED IF THAT DECISION AFFECTS THEM BY REASON OF CERTAIN ATTRIBUTES WHICH ARE PECULIAR TO THEM OR BY REASON OF CIRCUMSTANCES IN WHICH THEY ARE DIFFERENTIATED FROM ALL OTHER PERSONS AND BY VIRTUE OF THESE FACTORS DISTINGUISHES THEM INDIVIDUALLY JUST AS IN THE CASE OF THE PERSON ADDRESSED 

The General Court was therefore correct to conclude that the concept of ‘regulatory act’ provided for in the fourth paragraph of Article 263 TFEU does not encompass legislative acts.

It must be held that the content of the condition that the act of which annulment is sought should be of individual concern, as interpreted by the Court in its settled case-law since Plaumann v Commission, was not altered by the Treaty of Lisbon. It must therefore be held that the General Court did not err in law in applying the assessment criteria laid down by that case-law.

Last, the Court holds that the Charter of Fundamental Rights of the European Union does not require that an individual should have an unconditional entitlement to bring an action for annulment of European Union legislative acts directly before the Courts of the European Union.