Should the EU sanction its Member States for breaches of rule of law and human rights? Part 1: The Legal Framework

Professor Steve Peers, University of Essex

I’ve taught EU law and human rights for over twenty years now, and the issue of sanctions against Member States for human rights breaches used to be the easy bit. Why? Because the procedure to enforce such sanctions (set out in Article 7 TEU) had never been used – and there was no apparent prospect that it ever would be. So there was no need to discuss it in any detail. A more theoretical sort of academic might have spent time counting the angels on the head of this constitutional pin, but I was anxious to move on to the real world issues of arrest warrants and asylum seekers.

Everything has since changed. Like Article 50 – which similarly raises fundamental issues about the EU’s relationship with its Member States – Article 7 was apparently dashed off in previous Treaty amendment talks without much thought to its detailed application in practice, perhaps because its authors thought it would never be used. Yet here we are, with both Articles now a live political and legal issue: the Ragnarok of EU law.

There are two recent parallel major developments. First of all, the Article 7 process has been triggered both against Poland (by the European Commission) and Hungary (by the European Parliament). Secondly, there are case law developments raising general questions about Member States’ observance of human rights and the rule of law outside the very specific (and very political) Article 7 process. In this context, last week the CJEU delivered its first judgment that a Member State is infringing judicial independence by means of reforms to its judicial system (see discussion here).

The prospect of the EU sanctioning its Member States for breaches of human rights and the rule of law raises a number of fundamental legal and political issues – and is best understood in a broader historical context. In light of the recent developments (and ongoing disputes), this is an opportune moment to provide an overview and analysis of this issue.

I’ll do this in a series of three blog posts, addressing in turn:

a)      the legal framework for sanctions under Article 7

b)      the overlap of the sanctions rules with other aspects of EU law

c)       the historical context and broader constitutional dynamics.

The legal framework for sanctions

Although many people refer to Article 7 TEU, there are other Treaty provisions which are inextricably linked: Article 2 TEU sets out the values which Article 7 is used to enforce; Article 354 TFEU describes voting rules for the EU institutions; and Article 269 TFEU provides for limited jurisdiction for the CJEU over the sanctions procedure.  All of this must be distinguished from the normal rules of EU law, discussed in the second blog post.

First of all then, what are the values of the EU, legally speaking? Article 2 TEU states:

The Union is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities. These values are common to the Member States in a society in which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women and men prevail.

Article 7 then sets out the process of enforcing those values. It begins with Article 7(1), which provides for a kind of ‘yellow card’ – a warning if there is there is ‘a clear risk of a serious breach’ of those EU values:  

1. On a reasoned proposal by one third of the Member States, by the European Parliament or by the European Commission, the Council, acting by a majority of four fifths of its members after obtaining the consent of the European Parliament, may determine that there is a clear risk of a serious breach by a Member State of the values referred to in Article 2. Before making such a determination, the Council shall hear the Member State in question and may address recommendations to it, acting in accordance with the same procedure.

The Council shall regularly verify that the grounds on which such a determination was made continue to apply.

Notice that the ‘yellow card’ process can be triggered by the European Parliament, or a group of Member States, or the Commission. There is no requirement of unanimity of Member States to approve a Council decision to issue a ‘yellow card’ (this is a common misunderstanding), but the threshold of four-fifths of Member States’ governments in the Council is nevertheless fairly high. Triggering the process (as the EP did for Hungary, and the Commission did for Poland), does not, as some think, mean that the Council will agree to issue a ‘yellow card’, or has done so already. Indeed, the Council is still considering the proposals to issue a ‘yellow card’ against both Poland and Hungary, having held several of the hearings referred to in Article 7(1). If the Council ever did issue a ‘yellow card’, note that this does not entail a sanction as such: it is only a finding of a risk to EU values, with possible recommendations. Nevertheless, the issue of a ‘yellow card’ is perceived as extremely politically serious.

This brings us to Article 7(2), which is the ‘red card’ of the process:

2. The European Council, acting by unanimity on a proposal by one third of the Member States or by the Commission and after obtaining the consent of the European Parliament, may determine the existence of a serious and persistent breach by a Member State of the values referred to in Article 2, after inviting the Member State in question to submit its observations.

The procedure here is even tougher: unanimity of the Member States. The European Parliament cannot trigger the process, but could veto it  if the Commission or a group of Member States trigger it. The threshold to be met is higher: not just the risk of a serious breach, but the ‘existence of a serious and persistent breach’ of those values. It’s likely that the EU would get to the ‘red card’ stage after issuing a ‘yellow card’, but that’s not a legal requirement: a ‘straight red’, for (say) a country which had suddenly undergone a military coup, is also conceivable.

What are the consequences of a ‘red card’? Article 7(3) sets them out:

…the Council, acting by a qualified majority, may decide to suspend certain of the rights deriving from the application of the Treaties to the Member State in question, including the voting rights of the representative of the government of that Member State in the Council. In doing so, the Council shall take into account the possible consequences of such a suspension on the rights and obligations of natural and legal persons.

The obligations of the Member State in question under the Treaties shall in any case continue to be binding on that State.

Notice that the Member States don’t have to act unanimously in the Council when deciding exactly what sanctions to apply to the black sheep amongst them. The unanimity threshold only applies when taking the previous step of deciding whether there’s a serious and persistent breach of the EU values.  As for the specific sanctions which might be imposed, the Treaty mentions suspension of voting rights, but that’s just one example. The Council might instead (or additionally) impose other sanctions, such as suspension of MEPs’ voting rights (which raises the awkward question of whether they might also end up sanctioning any opposition MEPs from the Member State in question – whose voices would ideally need to be heard). However, there’s an obligation to consider the rights of individuals and businesses, which suggests that trade sanctions might be problematic. It might also be hard to justify restricting free movement rights, but in any event note that there are specific rules on asylum for EU citizens fleeing from a Member State subject to a ‘red card’. (I discuss them further in the second blog post).

Most significantly, there’s no provision to expel a Member State from the EU as such. Having said that, a Member State subject to suspension might be so outraged to be in that position that it triggers the process of leaving the EU under Article 50. The UK’s withdrawal process has been complicated and controversial enough; now imagine the legal and political complexities of a Member State subject to an Article 7 ‘red card’ triggering Article 50. Should its political authorities’ actions be considered legally and morally valid? What if a group of exiles claim to be the legitimate government of that Member State (a la the USSR-era Baltic States), and that purported government does not wish to leave the EU?  What if a part of that Member State, at odds with the government in power over EU membership and its violation of EU values, attempts to secede?

Of course, the possibility of withdrawal (alongside concerns about sovereignty, and the workings of partisan politics) may also have influenced the pronounced reluctance of the EU to use the Article 7 process. Does the EU really want Michel Barnier’s main task to be crowd control?

Article 7(4) TEU then provides that the Council, again by qualified majority, may ‘vary or revoke’ its sanctions against a Member State ‘in response to changes in the situation which led to their being imposed’. Article 7(5) notes that the rules on voting within the institutions when Article 7 is being applied are set out in Article 354 TFEU. The latter provides that the Member State which is the subject of potential sanctions has no vote at any stage of Article 7, as otherwise this would obviously have made the adoption of any decision on breach of EU values impossible. Abstentions cannot prevent the adoption of a ‘red card’ decision. Where the Council votes to implement a ‘red card’ decision, a higher threshold for adopting EU laws applies (72% of participating Member States in favour, instead of the usual 55%). If a Member State’s voting rights are suspended, the usual rules on Council voting with only some Member States participating apply. For its part, the EP ‘shall act by a two-thirds majority of the votes cast, representing the majority of its component Members’.

Finally, Article 269 TFEU significantly limits the role of the CJEU over the sanctions procedure:

The Court of Justice shall have jurisdiction to decide on the legality of an act adopted by the European Council or by the Council pursuant to Article 7 of the Treaty on European Union solely at the request of the Member State concerned by a determination of the European Council or of the Council and in respect solely of the procedural stipulations contained in that Article.

Such a request must be made within one month from the date of such determination. The Court shall rule within one month from the date of the request.

The legal issues

Given the limit on judicial control of the Article 7 process, it is almost entirely political. So the legal questions arising from it may be largely hypothetical in practice. However, they do exist.

The first important point is the wide scope of issues which can be the subject of the Article 7 process. It is sometimes claimed that the process can only be used to sanction Member States for breaches of EU law, but this is clearly false. There is no reference to EU law breaches in Articles 2 or 7. Indeed, such a limit on the scope of Article 7 would be odd, given that Article 269 TFEU limits the Court’s jurisdiction, yet other provisions of the Treaties (discussed further in the next blog post) give the Court extensive jurisdiction over the enforcement of ordinary EU law.

This claim about the limited scope of Article 7 is also absurd if you consider the broader context. Imagine, for instance, a Member State placing LGBT citizens in concentration camps. A narrow interpretation of Article 7 would mean that the EU could only complain about this to the extent that being locked up in camps would have a discriminatory effect on the detainees’ access to employment. Yes it would, but that would hardly be the most outrageous aspect of detaining LGBT people in camps because of their sexual orientation. (EU law is also relevant to LGBT refugees, but the Article 7 process would have to be triggered first for it to be relevant to refugees who are EU citizens).

So obviously Article 7 is not intended to be limited in this way. Indeed, its broad scope partly explains why the CJEU’s jurisdiction is limited – to avoid giving it jurisdiction to rule on issues which are not normally within the scope of EU law. (Another reason is the intention to keep the Article 7 process in the hands of politicians, not judges).

On the other hand, the Article 7 process and ordinary EU law can overlap. The Court can use its ordinary jurisdiction to rule on an issue being discussed in the Article 7 process, and vice versa. This was confirmed implicitly in last week’s judgment on Poland and the rule of law, given that the issues in that judgment also formed a part of the Commission’s Article 7 case against Poland. In fact, the Advocate-General’s opinion addressed the overlap explicitly (paras 48-50), arguing that ‘[t]here are firm grounds for finding that Article 7 TEU and Article 258 TFEU are separate procedures and may be invoked at the same time’.  As noted already, this alternative option of using ordinary EU law to restrain Member States’ breaches of human rights or the rule of law is discussed in the next blog post in this series.

Exactly how does the Court’s limited jurisdiction over Article 7 work? The wording of Article 269 TFEU definitely covers the decisions on the ‘yellow card’ or the ‘red card’. At first sight, it also applies to the implementation of sanctions, since the text refers to any Council actions pursuant to Article 7 TEU. But on this point, the use of the word ‘determination’ is confusing, as Article 7 doesn’t use that word to refer to the implementation of sanctions,  but only the decisions on whether EU values have been (or might be) breached.

Note also that the only possible challenger is the Member State sanctioned under Article 7 – not any other Member State, an EU institution, or an individual or business. If individuals are barred from challenging the validity of Article 7 implementation decisions, even indirectly via national courts to the CJEU, how else can the Council’s obligation to ‘take into account the possible consequences of such a suspension on the rights and obligations of natural and legal persons’ be enforced? At any rate, there’s no limit on the Court being asked by national courts to interpret the decisions implementing sanctions, which could be significant in working out the impact of sanctions on individuals. In particular, if Council decisions under Article 7 disapply ordinary EU law in some way, there should be no objection to the Court’s ordinary jurisdiction to interpret such ordinary EU law applying.

A Court judgment under Article 269 TFEU can only address procedural issues, not substance. In other words, the Court cannot be asked to rule on the question of whether the Member State concerned has actually breached EU values (or seriously risks breaching them). As we will see in the second blog post, however, the developing case law on the overlap between Article 7 and ‘ordinary’ EU law renders this firewall a little diffuse. Also, one can imagine that a Member State may make arguments about the fairness of the hearings, even where (as in the case of Poland and Hungary) some hearings have been held. (Update, Sep 1 2019: the Council's internal rules on Article 7 hearings have now been published). Finally, the time limits in Article 269 require significant fast-tracking: the challenge must be made one month after the determination (the usual deadline to bring an action to challenge an EU act is two months after publication) and (uniquely in EU law) one month for the Court to give its ruling.  

Even though Article 7 has not resulted in any sanctions decision yet, some issues about its scope may be addressed in the near future, because Hungary has brought a legal challenge to the European Parliament’s decision merely to trigger Article 7. This case might be inadmissible, because usually it is not possible to challenge the start of an EU legal procedure, but only a legal act once adopted, which may explain why Article 269 TFEU makes no reference to challenging acts of the European Parliament at all (or indeed, to challenging acts of the Commission or the Member States). The substance of the Hungarian government’s argument is that the European Parliament wrongly ignored abstentions when counting votes cast to trigger the Article 7 process.

One key legal and political question is the interpretation of the unanimity requirement to issue a ‘red card’ determination of a serious breach of EU values. Some have suggested that since two Member States are facing Article 7 procedures, and they would have a natural tendency to stick together and vote for each other, unanimity can never be reached. Therefore, for the ‘red card’ procedure to be effective, it must be interpreted to mean that any Member State facing an Article 7 procedure must lose its vote even as regards issuing a ‘red card’ against another Member State.

With respect, this interpretation is untenable. Article 354 TFEU refers to ‘the Member State in question’ not voting in its own case – clearly using the singular, as well as the definite article. There is no way to stretch the canons of interpretation for this to refer to multiple Member States. Such wild leaps of legal fancy are particularly inappropriate when a main point of the process is to ensure protection of the rule of law in the European Union.

Conclusions

Article 7 TEU recently turned 20 years old. It was conceived as a political process par excellence, and it remains supremely political at childhood’s end, even as the first attempts to trigger it are made. Due to its impact on national sovereignty, and the web of transnational partisan politics in which the governments concerned are embedded, Article 7 has long been seen as a ‘nuclear weapon’ – only to be used as a last resort, in a political emergency such as a military coup. Although the attempt to nuance Article 7, by adding a ‘yellow card’ process, dates from 2003, in practice this version of the process is perceived as politically ‘nuclear’ too.

The obvious problem here – which the ‘yellow card’ reform sought but failed to address – is that democracy rarely collapses overnight. In the famous words of Michael Rosen, ‘people think that fascism arrives in fancy dress’, but in fact ‘it arrives as your friend’ – promising to:

…restore your honour, 

make you feel proud, 

protect your house, 

give you a job, 

clean up the neighbourhood, 

remind you of how great you once were, 

clear out the venal and the corrupt, 

remove anything you feel is unlike you...

And to that end, and for those reasons, it often gains a foothold through the democratic process. Yet the values of the EU to be protected also include democracy – and the Article 7 process is in the hands of the governments of fellow Member States. All have some skeletons in their own closet; and all have backs that might need some scratching by the governments of the States being criticised.

So is the Article 7 process doomed? In fact, the expansion of EU law in areas with significant relevance to human rights – and the willingness of the CJEU to rule on the judicial independence of national courts in general – means that recourse to the nuclear option may arguably not be necessary. In effect, the conflict over the protection of human rights and the rule of law in Member States can also be fought by conventional means: the ordinary system for the enforcement of EU law as such, to which we will turn in the second post in this series. As for the broader tension when concerns about the rule of law and human rights stem from a democratic outcome, this will be assessed as part of the broader discussion in the third post.  

Barnard & Peers: chapter 9

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The Global Compact for Migration: cracks in unity of EU representation

Pauline Melin, PhD, Lecturer in European Law (Maastricht University) and Researcher at the Institute for European Law (KULeuven)

Today, the UN Global Compact for Safe, Orderly and Regular Migration is meant to be approved by an intergovernmental conference in Marrakesh with the purpose to be adopted on the 19th December 2018 as a Resolution of the UN General Assembly in New York. The debate over the adoption the Global Compact for Migration has been politically polluted. Since the end of October 2018 and the withdrawal of Austria, a Member State who had until then positively contributed to the negotiations Global Compact through the Council Presidency, no week has passed without a new announcement of an EU Member State withdrawing or doubting its support for the Global Compact for Migration. That vague of lack of support coming from the EU Member States is in contradiction with the (supposedly) common position presented by the Union delegation during the negotiation process. Those cracks in unity of representation of the EU on the international scene raise questions concerning the role of the EU in the negotiations of the Global Compact and the consequences for its Member States in light of the principle of sincere cooperation.

The role of the EU in the negotiation of the Global Compact for Migration

The process eventually leading to the adoption of the Global Compact started in September 2016 with the New York Declaration whereby 193 Heads of State and Government recognized the need for developing an international cooperation on migration.

Throughout its different drafts (the Zero Draft on 5th February 2018, the Zero Draft Plus on 5th March 2018 and the Final Draft on 11th July 2018), the wording of the Global Compact concerning its legal nature stayed consistent. The Global Compact is intended to present “a non-legally binding, cooperative framework that builds on the commitments agreed upon by Member States in the New York Declaration for Refugees and Migrants.” (emphasis added, points 5,6, and 7 of the Zero Draft, Zero Draft Plus and Final Draft respectively).

From the UN side, the negotiations of the Global Compact were meant to be as inclusive as possible with the participation of all its State Members, all members of specialized agencies that have an observer status with the General Assembly, intergovernmental organizations and other entities having received a standing invitation. The EU, as a regional group, was granted standing status in order to participate in the negotiations and the conclusion of the Global Compact.

From an EU perspective, given the fact that the Global Compact for Migration is a non-legally binding international instrument, the procedure for negotiating and concluding an international agreement enshrined in Article 218 TFEU was not applicable (C-233/02 France v. Commission, para. 40). The EU participated in the negotiation of the Global Compact through the delivery of Union delegation statements. According to the European Commission, the Union delegation statements were “EU coordinated statements” constituting an “unified EU approach”. That unified EU approach must however be nuanced considering that, since March 2018, Hungary has proposed a very different approach than the one defended by the Union delegation. Furthermore, the exclusion of Hungary from the EU coordinated statements can be seen from the Union delegation’s statements themselves which mention “on behalf of 27 Member States”.

The (lack of) common position

The fact that the Global Compact is a non-legally binding international instrument does not entail that the principles of conferral, institutional balance or sincere cooperation should not be respected. In case C-660/13 Council v. Commission on the Swiss MoU, the Court found that the Commission needs a Council Decision authorizing it to sign the negotiated text of a non-binding instrument before it can approve it on behalf of the Union. In the context of the negotiation of the Global Compact for Migration, the Commission in fact relied on this case in order to justify its proposal for Council Decisions (since withdrawn) authorizing it to sign the Global Compact in Marrakesh on behalf of the Union.

However, as opposed to the Council v. Commission case, the Commission here did not seem to have a clear negotiating mandate from the Council. In Council v. Commission, there were some Council Conclusions adopted in 2012 authorizing the start of the negotiation between the Swiss Confederation and the EU whereby the content of the negotiation as well as the designation of the European Commission as the negotiator were set out. The European Commission then considered that because the negotiated text was similar in content to the negotiated mandate, it could sign the negotiated text on the basis of Article 17(1) TFEU (para.35). However, the Court disagreed and held that neither Article 17(1) TEU nor the negotiating mandate found in the Council Conclusions were sufficient bases for authorizing the Commission to sign the negotiated text without a Council Decision on the matter.

In the case of the negotiation of the Global Compact for Migration, there is in fact no Council Decision authorizing the start of the negotiation. In order to justify its negotiating position on behalf of the Union, the European Commission relies on two documents: the European Council Conclusions on Migration from October 2016 and the European Consensus on Development from 2017. In the European Council Conclusions on Migration, it is simply mentioned that the European Council welcomes the New York Declaration. In the European Consensus on Development, it is stated that the EU and its Member States will actively support the elaboration of the UN Global Compacts on Migration and Refugees. While the two documents could be considered as an indication that there is a willingness from the European Council to have a common position in the negotiations of the Global Compacts for Migration and Refugees, there is nothing in the documents that either identify the European Commission as the negotiator on behalf of the Union and its Member States nor that indicate what the content of that common position would be. With no official document proving the common position of the EU and its Member States, one might wonder whether the Member States were obliged to abstain from contradicting the Union delegations’ statements.

The point of departure of the principle of sincere cooperation

From the PFOS case, it seems that the principle of sincere cooperation whereby the Member States should support the position expressed by the EU or, at least, abstain from contradicting it starts from the moment there is an established common position (para. 89). In the PFOS case, Sweden had submitted a proposal to list PFOS in Annex A of the Stockholm Convention while a Commission proposal for a Council Decision authorizing the Commission to submit on behalf of the Union and its Member States a list of chemicals to be added in the Annexes of the Stockholm Convention did not comprise PFOS within the list. Firstly, the Court recalled that the principle of sincere cooperation flows from the requirement of unity in international representation of the Union (para.73). Then the Court reminded that the submission by the Commission of a Council proposal for the authorization to start the negotiation of a multilateral agreement represent the point of departure for a concerted action even though the proposal has not been adopted by the Council (para. 74). The Court added that the establishment of a common position through a Council Decision was not a prerequisite for its existence as long as “the content of that position can be established to the requisite legal standards” (para.77). In the PFOS case, the Court found that the fact that Council’s conclusions and minutes of the meeting of the Council’s Working Party on International Environmental Issues were sufficient evidences of an established common position which the Member States should support or, at least, abstain from contradicting (para.89). In reference to the “requisite legal standards”, the Court referred another case whereby the Council and the Commission had concluded an arrangement setting up a coordination procedure between the Commission and the Member States to decide on the exercise of responsibilities or on statements in the context of the UN Food and Agriculture Organization (‘FAO’).

In the context of the drafting process of the Global Compact for Migration, one may consider the General Arrangements for EU Statements in multilateral organisations as being the relevant requisite legal standards. In the General Arrangements, point 2 indicates that “[G]iven the sensitivity of representation and potential expectations of third parties, it is essential that, in conformity with current practice, the preparation of statements relating to the sensitive area of competences of the EU and its Member States should remain internal and consensual.” (emphasis added). Hence, while the need for a Council Decision is not required, there is a need to have an internal discussion and a consensus about the common position. Considering the fact that internal coordination for setting a common position takes place behind closed doors, it is not possible to ascertain whether the internal coordination on the Global Compact for Migration actually took place.

Conclusion

While there might have been internal coordination and an agreed common position, the lack of evidence of it becomes a problem when Member States start expressing opinions contradicting the Union’s position. The uneasiness of the European Commission faced by rebellious Member States can be felt through the timing of its proposals for Council Decisions authorizing it to sign the Global Compact for Migration on behalf of the Union. The European Commission adopted those proposals in March 2018 whereas the Final Draft of the Global Compact for Migration was only agreed in July 2018. As a result of the lack of proof of an agreed common position, it is difficult for the European Commission to ensure that the Member States respect their obligations under the principle of sincere cooperation. However, there should be a strong interest for the European Commission to avoid cracks in unity of representation as it ultimately diminishes the credibility of the EU as a global actor. Given the growing relevance of non-binding international instruments, it is unlikely that the cracks in unity of representation will remain anecdotal to the approval of the Global Compact. It is therefore time to think about a clear legal framework for the negotiation and conclusion of non-binding international instruments.

Barnard & Peers: chapter 24, chapter 26

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How to protect the rights of UK citizens in the EU27 after Brexit? Analysis of the Shindler judgment

Professor Steve Peers, University of Essex*

Introduction

The EU General Court today gave its judgment in the case of Shindler and others, on the legality of the EU Council decision giving the EU Commission a mandate to negotiate the Brexit withdrawal agreement with the UK. In the Court’s view, the case, which was brought by a group of UK citizens living in the other EU Member States, was inadmissible. Although this necessarily meant that the Court did not rule on the merits of the legal challenge, the judgment nevertheless touched on a number of interesting issues regarding the process and consequences of the UK’s withdrawal from the EU.

Today’s judgment could still be appealed to the full Court of Justice, and indeed the applicants’ lawyer has announced an intention to appeal. However, it might be difficult for the Court to give a ruling on the appeal before Brexit day. The judgment also arguably leaves the door open to potential legal challenges against further steps in the Brexit process.

Furthermore, it should be noted that today’s judgment does not have any direct implications for other cases raising Brexit legal issues, which I summarised here, including the Wightman case on whether the UK’s notification of withdrawal from the EU can be unilaterally revoked (on the background to Wightman in the Scottish courts, see here; on the legal arguments on unilaterally revocability, see here). To add to that, a parallel case in the Dutch courts on the legal status of UK citizens in the EU (see discussion here) has been stalled until Brexit day, and the CJEU has ruled already that the UK remains fully part of EU law until that date (as discussed here).

The judgment

While the applicants presumably disagree with the UK’s decision to trigger the Brexit process, the EU General Court only has jurisdiction over acts of the EU institutions or other bodies, not acts of the Member States. The applicants therefore challenged the Council’s response to the UK’s notification of withdrawal from the EU under Article 50 TEU. (Note that the act being challenged in this case – namely the Council’s decision to give the Commission a negotiating mandate for the withdrawal agreement – is different from the European Council’s adoption of negotiating guidelines for the agreement, although a legal challenge brought against those guidelines would surely have had the same result as this case). The Commission planned to intervene in support of the Council, although ultimately its application to do so was irrelevant. No Member States intervened.

When individuals (natural or legal persons) seek the annulment of acts adopted by the EU institutions directly before the EU General Court, they are subject to restrictive conditions on standing set out in Article 263 TFEU. In order to sue, they must either be: a) addressees of the act; b) directly and individually concerned by it; or c) directly concerned by it, if it is a regulatory act which does not entail implementing measures.

 

Shindler and others are not addressees of the Council’s negotiating mandate, and they were likely covered by point c), since the EU courts have ruled (see the Inuit judgment, and the discussion here) that point c) applies whenever the EU act is not adopted by an EU legislative process, which the negotiating mandate was not. However, the General Court never really got to that stage of legal analysis, since it ruled that they lacked standing anyway, because they did not meet the requirement that ‘the binding legal effects of the measure being challenged must be capable of affecting the interests of the applicant, by bringing about a distinct change in his legal position’.

In the Court’s view, the decision on the negotiating mandate was binding. However, while, following previous CJEU case law (the cases referred to were discussed here and here), a negotiation mandate produces legal effects between the EU and Member States, and between EU institutions, it ‘does not directly affect the legal situation of the applicants’.

On that point, the decision on the negotiating mandate was legally distinct from the UK decision to withdraw from the EU (which was not defined by the Court), and from the notification of the UK’s intention to withdraw from the EU sent by the Prime Minister. The latter notification, not the former decision to withdraw, started the two-year time limit set out under Article 50, after which the Treaties cease to apply to the UK in the absence of a withdrawal agreement, unless there is an agreement to extend the period. (Today’s judgment does not address the question at issue in Wightman – ie whether the notification can be revoked).

Nor does the decision on the negotiating mandate ‘alter the legal situation of UK citizens resident in one of the European Union’s other 27 Member States’, as regards either their situation when that decision was adopted or their situation on Brexit day. The negotiating mandate ‘merely constitutes a preparatory act for any final agreement’, which would have to be approved by the Council with the consent of the European Parliament. Annulling it would not change the position of UK citizens, because the notification would still be valid and the two-year time limit would still apply. Although the UK citizens’ status, ‘particularly as regards their status as EU citizens, is likely to be affected’ from Brexit day, whether or not there is a withdrawal agreement, that change would not result from the decision to adopt the negotiating mandate.

The Court then rejected a number of counter-arguments of the applicants against this finding. First, they had argued that the Council’s decision was ‘an implicit act by which the Council accepted the notification of intention to withdraw’. In the Court’s view, although the decision produced effects within the EU and between the EU and Member States, it did not produce legal effects for the applicants: for them it ‘must be considered to be a preparatory act’ without ‘direct legal effects’.

Nor did it implicitly accept the UK’s notification to withdraw, as it was distinct from the decision to withdraw or the notification of that decision. Also, withdrawal from the EU ‘is based on a unilateral decision’ by a Member State ‘pursuant to its own constitutional requirements’. Article 50 refers twice to a decision by a Member State – and then to notifying its intention to withdraw, not to making a ‘request’ to withdraw. Article 50(3) TEU, setting out the two-year deadline and the possibility of a no deal outcome, ‘confirms that the possibility for a Member State to withdraw from the EU is not subject to authorisation from the EU institutions’.

So there is no process of accepting the notification from the EU institutions, in which they check if the UK has met its own constitutional requirements: ‘[s]uch a decision of acceptance by the Council or by any other EU institution is not needed and is not provided for by Article 50 TEU.’ Anyway, the notification was sent to the European Council, not the Council; and the Council’s reference to the Brexit process in its negotiating mandate only observed the legal situation, not created it.

Next, the applicants had argued that the Council's negotiating mandate ‘does not include an objective to ensure that UK citizens who obtained the status of EU citizen before 29 March 2019 maintain that status’, therefore failing to protect them fully or provide for legal certainty. The Court rejected this argument for several reasons: the negotiating mandate was (unsurprisingly) simply a negotiating mandate, not a final position; there would not necessarily be an agreement; the position of UK citizens will not be determined unilaterally by the EU but also depend on the UK’s position; and the final agreement will need consent of the European Parliament. So the mandate, being addressed to the Commission, did not itself determine the position of UK citizens after Brexit.

Also, the absence of any provision in the mandate on EU citizenship and voting rights ‘does not directly affect [UK citizens’] legal situation’, because the negotiating mandate ‘is merely a preparatory act which cannot prejudge the content of any final agreement, particularly as regards the personal scope of any provisions on the protection of the status and rights of UK citizens in the EU 27’. Furthermore, the mandate could not establish the rights of UK citizens in the EU27 in the absence of an agreement, and so an argument based on the Council’s failure to address this scenario was unfounded.

Thirdly, the applicants had argued that ‘the Council should have refused or stayed the opening of negotiations’, because the withdrawal process is ‘void’ due to ‘the absence of definite constitutional authorisation based on the votes of all UK citizens, who are also EU citizens’. More precisely, the applicants object to being denied the vote in the 2016 referendum and the 2017 UK general election, because UK citizens who have been living outside the UK for more than 15 years lose the right to vote. Also, they argued that the European Union (Notification of Withdrawal) Act 2017 does not require the UK to notify its withdrawal but only authorises the Prime Minister to do so, and that:

legal proceedings are currently underway before a UK court, that the Council and the United Kingdom should have sought judicial review of the constitutionality of the notification of the intention to withdraw pursuant to the principle of sincere cooperation provided for in Article 4(3) TEU, and that the Council also should have requested the opinion of the Court as to the compatibility with the Treaties of depriving expatriate UK citizens of the right to vote and their indirect representation by MPs, pursuant to Article 218(11) TFEU. They add that to dismiss the present action for inadmissibility would infringe the principle of democracy, in so far as removing EU citizenship in March 2019 will occur in circumstances that are illegal, where EU citizens have been deprived of the right to vote.

In the Court's view, these are substantive arguments that do not impact the admissibility of the case, because they do not impact the Court’s finding that the negotiating mandate ‘does not directly affect the legal situation of the applicants’. So ‘[e]ven if the Council should have refused to open the negotiations or should have verified that the decision by which the United Kingdom decided to leave the European Union had been taken in accordance with its own constitutional requirements’, the negotiating mandate only authorised the start of talks and set the negotiation objectives of the EU. Equally, even if the Council ‘was wrong’ not to check the compatibility of the withdrawal agreement with EU law (ie, the process in Article 218(11) TFEU which the applicants refer to), which the Court noted is optional, or ‘infringed the principle of sincere cooperation’, that would not alter the admissibility criteria either.

As for the alleged infringement of the principle of democracy, this did not change the criteria for admissibility either, as it would in effect amount to the tail wagging the dog: ‘tantamount to inferring the admissibility of an action for annulment under Article 263 TFEU from the possible unlawfulness of the contested decision’. Just because the EU institution allegedly seriously breached EU law or had a major adverse impact on the applicant, it does not follow that the challenge is admissible. Anyway, again the negotiating mandate ‘does not, of itself, restrict the applicants’ rights’.

Next, the Court rejected the argument that this was the applicants' only legal remedy before they lose EU citizenship. But the Court repeated that the Council decision was not the cause of the UK leaving the EU, and added that protection of EU law rights can also be secured by national courts. In this case, the Court noted that the voting franchise ‘and, indeed, the notification of intention to withdraw, were open to challenge before the UK courts, which may, where appropriate, refer questions to the Court for a preliminary ruling on the interpretation of the Treaties, pursuant to Article 267 TFEU.’ More precisely, the Court observed that the High Court had already rejected a case brought by Mr Shindler concerning the franchise, as well as the Webster challenge to ‘the alleged lack of a decision to withdraw taken in accordance with the United Kingdom’s constitutional requirements’.

Finally, the applicants argued that no such route through the UK courts would be possible after Brexit day, as the UK might not consider itself bound by an EU court decision. However, the Court ruled that it could not alter the rules on admissibility of legal actions in light of this scenario.

Comments

It’s striking that the General Court has chosen a less obvious route to find that this case is inadmissible – the lack of direct impact on the applicants – rather than the more obvious route of finding that there is no ‘direct concern’, or that the negotiating mandate calls for further implementing measures (ie negotiations with the UK). The implication of the Court’s judgment is that that the withdrawal agreement – if it is ratified in some form – would have a direct impact on the applicants, and that they could try afresh to challenge it then. But then they would have to face the hurdle of showing direct concern and the absence of implementing measures – which could be a difficult hurdle to surmount given that the withdrawal agreement will be implemented by national bodies in the EU27 and the UK.

As for alternative routes to challenge the Council’s negotiating mandate, it is hard to see exactly what could be attacked via the national courts (which can ask the CJEU whether an EU act is invalid: direct challenges like today’s case are only one means of challenging the legality of EU acts). Again, though, the Council’s decision to conclude a final withdrawal agreement could be attacked via the EU27 national courts, even if a direct action would face different standing challenges; recent case law of the CJEU (see discussion here) has confirmed that the EU’s conclusion of international treaties can indeed be challenged by this route.

Another route to challenging the validity of EU acts is by claiming damages liability of the EU, which is not subject to the same standing rules. According to the CJEU case law, the EU incurs damages liability when it acts unlawfully, its unlawful acts cause damage to individuals, and it commits a sufficient serious breach of a legal rule conferring rights on individuals. But it’s hard to see how damages liability could be incurred by the negotiating mandate, since the logic of the Shindler ruling is that the mandate could not cause damage to individuals, as it did not directly affect their legal position. On the other hand, an argument about damages liability could be made if there is a withdrawal agreement, although note that the threshold to succeed in a damages claim is quite high: see, for instance, the Ledra Advertising case on losses of Cypriot bank depositors, discussed here.

In the case of no withdrawal agreement (or replacement treaty ring-fencing rights), there would be nothing which could be the subject of legal challenge at EU level, although UK citizens could still try to argue in the national courts of the remaining Member States that there is a principle of acquired rights which EU law recognises (see again the Dutch case discussed here, which is on hold), or at least that EU legislation on the position of non-EU citizens (which has partly harmonised national law) applies to them. Equally there would be no EU act to claim resulted in damages, although UK citizens (and others) might try to argue that the EU’s conduct of the negotiations could be the subject of a damages claim.

Moving to the core of the Court’s reasoning, it is a persuasive argument that the decision to establish a negotiating mandate did not directly impact upon the applicants’ rights. The process was indeed triggered by the UK, with the negotiating mandate at most taking note of that decision; and any later impact on individual rights will flow from the final agreement (if ratified) or the absence of a deal.  While the Court seemed to assume that UK citizens lose EU citizenship as a result of Brexit, it did not expressly say as much.

The Court was also right to stress that withdrawal is the responsibility of the UK in accordance with its own constitutional requirements, meaning that the Council could not in some sense review whether the UK had met those requirements when it submitted its notification to withdraw. It’s particularly unclear how exactly the Council should have sought judicial review of the UK’s notification, or how the Article 218 process of assessing draft international treaties for their compatibility with EU law could extend to an examination of the franchise in the UK referendum and general elections. The general assertion that the circumstances are ‘illegal’ due to the limited franchise in the referendum rather overlooked the legal process in the UK, which had already (as the Court noted) rejected a claim challenging the legality of the franchise restrictions. Having said that, the Court later indicated that national court disputes over the Article 50 process in the UK could be sent to the CJEU – although it did not as such suggest that this would, after all, entail a review of those national constitutional requirements in light of EU law.

Similarly the Court rightly rejected the arguments about the negotiation mandate being insufficient because it depends upon the final agreement (if ratified) what the rights of individuals are, and applies its usual case law refusing to rethink the strict rules on standing in light of the applicants’ particular circumstances. 

It’s useful to examine briefly what the Court would have ruled on if it had examined the merits of the claim, which are summarised here. The first argument was that withdrawal from the Euratom treaty had to be a separate legal process; I have a different view, as set out here. (Note that winning on this point would not have helped with the key legal objective of preserving UK citizens’ rights).

The second argument was that the negotiating mandate wrongly claims that the EU alone was competent to conclude the withdrawal agreement, and that it should be jointly ratified with EU Member States. Leaving aside the merits of this argument, with respect it is hard to see how it helps the applicants if they had won on this point, because it would have seriously increased the risk of a no deal scenario – which would, as I recently pointed out, leave UK citizens in the EU27 in particular much worse off than under the withdrawal agreement.

The third and fifth arguments have been addressed in an indirect way by the judgment, despite the finding of inadmissibility: the limited franchise is a matter to be addressed in accordance with the UK’s own constitutional requirements, and the lack of certainty regarding the final outcome is simply unavoidable at the point when the Council adopts a negotiating mandate. Finally, the fourth argument – concerning the lack of a vote for UK citizens living in overseas countries and territories – is another form of franchise argument, which again should be left to the UK’s constitutional requirements to address.

Finally, on the overall context of the case: while in my view, protection of the rights of UK citizens in the EU27 (and the parallel rights of the EU27 in the UK) is absolutely fundamental, the focus should be on securing those rights in future – either by reversing Brexit, or failing that by at least avoiding a no deal outcome – rather than re-litigating the franchise of the referendum, by trying to induce the EU courts to rule on an issue (national constitutional requirements) which should be wholly outside their remit.  In the event of a no deal outcome, despite the apparent indifference of the Commission to the fate of UK citizens in the EU27, the focus has to be on securing a ring-fenced treaty on securing the rights of citizens on both sides; failing that, EU-wide legislation on the acquired rights of UK citizens (hopefully matching parallel action by the UK for EU27 citizens); and failing that, litigation to argue that the EU and/or its Member States have an obligation to preserve their rights as much as possible.

*Supported by an ESRC Priority Brexit Grant on 'Brexit and UK and EU Immigration Policy'

Barnard & Peers: chapter 10, chapter 27

Photo credit: European Sanctions Blog

The European Commission’s Activation of Article 7: Better Late than Never?

Dimitry Kochenov, Professor of EU Constitutional Law at the University of Groningen; Laurent Pech, Professor of European Law at Middlesex University London; and Kim Lane Scheppele, Professor of Sociology and International Affairs at Princeton University

‘The European Union is first and foremost a Union of values and of the rule of law. The conquest of these values is the result of our history. They are the hard core of the Union's identity and enable every citizen to identify with it. The Commission is convinced that in this Union of values it will not be necessary to apply penalties pursuant to Article 7 of the Union Treaty’ European Commission, 15 October 2003

1. What has just happened?

On Wednesday, the European Commission reacted to the continuing deterioration of the rule of law situation in Poland by (i) issuing a fourth Rule of Law Recommendation, which complements three previous Recommendations, adopted on 27 July 2016, 21 December 2016 and 27 July 2017; (ii) submitting a Reasoned Proposal for a Decision of the Council on the determination of a clear risk of a serious breach of the rule of law by Poland under Article 7(1) TEU and (iii) referring the Polish Law on the Ordinary Courts Organisation to the Court of Justice of the EU under Article 258 TFEU and in the context of which the Commission is raising for the first time (to the best of our knowledge) a violation of Article 19(1) TEU in combination with Article 47 of the EU Charter of Fundamental Rights by Poland to the extent that the Minister of Justice has been given a discretionary power to prolong the mandate of judges which have reached retirement age (a similar combination was raised in the first stage of an infringement action against Hungary in December 2015 with regard to immigration issues but this language was dropped by the time it got to the Court of Justice).

Should the Polish authorities finally decide to implement the Commission’s recommendations within three months, the Commission has indicated its readiness to ‘reconsider’ its Article 7(1) proposal (para 50 of the Commission’s fourth rule of law recommendation).

The intensity and repeated nature of Poland’s ruling party attacks on the most basic tenets of the rule of law are unprecedentedly aggressive and in obvious breach of the Polish Constitution, which in our view warrants the Commission’s action (this is not to say that Article 7(1) should not also be activated against Hungary as two of the present authors previously argued in this 2016 article). Indeed, as rightly noted by the Commission, the Polish authorities have adopted over a period of two years no less ‘than 13 laws affecting the entire structure of the justice system in Poland, impacting the Constitutional Tribunal, Supreme Court, ordinary courts, National Council for the Judiciary, prosecution service and National School of Judiciary’. It was time therefore for the Commission to defend the independence of Member State judiciaries and the rule of law (as nicely put by Maximilian Steinbeis, ‘Polish courts are our courts’, that is, ‘if the legal system in a Member State is broken, the legal system in the whole of the EU is broken’).

The media have so far only almost exclusively focused on the first ever invocation of what is often described as the EU’s ‘nuclear option’, which, however, as correctly pointed out by Frans Timmermans in his press conference announcing the Commission’s actions, is a misnomer (as we previously argued here). To put it briefly, Article 7 TEU provides for two main mechanisms: a preventive one in case of a ‘clear risk of a serious breach’ of the values common to the EU and its Member States and a sanctioning one where ‘a serious and persistent breach’ of the same values has materialised (for more detailed commentaries on the mechanics of Article 7 see here and here).

The Commission merely initiated the preventive mechanism on Wednesday when one could however reasonably argue that we are already way beyond the stage of a ‘clear risk’ and entered ‘serious and persistent breach’ territory following the capture of the Polish Constitutional Tribunal in obvious breach both of the Polish Constitution and the Commission’s first and second rule of law recommendations (see Pech and Scheppele, January 2017). Before however offering further details on the situation in Poland, however, it may be worth offering a brief overview of Article 7’s genesis.

2. Genesis of Article 7

On 9 May 1950, the venerable Schuman Declaration invited all the free European states to join the unification project, implying respect for the rule of law, a democratic system of government, and a market economy. The initial versions of the Treaties presumed compliance of the Member States with these principles, now reflected in Article 2 TEU. The enforcement of compliance was nevertheless strictly confined to the scope of the law of the EU via what are now Articles 258 and 259 TFEU, later reinforced by Article 260 TFEU, thus leaving compliance with the EU’s foundational values almost exclusively to the care of the constitutional systems of the Member States. The first shift towards a more active role to be played by the EU in this respect happened in 1978 when the Commission contemplated a proposal for a possible sanctions mechanism against the backdrop of the then upcoming Greek accession.

A few years later, the European Parliament draft EU Treaty from 1984 contained such a mechanism for the first time. Later on, the EU began systematically including ‘human rights clauses’ in all association and cooperation (‘Europe-’) agreements with the Central and Eastern European states and incorporated these into the fabric of the pre-accession political conditionality in the areas of democracy, the rule of law and human rights.

In anticipation of the forthcoming accession of numerous countries to the EU, the Treaty of Amsterdam included the first version of Article 7 which only provided then for possible sanctions in a situation of ‘serious and persistent breach’. With the Nice Treaty, Article 7 TEU was revised to further enable the EU to adopt preventive sanctions in the situation where there is ‘a clear risk of a serious breach’ of the EU values by a Member State. This change was made to enable the EU to step in in a situation similar to the one in Austria following the formation of a governmental coalition involving Jorg Haider's far-right Freedom Party. Before the Nice amendment, EU’s involvement with Austria took the form of a series of illegal ad hoc ‘bilateral sanctions’ imposed on Austria by 14 other Member States acting, strictly speaking, outside of the framework of EU law.

These diplomatic sanctions were ended when the report issued by a “wise men” committee, which was set up to investigate the political and human rights situation in Austria, concluded that Austria’s record and commitment to common European values, including the rights of minorities, refugees and immigrants, was at the time of the report satisfactory: the illegal sanctions triggered by the election result would thus clearly not be justified under the amended Article 7 either. One might note in this respect how times have changed when the Freedom Party's inclusion in a coalition government in Austria last week passed almost totally unremarked this time. It is wise however for the EU not to overreact to election results, but to instead react to actual breaches of the values common the EU and its Member States.

In the light of this episode and other factors explored in this blog post published in January 2015, the European Commission thought it useful to adopt a pre-Article 7 procedure in 2014 to address systemic threats to the rule of law in any of the EU’s 28 Member States in response to the EU-28 governments’ express request in 2013 that the Commission should ‘take forward the debate in line with the Treaties on the possible need for and shape of a collaborative and systematic method to tackle’ rule of law backsliding (this is why it beggars belief that some EU national governments are now complaining that the Commission is finally taking this existential issue seriously).

The new pre-Article 7 procedure was activated for the very first time in January 2016 following the non-respect by Polish authorities of crucially important rulings of the Polish Constitutional Court and the adoption of new rules with respect to Public Service Broadcasters. As we predicted in this January 2015 post, any soft dialogue with authorities bent on undermining if not completely dismantling all checks and balances was bound to fail and this is indeed what has happened with respect to Poland. It was also bound to create more space within which the determined autocrats in the Polish governing party would have more time to consolidate their unchecked power in relative peace. Be that as it may, having at last accepted the totally fruitless nature of the so-called constructive dialogue with Polish authorities, the European Commission finally decided, ‘with a heavy heart’, to activate Article 7(1).

3. Is the Commission’s decision to initiate Article 7 justified?

First, we agree fully with Frans Timmermans when he said earlier this week that the ‘common pattern’ of all the legislative changes targeting the judiciary in Poland ‘is that the executive or legislative powers are now set up in such a way that the ruling majority can systematically, politically interfere with the composition, the powers, the administration and the functioning of these authorities, thereby rendering the independence of the judiciary completely moot.’ We also share the view recently expressed by Vera Jourova and according to which 'if one national system of judiciary is broken, the EU system is broken’.

A full account of the measures taken to remove checks and balances would take more space than we have here, so we can only but give a flavour of the so-called ‘reforms’ devised by Poland’s ruling party and which have been repetitively and publicly criticised (a point which the Polish government tends to conveniently forget). It is not just the European Commission that has repeatedly criticised the Polish reforms, but also the European Parliament, key bodies of the Council of Europe such as the Venice Commission, the United Nations Human RightsCommittee, the OSCE Office for Democratic Institutions and Human Rights as well as representatives of the judiciary across Europe, including the Network of Presidents of the Supreme Judicial Courts of the European Union and the European Network of Councils for the Judiciary. Numerous civil society organisations such as AmnestyInternational and Human Rights Watch have also expressed concerns and tens of thousands of Poles have taken to the street to protest the attacks on their own judiciary.

In light of yesterday’s visit to Poland by the British Prime Minister and her failure to publicly and unambiguously criticise the country’s ongoing descent into authoritarianism  (when asked about the Commission’s activation of Article 7(1) Theresa May said: ‘These constitutional issues are normally, and should be primarily a matter for the individual country concerned’), it is may also be worth recalling that a number of UK bodies have also expressed their strong concerns regarding the situation in Poland.

For instance, last July, the Bar Human Rights Committee of England and Wales called on ‘the Polish President, government and parliament to reject these draft laws and to withdraw and repeal all the measures which pose such a grave threat to judicial independence and the rule of law in Poland’. Previously, the body which represents independent judges in England and Wales issued a press release to make clear its concerns 'about the proposed situation in Poland and any impact on judicial independence'.

Last but not least, let us not forget the recent and significant intervention of the Court of Justice in the Białowieża Forest infringement case in the context of which the Court decided that Poland should be subject to a penalty payment of at least €100,000 per day should it be found to have violated the Court’s order. They did so because Polish authorities’ declared that they would ignore a previous order adopted by the Vice-President of the Court to that effect. This was another factor which led the European Parliament to adopt a resolution on 15 November 2017 in which the Parliament describes the current rule of law situation in Poland as representing ‘a clear risk of a serious breach of the values referred to in Article 2 of the TEU’ and in which the Parliament also rightly deplored ‘the Polish Government’s refusal to implement the order of the Court of Justice of the EU on logging in the Białowieża forest’.

The European Commission therefore is hardly alone in its criticism of the Polish ruling party’s repeated attacks on the rule of law notwithstanding the Polish government’s ridiculous claim repeated ad nauseam that these attacks are politically motivated.

Three examples may also suffice to demonstrate that what the Polish ruling party calls ‘reforms’ are nothing but a set of unconstitutional and autocratic changes which aim to completely subjugate the judiciary to the will of the ruling party under the guise of the ‘will of the people’, no matter how plainly incompatible these changes are with both the Polish Constitution and Poland’s international obligations.

Frans Timmermans was entirely correct to point out that the constitutionality of legislation in Poland is longer guaranteed following the successful but unconstitutional capture of the Polish Constitutional Tribunal via the unlawful appointment of ideologically compatible ‘judges’ and the rushed installation, specifically in violation of a request from the Commission, of a new president of the Polish Constitutional Court in December 2016 (for further analysis see the 2017 posts by Pech and Scheppele: Part I; Part II; Part III). The situation is now so out of control that crucial rulings of the Constitutional Court that were made before it was captured ‘have been removed from the register of the Tribunal which is accessible from its website’ while ‘other judgements which were not yet published at the time of the adoption of the Recommendation of 21 December 2016 have by contrast been published on 29 December 2016 in the Journal of Laws’ (see para 5 of Commission Recommendation 2017/1520 of 26 July 2017). We are here in Orwellian and unprecedented territory for a country belonging to the EU and space precludes any analysis of the also unprecedented use (again to the best of our knowledge) of criminal law provisions designed to protect State institutions by the unlawfully appointed President of the Polish Constitutional Tribunal to silence her critics (see analysis here).

Secondly, Polish authorities never shy away from describing their ongoing destruction of the Polish judiciary as being in line with European standards or, failing that, as a pure matter of national sovereignty: two ludicrous points as explained here in a study co-authored by Professors Pech and Platon.

Let’s take for instance the forthcoming ‘reform’ of the Supreme Court. It is nothing less than a total purge of its current membership which should take two to three years to be completed. As noted by the Commission, by lowering the retirement age and applying it to current Supreme Court judges, the Polish ruling aims to compulsory retire right away ‘almost 40% of the current Supreme Court judges’ with the additional discretionary power given to the President of the Republic ‘to prolong the mandate of Supreme Court judges’ with all new Supreme Court judges to be appointed ‘by the President on the recommendation of the newly composed National Council for the Judiciary, which will be largely dominated by political appointees’. One should note in passing that the Minister of Justice, on the basis of another set of provisions, has already gained the power ‘to appoint and dismiss all presidents of courts without concrete criteria, no obligation to state reasons and no judicial review’… This will prove no doubt useful at the time of the next parliamentary elections as the Supreme Court has jurisdiction over the validation of election results (the Polish ruling party has already begun the process of amending electoral rules with no doubt the aim to make sure it will not be in a position to lose them ever again, and a process which no doubt they will try to defend as another necessary ‘reform’…).

To make matters even worse, the new process of ‘extraordinary review’ of final judgments laid down in the Act on the Supreme Court, which the Venice Commission described as having a lot of similarities with the ‘old Soviet system’ and as jeopardising the ‘stability of the Polish legal order’ in its most recent Opinion on Poland. Indeed, again as noted by the Venice Commission, under this new process, ‘it it will be possible to reopen any case decided in the country in the past 20 years, on virtually any ground. Moreover, in the proposed system the new judgements, adopted after the re-opening, will also be susceptible to the extraordinary review. It means that no judgment in the Polish system will ever be “final” anymore’ (para 58). This is as breath-taking as it is unprecedented for a country belonging to the EU and in this respect we also share the Venice Commission’s finding that some aspects of the Polish judicial ‘reform’ targeting its Supreme Court ‘have a striking resemblance with the institutions which existed in the Soviet Union and its satellites’ (para 89).

Viewed in this light one may be forgiven for thinking that the European Commission should have moved right away to the sanctioning branch of Article 7 TEU by initiating Article 7(2) rather than Article 7(1). With its neo-Soviet approach to the division of powers, Poland is already closer to Belarus in the structure of its institutions than it is to any other European state. But, as the best is sometimes the enemy of the good, we can understand why the European Commission would prefer to proceed with the preventive arm of Article 7 first. Indeed, going straight to the European Council would mean having to secure a unanimous determination regarding ‘the existence of a serious and persistent breach’ in Poland before the eventual suspension of ‘certain of the rights deriving from the application’ of the EU Treaties to be agreed under a lighter procedure laid down in Article 7(3) TEU (qualified majority in the Council is then required). Importantly, the Commission faced no legal obligation to start with 7(1) TEU first, as Article 7(2) TEU – unanimous finding by the European Council of the existence o the breach of values can unquestionably serve as the entry point into the palette of what Article 7 TEU has to offer.

4. Will the triggering of Article 7(1) make a difference?

While we welcome the Commission’s decision to submit a reasoned proposal to the Council having rightly concluded that there is a ‘clear risk of a serious breach by the Republic of Poland of the rule of law referred to in Article 2 TEU’ (para 127 of the reasoned proposal), the triggering of this provision is overdue and, as one of us previously argued in October 2016, the right time to have done so was November 2016 before the all too predictable unconstitutional capture of the Polish Constitutional Tribunal which happened at the end of December 2016. The continuing and misplaced faith in ‘dialogue’ with a government so clearly following Orban's autocratic blueprint has meant that the Polish ruling party was able to undermine if not annihilate virtually all checks and balances one year before the Commission moved to act, fulfilling its duty as the guardian of the Treaties.

The Commission may also be criticised for not triggering much earlier on Article 7(1) against ‘both Poland and Hungary even apart from the instrumental reason that Article 7 TEU is foiled by two rogue states acting in concert if sanctions are attempted against them one at a time’. In this respect, sceptics may argue that the triggering of Article 7 is bound to fail as ultimately, ‘rogue countries’ may just protect one another should the Commission (or one third of the Member States) decide to activate the sanctioning mechanism laid down in this provision. While this is a minority view we share the argument first defended by one of the present authors that in a situation where ‘Article 7(1) is invoked against both Hungary and Poland at the same time, neither should be able to vote if Article 7(2) … is invoked against either one’. We believe this interpretation can be justified on the basis of the effet utile doctrine – a corollary to the teleological method of interpretation and which may be described as a ‘form of interpretation of treaties and other instruments derived from French administrative law which looks to the object and purpose of a treaty, as well as the context, to make the treaty more effective' (Encyclopaedic Dictionary of International Law).

The recent ruling of the Court of Justice in the Białowieża Forest infringement case may be said to further strengthen Professor Scheppele’s claim. Indeed, in the absence of any explicit reference to the eventual imposition of financial sanctions in the context of interim relief rulings under Article 279 TFEU (for further analysis see Professor Sarmiento’s post here), the Court, correctly in our view, by reference to Article 260 TFEU but also and significantly by reference to the effective application of EU Law in the name of the principle of the rule of law enshrined in Article 2 TEU, held that Article 279 TFEU confers on it the power to make provision for a penalty payment to prevent non-compliance:

The purpose of seeking to ensure that a Member State complies with interim measures adopted by the Court hearing an application for such measures by providing for the imposition of a periodic penalty payment in the event of non-compliance with those measures is to guarantee the effective application of EU law, such application being an essential component of the rule of law, a value enshrined in Article 2 TEU and on which the European Union is founded.

Be that as it may, we also agree with Frans Timmermans when he said that ‘the facts leave [the Commission] no choice’ but to initiate Article 7. As two of the present authors previously wrote, it was more than time ‘to oblige national governments to face up to their own responsibilities to keep European values at the centre of the Treaties’. The remaining question, of course, is why this argument has been used in the context of 7(1) as opposed to 7(2) given that the situation on the ground in Poland is clearly – in the view of the Commission, the Venice Commission and countless other actors – one of clear and persistent breach of values, as opposed to a threat thereof.

The explanation might lie beyond the simple difficulty of the procedural requirements related to the sanctioning stage. Even though Article 7(1) is merely a warning without any direct sanctions, the indirect effects of triggering Article 7(1) should not be underestimated. To name but a few possible knock-on effects (further analysis and references here), the activation of Article 7(1) coupled with the forthcoming total subjugation of the Polish courts to the whims and interests of the Polish ruling party may lead the Court of Justice to set aside the principle of mutual trust and/or stop recognising Polish courts as courts within the meaning of EU Law (the ongoing and arguably insufficiently noticed infringement procedure concerning the Polish Law on the Ordinary Courts will require the Court of Justice to address, for the first time as far as we know, the independence of the whole judiciary of a Member State). This could then leave the European Commission no choice but to suspend EU funding to Poland, an option which according to Israel Butler is in any event already available to the Commission (on this issue see also a recent report ‘Can EU funds promote the rule of law in Europe?’).

A functioning judicial system is not only necessary to maintain a constitutional government; it is also necessary to maintain a market economy. The impact on commercial arbitration involving Polish companies if not the financial markets may also in time be too significant to be comfortably ignored by Polish authorities. And while it was recently noted by Capital Economics that the experience of Hungary suggests that ‘recurrent run-ins’ with the EU ‘do not tend to have much impact on growth in the short-run’, ‘the potential impact on Poland’s growth prospects over the medium-term’ might eventually become significant for an economy which is not only highly dependent on EU funding but also FDI.

Looking beyond the law and economics of Article 7, it is difficult to predict how the politics of Article 7 may play out. We do not believe the Austrian precedent means that a nationalistic backlash is necessarily bound to materialise and undermine the Commission’s attempts to stop Poland’s descent into authoritarianism. In the case of Austria in 2000, a number of EU countries overreacted as diplomatic sanctions were adopted before any evidence of any systemic attempts to undermine principles such as the rule of law or respect for human rights. And while the freezing of bilateral relations may have led to a rise in nationalist sentiments in Austria, which was unsurprising considering that diplomatic sanctions were adopted before a breach of Article 2 values in the country could be documented, using the ‘Austrian precedent’ to justify inaction against both Poland and Hungary makes no (legal) sense. In these two countries, we have a sustained track record and ample evidence of actual, repeated and systemic rule of law violations in these two countries starting in 2011 in the case of Hungary and starting in 2015 in the case of Poland.

The Commission, as Guardian of the Treaties, should not, in any event, only seek to uphold the rule of law when facing an easy political constellation. All EU institutions but also national governments should carefully assess the long term cost of appeasement or inaction  and stop prioritising how autocratic or nativist forces may reach to prioritise instead the broader interests of EU citizens, whose rights and obligations can now unfortunately ‘be defined, in part, by ‘illiberalregimes’ via their participation to the EU’s decision making processes’.

The European Parliament did point out in December 2015 that Hungary was ‘a test for the EU to prove its capacity and political willingness to react to threats and breaches of its own founding values by a Member State’ and that ‘the inaction of the EU may have contributed to … the rule of law being undermined’ elsewhere in the EU. The Union’s passivity regarding Orban's ‘mafia state’ (in large part due to the leadership of the European People’s Party putting time and time again short term political considerations over the principles this party supposedly stands for) has no doubt emboldened Poland’s ruling party to not even bother playing to the gallery while they relentlessly destroy all rule of law institutions in plain sight and prepare the grounds for the de facto establishment of a one-party state.

To end however on an optimistic note, one may refer to the seemingly beneficial political knock-on effects of the Commission's decision to initiate Article 7(1) in Romania, a country where the rule of law situation has been seriously deteriorating these past few months despite the country having been subject to a special rule of law mechanism since 2007. With reference to the Commission's decision, the Romanian President has warned the country's ruling coalition that the country could be next if the ruling coalition pushes ahead with its controversial changes to Romania's legal system.

5. Next steps

The Commission’s Article 7(1) proposal was issued at the same time as the Commission’s fourth rule of law recommendation. This recommendation gives Poland three months to solve the problems identified in the Recommendation. This suggests that the Council will not seek to organise the hearing of Poland and obtain the consent of the European Parliament until at least the end of March 2018. There are no signs yet that the Polish government tends to engage in good faith and cooperate by that time. On this basis one could foresee the following schedule for playing out the next stages of the Article 7 process:

(i) The Council would organise a hearing following the procedure identified in of Article 7(1) TEU in April/May 2018;

(ii) Consent of the Parliament would then be sought in May/June 2018 (Article 354 TFEU provides that the European Parliament shall act by a two-thirds majority of votes cast, representing the majority of its component Members);

(iii) Assuming this consent is given the Council may then seek to adopt in June/July a decision by a four-fifths majority (22 of 27 Members of the Council will have to agree with Poland obviously precluded from taking part in this vote) in order to formally determine the existence of ‘a clear risk of a serious breach by the Republic of Poland of the rule of law’ (see Article 1 of the Commission’s reasoned proposal for a Council decision under Article 7(1) regarding the rule of law in Poland);

(iv) Assuming this decision is adopted (at this stage it remains unclear whether 22 of 27 Members of the Council stand ready to de facto censure the Polish ruling party), the Council would then most likely simultaneously address recommendations to Poland acting in accordance with the same voting procedure (the post-Lisbon text of Article 7(1) provides that the Council may address recommendations to Poland before making such a determination but the Commission’s reasoned proposal suggests that a single decision could be adopted by the Council to simultaneously determine the existence of a clear risk of a serious breach of the rule of law and adopt recommendations);

(v) Should Poland fail to comply with the Council’s recommendations within the foreseen three-month deadline post the adoption of the Council’s Article 7(1) decision, one would then expect this problem to be escalated to the European Council by the end of December 2018, but this would not be an automatic consequence of Poland’s failure to comply with any eventual Article 7(1) decision by the Council.

Interestingly, it is also expected that the European Parliament will organise a plenary vote on whether to initiate Article 7(1) proceedings against Hungary in September 2018, in which case by the time the European Council might have to unanimously determine the existence of a serious breach, we could have both Kaczynski's Poland and Orban's Hungary subject to Article 7 proceedings, in which case, if one agrees with our effet utile reading of Article 7, both should lose their right to vote to protect one another in this context. It would indeed be quite an absurd construction of Article 7 if its deterrent effect simply disappeared when one rogue member state was joined by a second.

Looking beyond Article 7 and as previously noted, we can only but deplore the EU’s failure to prevent and sanction rule of law backsliding from emerging first in Hungary before spreading to Poland. Faced with two member states that are violating European values, the most effective way to deal with the issue may be to cut off EU funding. We worry that this, too, is unlikely to happen in the absence of a ‘nuclear’ ruling by the Court of Justice, meaning a ruling leading to the suspension of the principle of mutual trust where Poland is concerned (further analysis here). The impact of bilateral diplomatic pressure if not the freezing of diplomatic relations would also most likely be effective but the need for the EU27 to remain united in the context of the Brexit negotiations means that this option is off the table.

Thinking longer-term, multi-speed Europe may well solve not only the uneven willingness of states to move toward closer cooperation, but may also provide the perfect opportunity to leave behind states that are unwilling to fully adhere to basic principles. If the EU proves unable to rein in autocrats any other way, the incorporation of conditionality techniques into policing each of the integration’s concentric circles likely to become a necessary element of the edifice. As the speed and vectors of integration evolve, Poland and the likes of Poland could find themselves outside the scope of meaningful activity – behind the door of the integration’s kitchen. With the growing pressure on the Union’s values from a number of countries, this may be the most realistic way forward to preserve the EU as a union of value in the long run, while also being sufficiently open towards the states hijacked by autocratic and plutocratic forces.

Barnard & Peers: chapter 9
Photo credit: DW