SN and SD – The judicial endorsement of the EU’s exclusive competence in negotiating and concluding the EU-UK Withdrawal Agreement
On 16 November 2021, the Court of Justice delivered its ruling in Case C‑479/21 PPU, SN and SD v Governor of Cloverhill Prison and Others. The Court held that the provisions of the EU-UK Withdrawal Agreement (WA) on the European Arrest Warrant (EAW) and the provision of the Trade and Cooperation Agreement (TCA) on the newly established surrender regime are binding upon Ireland. Arguably, this conclusion looks fairly obvious at first glance. Indeed, pursuant to Article 216(2) TFEU, international agreements concluded by the EU are binding on the Member States. Ireland being one of them is bound by such agreements.
So why did this question arise in the first place or, maybe more provocatively, did the Court not have to assess the obvious here? The reason for this preliminary reference is Protocol 21 attached to the Treaties. The Protocol provides for the non-participation of Ireland (and previously also of the UK) in the adoption of the measures pursuant to Title V Part Three of the TFEU (Area of Freedom, Security and Justice – AFSJ), with the possibility to opt in. Since the EAW forms part of the AFSJ, the question arose whether the provisions of the Withdrawal Agreement and the TCA fell within Ireland’s opt-out under Protocol 21. If the provisions did in fact fall within the scope of the Protocol, they would not apply to Ireland. The application of the Protocol depends on whether Article 82(1) TFEU should have been included as a substantive legal basis of the two agreements between the EU and the UK. The Court seized this opportunity as a follow-up to the Wightman case to provide some additional clarifications on the EU’s competence to conclude the Withdrawal Agreement. Whilst the reasoning of the Court is convincing, this blog post presents some further arguments that were neglected by the Court in its judgment.
The case started with two arrests made in Ireland pursuant to the EAW, the first one in September 2020, and the second in February 2021. The UK had sought the extradition of the two arrested persons (SN and SD), who in turn challenged the application of the EAW in Ireland. According to Irish law, the national act transposing the EAW Framework Decision is applicable vis-à-vis the third country subject to existence of a binding agreement between Ireland and the third country. The applicants claimed that the legal basis of the Withdrawal Agreement and the TCA should have included Article 82(1)(d) TFEU as a legal basis to justify the inclusion of provisions on the AFSJ, and in particular the EAW. Article 82 TFEU would have then triggered the application of Protocol 21 and the provisions on the EAW would not apply in Ireland. Under these circumstances, the Irish Supreme Court decided to refer to the Court of Justice under the urgent preliminary reference procedure.
The Court´s reasoning
Firstly, in order to ascertain whether Article 50 TEU is appropriate as the sole legal basis of the Withdrawal Agreement, the Court had to consider the nature of this provision. In this respect, the Court relies on a teleological interpretation of Article 50 TEU: it refers to the purpose of Article 50, as it had previously held in Wightman (para 49), as “enshrining the sovereign right of a Member State to withdraw from the European Union and, … establishing a procedure to enable such a withdrawal to take place in an orderly fashion”. According to the Court, the attainment of these objectives presupposes the existence of the EU’s exclusive competence to negotiate and conclude a withdrawal agreement (para 50). Based on this competence, the EU negotiated and concluded the EU-UK Withdrawal Agreement covering various areas, including the application of the EAW during the transition period and thereafter under Article 62(1)(b) WA (para 52).
The Court concludes that, because the Withdrawal Agreement covers all areas stipulated by the Treaties, and given the impossibility to add a legal basis which is incompatible with the procedures enshrined in Article 50(2) and (4) TEU, Article 50 TEU is the only autonomous legal basis of the Withdrawal Agreement (paras 54-56). The Court explain this incompatibility by highlighting the conflicting voting rules. It distinguishes between the qualified majority voting without the representative of the leaving state required by Article 50 TEU and the unanimity vote with the participation of the leaving state’s representative based on Article 218 TFEU (for the conclusion of international agreements) (para 53). Since the inclusion of the AFSJ or any other legal basis was not necessary, Protocol 21 is also not applicable and Ireland is bound by the EAW provisions of the Withdrawal Agreement (paras 56 and 70).
Secondly, the Court examines Article 217 TFEU as a legal basis for the conclusion of the TCA. It observes that Article 217 allows the EU to conclude association agreements that can cover any policy area falling within the competences of the EU. The AFSJ is a shared competence and thus may form part of such an agreement (para 58). The Court then examines whether the inclusion of the surrender mechanism in the TCA, necessitates the addition of a specific AFSJ legal basis (Article 82 TFEU). Pursuant to this mechanism, EAWs issued before the end of the transition period in cases where the requested persons have not been arrested before the end of the period are covered by the TCA. Article 218 TFEU requires association agreements to be adopted by unanimous vote in the Council and consent of the EP (para 62). Given these stringent conditions, the risk of circumvention of the stricter procedural rules under Article 218 TFEU (as compared to the ordinary legislative procedure required by Article 82 TFEU) would not have arisen. The requirement to add Article 82 TFEU as a specific legal basis is therefore not applicable.
The Court also points to the broad objectives of association agreements, which aim to ensure the fair balance of rights and obligations between the EU and a third state (paras 65-66). Taking into account the wide scope of the TCA, the incorporation of the AFSJ measures is part of the overall aim of the agreement of creating a balanced and broad relationship between the EU and the UK, as stipulated by Article 1 TCA (para 67). The surrender mechanism embedded in the TCA falls within this wide objective, and thus the TCA does not pursue several objectives that would necessitate reference to multiple legal bases (para 68). Consequently, Article 217 TFEU was correctly chosen as the sole legal basis for the conclusion of the TCA, without there being any need for an additional legal basis that would trigger the application of Protocol 21. For this reason, the EAW provisions enshrined in the TCA are also binding upon Ireland.
The ruling can be described as an ex post validation of legality of the Withdrawal Agreement. The Court has now had the possibility to assess the choice and legality of Article 50 TEU as a sole legal basis for the negotiation and conclusion of the Agreement. In my view, the most important element of this ruling is the additional elaboration provided by the Court on the legal nature of the Withdrawal Agreement, which may be perceived as a follow-up to its Wightman judgment. The conclusion of the Court regarding the existence of the exclusive competence of the EU to conclude the Withdrawal Agreement in paragraph 50 confirms the assumption made by the Council originally in May 2017. Indeed, in its negotiating directives, the Council indicated that Article 50 TEU entrusts the Union with an exceptional one-off competence specifically for the purpose of negotiating and concluding a withdrawal agreement. Some objections had been raised against this conclusion. For example, it was claimed that the EU-UK Withdrawal Agreement should have been concluded as a mixed agreement (Frau, 30). The prevalent argument here is that the Withdrawal Agreement covers areas that fall within the competences of the Member States (Frau, 79). In SN and SD, the Court pointed out that, for the specific case of a Member State’s withdrawal, the EU has an exclusive competence to negotiate and conclude an agreement covering all fields within the scope of the Treaties (para 50). In identifying this competence, it highlighted the aims of Article 50 TEU: the reduction of uncertainty and minimisation of disruptions (para 51). Thus, as mentioned above, the Court used a teleological interpretation of Article 50 to infer the EU exclusive competence to regulate all issues related to a Member State withdrawing from the EU.
However, in my view, there are several other arguments to defend the EU exclusive nature of the Withdrawal Agreement that were not included in the Court’s final judgment in SN and SD. In particular, the Court could have found more support for its interpretation from point 5 of the Council negotiating directives from May 2017. As mentioned above, these directives refer to the exceptional horizontal competence provided by Article 50 TEU as a one-off competence which strictly arranges the withdrawal of a Member State. These conditions create specific limitations for the exercise of this unique competence. The criterion of exceptionality in the context of Brexit is obvious. The withdrawal of a Member State has only happened once thus far in EU/EC history (this alone makes it exceptional) and the procedure had to be adapted to the specific Brexit circumstances, and more importantly to the needs of citizens (even arrested citizens) and businesses. Another exceptional element rests in the fact that the Agreement was concluded at a time when the UK was still a Member State. Normally, the EU concludes international agreements with third states. Lastly, the unique nature of the competence is reflected by the deadline provided for by Article 50, which does not exist for any other type of international agreement. After the expiry of the Article 50 TEU deadline without the EU and the leaving Member State having come to an agreement, this one-off EU exclusive competence vis-a-vis the leaving state expires as well, and the normal regime applies as it would with any other third country.
In its analysis of procedural aspects of Article 50, the Court in principle endorsed the sui generis nature of the EU-UK Withdrawal Agreement. The distinction from other international agreements is based on the incompatibility of the general EU procedure for the conclusion of international agreements set out in Article 218 TFEU with the procedure laid down in Article 50, the so-called ‘exit clause’. In this respect, the Court referred to the Opinion of Advocate General Kokott in the same case (see para 53). She pointed out that in some matters covered by the Withdrawal Agreement, like indirect taxation, the general voting rule is unanimity in the Council and consultation of the EP. For other international agreements covering indirect taxation, Article 218(6)(b) and (8) TFEU requires the same strict procedure. However, this would be incompatible with the adoption rules for a withdrawal agreement under Article 50 TEU, which is adopted by qualified majority in the Council, and consent of the EP (see paras 52-53). The AG and the Court thereby distinguish the specific treaty-making procedure for the conclusion of a withdrawal agreement from the general treaty-making procedure for international agreements under Article 218 TFEU.
To conclude, the SN and SD ruling provides for an important confirmation of the legality of the adoption of the EU-UK Withdrawal Agreement and the TCA. This case will certainly not be the last related to interpretation of the two agreements. Some cases are currently pending (see e.g. C-673/20) and even more cases could arise, mainly on the interpretation of citizens’ rights. The CJEU will also be confronted with preliminary references made by the Member States’ courts on the interpretation of the TCA. The main benefit of the ruling is that the Court confirmed the EU’s exceptional exclusive competence stemming from Article 50 TEU for the negotiation and conclusion of the EU-UK Withdrawal Agreement, without prejudice to the distribution of competences between the EU and its Member States in the areas covered by the Agreement. Regardless, one can hope that this relatively new provision of primary law – Article 50 TEU – was applied and extensively interpreted by the EU institutions for the first and last time.