Department of Business Law
Advisor: Lars Kjærgård Terkilsen
Author: Jurgita Samulenaite
M.Sc. EU Business and Law
Delegation of powers in the EU before and after the Treaty of Lisbon:
Comitology in the CCCTB
Aarhus School of Business, Aarhus University
August 2010
Table of Content
1. Introduction…………………………………………………………………...…2
1.1. Problem statement………………………………………………………..…7
1.2. Delimitations………………...……………………………………………...7
1.3. Methodology……………………………………………………………..….7
1.4. Structure of the paper…………………………………………...…………..8
2. Pre-Lisbon delegation of implementing powers………..……………………..…9
2.1. In principle the implementation is to be conferred on the Commission…….9
2.1.1. EC Treaty provisions…………………………………………..…….10
2.1.2 The ECJ case law………….………………………………………….11
2.2. The Comitology Decision…….……………………………………………16
2.2.1. Comitology procedures……………………………………………....17
2.2.2. Selection of procedures……………………………………………....21
2.2.3. The EP’s influence…………………………………………………...23
2.3. The Council implementing itself:…………………….……..……………..25
2.3.1. Visa Border Case………………………..…………………………..26
2.3.2. The opinion of the Advocate General……………………………….27
2.3.3. The judgement of the Court…………………………………………30
3. Post-Lisbon delegation and implementation….…………………………….……32
3.1. Delegated acts (Article 290 TFEU)………………………………………..33
3.1.1 Material and temporal limits of the delegation……………………...34
3.2. Implementing acts…………………….……………………………………38
3.2.1 Commissions proposalCOM(2010)83………….……………………42
3.3. Post- and Pre-Lisbon: differences……………..……….…………………..43
4. Delegation of powers in the CCCTB………….…………..………………….….45
4.1. Delegation of powers in the EU taxation area…………..……………….…47
4.2. Comitology in CCCTB before and after the Lisbon Treaty…..…………....49
5. Conclusions………………………………………………………….…………...55
1. Introduction
Legislation and implementation are very interrelated: the legislator enacts legislation
and the administrators implement the legislation within the boundaries set by the
legislator1. In the European Union (EU) the legislator (the Council alone or together
with the EP) might delegate powers to the Commission. However, there has been no
clear division of powers between the Legislature and the Executive in the EU2. In fact,
the difficulties of delegation of powers from the legislator to the executive have plagued
the EU legal system from its very beginning3. Introducing some clarity into the
delegation of powers from the EU legislator to the Commission was needed.4
Therefore, the Treaty of Lisbon5 has made important changes regarding these issues by
differentiating among legislative, delegated and implementing acts6.
Thus, it has reorganized the old system of delegation of powers to the Commission: the
Articles 202 and 211 EC Treaty7 have been replaced with the system of Articles 288–
291 TFEU8. As a result, the Articles 202 and 211 EC Treaty have been abolished, and
this raises questions about the implications on the implementation structure of
comitology that existed thereof.
Comitology9 is a method of decision-making, where committees, consisting of
representatives of the Member States and chaired by a representative from the
Commission, assist the Commission in implementing the legislation, by providing
1
Franchino (2007), p. 20
Joined cases 188 to 190/80, France, Italy and UK v Commission, [1982] ECR 2545
3
Hofmann (2009), p.482
4
Piris (2006), p. 73
5
Treaty of Lisbon amending the Treaty on European Union and the Treaty establishing the European
Community, signed at Lisbon, 13 December 2007, [2007] OJ C306/01, cited on the basis of the
consolidated versions of the Treaty on European Union and the Treaty on the functioning of the European
Union (TFEU) in [2008] OJ C115/01
6
Articles 289-291 TFEU
7
European Union – Consolidated versions of the Treaty on European Union and of the Treaty
establishing the European Community, cited on the basis of the consolidated versions published in [2006]
OJ C 321 E/1
8
Hofmann (2009), p. 493, footnote 54
9
Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of
implementing powers conferred on the Commission, as amended by Council Decision 2006/512/EC of 17
July 2006 (OJ L 200/11) – Consolidated Version 2006 (hereinafter: the Comitology Decision)
2
2
advice under committee procedures, which, in certain cases, enable the Council to take
over the work of implementation10.
Comitology has been referred to as ‘the most significant, enduring and often
controversial organic development in the decision-making structure’ of the EU11. The
word itself is unfriendly and is usually associated with the technocratic and selfabsorbed nature of EU decision-making; yet, during the last decade transparency in the
implementation took a major leap and had been compared very favourably with that of
the most advanced national systems12.
The Council established the first management committee in the early 1960s for the
purposes of implementing the Common Agricultural Policy, which required many
detailed rules to be passed quickly, in order to cope with changing market
circumstances13. Applying primary legislation methods was not practical.
However, the Member States were not willing to delegate legislative powers to the
Commission without retaining some form of control over these measures: they wanted
to ensure the representation of their interests and participation in the decision-making
process14.
Thus, the creation of the management committees has been an answer for the Member
States wish to intrust the Commission with the task of dealing with technical and
changing issues; while at the same time the Member States could control the way, in
which the Commission has carried out this executive role15. Such committees,
consisting of representatives of the governments of the Member States, would be
directly involved with the Commission in the deliberations concerning the secondary
measures. The latter would be immediately applicable, subject to the condition that it
could be sent back to the Council, if it was contrary to the committee’s opinion. It was
open for the Council to take a different decision by qualified majority.16
10
Lenaerts (2000), p. 645
Hofmann, Turk (2006), p. 417
12
Hofmann, Turk (2009), p. 92-94
13
Craig (2006), p. 104
14
Hofmann, Turk (2009), p.67
15
Lenaerts (2000), p. 646
16
Craig (2006), p.105
11
3
Thus, the Council would delegate powers to the Commission, enabling the Commission
to make further regulations. Such delegation would be subject to procedures involving
committees of representatives of the Member States, so that they, together with the
Council, could retain the influence over the Commission.
These committee procedures had been a mere institutional practice, although a very
common one,17 until the ECJ has ratified them as legal in the Koster case18. They were
eventually legally codified in 198719.
Comitology committees deal mostly with issues of a routine nature that usually require
a high degree of detailed technical knowledge and expertise20. They have been
contributing to an impressive flow of implementing legislation21.
As a result of the comitology, the Commission could very fast adopt urgent measures
for prevention of the spreading of avian flu; prohibit dangerous chemical substances;
ensure that the lighters, which are put on the market, are children resistant; authorize the
marketing of medical products or safe food additives with appropriate labelling
requirements; adjust legislation to technical and scientific progress, etc.22
However, some matters can be both highly technical and strongly politicised, as, for
example, biotechnology, dioxins23. Here the border between purely technical issues and
those with political implications is very often far from clear, because there is no ready
division between principle and detail, no clear equation between detail and the absence
of political controversy24. Implementing measures can deal with routine details, but they
may also deal with issues of political choice, which might be as controversial as those
addressed in the primary legislation25.
17
Hofmann, Turk (2006), p. 418
Case 25/70, Einfuhr- und Vorrasstelle fur Getreide und Futermittel v Koster et Berodt & Co. [1970]
ECR 1161
19
Council Decision 87/373/EEC of 13 July 1987, laying down the procedures for the exercise of
implementing powers conferred on the Commission [1987] OJ L 197/33
20
Hofmann, Turk (2009), p.82
21
Ibid, p. 68
22
Ibid, p.94
23
Ibid, p.69
24
Craig (2006), p. 101
25
Ibid.
18
4
Highly politicised implementing measures have primarily been referred to the
Council26. Such ‘political’ decisions contribute to the rather negative image of
comitology27. In the politically sensitive situations, the procedural aspects become very
important.
There could have been situations, where the Council failed to act (by qualified
majority), and, as a result, the Commission would adopt the proposed measures28.
Consequently, the (simple) majority of Member States interests could be overruled. This
can place the Commission in a rather inconvenient situation, and such procedures do no
good to the representation of legitimate interests in the EU29.
Nevertheless, the Lisbon Treaty has put an end to the Articles 202 and 211 EC Treaty,
on which the legal framework of comitology system has been based. This raises
questions about the future of this implementation structure that existed thereof. Will it
disappear?
The answer might have a considerable difference on the envisaged Common
Consolidated Corporate Tax Base30 (CCCTB), where the comitology procedure for the
exercise of implementing powers by the Commission has been identified as one of the
project’s characteristics31.
CCCTB is a system based on a set of common rules for establishing the corporate
taxable base. The multinational groups would have the option of adopting this common
European tax base for their activities in participating Member States32. The project
would address the underlying tax obstacles, which exist for the corporate taxpayers,
operating in different countries.33
The Commission has prepared Working Documents concerning CCCTB, where it has
been stated that because it would not be possible to lay down every detailed rule in the
26
Hofmann, Turk (2009), p.69
Hofmann, Turk (2006), p. 117
28
Article 5(6) of the Comitology Decision
29
Hofmann, Turk (2009), p. 94
30
See CCCTB/WP/057; CCCTB/WP/061; CCCTB/WP/062
31
Lang (2008), p.34; CCCTB/WP/062, p.2
32
Ibid, p. 31
33
Ibid, p.34
27
5
basic instrument, therefore, it should be provided that the implementing measures could
be adopted under the Comitology Decision34.
However, the reference to the Comitology committees in the CCCTB project has raised
many comments from the Member States: some of them have referred to the
requirements that the basic elements of a tax base are to be set by primarily law; two
Member States considered that the Comitology procedure should not be used at all and
recommend laying down all rules in the basic instrument; business community seems to
be more positive and holds that it would provide for reasonable flexibility and allow to
keep the system updated in a practical way35.
The Comitology procedures are not based on unanimity, which is the main rule that
applies to positive integration in direct taxation in the EU36.
As a matter of fact, only few initiatives in direct tax37 have been successful so far
mainly due to this unanimity requirement38. Similarly, corporate tax coordination has
also been a very politically sensitive and long-lasting policy issue in Europe39.
It would go beyond the scope of this paper to provide the analysis of the corporate
taxation in the European Union. However, it might be interesting to mention the
comment from The Economist that since 1962 (when the first report on the corporate tax
rates was published in the EU40), it has been easier for the Americans to send a man to
the moon than for the Europeans to realise their dream about the tax harmonisation41.
The future of the CCCTB project is also uncertain42, however, it is a ‘dream’ of this
paper to get a better insight into why such projects do not take off and what could be
done in order to help them to reach the stars.
34
CCCTB/WP062, p. 2
Lang (2008), p.403
36
Article 115 TFEU (ex Article 94 EC Treaty)
37
There are four Council directives on direct tax: (1) Parent-Subsidiary Directive on dividends (Council
Directive 90/434/EC); (2) Merger Directive on company reorganizations (Council Directive
90/434/EEC); (3) Interest-Royalty Directive (Council Directive 2003/49/EC); (4) Savings Directive
(Council Directive 2003/48/EC). See Helminen (2009), p. 20
38
Lang (2008), p. 17
39
Gelauff (2008), p. 276
40
Ibid.
41
Harmony and discord, May 3rd, 2007
42
The common EU corporate tax is considered to be the best solution in the long term, however, in has
been argued that such an extensive harmonization might not be possible because of practical and political
reasons. See Helminen (2009), p. 229
35
6
1.1. Problem Statement
Based on the above the question is
What are the effects of the Treaty of Lisbon on the usage of comitology in the
CCCTB?
While not answering directly, the further questions will be addressed also:
How the new Treaty will change the delegation of powers in the EU?
What is the future of the comitology committees? Will they continue to exist at all?
Has it been appropriate to use the comitology in CCCTB before the Lisbon Treaty?
Can the comitology committees be applied to the proposed measures after the Treaty of
Lisbon?
1.2. Delimitations
I will analyse the delegation of powers by the Council to the Commission via the
Comitology committees (its preparatory phase will not be analysed), in relation to those
specific measures, which were explicitly mentioned in the CCCTB.
The assumption is that the CCCTB would be adopted by unanimity, i.e., Article 115 (94
EC Treaty)43. Therefore, there will only be a limited attention to the role of the EP.
1.3.Methodology
As regarding the ‘old’ system, the analysis is based on the EC Treaty, Judgements of the
European Court of Justice (ECJ) and the Comitology Decision.
As regarding the new system, the main focus will be on the Treaty of Lisbon and the
Commission’s Proposal of Regulation laying down the rules and general principles
concerning mechanisms for control by Member States of the Commission’s exercise of
implementing powers.
Relevant books and articles will also be analysed.
43
Even though there have been arguments for using Article 116 TFEU (Article 96 EC Treaty). See
Helminen (2009), p. 18
7
1.4. Structure of the paper
The structure of the paper is the following.
Chapter 2 will describe the mechanism of delegation of implementing powers to
comitology committees that existed before the Lisbon Treaty. The Council’s right to
reserve implementing powers for itself will also be presented in this part.
Chapter 3 will describe the changes that were introduced in the delegation and
implementation in the EU due to Treaty of Lisbon. This part will also consider the main
differences between both the old and the new systems.
The analysis from previous chapters will be used in Chapter 4, which will discuss the
possible application of the Comitology in the CCCTB before and after the Treaty of
Lisbon.
Chapter 5 will sum up.
8
2. Pre-Lisbon Delegation of implementing powers
The EC Treaty contains only brief rules on the delegation of implementation. The main
principle, which has been stated in the EC Treaty, confirmed by the ECJ case law and
finally settled in the Comitology decision, has been, that the Council shall confer on the
Commission the powers for implementation of the rules, which it lays down44. The
legislation, adopted by the Council, shall establish a basic framework, and then the
legislation, which shall give this framework an operative meaning45, will be left to the
Commission. (This will be analysed in the first part of this chapter).
However, this principle has been subject to two conditions. The first one is that the
Council may impose certain requirements on the Commission’s use of the delegated
implementing powers46. Thus, in the practice, the Commission’s implementing powers
have been exercised within the framework of Comitology committees (Part (2) of this
chapter). The second one is that in specific cases the Council may reserve the exercise
of implementing powers to itself47 (Part 3).
2.1. In principle the implementation is to be conferred on the Commission
The EC Treaty uses the terms ‘legislation’48 and ‘implementation’49, but does not define
them50. Whether an act has been a legislative or an implementing act, depended mainly
on its legal basis: in general, if an act was based on the Treaty article, then it was the
legislative act, if an act was based on a legislative act, then it was the implementing
act.51
Legislative act had its legal basis in the EC Treaty and was decided under the decisionmaking procedure, specified in its provisions52. The implementing acts had their legal
basis in a secondary legal act and intended to insure its implementation53.
44
Article 202(3) EC Treaty
Bergstrom (2005), p.2
46
Article 202(3) EC Treaty
47
Ibid.
48
Article 207(3) EC Treaty
49
Articles 202(3) and 211 EC Treaty
50
Lenaerts (2000), p. 650; case 16/88 para.11 (as regarding the term of ‘implementation’)
51
Lenaerts (2000), p. 650
52
Hofmann (2009), p. 495; Koster case, op cit n 18, para. 6
45
9
Both legislative acts and implementing acts could be issued within the typology of acts
in Article 249 EC Treaty. The legal effect of the Commission’s regulation or directive
had been equivalent to the legal effect of the Council (and EP) regulation or directive;
the fact that the former had a legal basis in the latter did not in itself imply that only
specifying issues could be dealt with in the Commission’s directives or regulations.54
However, as will be seen later, the ECJ has added a substantive test55 (that the essential
provisions must be laid down by the legislator) in Koster case56.
2.1.1. EC Treaty provisions
The legal basis for the executive power of the Commission has been Article 211 EC
Treaty: it provides that “the Commission shall … exercise the powers conferred on it by
the Council for the implementation of the rules laid down by the latter.”
Thus, implementing powers could be delegated to the Commission. However, according
to the Article 211 EC Treaty, the Council could freely decide whether or not to delegate
implementing powers to the Commission57. However, later58 the Article 202 EC Treaty
had been introduced, and its third indent has provided the Council with the authority for
such delegation.
According to Article 202(3) EC Treaty, the “Council shall … confer on the
Commission, in the acts which the Council adopts, powers for the implementation of the
rules which the Council lays down. The Council may impose certain requirements in
respect of the exercise of these powers. The Council may also reserve the right, in
specific cases, to exercise directly implementing powers itself. The procedures referred
to above must be consonant with principles and rules to be laid down in advance by the
Council, acting unanimously on a proposal from the Commission and after obtaining the
opinion of the European Parliament.” (Emphasis added.)
53
As follows from the Article 211(4) EC Treaty; Koster case, op cit n 18, para.6
Olsen (2006), p. 434
55
Lenaerts (2000), p.651
56
Koster case, op cit n 18
57
Ibid., para.9
58
Because of the Single European Act (OJ L 169 of 29 June 1987)
54
10
Thus, in addition to the existing possibility of transferring implementing powers to the
Commission in accordance with Article 211 EC Treaty, the Article 202 EC Treaty laid
down an obligation on the Council to do so59. The delegation has become a duty for the
Community legislator60, except in specific cases, where the Council may exercise the
implementing powers itself.
In other words, in principle implementing powers are to be delegated to the
Commission. However, this is subject to two conditions: first, in ‘specific cases’ the
Council might reserve the right to exercise the implementing powers itself; second, the
Council may impose certain requirements (which must be consonant with the
procedures and rules to be laid down in advance) on the Commission’s executive action.
As it was argued, the legislator does not delegate implementing powers to the
Commission, but authorizes, when the Commission may exercise them, and imposes the
procedural framework for such implementation61.
2.1.2. The ECJ case law
In the following I will describe few selected cases, in order to present the ECJ’s
judgements that have influenced the delegation of implementing powers in the EU.
The Court has for a long time been dealing with the Comitology62. In fact, it was the
ECJ that validated the management committee procedure that was attached to the
delegation of powers to the Commission; until then it was only an institutional
practice63.
In the following case it has been confirmed that the EC Treaty had enabled the Council
to delegate to the Commission, and the legislator could do so by subjecting this
delegation to certain conditions.
59
Olsen (2006), p. 432
Hofmann, Turk (2006), p. 418
61
Lenaerts (2000), p. 653
62
Hofmann, Turk (2006), p. 418
63
See Koster case, op cit n 18
60
11
In the Koster case64, the matter at issue was, whether the Commission had a right –
under the so-called management committee procedure – to adopt a rule, according to
which the trader forfeited his deposit on the failure to effect the export, covered by the
issued license, within the prescribed period.
The ECJ stated that the Article 211 EC Treaty provided that the Commission should
exercise the powers conferred on it by the Council for the implementation of the rules,
which were laid down by the legislator.
This provision enabled the Council to determine any detailed rules, to which the
Commission was subject in exercising the powers conferred on it. The so-called
management committee procedure formed part of the ‘detailed rules, to which the
Council may legitimately subject a delegation of power to the Commission’65. The
function of the management committee was to ensure permanent consultation in order
to guide the Commission in the exercise of the powers, conferred on it by the Council,
and to enable the latter to substitute its own action for that of the Commission. The
management committee did not have the power to take a decision instead of the
Commission or the Council. Thus, ‘the management committee machinery enabled the
Council to delegate to the Commission an implementing power of appreciable scope,
subject to its power to take the decision itself if necessary’66.
Thus, the Council was enabled to delegate powers to the Commission, and it could
(“may”) do so by subjecting this delegation to certain conditions.
The ECJ upheld the validity of the management committee procedure that was attached
to the delegation of power to the Commission.
But what is to be delegated and what is not to be delegated?
In the same case the Court has also distinguished between the basic elements and
implementing provisions. It stated that ‘according to the legal concepts recognized in all
Member States’, there has been established a distinction between “the measures directly
based on the Treaty itself and derived law intended to ensure their implementation. It
cannot therefore be a requirement that all the details of the regulations concerning the
64
Koster case, op cit n 18.
Ibid. para. 9
66
Ibid.
65
12
common agricultural policy be drawn up by the Council to the procedure in [the
relevant Article]. It is sufficient for the purposes of that provision that the basic
elements of the matter to be dealt with have been adopted in accordance with the
procedure laid down by that provision. On the other hand, the provisions implementing
the basic regulations may be adopted according to a procedure different from that in
[the relevant Article], either by the Council itself or by the Commission by virtue of an
authorization complying with Article [211]”67. (Emphasis added.)
Thus, the basic elements had to be dealt with by the Council in the basic act, adopted in
accordance with the procedures laid down in the EC Treaty. But the implementing
provisions are to be delegated to the Commission (or the Council) and they may be
adopted according to a different procedure than the one, required for the adoption of the
basic act.
The legislator has also been required to lay down the essential elements, i.e., the policydefining provisions,68 in the primary legislative act in the C-240/90 Germany v
Commission.69
In this case Germany had challenged the Commission’s power to adopt rules, which
provided for the penalties to be imposed on producers, who have committed
irregularities, when making an application for the financial aid. The German
Government argued that only the Council had such a power and that it could not be
delegated to the Commission.
The Court referred to Koster case and differentiated between “rules, which since they
are essential to the subject-matter envisaged, must be reserved to the Council’s power,
and those which being merely of an implementing nature may be delegated to the
Commission.”70
In this relevant case, the challenged rules could not be classified as “essential to the
common organization of the market established by the first basic regulation. … Such
classification must be reserved for provisions which are intended to give concrete shape
to the fundamental guidelines of Community policy. That is not true of penalties, …
67
Ibid. para 6
Hofmann, Turk (2006), p.425
69
Case C-240/90 Germany v Commission [1992] ECR I-5383
70
Ibid, para 36
68
13
which are intended to underpin the options chosen by ensuring the proper financial
management of the Community funds designated for their attainment.”71
In this case the German Government also maintained that the enabling provisions of the
basic regulations were “couched in terms too general for that purpose”72.
However, the Court held that after “the Council has laid down in its basic regulation the
essential rules governing the matter in question, it may delegate to the Commission
general implementing power without having to specify the essential components of the
delegated power; for that purpose, a provision drafted in general terms provides a
sufficient basis for the authority to act”73.
However, the ECJ’s interpretation of implementing measures has varied according to
the policy field concerned. The ECJ held that the concept of implementation must be
given a “wide interpretation”74 on rules of agricultural matter. However, in other areas,
the delegating provisions shall be more defined.
In the case 22/8875, the Court held that a wide interpretation of implementation “cannot
be relied upon in support of provisions adopted by the Commission on the basis of its
implementing powers in agricultural matters where the purpose of the provision … lies
outside that sphere but within a sector subject to an exhaustive set of rules laid down by
the Council which … do not confer any implementing powers on the Commission”76.
Thus, the Commission cannot rely on the wide interpretation of its powers in the nonagricultural matters, if the rules, laid down by the Council, do not confer such
implementing powers on the Commission.77
In non-agricultural areas, the delegating provisions themselves must define the
conditions for the Commission’s action.
71
case 240/90, para. 37
Ibid. para. 40
73
ibid, para 41
74
Case 23/75, Rey Soda v Cassa Conguaglio Zucchero [1975] ECR 1279, para.10
75
Case 22/88 [1982] ECR 2049
76
Ibid, para. 17
77
Hofmann (2009), p. 491
72
14
In the Central-Import Muenster case78 the company complained about countervailing
charges it had to pay on imports of dried grapes according to the Community
legislation.
The complainant stated: “in the event of the delegation of [the powers] to the
Commission the Council was required to lay down beforehand in specific terms the
conditions for [their] exercise by the Commission”79.
The Court held that for “an enabling provision to be valid, it must be sufficiently
specific – that is to say, the Council must clearly specify the bounds of the power
conferred on the Commission”80.
And ruled that in this case the basic regulation contained a sufficiently specific enabling
provisions, i.e., the power conferred on the Commission was delimited in a sufficiently
specific manner81.
Thus, the enabling provisions themselves must lay down the conditions for the
Commission’s exercise of delegated powers.
In the Alliance for Natural Health82case the Court dealt with the claim that the criteria
for adopting implementing legislation were not sufficiently precise83.
The Court held that “when the Community legislature wishes to delegate its power to
amend aspects of the legislative act at issue, it must ensure that the power is clearly
defined and that the exercise of the power is subject to strict review”84.
Thus, the legislator could delegate its power to amend certain elements (in this case,
positive lists relating to food supplements, listed in annexes) of the legislative act.
In this matter, the essential criteria, which limited the Commission’s exercise of
delegated powers, were laid down85.
78
Case 291/86 Central-Import Muenster [1988] ECR 3679
Ibid, para 12
80
ibid, para. 13
81
ibid para 15
82
Joined cases C-154/04 and C-155/04 Alliance for Natural Health ECR [2005] I-6451
83
Hofmann, Turk (2006), p. 426
84
Op cit n 82, para. 90
85
Ibid, para. 92
79
15
2.2.The Comitology Decision86
Article 202 EC Treaty provides that when conferring on the Commission powers for the
implementation, the Council may impose certain requirements in respect of the exercise
of these powers. These requirements, which the legislature imposes in the basic act on
the Commission for the exercise of the implementing powers, must be consistent with
principles and rules to be laid down in advance.
Such principles and rules were first time set in the 1987 Comitology Decision87.
Later it was replaced with the Second Comitology Decision in 199988, which was
amended by the 2006 Decision89.
Thus, the requirements, which the Council imposes on the Commission on its exercise
of implementing measures, must be in conformity with the Comitology Decision.
The Comitology Decision determines the way, in which the Commission acts with the
comitology committees in adopting implementing measures, by laying down the
procedures, according to which committees, composed of the representatives of the
Member States, shall assist the Commission in its exercise of delegated implementing
powers. The decision also regulates the roles of the Council and the EP in that matter.
The powers of the committees differ among the different procedures, and have been
mainly related to the consequences of a negative or none opinion by the committee90.
This provided the possibility to refer the implementing proposal to the Council, which
could then have a different opinion91. In other words, the Comitology committees have
been as the triggering element for the Council to intervene in the implementing
sphere92. In this way, the committees have been regulating the allocation of
implementing powers between the Commission and the Council.93
86
The Articles quoted in this chapter refer to consolidated version unless provided otherwise
op cit n 19.
88
Op cit n 9.
89
Council Decision 2006/512/EC of 17 July 2006 (OJ L 200/11) This paper refers to the consolidated
version.
90
Olesen (2006), p. 446. For the implementing measures of a quasi-legislative nature, if the basic act has
been adopted together with the EP under the co-decision, even the positive opinion by the committee
means that the draft measures shall be submitted to the legislators.
91
Ibid, p. 443
92
Hofmann, Turk (2009), p. 90
93
Ibid, p. 90
87
16
2. 2.1. Comitology procedures
The Commission is to be assisted by four main types of committee procedures:
advisory, management, regulatory and regulatory with scrutiny.94
Certain features are common to all committees. Every particular committee is made of
the representatives of the Member States, and chaired by a representative of the
Commission. The Commission must consult a committee before adopting proposed
implementing measures. The chairman shall submit a draft of the implementing
measures to the committee. The committee must deliver an opinion on the draft within a
certain period set by the chairman according to the urgency of the decision. The
chairman shall not vote.95
Advisory committee procedure
Advisory committee procedure is laid down in Article 3. An opinion is delivered by
taking a vote if necessary and a simple majority is decisive96. The Commission is
required to take the utmost account of the opinion delivered by the committee.
The committee has a purely advisory role and its opinion is not considered as binding to
the Commission97. The Commission could take the measure even if the committee was
opposing it98.
Management committee procedure
Management committee procedure99 provides that the committee must deliver its
opinion by the qualified majority100. The management committee can only block the
Commission’s proposal by qualified majority, which will then be submitted to the
Council.
94
Besides there has been a safeguard procedure, which may be applied where the basic act confers on the
Commission the power to decide on such measures. However, these provisions will not be dealt with in
this paper.
95
First and second paragraphs of Articles 3, 4, 5 and 5a
96
Olesen (2006), p. 446
97
Ibid, p.446
98
Hofmann, Turk (2006), p. 129
99
Article 4
100
As laid down in Article 205 (2) EC Treaty.
17
The Commission shall adopt measures, which shall be immediately applied, if there is
no qualified majority against the proposal (for example, when the committee’s opinion
is not positive, but it does not reach the qualified majority required101).
However, if the committee’s opinion reaches the qualified majority against the proposed
measures, the Commission must notify the Council. In this case, the Commission may
postpone the application of the decided measures for a period laid down in the basic act.
The Council, acting by qualified majority, may take a different decision within that
period (which shall not exceed three months).
Regulatory committee procedure
In the Regulatory committee procedure102, the Commission needs the qualified majority
in the committee to support the proposal. Otherwise, the Commission shall without
delay submit the proposed measures to the Council.
If the committee delivers a positive opinion (i.e., the qualified majority supports the
proposal), then the Commission shall adopt the implementing measures.
If either negative or no opinion is delivered, i.e., the committee does not support the
Commission’s proposal with the qualified majority, then the Commission cannot adopt
the proposed measures (contrary to the management committee procedure). In such
cases, the Commission shall without delay submit the draft measures to the Council.
The EP shall also be informed103.
The Council may adopt the proposal by qualified majority104, within a period to be laid
down in the basic instrument, which shall not exceed three months from the date of
referral to the Council.
101
Hofmann, Turk (2006), p.129
Article 5
103
If the relevant measures were proposed for implementing the basic act adopted under co-decision, the
EP may consider, whether they do not exceeded the delegated powers, and inform the Council about its
position. See chapter “The EP’s influence”. However, it has been argued that in regulatory procedure the
Council and the EP have not been on an equal footing in the implementation process: in the referral
phase, the Council has got a right to take responsibility for implementation, while the EP has not. See
Lenaerts (2000), p. 680
104
Or unanimously (see footnote (112))
102
18
The Council can also oppose the proposal by the qualified majority within that period.
If the Council does not do anything (e.g., lacks the required qualified majority) on the
expiry of the specified period, then the Commission adopts the implementing measures.
This lack of the required qualified majority could mean that the Commission would
adopt the measures if, for example, the Council voted against with a simple majority.
Such situations might be controversial, because interests of many Member States would
be overruled.
However, the Commission has stated that in the review of proposals for implementing
measures concerning ‘particularly sensitive sectors’, in order to find a balanced
solution, the Commission will act in such a way, so that to avoid going against ‘any
predominant position’ (i.e., an ordinary majority), which might emerge within the
Council ‘against the appropriateness of an implementing measure’.105
Yet this statement does not take away the requirement, which is laid down in the
Comitology Decision, for the Council to vote by qualified majority in order to oppose a
proposal for implementing measures.106
But if the Council votes against by qualified majority, then the adoption of the proposed
measures will be opposed. In this case, the Commission shall re-examine them. The
Commission has three options: it might amend the proposal, re-submit the same
proposal or present a proposal for legislation on the basis of the Treaty (for example, if
the proposed measure exceeded the power delegated by the basic act).
Yet there is a theoretical possibility of a “never-ending game of tennis”107: if the
Commission re-submitted the same proposal without modifying it, and the Council
would again oppose the measure… It has been argued that there would be two
possibilities in such a case108.
The Council could reject the proposal on the second time and then it could not be
adopted.
Or it would have to either adopt the proposal (with qualified majority) or amend it with
unanimity.
105
Declarations on Council Decision 99/468/EC, OJ 1999/C 203/1
Lenaerts (2000), p.677
107
Hofmann, Turk (2006), p. 130
108
Hofmann, Turk (2006), p.141, 104 footnote
106
19
The possibility for the Council to amend the Commission’s proposal in the referral
procedure is not stated in the Comitology Decision. It may either adopt or oppose the
proposal.
Nevertheless, it seems that the Council has such an amending power if it acts
unanimously109.
One argument refers to the Article 250 EC Treaty, where it is provided that in the
legislative procedure the Commission’s proposal can only be amended by unanimity.
However, this Article relates to the legislative proposals, while the proposal under
Article 5 of the Comitology Decision leads to the adoption of implementing acts110.
The other argument refers to the practice under the old comitology procedure in the
1987 Decision, where the Council could accept the Commission’s proposal by qualified
majority or amend by unanimity111.
Regulatory procedure with scrutiny
Regulatory Procedure with Scrutiny112 is laid down in Article 5(a) of the Comitology
Decision.
If the Commission’s draft measures have got the positive opinion from the committee,
they shall be submitted for scrutiny to the EP and the Council.
If neither the Council nor the EP opposes the draft, the Commission shall adopt the
measures.
If at least one of them, i.e., either the EP (by absolute majority) or the Council (by
qualified majority) opposes, then the draft measures cannot be adopted. In that event,
the Commission may submit an amended draft to the committee or a proposal for
legislation on the basis of the Treaty, i.e., start all over again.
In the case of either a negative (or none) opinion by the committee, the Commission
submits a proposal to the Council and forwards it to the EP.
The Council has a first go at the proposal and has a chance to amend it by unanimity
within two months113.
109
Lenaerts (2000), p. 677
Hofmann, Turk (2006), p. 102, footnote 36
111
Ibid, p.130
112
Article 5(a)
113
Hofmann, Turk (2009), p.101
110
20
The Council can also oppose the proposal. Then the measures shall not be adopted and
the Commission may either submit to the Council an amended draft or a proposal for
legislation.
If the Council envisages adopting the measures, it submits them to the EP. (If Council
fails to act, the Commission submits the measures to the EP.)
If the EP opposes the adoption114, then the Commission shall not adopt the measures. It
may then start the procedure again.
If the EP does not oppose, the Council (or the Commission, if the Council had failed to
act) shall adopt the measures.
2.2.2. Selection of procedures
Criteria for the choice of the comitology procedures for the adoption of implementing
measures are specified in the Article 2 of the Comitology Decision. It states, in which
cases a basic act can introduce a certain procedure (advisory, management, regulatory or
regulatory with scrutiny) for its implementation.
Generally, a lighter procedure applies to purely technical measures, while for measures,
‘requiring a political assessment or with important general repercussions (and, therefore,
approaching the legislative sphere)’, there is a need for a procedure, in which the
legislator plays a greater role.115
The Management procedure should be used for ‘management measures, such as those
relating to the application of the common agricultural and common fisheries policies, or
to the implementation of programmes with substantial budgetary implications’.
The Regulatory procedure must be followed as regards measures of general scope
designed to apply essential provisions of basic instruments; as well as where a basic
114
In this procedure, the EP may oppose the adoption of the proposed implementing measures, if the
measures exceed the implementing powers provided for in the legal basic act, or the draft is not
compatible with the aim or the content of the basic act, or the measures in question do not respect the
principles of subsidiarity or proportionality. Article 5a(4e)
115
Lenaerts (2000), p. 668
21
instrument stipulates that certain non-essential provisions of the instrument may be
adapted or updated by way of implementing procedures.
Thus, the regulatory procedure must be adopted when implementing procedures may
adapt or update non-essential provisions of the basic act. For measures of general scope
the regulatory committee is also required, insofar as essential provisions of the basic act
are being implemented116.
The Regulatory procedure with scrutiny shall be used, where a basic instrument,
adopted in accordance with the co-decision procedure, provides for the adoption of
measures of general scope, designed to amend non-essential elements of that
instrument, inter alia, by deleting some of those elements or by supplementing the
instrument by the addition of new nonessential elements.
Thus, the conditions for applying this procedure comprise three aspects:
1) the basic instrument is adopted under co-decision procedure;
2) implementing measures are of general scope;
3) these measures are to amend non-essential elements of the basic instrument,
where amendments can be understood as formal amendments117 to the basic act,
or as supplementing it.
The Advisory procedure is to be adopted ‘in any case, in which it is considered to be the
most appropriate’. Thus, the advisory procedure is a residual category: whenever other
procedures are not prescribed, the legislature can choose it.118
The criteria are mandatory for the regulatory procedure with scrutiny. While the legal
force of the criteria for choosing advisory, management or regulatory procedures has
been ambiguous.119
Article 2 states that the ‘choice of procedural methods for the adoption of implementing
measures shall be guided by the criteria’, thus implying that legally binding rules are
involved120. However, the Recital (5) of the preamble has undermined this by stating
that ‘such criteria are of a non-binding nature’.
116
Lenaerts (2000), p. 673
Hofmann, Turk (2009), p. 99
118
Lenaerts (2000), 673
119
Ibid, p. 668
120
Ibid.
117
22
One explanation has been that the criteria do not operate as rules in the strict legal
sense, but are as principles, constituting guidelines for the legislature, and do not wholly
eliminate its freedom of choice121. The ECJ has dealt with this issue in the following
case.
In the case C-378/00122 the Commission has applied for annulment of the EP and the
Council Regulation, in so far as it made adoption of measures, for the implementation
of the LIFE programme, subject to the regulatory procedure (while the Commission had
proposed the management procedure).
The ECJ stated that principles and rules, which the Council was empowered to adopt,
and which were thus laid down in the comitology decision, must be observed. It held
that “the fact that the criteria laid down in … the second comitology decision are not
binding in nature does not prevent that provision from having certain legal effects, and
in particular does not prevent the Community legislature from being subject, when it
departs from those criteria, to the obligation to state reasons on that point in the basis
instrument adopted by it”123. The Court has annulled that Article of the Regulation,
which dictated the choice of the regulatory procedure.
2.2.3 The EP’s influence
Besides the veto right under the Regulatory procedure with scrutiny, the EP has also the
rights of information (Article 7(3)) and review (Article 8).
According to the Article 7(3), the Commission shall inform the EP about the committee
proceedings on a regular basis. The EP shall receive agendas for meetings of
comitology committees, and the results of voting and summary records of meetings and
lists of the authorities and organizations to which the representatives of the Member
States belong. The EP shall also be informed of all the measures or proposals for
measures, which the Commision transmits to the Council.
121
Ibid, p. 669
Case C-378/00 Commission v Parliamen and Council. [2003] ECR I-937
123
Ibid, para.50
122
23
For the implementation of instruments adopted under co-decision124, the EP is also
entitled to receive draft of implementing measures, which was submitted to the
committees.
Where the implementing measures concern a basic act, which was adopted under codecision procedure, the Article 8 enables the EP to defend its prerogatives against
possible infringements by the Commission at any stage in the implementing
procedure.125 If the EP considers that the proposed implementing measures would
exceed the implementing powers provided for in the basic act, it may indicate this in a
‘resolution setting out the grounds on which it is based’. The Commission shall take the
resolution into account and must re-examine the draft measures.126
In the regulatory procedure, the EP shall inform the Council, if it considers that the
proposed measures exceed the implementing powers provided for in the basic
instrument, i.e. are ultra vires. Where appropriate, the Council, before acting by
qualified majority on the relevant proposal, has to take into account the EP’s position127.
However, the EP’s resolution is not binding either on the Commission or on the
Council. The Commission may continue with the procedure and decide to maintain the
proposed measures. While the Council’s action under the regulatory procedure is
limited: firstly, there should be a certain minority in the committee, which opposed the
proposed implementing measures, in order for them to be referred back to the Council;
secondly, the Council itself could oppose the proposal only with the qualified majority.
The legislature could not intervene directly, thus the Commission had a large degree of
freedom to decide on the limits of its implementing powers itself.
Therefore, if it wished to avoid that the Commission developed those provisions in a
particular way, the legislator had to define the implementing task as precisely as
possible. Otherwise, the legislature had to bring the matter before the ECJ, if the
Commission exceeded its implementing powers128.
124
Article 251 EC Treaty
Lenaerts (2000), p. 681
126
It may continue with the procedure, submit new proposal to the committee or submit a proposal for
legislation. See Article 8.
127
Article 5(5) and 5(6)
128
Lenaerts (2000), p. 682; Article 230 EC Treaty
125
24
2.3. Council implementing itself
The Article 202(3) EC Treaty contained the main principle that the Council should
delegate implementing powers to the Commission. The Council could, in specific cases,
reserve the right to exercise directly implementing powers itself.
According to the Article 1 of the Comitology Decision, the Council might reserve the
right to exercise directly certain implementing powers itself only in ‘specific and
substantiated’ cases.
However, these articles did not provide any base for deciding these ‘specific cases’.
This part will discuss the ECJ case law regarding the Council’s right to reserve
implementing powers for itself.
In the Case 16/88129, the Court considered whether the Council had encroached upon
the Commissions own power to implement the budget, “by making the adoption of the
decisions which it empowered the Commission to take subject to the management
procedure”130.
Before giving the ruling that it had not, the ECJ affirmed that it was the Commission
that has the power for implementation: it stated that the Commission could, even before
the Single European Act (SEA)131, be empowered to adopt implementing measures.
After the SEA, the Council might reserve the right to exercise implementing powers
itself “only in specific cases and it must state in detail the grounds for such a
decision”132.
The grounds justifying the reservation of powers to the Council have been analysed in
the Visa Border133 case, where the Court gave its interpretation of the Article 202 EC
Treaty, as regarding the limits of the Council’s right to reserve the exercise of
implementing powers for itself.
129
Case 16/88 Commission v Council [1989] ECR 3457
Ibid, para. 15
131
Op cit n 58
132
Op cit n 129, para. 10
133
Case C-257/01 Commission v Council [2005] ECR I-345
130
25
2.3.1 Visa Border Case
In this case the Commission sought annulment of two Council’s regulations, which
reserved for the Council implementing powers for examining visa applications and for
carrying out border checks and surveillance134.
The claimant (the Commission) argued that, under the contested regulations, the
Council reserved the implementing powers for itself improperly and without giving
adequate reasons for doing so, therefore, the Article 202 EC Treaty and Article 1 of the
Comitology Decision were infringed135.
The Commission stated that normally the Commission itself exercised implementing
powers, and the Council could reserve to itself such powers only exceptionally,
provided the Council put forward reasons that demonstrated there was a specific
situation, which justified such reservation. In the relevant case, the Council had not
established specifity and provided only a statement of reasons, which was too
general136: a mere reference to visa policy and border surveillance in general terms was
not enough137. The Commission had also submitted that the sensitivity of both visa and
border policy did not in any way amounted to an adequate reason for the Council to
reserve implementing powers.138 And even if the relevant areas were to be regarded as
sensitive, the Commission submitted that it was capable to deal with such matters by
involving the Member States in the decision making, according to the Comitology
procedure139. The Commission maintained that the special provisions of the relevant
area could not exclude the usage of comitology procedure, set up under the Article 202
EC Treaty140. It also noted that certain aspects of visa policy had already fallen in the
Community’s framework, and the Council had already conferred implementing powers
134
Op cit n 133, para.1
Ibid, para. 33; the second plea concerned implementing measures that could be adopted by the
Member States.
136
Opinion, para.29
137
Op cit n 133, para. 35
138
Opinion, para.31
139
Op cit n 133, para. 41
140
Ibid. Para. 40
135
26
on the Commission, especially in areas, where secrecy was an absolute rule.141 Finally,
the concerned domains are matters of formalities and procedures142.
The Council noted that the relevant regulations contained different procedures, which
were legislative, executive and factual in nature and took account of this special feature,
by providing three different procedures for amending those relevant measures143.
It also disputed that the reservation of implementing powers was proper and concerned
specifically amendments to certain ‘detailed provisions and practical procedures’ of the
relevant measures and not amendments of other aspects of visa policy or border
policy144.
The Council referred, in recitals of both regulations, to the ‘enhanced role of the
Member States’ in respect of visas and border surveillance, and to ‘the sensitivity of
those areas’, in particular as regards political relations with non-member States, as the
reasons, which prompted the Council to reserve the implementing powers for itself145.
Thus, in the Council’s view, this reservation was consistent with Article 202(3) and
Article 1 of the Comitology Decision.146
2.3.1.1. Opinion of Advocate General
In the Opinion of Advocate General Léger, the judge had examined the legal
framework, in which implementing powers were conferred, and considered this
particular area, in which the Council reserved such powers for itself.
The Advocate General mentioned that it has been a common ground that, in general, it
was the Commission that exercised implementing powers, and it has also been common
ground that the Council could reserve those powers in specific and substantiated
cases.147
141
opinion, para. 32
Op cit n 133. Para.41
143
Ibid. Para 42
144
opinion, para.34
145
Op cit n 133, para. 52; opinion para. 35
146
opinion, pra.37
147
opinion, para 38
142
27
However, he noted that, according to the relevant Community law, the Council could
not exercise implementing powers other than extraordinarily, where the legislator
established that it was concerned with a specific case and gave reasons for its
decision.148
Then the judge interpreted the meaning of ‘specific case’ and specified two conditions
that had to be fulfilled, so that the reservation of implementing powers was compatible
with the Community law149.
First, according to his view, the ‘specific case’ should mean that the Council would not
be able to reserve the implementing powers for itself generally.150 And there should be
‘no reservation of powers in respect of an entire field’, but only to one or more
particular aspects of the area151.
Second, the specific situation also required that “the reservation of powers should apply
for a fixed period of time”: the Council could not reserve those powers for the unlimited
period.152
Later he also argued that the specificity requirement “[did] not concern the provisions to
be amended, but the particular context in which such a reservation of powers
[occurred]”, i.e., it was “not the amendments which must be specific but the situation in
which the Council [reserved] implementing powers to itself”153.
It was also stated that the contested regulations were subject to the general obligation to
state reasons154 as well. And since the reservation of implementing powers was the
exceptional case, therefore, the reasons should be detailed: this is in order to establish a
tight framework for the Council’s reservation of the implementing powers155. The
statement of reasons should not only provide ‘factual and legal reasons’, but must also
explain why the Council, rather than the Commission, should exercise those powers156.
148
opinion, para, 44
Randazzo (2005), p. 1740, too para 56
150
opinion, para. 45
151
opinion, para 46
152
para. 47
153
para 64
154
Article 253 EC Treaty
155
para. 53
156
para. 54
149
28
As regarding the conditions, on which the Council could reserve implementing powers,
the judge concluded, that if the Council reserved such powers without complying with
the above mentioned requirements, this would undermine the institutional balance of the
delegation of powers157.
Then the Advocate General proceeded to consider the scope of the Court’s review of the
Council’s decision to reserve implementing powers for itself.
He stated that neither the Court nor other institution could determine, which were those
specific cases, when the Council could reserve the right to implement itself, - it is only
for the Council to decide.158
However, such decision could not be exempted from the judicial review.159 On the other
hand, the judge has acknowledged that the review of the Court could be limited due to
the political nature of such decisions160.
Finally, the judge considered, whether in this case the Council stayed within or
exceeded its limits of discretion.
He stated that even though the Council had reserved implementing powers only
concerning the amendments of certain provisions of the relevant regulations, there still
had to be specific situation, in which such reservation occurred, in order to comply with
the specificity requirement.161 The general framework, established by the Council, for
reserving the exercise of implementing powers for the entire area of the relevant
instruments, was not compatible with the ‘specifity requirement’162.
The Advocate General concluded that the contested regulations infringed the Article
202(3) EC Treaty and Article 1 of the Comitology Decision. Thus, proposed that they
must be annulled.
However, the ECJ took a different view. It will be described in the next part.
157
opinion, para. 55
para. 57
159
para.58
160
Randazzo (2005), p. 1740; para 60-61
161
para. 64
162
para. 68
158
29
2.3.1.2. Reasoning and the ruling of the Court
The ECJ referred to its judgement in the previous case163 that the Council may reserve
the right to exercise implementing powers directly only in specific cases, and ‘it shall
state in detail the grounds for such a decision’164.
“That means that the Council must properly explain, by reference to the nature and
content of the basic instrument to be implemented or amended, why exception is being
made to the rule that, under the system established by the Treaty, when measures
implementing a basic instrument need to be taken at Community level, it is the
Commission which, in the normal course of events, is responsible for exercising that
power.”165
In this case the Council referred to the enhanced role of the Member States and to the
sensitivity of those areas in recitals of both regulations.166
After assessing the context and “specific nature”167 of these policy areas, the Court held
that even though the reasons, provided by the Council, were both “general and laconic”,
they were “such as to show clearly the grounds justifying the reservation of powers to
the Council.”168
Thus, “the Council could reasonably consider itself to be concerned with a specific
case” and “reserve to itself … power to implement a series of provisions”169.
The Court affirmed that the special provisions reflected the specific nature of the area,
which has been covered by the relevant regulations, because that the framers of the EC
Treaty “did not wish to confer on the Commission a sole right of initiative in this area at
the outset”170.
Next, the exhausted list of provisions in the relevant regulations, which did not deal
with all the aspects of visas and external border control, showed that the reservation of
implementing powers has been ‘clearly circumscribed’171.
163
Op cit n 129.
Op cit n 133. Para 50
165
Ibid. para. 51
166
Ibid. Para. 52
167
Ibid. para 56
168
ibid, para. 53
169
Ibid, para 59
170
Ibid. Para. 56
171
Ibid. Para 57
164
30
It was also clear for the Court from the recitals of the relevant regulations that the
Council undertook to review after three-year transitional period to review the conditions
for the reservation of implementing powers by those regulations172.
Thus, the Court ruled that for all the above-mentioned reasons, which were sufficiently
clear from the preambles of the relevant regulations and from the context in which they
occurred, that “it must be held that the Council could reasonably consider itself to be
concerned with a specific case and that it duly stated the reasons … for its decision to
reserve to itself, on a transitional basis, power to implement a series of provisions”,
which were exhaustively listed in the relevant measures.173
The ECJ has rejected the Commission’s argument.174
Summary of the Chapter
This chapter described the legal framework for the delegation of implementing powers
that existed under the EC Treaty. The main assumption in the Article 202 EC Treaty
and the Article 1 of the Comitology Decision has been that the Council should delegate
implementing powers to the Commission, unless the Council reserved this right for
itself in specific cases. The requirements, which may be imposed on the Commission’s
exercise of the implementing powers, were laid down in the Comitology Decision.
172
Ibid. Para 58
Ibid., para. 59
174
The second one concerned implementing measures that could be adopted by the Member States. In the
second plea, the Commission maintained that implementing measures, which could be adopted by the
Member States, were contrary to the Article 202 EC Treaty. The Court stated that the Article 202(3) EC
Treaty, governed the “division of implementing powers as between the Council and the Commission”,
and that “the provision does not concern the division of powers as between the Community and the
Member States”174. The Commission’s complaint, that such measures should have been delegated to it,
“could succeed only if it were established that the procedure thereby put into practice was such as to
prejudice the effective or correct implementation”174 of the basic act. The Commission had failed to
demonstrate that a uniform procedure was required for the adoption of these measures. See Ibid. Para. 66,
71.
173
31
3. Post-Lisbon delegation of powers
The Lisbon Treaty has changed the structure of delegation of powers in the EU:
Articles 202 and 211 EC Treaty have been replaced by Articles 289-291 TFEU.
The new system distinguishes between legislative, delegated and implementing acts.
Legal binding acts are still the same – regulations, directives and decisions (Article 288
TFEU), but each one of them can be issued at three different levels: as legislative, as
delegated or as implementing acts175.
According to the Article 289 TFEU, legal acts adopted by legislative procedure shall
constitute legislative acts. Thus any measure adopted under the ordinary legislative
procedure (Article 294 TFEU) is a legislative act of the EU. In specific cases, provided
for by the Treaty, legislative acts can be adopted with special legislative procedures as
well (Article 289(3) TFEU).
A legislative act shall contain the essential elements, which shall not be delegated.
However, a legislative act may delegate to the Commission the power to adopt
delegated acts that supplement or amend certain non-essential elements of the
legislative act (Article 290 TFEU).
The third category is implementing acts. According to Article 291 TFEU, acts shall
confer implementing powers on the Commission or, in specific cases on the Council,
“where uniform conditions for implementing legally binding Union acts are needed”.
Implementing powers might be conferred by both legislative and delegated acts.
I will take a closer look at delegated and implementing acts, because “it is around
Articles 290 and 291 that the legal framework will have to be constructed to replace the
comitology system”176 that was established under the EC Treaty.
The first chapter will introduce the delegated acts. The implementing acts are described
in chapter two, which also covers the Commission’s proposal for implementing the
Article 291 TFEU.
175
176
There are also other special types of acts.
Commission’s Communication regarding Implementation of Article 290 COM (2009) 673, p.3
32
3.1 Delegated acts
Article 290 TFEU177 states that:
1.
A legislative act may delegate to the Commission the power to adopt non-legislative acts of
general application to supplement or amend certain non-essential elements of the legislative
act.
The objectives, content, scope and duration of the delegation of power shall be explicitly
defined in the legislative acts. The essential elements of an area shall be reserved for the
legislative act and accordingly shall not be the subject of a delegation of power.
2.
Legislative acts shall explicitly lay down the conditions to which the delegation is subject;
these conditions may be as follows:
(a) the European Parliament or the Council may decide to revoke the delegation;
(b) the delegated act may enter into force only if no objection has been expressed by
the European Parliament or the Council within a period set by the legislative act.
For the purposes of (a) and (b), the European Parliament shall act by a majority of its
component members, and the Council by a qualified majority.
3.
The adjective “delegated” shall be inserted in the title of delegated acts.
The paragraph (1) of the Article 290 TFEU provides for the legislator to delegate to the
Commission the power to adopt “non-legislative acts of general application to
supplement or amend certain non-essential elements of the legislative act”. The
Commission is the sole recipient of such delegated powers. As stated in paragraph (3),
such acts adopted by the Commission are called “delegated acts”.
The delegated act must both be of general application and amend or supplement certain
non-essential elements of the legislative act. If one of the criteria is not met, then the
Article 290 TFEU may not be applied178.
When the Commission receives the power to adopt delegated acts under the Article 290,
‘the Commission is authorised to supplement or amend the work of the legislator’179.
177
This provision is sufficiently defined and does not require adoption of any additional binding
legislation in order to make it operational. However, in order to make the system predictable, the
Commission, the Council and the EP will have to agree on a standard formula for such delegations. The
Commission’s view on the framework, within which such delegation of power shall operate, has been
defined in the Commissions’ Communication regarding Implementation of Article 290 of the TFEU
(COM (2009) 673).
178
COM (2009) 673, p. 4
179
Ibid, p.3
33
Thus, within the meaning of Article 290 TFEU, the legislator might delegate to the
Commission the power to adopt measures that it could have adopted itself. In this
manner, the delegated acts address legislative matters in a non-legislative procedure,
therefore, they are substantive but not formal legislation180.
A delegation of power is possible only in a legislative act. But the article does not
distinguish between the ordinary legislative procedure (former co-decision) and special
legislative procedures. Therefore, it does not matter whether or not the EP and the
Council adopt the legislative act jointly181.
Yet the delegation of power is not an obligation, but an option: the legislator “may”
delegate to the Commission the power to adopt delegated acts.
But when the legislator decides to confer powers on the Commission, then it shall
define the framework within which these powers shall be exercised. Each legislative act
shall define both the extent and the conditions of the delegation.
3.1.1 Material and temporal limits of the delegation
The legislative act may delegate the power to supplement or amend its non-essential
elements. Hence, only non-essential elements may be delegated. In the paragraph (1) it
is clearly expressed that the essential elements shall not be delegated: “the essential
elements of an area shall be reserved for the legislative act and accordingly shall not be
subject of a delegation of power”182.
To the essential elements belong “the objectives, content, scope and duration of the
delegation of power”183. The second subparagraph of Article 290(1) TFEU requires that
the legislator, in each legislative act that delegates powers, shall explicitly define these
criteria.
In this way, a delegation of power to adopt delegated acts is subject to the condition that
the legislator lays down the essential elements. The objectives, content, scope and
180
Hofmann (2009), p. 491
COM (2009) 673, p. 3
182
Non-delegation clause of essential elements is not explicitly formulated for implementing acts.
However, from a theological point of view, because it applies to delegated acts, it shall also be applicable
to the implementing acts. See Hofmann (2009), p.488
183
Ibid, p.488-489
181
34
duration of delegation will need to be actually defined (not only formally addressed) in
the legislative act184.
The Commission would have to comply with these material and temporal limits of the
delegation, which would influence its powers even before the preparation of the
delegated act185. The paragraph (2) of the Article 290 TFEU provides two control
options for the legislator, to which it can subject the Commissions powers after the
delegated act has been prepared.
3.1.2 Forms of control
Because it is the legislator that delegates to the Commission the power to adopt
measures that it could have adopted itself, therefore, it is the legislator that controls the
Commission’s exercise of these delegated powers186.
Provisions in Article 290 TFEU allow the legislator to do that by means of a right of
revocation or/and a right of objection.
Article 290(2) TFEU provides that the legislative act must (“shall”) explicitly define the
conditions, to which the delegation is subject. Two forms of control are available.
The legislator may act either on the delegation itself (which may be revoked if the
legislator considers that it is used incorrectly), or on the delegated acts (they may be
objected after their adoption, thus preventing their entry into force)187.
The first possibility allows the EP and/or the Council to reserve the right of full
revocation of the entire delegation of powers to the Commission.
If it wishes, the legislator (either the EP or the Council) can directly call back this
competence and no justification for this veto is needed188. However, when exercising
such a right, it might be appropriate to explain the reasons behind it189.
184
Hofmann (2009), p. 489
COM (2009) 673, p.6
186
COM (2010) 83, p.2 Commission’s Proposal for a Regulation laying down the rules and general
principles concerning mechanisms for control by Member States of the Commission’s exercise of
implementing powers. – COM(2010)83 final
187
COM (2009) 673, p. 6
188
Hofmann, Turk (2009), p.109
189
Op cit n 187, p. 8
185
35
The second one allows the EP or the Council to object to measures on a case-by-case
basis: the delegated act may enter into force only if no objection has been expressed by
one of the institutions within a time period set by the legislative act.
Thus, after adopting a delegated act, the Commission would notify the legislature about
it. This would trigger the right of opposition. Now the legislator has a right to object
within a certain period (laid down in the legislative act), and meanwhile, the adopted
delegated act is suspended. If the EP or the Council opposes, the delegated act cannot
enter into force190.
According to the Commission, the right of opposition (the right to object) is to be seen
as the ordinary means of control, exercised by the legislator over all delegated acts. And
the revocation (as a general and absolute withdrawal of the delegated powers to the
Commission) is to be seen as the exception191.
In the case of revocation, the legislator retains overall control over the delegation of
power to the Commission192. In the case of opposition, the legislator would get back the
delegated powers only after the duration criterion has expired.
Both193 control options are independent of each other, and the legislator is not obliged to
impose them cumulatively194. However, the control of the delegated legislative powers
would be most effective, if the legislative act contained both control procedures of
Article 290(2), i.e. to revoke the delegation entirely and to make delegation conditional
on a case-by-case basis.195
According to the last subparagraph of Article 290 (2), in order to exercise either of
control options, the EP shall act by a majority of its members, and the Council by a
qualified majority.
190
Ibid, p.10. Then the Commission has the possibility to either adopt a new (amended) delegated act,
present a legislative proposal on the basis of the Treaty, or might decide not to do anything. Ibid
191
COM (2009) 673, p.7
192
Ibid, p.8
193
It is not clear, however, whether this list is exhaustive. It has been argued that both closed (due to the
exception of delegation, etc.) and open (due to the need of new and flexible forms) numerations are
possible. See Hofmann, p. 493
194
COM (2009) 673, p.7
195
Hofmann (2009), p.493
36
3.1.3 Procedural requirements
Article 290 TFEU does not contain any provision about the procedure by which the
Commission will adopt the delegated acts. Neither of the paragraphs – neither directly,
nor indirectly – refer to the procedure for adopting such acts. As a result, the
Commission enjoys a large measure of autonomy in this matter196.
However, in the Commission’s Communication COM (2009) 673197, the Commission
has stated that, when preparing drafts of delegated acts, it intends to establish a practice
of involving experts from national authorities from all the Member States.
Where the preparatory work will require new expertise, the Commission plans to carry
out the necessary preparatory work and to consult the experts from the Member States.
In order to make sure that, first, from a technical and legal point of view, the delegated
acts comply fully with the objectives, specified by the basic act, and, second,
‘everything possible is done from a political and institutional point of view’, in order to
avoid objections by the EP or the Council at a later stage.198
The Commission might form new groups of experts or use the existing ones.
In addition, where needed, the Commission will do “any research, analysis, hearings
and consultations required, in the form best suited to the fields in question and the time
limits that have been laid down”199.
An effective partnership at the technical level with experts from the national authorities
is of highest importance to the Commission200. However, according to the Commission,
these experts will have a consultative rather than an institutional role in the decisionmaking.
Thus, it is probable that the Commission will be adopting the delegated acts without any
formal opinion neither from the experts nor the comitology Committees.
196
COM (2009) 673, p.6
Op cit n 176
198
Ibid, p. 6
199
Ibid, p. 7
200
Ibid, p. 7
197
37
3.2. IMPLEMENTING ACTS
Article 291 TFEU states that:
1.
Member States shall adopt all measures of national law necessary to implement legally
binding Union acts.
2.
Where uniform conditions for implementing legally binding Union acts are needed, those
acts shall confer implementing powers on the Commission, or, in duly justified specific
cases and in the cases provided for in Articles 24 and 26 of the Treaty on European Union,
on the Council.
3.
For the purposes of paragraph 2, the European Parliament and the Council, acting by means
of regulations in accordance with the ordinary legislative procedure, shall lay down in
advance the rules and general principles concerning mechanisms for control by Member
States of the Commission’s exercise of implementing powers.
4.
The word “implementing” shall be inserted in the title of implementing acts.
The first paragraph explicitly declares that it is the Member States’ competence and
responsibility to adopt all measures of national law that are needed for implementing the
legally binding EU acts.
However, in the second paragraph it is stated that, where it is necessary to create
uniform conditions for implementing the EU acts, the Commission must exercise its
executive power201. But Member States ability to decide at their own discretion in such
cases is restricted; therefore, the implementation at the EU level is the exception, while
the application by the Member States is considered to be the general rule.202
According to the Article 291 TFEU, the implementing acts do not supplement or amend
the legislative act (unlike the delegated acts in Article 290 TFEU). They shall only
guarantee the uniform implementation of the legally binding acts throughout the EU.
So the Commission does not use any “quasi-legislative” power. It uses purely executive
power203.
Now there is a straightforward obligation, deriving from the Treaty, that when the
conditions of Article 291 TFEU are fulfilled, acts must confer implementing powers on
the Commission. Where the basic instrument requires uniform implementation
201
COM (2009) 673, p. 3
Hofmann (2009), p. 497
203
COM (2009) 673, p. 3
202
38
throughout the EU, then the intervention by the Commission is not optional but
compulsory204.
However, in duly justified specific cases, those acts can confer those powers on the
Council.
Nevertheless, once powers for ensuring the uniform implementation of the acts are
conferred on the Commission, then the Council does not control the exercise of those
powers205. According to the wording of the Article 291 TFEU, “control by Member
States” is not framed in terms of the Council and does not say anything of control by the
EP206. The Member States are mainly responsible for implementing the legally binding
acts of the EU; therefore, they are responsible for controlling the Commission’s
implementing powers207.
Thus, the legislator cannot control the implementation by the Commission (contrary to
the delegated acts under Article 290 TFEU). Provisions in the Article 291 do not allow
the legislator any direct control of the Commission’s use of implementing powers208.
However, it is provided for the indirect control to the legislator. In Article 291(3)
TFEU it is stated that the EP and the Council will have to adopt the legislation in
accordance with the ordinary legislative procedure, in order to lay down rules and
principles concerning mechanisms for control by the Member States of the
Commission’s implementing powers.
This means that the continuation of Comitology procedures is envisaged209: reference to
the comitology is made in much the same indirect manner as it has been under the EC
Treaty.210 However, there is no provision in Article 291(3) TFEU that specifies the
form or the nature of such control by Member States.
Therefore, the Commission has issued a ‘Proposal for a Regulation of the European
Parliament and the Council laying down the rules and general principles concerning
mechanisms for control by Member States of the Commission’s exercise of
204
COM (2009) 673, p.4
COM (2010) 83, p. 3
206
Griller (2000), p. 121
207
Op cit n 205, p.2
208
Ibid.
209
Griller (2000), p.121
210
Hofmann, Turk (2006), p.96
205
39
implementing powers’ (COM(2010)83 of 9 March 2010). Its aim is to shape
procedurally the Member States’ control of the Commission’s exercise of implementing
powers.
Consequently, implementing powers are about to become subject to the comitology
procedures.
3.2.1. Commissions proposal COM (2010) 83211
Under the EC Treaty, the exercise of implementing powers by the Commission was
governed by the old Comitology decision. The Article 291(3) TFEU now requires the
EP and the Council to lay down the new rules and general principles for that.
In order to implement Article 291 TFEU, the Commission has issued the proposal
regarding the mechanisms, which shall apply for control by Member States of the
Commission’s use of implementing powers.
The Commission’s new proposal uses the experience and the common practice of the
old Comitology Decision: it draws on the Committees structure for the purposes of
controlling the Commission’s implementing powers by the Member States212.
It is stated in the new proposal that in cases, where the basic act requires the control of
the Member States for the adoption of implementing acts by the Commission, then, for
the purposes of such a control, there should be established committees, composed of the
representatives of the Member States and chaired by the Commission213.
According to the new proposal, there should be only two procedures: the Advisory
procedure and the Examination procedure.
The new Advisory procedure mirrors the old Advisory procedure. The new
Examination procedure would replace the old Management and Regulatory
procedures214.
211
The Articles quoted in this chapter refer to this proposal (unless referred differently).
Op cit n 9
213
COM (2010) 83, p.7
214
Ibid, p.3
212
40
The applicable committee procedure shall be defined in the basic act, according to the
type of the implementing measures concerned215.
3.1.1 Selection of procedures
According to the Commissions proposal COM (2010) 83, the advisory procedure is the
general rule: it can be applied to all policy areas and for all types of binding
implementing measures216. While the criteria for the choice of the examination
procedure are binding: the examination procedure can be used only when the criteria are
met217.
As stated in Article 2(2), the examination procedure may be applied for the adoption of
(a) implementing measures of general scope or (b) other implementing measures related
to the following policy areas: common agricultural and common fisheries policies;
environment, security and safety or protection of the health or safety of humans,
animals or plants; common commercial policy.
Thus, the examination procedure would apply when adopting measures of general scope
for implementing basic acts and for specific measures, which might possibly have an
important impact218.
The advisory procedure shall apply for all the other implementing measures, and for the
measures referred to above, ‘where it is considered to be appropriate’ (Article 2(3)).
3.1.2 Advisory and Examination procedures219
Some provisions are common for both procedures.
The chairman shall submit draft measures to the committee (Article 3(3)). The
committee shall examine them and deliver its opinion within a certain time limit, which
will be laid down according to the urgency of the issue.
215
Article 2(1)
COM (2010) 83, p. 3
217
Ibid, p. 4
218
Ibid, p. 8
219
Where the basic act provides, the Commission may also apply the immediately applicable measures on
‘imperative grounds of urgency’ (Article 6). But they are not relevant for the future discussion.
216
41
The chairman may request the committee’s opinion by written procedure (Article
3(4))220. The draft measures, on which the opinion is needed, shall be sent to the
committee members. If a member of the committee does not explicitly oppose the draft
before the set time limit expires, then it is considered that he or she gives the tacit
agreement to the proposed measures. However, any committee member may ask to
terminate the written procedure and examine the draft measures at the committee
meeting. The chairman may decide on the situation.
In order to take into account the discussions within the committee, the chairperson may
present amended version of the measures until the opinion is delivered (Article 3(4))221.
Advisory procedure is laid down in the Article 4.
The advisory committee shall deliver its opinion on the draft, if necessary, by taking a
vote. If the committee takes a vote, then the opinion shall be delivered with the simple
majority of its members. The Commission shall take the utmost account of the opinion
within the committee.
Examination procedure provides that the committee shall deliver its opinion on the
draft by the qualified majority (Article 5(1)).
If the committee delivers a positive opinion (i.e., the qualified majority supports the
proposal), then the Commission shall adopt the implementing measures. Only under
exceptional circumstances or if “new elements” have arisen, the Commission may not
adopt the measures. In such a case, a new draft version may be submitted to the
committee.
If there is no opinion from the committee, the Commission may ultimately adopt the
proposed measures or not, taking into account the positions expressed within the
committee222. There is no obligation for the Commission to adopt the draft measures, if
no opinion is delivered. Where the Commission does not adopt the draft measures, it
may submit to the committee an amended version of the proposal.
220
The old Comitology Decision did not stipulate the use of written procedures. However, they have been
a common practice. See COM (2010) 83, p.5
221
This has been a common practice under the old comitology system. See, Ibid, p. 5
222
Ibid, p. 4
42
If a negative opinion is delivered, the Commission shall not adopt the proposed
measures. In such case, the Commission may resubmit the proposal to the committee for
a second deliberation, or submit an amended version of the draft measures223.
Thus, under the examination procedure, the voting rules reflect the ones, which in the
old Comitology Decision were required for the Council, acting as an appeal body, for
preventing the adoption of draft measures by the Commission.
Now the examination committee itself would be able to prevent the adoption of such
measures, if a qualified majority of Member States voted against.224
3.3. Differences between Post- and Pre-Lisbon
In this part I will briefly review the main differences between the two systems: the new
system of delegated and implementing powers that has been introduced by the Lisbon
Treaty and the old rules for delegation that existed under the EC Treaty.
Before there had been distinction only between legislation and implementation.
Now there is legislation, delegation and implementation; i.e., a new category has been
introduced between legislative acts and acts of an implementing nature.
Under the EC Treaty, the phrase ‘implementing powers’ had covered a mix of two
separate types of powers225: first, the power to adopt an act, which amends or
supplements the basic legislative act itself, and, second, the power to implement (or
execute) a legislative act, i.e., it would be applied or executed, but without any
supplementation or amendment226.
The implementation by the Commission meant ‘delegated rule-making or decisionmaking subject to comitology procedures’227. Implementing acts covered a wide variety
of categories, including rules interpretation, rules application, rule setting, etc.228
223
It is also provided that in the ‘very exceptional circumstances’, the Commission might adopt draft
measures despite a negative opinion from the committee, but in such a case the committee would have the
last word within a time period, which would not exceed one month. Ibid, p. 4
224
Ibid, p.4
225
Piris (2006), p. 73
226
Craig (2006), 127
227
Craig (2006), p. 127
228
Hofmann (2009), p. 495
43
Thus, the fact that the Commission’s implementing powers had covered the power to
amend non-essential parts of legislative acts resulted in situations, where the legislator
was obliged to entrust to the Commission the more technical or detailed aspects of the
legislation as if they were implementing measures229.
Now such powers – supplementing and implementing – are separated: on the level of
secondary law it is distinguished between delegated and implementing acts. Now there
is a distinction between the powers delegated to the Commission to adopt nonlegislative acts of general application to supplement or amend certain non-essential
elements of a legislative act (i.e., delegated acts under Article 290 TFEU), and the
powers conferred on the Commission to adopt implementing acts (under Article 291
TFEU) of an administrative nature, where uniform conditions are needed.
Before it was the Council, which could confer implementing powers on the
Commission. Now there is a direct obligation, deriving from the Treaty, that acts shall
confer implementing powers on the Commission, were uniform implementation of these
acts is needed. In duly specified specific cases, those acts can also confer implementing
powers on the Council.
Under the new system, the comitology will not be used for delegated acts (what was the
status quo). The Council and the EP will now control delegated acts.
The comitology will apply to the implementing acts: the Member States will supervise
the implementation at the EU level.
Before the legislator could participate in the comitology procedures. Now the committee
itself may prevent the adoption of implementing measures under the examination
procedure. The voting rules in this procedure (i.e., qualified majority of Member States)
reflect the ones that were required for the Council, acting as an appeal body230.
The other important difference is that the Council will not be able to delegate powers to
itself under the new system. The legislator will only have to options: either to legislate
or to delegate to the Commission.
229
230
Griller (2008), p.93
COM (2010) 83, p. 4
44
4. Delegation of powers in the CCCTB
The Commission Services have prepared some working documents concerning the
CCCTB, where the comitology procedure for the exercise of implementing powers by
the Commission has been regarded as an important characteristic of the project.231
In these documents it has been stated that it would be impossible to lay down every
detailed rule in the basic CCCTB document232, because of the complicatedness of the
subject. Therefore, one possibility is for the detailed implementation of some of the
measures laid down in the CCCTB to be delegated by the Council to the Commission
and be agreed via the comitology process233. It is envisaged to make use of the
regulatory committee procedure as laid down in the Comitology Decision.234
Implementation measures, which could have been possibly covered by the comitology
procedure, are specified in paragraphs of two working documents:
- Working Document on “CCCTB: possible elements of a technical outline”
(CCCTB/WP/057)235, which sets out the possible outline of principles of the CCCTB by
bringing the various structural elements of the base together into a coherent set of rules;
- and Working Document on “CCCTB: possible elements of the administrative
framework” (CCCTB/WP/061)236, which sets out the possible elements of the
administrative framework for the CCCTB.237
Implementing measures, which have been suggested in CCCTB/WP/057 are:
-
(creating and) updating a (non-exhaustive) list of third country companies,
which have a similar form to EU companies and which are subject to the
Member State(s) corporate income taxes238;
231
CCCTB, 34
WP/57, p. 4
233
WP/62, p. 2
234
62, p.2
235
WP/57, p. 3
236
Wp 61, p. 2
237
A summary of the main principles of the regulatory comitology procedure are provided in the Working
Document “Explanatory note on the comitology procedure” (CCCTB/WP062).
232
238
point 10 of the wp57
45
-
adopting detailed definitions and guidance concerning the definitions of a
permanent establishment239;
-
establishing/laying down common criteria of the charities (donations to which
would be deductible expenses)240.
Working Document 61 stated that the Council, according to the procedure, laid down by
the Article 5 of the Comitology Decision, could delegate to the Commission the laying
down of:
-
detailed rules relating to the (the form and content241 of) notice to opt for the
common base (point 16);
-
detailed rules, relating to the decision, when the competent tax authorities of the
taxpayers of a group could in exceptional circumstances decide that a taxpayer
other than the designated one would be the principal taxpayer instead (point 25);
-
detailed arrangements for electronic filling and assessment (point 30);
-
the form of the tax return and consolidated tax return (point 32);
-
the information required to support the (consolidated) tax return (point 35);
-
detailed rules relating to the detailed arrangements, governing the formation and
functioning of panels (point 45);
-
detailed rules concerning the setting up and functioning of the appeals body and
panels (point 60).
In the final part of this paper I would like to apply the previous analysis on the
delegation of powers in the EU, in order to consider the following.
First, what the delegation of these measures would have meant under the EC Treaty,
and, thus, whether the delegation of these measures in CCCTB has been appropriate
under the EC Treaty.
Second, I will analyse the implications on these measures of the Treaty of Lisbon; i.e.,
will look at, how the new Treaty could effect the delegation to the Commission in the
CCCTB.
239
point 16, wp 57
point 25 and 46, wp 57 ‘Defining what a single asset is’ has also been mentioned in the WP57. For the
purposes of this paper, it will be considered together with the other “defining” measures, i.e., defining
permanent establishments and charities.
241
WP 61, point 30, p. 8
240
46
But to begin with, I will look at the delegation in the EU taxation area in general.
4.1. Delegation of powers in the EU taxation
Here I describe three situations of the delegation of powers that existed in the taxation
area in the EU: in the first one there is no delegation of powers; in the second one, the
competence to adopt implementing measures has been reserved for the Council; the
third case shows two examples of delegation of implementing powers to the
Commission.
The following is the case of the Savings Directive242, which does not delegate executive
powers to the Commission.
In December 1997, the Council instructed the Commission to propose a directive on the
taxation of savings, which the Commission had tabled in May 1998. After five years of
difficult negotiations, several Council meetings and a second proposal by the
Commission in 2001 (because the debate deviated so far away from the original
proposal), the directive was at last adopted in 2003243.
In this case, both the Commission’s proposal and the final directive had relied only on
national authorities for policy implementation and did not confer any executive powers
to the Commission. In addition, delegation of powers to the Commission was not even
discussed during the negotiations.244
The next example is the VAT (value added tax) Directive245, where the Council had
reserved the right to exercise implementing powers for itself.
242
Council Directive 2003/48/EC of 3 June 2003 on taxation on savings income in the form of interests
payments (OJ L 157/38)
243
Franchino (2007), p. 235
244
As regarding the negotiations, there has been a broad agreement on the basic policy objectives within
the Council. However, there was less consent on the details of the measure. For example, some Member
States favoured a broader definition of ‘interest’, while others preferred a narrower one. There were also
divergences on less important issues. Italy, Greece, Belgium and France preferred an identification
procedure that was based on a residence certificate and not on a modified address test, which was
proposed by Luxembourg, Finland and Britain. The views also differed on the provisions regarding the
certificate needed, in order to avoid the withholding tax and double taxation. See Ibid, p. 230-234
245
Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ
L 347/1)
47
The Article 397 of the VAT Directive states that the ‘Council, acting unanimously on a
proposal from the Commission, shall adopt the measures necessary to implement this
Directive’. When adopting the instrument with this Article, it was stated in the
preamble, that the implementing measures would have a budgetary impact, which for
one or more Member States could be significant; therefore, this impact of such
measures justified the Council’s reservation of implementing powers for itself246.
Finally, there are two cases of the delegation of implementing powers to the
Commission in the EU taxation legislation.247
According to the Article 24 of the Council Directive 92/12/EEC248, the Regulatory
procedure from the Comitology Decision should be used for adopting certain measures.
For example, accompanying documents, where goods or products, subject to excise
duty, move between the territories of the various Member States, under a simplified
internal Community transit procedure, etc.
The Article 20 of the Council Directive 76/308/EEC249 (as amended by the Council
Directive 2001/44/EC250) provides that the Commission shall be assisted by a recovery
committee. A range of detailed rules has been adopted for implementing different
provisions of the basic act under the Regulatory procedure: the form and content of
requests for information, means by which communications between authorities may be
transmitted, notification, recovery or precautionary measures, etc.251
Thus, Comitology committees have been used in taxation. Even though the tax area has
been a sensitive matter among the Member States, it should not be excluded a priori
from the scope of comitology252. However, the unanimity and conflict among the
Member States seem likely to decrease the discretion of the Commission253.
246
Lang (2008), p. 59; Council Directive 2004/7/EC of 20 January 2004 (OJ L 27/44), points 11-12
CCCTB/WP062 also provides more examples from other policy areas, where the Council acts by
unanimity, but confers implementing powers on the Commission.
248
Council Directive 92/12/EEC of 25 February 1992 (OJ L 76, 23.3.1992. pp. 1-13)
249
Council Directive 76/308/EEC, OJ 1976 L 73/18
250
Council Directive 2001/44/EC, OJ 2001 L 175/17
251
Lang (2008) p.58; Commission Directive 2002/94/EC (OJ L 337/41)
252
Lang (2008), p. 58
253
Franchino (2007), p. 182
247
48
4.2. Comitology in the CCCTB before and after the Lisbon
According to the ECJ case law, as long as the Council dealt with the essential rules of
the project in the main legislative act (in this case it would be adopted by the
unanimity), then the implementing provisions could have been adopted by a different
procedure.254
In other words, if the measures could not be classified as essential to the project, then
the Council could have delegated them to the Commission.255
Yet, tax is not the agricultural sphere, were implementation has been interpreted
widely256, therefore, in the present case the wide interpretation of implementation could
not be relied upon.257
Thus, delegating provisions would have to be more defined: the power conferred on the
Commission had to be delimited in a sufficiently specific manner and the basic
legislative act had to contain the ‘sufficiently specific’ enabling provisions.258
The legislature could also delegate its power to the Commission to amend certain
elements of the legislative act, but it had to be ensured that the power was well defined
and that the exercise of power is subject to strict review.259
Thus, (1) the delegation could also include the power to make amendments; but the (2)
strict review should be ensured.
I will now consider, whether the proposed measures in CCCTB concerned amendments.
And later will look at the Council’s possibilities to review the proposed implementing
measures under the Regulatory procedure.
254
Op cit n 18. para.6
Op cit n 71
256
Op cit n 74
257
Op cit n 75
258
Op cit n 81
259
Op cit n 82, para. 90
255
49
The first measure concerned creating and updating a (non-exhaustive) list of third
country companies, which have a similar form to EU companies and which are subject
to the Member State(s) corporate income taxes
I think that this measure could be considered as both amending260 and updating nonessential provisions. It could fall within “adapting or updating”261 certain non-essential
provisions of the instrument. But it could also be considered as amendment/update to an
annex to the basic act, which falls under RPS procedure262: ‘amending by deleting or
supplementing’263.
The other group of measures concern ‘definitions’: adopting detailed definitions and
guidance
concerning
the
definitions
of
a
permanent
establishment;
and
establishing/laying down common criteria of the charities (donations to which would be
deductible expenses).
These measures might be non-essential264, however I think that the interpretation of
these terms might be regarded as technical changes that might have an impact on the
size of the tax base265.
Because of the unanimity requirement in the tax area, the Council could either reserve
implementing powers for itself, or legislate these issues in the main legislative act.
The whole other group deals with laying down the detailed rules:
detailed rules relating to the notice to opt for the common base; detailed rules, relating
to the decision, when the competent tax authorities of the taxpayers of a group could in
exceptional circumstances decide that a taxpayer other than the designated one would be
the principal taxpayer instead; detailed arrangements for electronic filling and
assessment; the form of the tax return and consolidated tax return; the information
required to support the (consolidated) tax return; detailed rules relating to the detailed
arrangements, governing the formation and functioning of panels; detailed rules
concerning the setting up and functioning of the appeals body and panels.
260
Artice 2 (2) Comitology Decision; Hofmann, Turk (2009), p. 99
Article 1(b) Comitology Decision
262
Hofmann, Turk (2009), p.99
263
Artice 2 (2) Comitology Decision
264
Lang (2008), p.60
265
Ibid, p. 403
261
50
I think that these measures would have supplemented the legal act with the new set of
rules, which came ‘on top of the corpus’, constituted by the basic act266. Thus, it might
be considered as a supplementing measure, which could fall under RPS, if was adopted
under co-decision. These measures do add new set of rules, however, they are matter of
form and procedure267.
To sum up, the CCCTB project proposal contains different procedures, which are quasilegislative, supplementing or updating. However, it was proposed to use one procedure
to adopt all of them, which I will refer briefly to.
In the Regulatory procedure, if the committee delivered a positive opinion by qualified
majority, then the implementing measures will be adopted without Council being able to
review the proposed measures.
Which is contrary to the Regulatory procedure with Scrutiny (RPS), where even
positive opinion from the committee would mean that the Commissions proposed
implementing measures would be referred to the Council (and the EP) for its approval.
However, one of the conditions for applying RPS procedure has been that the basic act
had to be adopted under co-decision procedure. As it is assumed that the CCCTB would
be adopted under unanimity, therefore, the RPS could not be applied.
Thus, in the Regulatory procedure, the Council would review the proposed measures
only if there would be blocking minority in the committee, i.e., if the committee did not
support the Commission’s proposal.
Subsequently, the Council could oppose or adopt the proposal with the qualified
majority.
However, there might be situations, when the Council lacks the required qualified
majority. In such cases, according to the Comitology Decision, the Commission must
adopt proposed measures.
266
267
Hofmaa, Turk (2009), p. 9
Lang (2008), p.60
51
This meant that it would be possible for the Commission to adopt the implementing
measures, if, for example, the Council voted against with a simple majority, i.e., neither
opposed it nor adopted the measures.
Even though the Commission stated that it would try to avoid going against the ordinary
majority, nonetheless, it has been a legal requirement, stated in the Comitology
Decision, that the Commission should adopt the measures, if the Council does not act or
oppose.
It could be very likely that in such a sensitive area as tax, there could be situations,
where the committee delivered none or negative opinion, and then the Council was left
to deal with the conflict situation, where it was unable to vote by qualified majority,
thus, leaving the Commission the proposed measures to be implemented by the
Commission.
To put it in other words, the legislator could not intervene directly.
And this has been in the area, where the basic act would be adopted unanimously, where
there has been “enhanced role of the Member States”268.
Therefore, in the light of the Visa Border case, it is possible to conclude that the
Council could have easily reserved the implementing powers for itself in CCCTB under
the EC Treaty. Taxation area reflects the ‘enhanced role of the Member States’ due to
the unanimity requirement.269 Council’s reservation of powers could be justified,
despite those few examples, where the Comitology has been used in taxation area
before.
As long as the Council had properly explained the reasons for doing that, it
could have reserved the right to implement itself (However, maybe not for the entire
period.)
However, things have changed after the Treaty of Lisbon.
The legislator could no longer delegate to itself such powers, as regarding the measures,
mentioned in the CCCTB.
268
269
Randazzo (2005), p. 1747
Ibid.
52
The Council will only have two options available under the new system: either to
legislate or to delegate to the Commission.270
Therefore, I would like to discuss the legislator’s options, as regarding proposed
measures in the CCCTB, in the new situation.
I think that the first measure (creating and updating a list of third country companies,
which have a similar form to EU companies, etc.), under the new system could be
subject for the delegated power, because it would ‘supplement or amend’ certain
elements of the legislative act271.
The other group of measures concern ‘definitions’ (of a permanent establishment and
charities). In the new system, these measures could also be regarded as
supplementing/amending measures, and might fall under the scope of delegated acts.
However, it is not clear, whether the voting rules (qualified majority) would not
jeopardize the unanimity requirement. And also whether these measures would not
affect the size of the taxable base. In such cases, the Member States might prefer that
the Council shall decide these issues in the basic instrument.272
The whole other group deals with laying down detailed rules relating to many different
procedures, as the notice to opt for the common base, etc.
Under the new system, these rules and procedures might be delegated to the
Commission. Because these are matters of procedure and form273 that could be usefully
dealt with in delegated acts.
Thus, if the Council chooses to confer powers on the Commission, it would need to
define objectives, content, scope and duration in the legislative act. And because it is the
legislator that delegates powers to the Commission, to adopt those measures, therefore it
is the legislator that controls the exercise of these powers.
270
Implementing powers could still be conferred on the Council in specific cases: Article 291(2) TFEU.
However, I don’t think this provision is directly relevant for measures, proposed in the CCCTB.
271
Article 290(1) TFEU
272
Lang (2008), p. 60
273
Ibid. P.60
53
The legislator would have a control over delegated powers by (full) revocation and by
reviewing every measure before the adoption.
Thus, under the new system of the Lisbon Treaty, the measures, proposed in the
CCCTB relating to the updating of the lists and laying down the procedures, could be
delegated to the Commission, with the effect that the Council could any time recall its
delegated powers, and review every single measure before the adoption.
Yet, according to the analysed Commission’s proposal, there would be no comitology
committees for delegated powers in the new system. Of course, the proposal might be
changed, or the legislator might include the statement in the legislative act that a
committee shall be consulted.
However, in the current state, it does not seem to be comitology committees procedures
for the proposed measures in the CCCTB under the new Treaty of Lisbon.
54
5. Conclusion
The Treaty of Lisbon has changed the Comitology system as we knew it before.
Therefore, in this work I was looking at the both systems – the old and the new one, – in
order to understand the changes that have occurred in the delegation of powers in the
EU.
These changes were of particular relevance in relation to the Common Consolidated
Corporate Tax Base CCCTB, where it has been proposed to use the Comitology
procedure for adopting certain measures.
As regarding the old system, during my analysis of the ECJ case law, the Comitology
Decision, I have found that the Regulatory Comitology procedure has not been really
suitable for dealing with such a sensitive matters as direct taxation.
However, after examining the new system that has been introduced by the Treaty of
Lisbon, I found that that the situation has improved for the legislator’s possibilities to
control the Commission’s exercise of delegated powers.
As regarding the CCCTB, I think that the proposed measures are no longer suited for
the Comitology committees. These measures would be better dealt with through the
delegation of powers to the Commission to adopt delegated acts or by legislator in the
basic instrument. According to the current Commission’s communications and
proposals, delegated acts would be adopted without the Comitology Committees.
However, the matters are not settled yet and many changes might still occur to the
current proposal and the final result. Therefore, I think there are a lot of interesting
topics for the future Master Thesis.
55
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