#3519 - Preliminary Reference - European Law

Functions

• Development of EU law (direct effect, supremacy)

• Maintenance of institutional balance

• Enhancement of individuals’ interests (obl. to refer for court against whose decision there’s no nat. remedy)

• Legal integration – uniformity/consistency of EU law

• ECJ: “veritable cornerstone of the operation of internal market” – plays a fundamental role in ensuring Treaty law retains its Comm. Character w/a view to guaranteeing EC law has same effect in all MS.

Types of questions referred

1. Treaty interpretation (Art 267 (1)(a))

• used to make judgments on supremacy & DE

• ECJ merely interprets Treaty – no judgment on nat. law validity

• If incompatibility found, obl. on nat. court to redress situation

2. Validity & interpretation of EU institutions, bodies etc. acts (Art 267(1)(b))

• Chalmers: 2 striking features

1. nat. courts monopoly over disputes involving points of EU law to be decided on nat. law, facts & application of EU law

2. Nat. courts act as gatekeepers to ECJ – no direct right of access to private parties

• ECJ: 3 stages of EU legal order

1. EU is autonomous legal order

2. Requiring MS courts to interpret EU law uniformly

3. By providing for direct relation b/w MS courts and ECJ, Art 267 enables this uniformity

Who can refer

1. Body or tribunal – determined by ECJ on the basis of broad definition: factors

1. established by law

2. compulsory jurisdiction

3. decisions of judicial, not admin, nature

4. independence

1. external – no intervention/pressure liable to jeopardise judgment

2. internal – impartiality

• Complex application

• Ref can be made only if there’s a pending case b/f nat. court which leads to decision of judicial nature

• Cartesio – ref couldn’t be made b/c court was discharging admin function which didn’t resolve dispute

• In the interest of uniformity, ECJ can rule on issues of validity & interpretation arising out of procedure of bodies to which govt. has assigned some adjudicatory function

• Broekmeulen– Dutch Appeals Comm. hearing appeals from a body resp. for admission of docs

• Chalmers: rationale: any body deciding on EU law rights should be able to refer – if not, Cs would have to challenge through another body, adding to expense & delay, dis-incentivising parties from referral but could open floodgates whereby undertrained actors would overload the court.

• AG Colomer: definition is too wide; the strategy behind 267 was to create a conversation b/w ECJ & nat. courts – independent parts of executive not intended to be part of it. Practical consequence: allows bodies w/no legal training to formulate ref + admin actors have a chance to disrupt domestic judicial hierarchy and system of precedent by referring something they disagree with

2. With discretion/ obligation to refer

• Art 267(2) – discretion (any court or tribunal)

• Art 267(3) – court/tr. against whose decision there’s no remedy in nat. law(unless CILFIT satisfied/issue previously decided)

• What bodies are covered?

1. abstract theory – bodies whose decisions are never subject to appeal

2. concrete theory – bodies whose decisions aren’t subject to appeal in that case (Costa v ENEL)

• Costa v ENEL – magistrate, whose decisions were normally subject to appeal, could refer to ECJ b/c in that case sum of money too low for appeal to be made in nat. law.

• somewhat distorting to nat. judicial hierarchy – lower court can refer even in the face of decision by a higher court ...

• NB: nat. court not obliged to raise matters of EU law on own volition but it can’t be prevented from doing so by a rule of national law

• NB: no obl. for nat. court/tr. to refer just b/c parties ask for it

Precedent System

• Development of precedent:

1. modified the original conception of horizontal & bilateral relationship b/w MS & ECJ

2. shifted it to vertical hierarchy b/w ECJ & national courts

Instances where nat. court may conclude it doesn’t need to refer

1. ECJ has already resolved the issue

• Refer only where quest. raises new argument/factor – if not, ECJ will restate substance of earlier judgment

• Courts/tribunals with obligation to refer have the same discretion as any other nat. court to determine if decision is necessary for it to give judgment – if not, it doesn’t have to refer

• CILFIT – Italian court’s ref.; ECJ: obl. to refer is not unconditional but premised on existence of reasonable doubt as to interpretation + recourse to ECJ being necessary for decision in the case

2. There’s no doubt as to EU measure’s validity

• System of precedent – multilateral effect of court rulings (can be relied on across MS)

3. Decision isn’t necessary for deciding that case

4. Acteclair doctrine applies

• Nat. court feels issue is clear; i.e.

1. equally obvious to other MS courts & ECJ

2. so obvious that leaves no scope for reasonable doubt

• Assess a) & b) on the basis of characteristic features of EU law + difficulties of interpretation

• CILFIT test

1. Legislation drafted in several languages – all equally authentic

2. Peculiar terminology

3. Possibility of same terms having different meanings in EU law & nat. law

4. Interpret in light of EU law as a whole, having regard to objectives + evolution

• NB: CILFIT conditions are too restrictive – nat. courts should have more discretion.

• AG Jacobs: nat. judges shouldn’t have to consider all language versions – not realistic/feasible! CILFIT should apply in commonsensical way, so that court can really determine if prel. ref. is worth the burden

• Mancini & Keeling:ECJ, recognising it can’t coerce nat. courts, conceded something to professional/national pride of judges but then restricted circumstances to cases so rare that ECJ’s authority remains intact. Clear objective – by granting MS courts lawfully power to do that which they could do unlawfully + subjecting it to strict conditions it would induce them to wilfully engage in the mechanism of judicial co-op provided by Treaty

• Rasmussen: CILFIT II should give back initiative to MS judges, trusting them to solve far more quest. of interpretation of Comm. law (i.e. enlarge scope of acteclair acts)

• Craig & DB: ECJ currently content w/CILFIT; in Intermodal, it refused to extend conditions through finding that nat. court isn’t required to ensure matter is equally obvious to bodies of non judicial nature & instead confirmed the traditional conditions

Circumstances where ECJ may decline jurisdiction

1. Case is hypothetical (Foglia v Novello)

• Rationale

1. Practical – waste of resources as problem may never materialise

2. Conceptual – if it materialises, may not be in the envisaged form, thus causing uncertainty

• Fine dividing line b/w hypothetical & test cases

2. Question raised isn’t relevant to dispute

• Meilicke – German lawyer challenged theory of non cash contributions of capital developed by German courts as incompatible w/Banking Dir. ECJ: issue not @ stake in main action – no prel. ruling

3. Question not articulated w/sufficient clarity

• ECJ won’t alter the substance of question referred *contrast with Costa v ENEL*

• Govt& parties can submit observations under Art 20 of ECJ Statute – since they are notified of reference by the referring court, would be wrong to subsequently alter it

4. Facts are not sufficiently clear

• This is necessary for ECJ to apply relevant legal rules – ref. must have adequate factual foundation

• Courts must attach sufficient outline of factual & legal context to the reference

ECJ’s approach to formulation of reference

1. Initial approach

1. ECJ willing to correct improperly framed references

• Costa v ENEL – ECJ extracted from imperfectly formulated question one which really pertained to Treaty interpretation

2. ECJ refused to scrutinize reasons for making reference/facts behind it – the remit of nat. courts

• Costa v ENEL – Art 267 based on clear separation of functions b/w nat. courts & ECJ; latter not empowered to investigate facts, criticise grounds & purpose of the reference

• Early approach flexible & open, designed to refrain from discouraging recourse to EC law, esp. b/c doctrine of DE & supremacy delivered through prel. ref. procedure

2. Subsequent approach

1. ECJ is the ultimate authority for deciding whether reference is warranted

• Foglia v Novello (No1) – ECJ refused to give prel. ruling due to absence of genuine dispute b/w the parties b/f referring (Italian) court; clause inserted into contract to induce ECJ to declare that French tax system for wines was invalid

• Foglia v Novello (No2)– Italian court asked whether preceding decision was consistent w/principle that it was for nat. courts to determine facts & need for ref. ECJ: Court is final decider of own jurisdiction & its duty isn’t to give advisory opinions on hypothetical questions but rather to assist admin of justice in MS. Decl. of no jurisdiction in circumstances where parties use procedural mantra to induce it to give opinion on hypothetical problems in EU law doesn’t infringe on nat. courts’ prerogative but rather prevents use of 267 in inappropriate circumstances.

• Craig & DB: original division of functions b/w ECJ & MS courts separate, maybe even equal, as manifested in distinction b/w application & interpretation. Foglia reshaped this – ECJ no longer passive receptor & will assert control over suitability of ref., especially through assessment of whether it has jurisdiction

• Bebr: ECJ used to view 267 as method for establishing co-op w/MS, based on jurisdictional exclusivity, not hierarchical superiority. Foglia confused this. There may be various shapes of litigation & what appears as not genuine dispute may in fact be...