By Jasper Krommendijk
Last week, the ECJ delivered its judgment in Case C-398/13 P, Inuit Tapiriit Kanatami II, which deals with the EU ban on trade in seals products. This judgment is interesting for two reasons. Firstly, the absence of any consideration of the admissibility question, more specifically the fulfilment of the locus standi requirements. Secondly, the relationship between, on the one hand, the Charter of Fundamental Rights and the ECJ and, on the other hand, the European Convention on Human Rights (ECHR) and its court, the European Court on Human Rights (ECtHR). This post will examine these two issues after a discussion of the background to the so-called “Inuit Saga” and the eventual ECJ judgment which came about after more than five years of litigation in two different episodes.
Background of the Inuit Saga and the judgment of the ECJ
This is the second time that the ECJ was confronted with the issue of trade in seals, after having dismissed an earlier appeal to the order of the General Court in an action for annulment of Regulation No 1007/2009 on the basis of lack of admissibility (Case T-18/10, Inuit Tapiriit Kanatami I, EU:T:2011:419). It was in this first judgment that the ECJ for the first time gave its interpretation of the concept of “regulatory act” in the third limb of the fourth paragraph of Article 263 TFEU (Case C-583/11 P, Inuit Tapiriit Kanatami I, EU:C:2013:625, a comment of this judgment can be found here). The ECJ followed the General Court and defined regulatory acts as “acts of general application other than legislative acts” (para. 60). The ECJ also sided with the General Court in finding that Regulation No 1007/2009 of the European Parliament and of the Council of 16 September 2009 (“basic regulation”) did not satisfy this definition, because of the legislative nature of the regulation which was adopted on the basis of the ordinary legislative procedure of Article 251 TEC (currently Article 294 TFEU).
The applicants, Inuit Tapiriit Kanatami, an association which represents the interests of Canadian Inuits, and a number of other associations and individuals (seal product manufacturers and traders of various nationalities), thus had to wait for another occasion. On 10 August 2010, the Commission adopted Commission Regulation (EU) No 737/2010, which laid down detailed rules for the implementation of the basic regulation. Within less than four months after the Commission adopted this regulation, the applicants brought an action for annulment of this regulation in which they invoked the inapplicability of the basic regulation on the basis of the plea of illegality in Article 277 TFEU.
The General Court dismissed the two pleas put forward by the applicants. The Court, firstly, held that Article 95 (currently Article 114 TFEU) offered a proper legal basis for the basic regulation (Case T-526/10, Inuit Tapiriit Kanatami II, EU:T:2013:215, paras. 25-78, commented here). Neither did the General Court conclude that the basic regulation breached the principles of proportionality and subsidiarity (paras. 79-103) or fundamental rights (paras. 104-119). The second plea that the Commission misused its powers when adopting the implementing regulation was also unsuccessful.
Despite their persistence, the applicants suffered a fourth defeat before the ECJ (Case C-398/13 P, Inuit Tapiriit Kanatami II, EU:C:2015:535). The ECJ dismissed the arguments of the applicants that the General Court erred in law in finding that Article 95 (currently Article 114 TFEU) constituted a solid legal basis (paras. 21-42). Neither did the ECJ accept the pleas that the General Court erred in law by stating that it was appropriate to refer only to the Charter of Fundamental Rights and not the ECHR (paras. 43-48), that the right to property cannot be extended to the protection of commercial interests (paras. 49-63) and that the UN Declaration on the Rights of Indigenous Peoples does not have binding force (paras. 64-69).
No review of the fulfilment of the locus standing requirements
The most surprising aspect of last week’s judgment is not so much the substantive examination of these pleas. Rather, what is remarkable is that the ECJ does not touch upon the issue of admissibility at all, even though the General Court came up with an unusual reasoning. The General Court refrained from examining the standing of the applicants and immediately turned to the merits of the case. The General Court held: “for the sake of the economy of procedure, the applicants’ claim for annulment should be considered first, without a prior ruling on the admissibility of the action” (Case T-526/10, Inuit Tapiriit Kanatami II, EU:T:2013:215, para. 21). The General Court thus proceeded as if the applicants had standing. This explains why the applicants had no reason whatsoever to put forward an (in)admissibility argument and have the ECJ delve into this matter and dismiss their second action as inadmissible on such procedural grounds. More startling is the absence of any objections by the Commission and the intervening institutions, the European Parliament and the Council. At least the ECJ judgment makes no mention of such objections. The Council only raised this issue during the proceedings before the General Court, but it is unclear whether this was repeated before the ECJ (Opinion Advocate General Kokott in Case C-398/13 P, Inuit Tapiriit Kanatami II, EU:C:2015:535, para. 24). Even if the (intervening) parties did not raise this issue, this would not have precluded the ECJ from examining it of its own motion, as AG Kokott also noted in her Opinion (para. 25; Case C-176/06 P, Stadtwerke Schwäbisch Hall and others v. Commission, EU:C:2007:730, para. 18). It is, however, unclear why the ECJ did not do so, even more so because the issue of locus standi for direct actions is controversial and much commented upon.
In not addressing the admissibility question, the ECJ seems to implicitly accept that Inuit Tapiriit Kanatami and the co-applicants had standing to challenge the Commission’s implementing regulation. It appears that the ECJ regarded the implementing regulation as a regulatory act, as AG Kokott also suggested in her Opinion (para. 26). If the implementing regulation would not qualify as a regulatory act, than the applicants had to prove that they were individually concerned, which is nearly impossible given the strict Plaumann formula (Case C-25/62, Plaumann v. Commission, EU:C:1963:17). The applicants would certainly not establish such individual concern in the case at hand, because they cannot differentiate themselves since everyone could potentially engage in the trade in seals products (see also Case C-583/11 P, Inuit Tapiriit Kanatami I, paras. 72-73). The implicit “finding” of a regulatory act would also mean that the ECJ is of the opinion that the Commission Regulation fulfilled the other locus standi requirements for starting an action for annulment of a regulatory act, i.e. that the regulation is of “direct concern” to the applicants and that the implementing regulation “does not entail implementing measures”. Such findings would in itself not be unthinkable.
There are two main reasons why it would, nonetheless, have been desirable for the ECJ to explicitly address the matter of admissibility in an explicit way. Firstly, it is not very clear how this judgment relates to previous case law, especially with respect to the earlier mentioned condition of “does not entail implementing measures”. To date, the requirement of the absence of implementing measures has been construed rather narrowly by the ECJ (see Case C-274/12 P, Telefónica v. Commission, EU:C:2013:852, para. 35; Case T-380/11, Palirria Souliotis v. Commission , EU:T:2013:420, para. 42). The recent judgment of the ECJ in T & L Sugars, a case dealing with import licenses for sugar, for example, shows that the ECJ quickly concludes that there are implementing measures at the national level, which should be challenged before national courts (C-456/13 P, T & L Sugars, EU: C:2015:284). The ECJ qualified the limited intervention of national authorities as implementing measures (para. 31). These measures at the Member States’ level consisted of receiving applications from economic operators, checking their admissibility, submitting them to the Commission and then issuing licences on the basis of the allocation coefficients fixed by the Commission. Cruz Villalón concluded that such “non-substantive, or ‘ancillary’, measures […] by the national authorities […] in the exercise of a circumscribed power” or a “purely administrative activity” are not implementing measures (Opinion Advocate General Cruz Villalón in Case C-456/13 P, T & L Sugars, para. 31 and 34). By contrast, the ECJ determined that the “allegedly mechanical nature of the measures taken at national level” did not call into question the conclusion that there were implementing measures (para. 41). The ECJ thus explicitly departed from the Opinion of AG Cruz Villalón who argued against such a finding “if the objective of relaxing the admissibility conditions for natural and legal persons in connection with non-legislative regulatory acts is not to be wholly frustrated” (para. 31). Given the ECJ’s rather restrictive approach, it would have been better had the ECJ provided more guidance on this matter in Inuit Tapiriit Kanatami II. This is also because it is not immediately clear whether the measures needed by the Member States as a result of the Commission’s implementing regulation are fundamentally different from the intervention required from Member States in T & L Sugars. That is to say, Article 9(1) of Commission Regulation (EU) No 737/2010 obliges Member States to designate one or several competent authorities to verify, control and preserve copies of attesting documents for imported seal products. Are these indeed no implementing measures, as the silence on the admissibility questions seems to suggest?
Secondly, another problematic aspect of the omission of the mentioning of admissibility is that the ECJ also tacitly approves the above mentioned approach and reasoning of the General Court which directly turned to the substance of the case without examining the admissibility “for the sake of the economy of procedure”. As argued above, the ECJ had the option of examining this matter of its own motion, irrespective of the argument put forward by the (intervening) parties. The implicit acceptance of standing is a rather problematic development, if the ECJ indeed decides to follow it. It runs counter to the standing requirements formulated in Article 263 TFEU and dilutes the difference between privileged applicants (Member States and the EU institutions) and non-privileged applicants (natural or legal persons).
No legal requirement to examine the case law of the ECtHR, but still a helpful device
The judgment is interesting from another point of view as well. The ECJ confirmed once again that the ECHR “does not constitute, as long as the European Union has not acceded to it, a legal instrument which has been formally incorporated into EU law”, even though Article 6(3) TEU confirms that fundamental rights recognised by the ECHR constitute general principles of EU law and Article 52(3) requires that ECHR-corresponding rights in the Charter are given the same meaning and scope as those laid down by the ECHR (para. 45). The ECJ subsequently held that it was appropriate for the General Court to solely examine the validity of the basic regulation on the basis of Articles 17, 7, 10 and 11 of the Charter (para. 46).
The reasoning of the ECJ corresponds with the Opinion of AG Kokott, who dismissed the applicants ECHR argument on the grounds that they failed to explain the ‘additional benefit’ for considering the ECHR. She implied that a reference to the ECHR would only be warranted if the ECHR is imposing higher requirements than the Charter (paras. 69-70). It is interesting to contrast this formal approach with the recent ECJ judgment in Deutsche Bahn. In this case, the ECJ first examined the compatibility of the ECJ’s judicial review of Commission inspection decisions with Articles 8 and Article 6(1) ECHR before reaching the conclusion that there was no violation of Articles 7 and 47 of the Charter (Case C-583/13 P, Deutsche Bahn and others v. Commission, EU:C:2015:404, paras. 32-36 and 46-48).
Despite the formal reluctance in Inuit Tapiriit Kanatami II to acknowledge the case law of the ECtHR, the ECJ at the same time cited two judgments of the ECtHR to support its conclusion that future income cannot be considered possessions, “unless it has already been earned, it is definitively payable or there are specific circumstances that can cause the person concerned to entertain a legitimate expectation of obtaining an asset” (para. 61). Despite this being a desirable development from the point of view of Article 6(3) TEU and Article 52(3) Charter, it still raises the question why the ECJ “needed” the EC(t)HR in the first place. Could the ECJ not have referred “only” to the Charter, as the ECJ has explicitly stated and done so in relation to Article 47 of the Charter (e.g. Case C-386/10 P, Chalkor v. Commission, EU:C:2011:815, para. 51; Case C-199/11, Otis and others v. Commission, EU:C:2012:684, para. 47)?
This is not to say that both perspectives are mutually exclusive or irreconcilable. There is obviously a difference between merely taking the EC(t)HR into consideration when interpreting the Charter and a legal determination that the EU is formally bound by the ECHR and the case law of the ECtHR as a result of which the ECJ must examine the validity of EU law in the light of the EC(t)HR prior to accession.
The second judgment of the ECJ in Inuit Tapiriit Kanatami thus raises several questions: to what extent is the economy of the procedure indeed a valid justification for skipping a(n explicit) review of the fulfilment of the admissibility requirements? Which level of intervention from Member States is required so that one can speak of “implementing measures” as a result of which it is no longer possible for natural or legal persons to use the more relaxed standing requirements for regulatory acts on the basis of the third limb of Article 263(4) TFEU? When exactly is it necessary for the ECJ to “only” refer to the Charter and not the ECHR, as the ECJ did in relation to Article 47 of the Charter? These questions are far from settled yet and it is to be hoped that they will be addressed by the ECJ in future.