C-233/02

OPINION OF MR ALBER — CASE C-233/02

OPINION OF ADVOCATE GENERAL ALBER delivered on 25 September 2003 1

I — Introduction I I— Legal framework

A — Transatlantic Economic Partnership

2. At their summit in May 1998 the European Union and the United States of America adopted a statement on the Trans- atlantic Economic Partnership (TEP). In Point 10 of that statement the partners affirm their intention to concentrate on 1. The services of the Commission con- removing barriers which create significant cluded with their American counterparts restrictions to transatlantic trade and guidelines on regulatory cooperation and investment. In particular, this entails the transparency under the Transatlantic Eco- removal of provisions that hinder market nomic Partnership. The French Republic opportunities for goods and services. claims that the Court should annul that arrangement since, in its view, it constitutes a binding international agreement. It points out that, in accordance with Article 300 EC, only the Council has the power to conclude such an agreement. Moreover, it 3. In Point 17, the partners state their submits that the Commission's right of intention to initiative is restricted on account of the obligatory nature of that arrangement. By contrast, the Commission takes the view that the arrangement is merely a prepara- tory measure. It contends that since there is no binding act within the meaning of Article 230 EC, the action is inadmissible. — establish as soon as possible a Plan identifying areas for common actions both bilaterally and multilaterally, with a timetable for achieving specific 1 — Original language: German. results;

C — Guidelines on Regulatory Cooper- ation and Transparency 5. On 9 November 1998 the Council approved an Action Plan which had been agreed by the EU and the USA with regard to the TEP. 3Section 3.1. of the Action Plan, which relates to points 9 to 14 of the TEP statement, deals with 'Technical bar- riers to trade in goods'. Paragraph 3.1.1., 'Regulatory Cooperation', provides for the identification and implementation of jointly 6. In July 1999 negotiations began between defined general principles/guidelines for the services of the Commission and the effective regulatory cooperation. Moreover, American Government on principles/guide- provision is made 'jointly [to] review lines. During the negotiations the represen- mutually agreed issues, notably access to tatives of the Commission pointed out that each others' regulatory procedures with the principles/guidelines could not create respect to transparency and participation any obligations between the USA and the of the public — including the opportunity EC which are binding under international law and that they were fully compatible with the legal provisions in force on both sides. In February 2002 the negotiations on 2 — 'Nothing in this text constitutes an EU negotiating mandate'. the Guidelines on Regulation and Trans- 3 — Council press release No 12560/98. The text of the Action Plan is attached to the press release as Annex IV. parency (hereinafter 'Guidelines') were con-

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eluded. The text itself was not signed; be implemented on a voluntary basis and instead agreement was reached by means that they did not constitute an international of statements issued by the respective agreement but rather the results arrived at services which had been responsible for by the competent services of both partners. the negotiations.

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'meaningful input' on the drafting of 12. Section IV, Operational Elements of regulations and the possibility also to give Regulatory Cooperation', provides for the due consideration to such input within that exchange of information and mutual con- framework (Point 4(c)). A further aim is to sultation between the competent services. promote public participation in the regula- This also extends where necessary to non- tory process through access to documents public information (Point 10). Moreover, being drafted, analyses and relevant data the aim is to collect and analyse data jointly (Point 4(d)), to provide public explanations as well as to reach a common under- and necessary technical information (Point standing on the methodology for analysing 4(f)) and to create greater public under- facts and data and causes potentially standing of the objectives pursued and warranting regulatory action. There should effects sought by the regulations (Point 4 also be an exchange of rulemaking prio- (g)). On the whole, such steps aim to help rities (Point 11). Finally, provision is made facilitate trade (Point 4, final sentence). for monitoring of forthcoming rulemaking projects (Point 12).

19. In the view of the French Government, III— Submissions of the parties and forms the Guidelines constitute a binding inter- of order sought national agreement. The Treaty, and in particular Article 300 EC, does not confer any power on the Commission to conclude international agreements but reserves that power for the Council. In Opinion 1/75 the 16. The French Republic considers the Court of Justice held that neither the form Guidelines arrangement to be a legally nor the designation is in essence decisive as binding international agreement. Relying to whether or not an agreement constitutes on the judgment in France v Commission, 6 an international agreement. Rather, the it takes the view that the act whereby the expression 'agreement' indicates any under- Commission experts agreed the Guidelines taking entered into by a body subject to with their American negotiating partners is international law which has binding force, an act against which an action for annul- whatever its form. An understanding which ment may be brought. contains a standard, that is to say a rule of conduct, covering a specific field, deter- mined by precise conditions and which is binding upon the participants,, is such an undertaking. 7

17. The act by which the Commission's negotiators agreed on the negotiated text with their American counterparts at oper- ational level expresses the Commission's willingness to enter into a binding obliga- 20. The Guidelines fulfil those require- tion with the United States. In view of the ments. It is true that they do not take the level agreed by the two contracting parties form of a series of articles and do not for conducting the negotiations, the Com- contain any provision relating to their entry mission was required to express its commit- into force. However, such matters of form ment to cooperate only at operational level. are not of decisive importance. What must

22. Nor does the fact that the Guidelines are not intended to modify existing Com- munity law militate against their binding nature. The arrangement contains at the 25. The French Government likewise con- very least an undertaking to cooperate with siders it to be of no consequence that the the American authorities. Commission has never received a negotiat- ing mandate, that it has continually insisted to its negotiating partners that the arrange- ment is not binding and finally that the American side also regards the Guidelines as not binding. The only relevant factor is the content of the arrangement. The bind- 23. The procedural aspects provided for in ing nature of the Guidelines follows from Section VI, in particular the ongoing review the content. Moreover, the procedural process agreed in point 18, offer clear provisions in Section VI do not contain evidence of the binding nature of the the verb 'should' used elsewhere but the arrangement. The contracting parties have verb 'will'. This guarantees the implementa- an obligation under the Guidelines to tion of the measures provided for therein. achieve a particular result. In that regard As far as the French Government is they are under the supervision of an ad hoc concerned, that means that the review review body. Thus the contracting parties mechanism is not merely optional.

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(1) annul the Commission's decision whereby it concluded with the USA the Guidelines on regulatory coope- ration and transparency;

28. However, the Guidelines provide a way of influencing the Commission's proposals and restrict the freedom it enjoys. For

8 — Cited in footnote 6. (2) order the Commission to pay the costs.

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31. The Commission claims that the Court 35. The Commission takes the view that it should: may agree principles or guidelines with the American authorities without exceeding its powers. It is true that the Commission may enter into international arrangements which produce legal effects and/or give rise ( 1 ) dismiss the action as unfounded; to obligations only in the cases expressly provided for by the Treaty. However, a contrario this does not preclude the Com- mission from concluding with the author- ities of non-Community states practical talks on cooperation that do not give rise (2) order the French Republic to pay the to international obligations. The Commis- costs. sion has the power to conclude informal administrative talks with the competent administrative authorities of the United States. It takes the view that its right of initiative includes the possibility to hold any 32. The Commission considers the action consultations it considers necessary before to be unfounded. It contends that the it proposes a measure to the Parliament and Guidelines do not constitute an interna- the Council. tional agreement. They do not produce any legal effects and therefore there is no act within the meaning of Article 230 EC against which an action for annulment may be brought.

They were neither formally adopted nor respect the form chosen for the arrange- signed by either party. Both parties had ment plays a decisive role. The form continually emphasised that they did not demonstrates the intention of the contract- want to create binding provisions. The ing parties to create a non-binding docu- Commission draws attention in particular ment. to the use of the words 'should' and 'will' rather than 'shall'. The vocabulary chosen is standard for non-binding international instruments. The term 'parties' is not used at any point in the text; 'sides' is used exclusively throughout. Moreover, the EU 40. The United Kingdom, which has been and the USA are not referred to as given leave to intervene in support of the contracting parties. Commission, restricts its observations to the substantive aspects of the dispute. It submits that in order to interpret an international agreement, the whole set of circumstances that led to its adoption must be taken into consideration. This is the only way to determine the legal significance of a document.

38. The structure of the Guidelines also confirms their non-binding nature. They do not contain any final provisions concerning 41. The monitoring and follow-up pro- their entry into force or any rules on the vided for in points 18 and 22 of the settlement of disputes. Provision is made Guidelines are nothing more than state- merely for a review mechanism. None of ments of intent. Any infringement of those the provisions is capable of making either points cannot under any circumstances side liable under international law. render either side liable under international law.

47. The Commission takes the view that since there was no decision by the College of Commissioners, the arrangement does not bind it as an institution. In this regard, 44. Under the first paragraph of Article it must be pointed out that the College took 230 EC the Court of Justice is to review the note of the arrangement at its meeting on 9 legality of acts adopted jointly by the April 2002. That fact alone could support European Parliament and the Council, of the view that that the Commission acts of the Council, of the Commission and approved the arrangement and that that of the ECB, other than recommendations approval constitutes a decision by the and opinions, and of acts of the European Parliament intended to produce legal effects vis-à-vis third parties. The action brought 9 — C a s e 22/70 Commission v Council [1997] ECR 263. by the French Republic is admissible if the paragraphs 38 to 42; c a s e C-366/88 Francev Commission Guidelines arrangement concluded with the [1990] ECR I-3571, paragraph 8; France v cited in footnote 6, paragraph 14; Case C-58/94 Commission, Netherlands American Government is an act of the v Council [1996] ECR I-2169, paragraph 24. Commission within the meaning of that 10 — Order in Case 135/84 F.B. v Commission [1984] ECR 3577, paragraph 6; order i n Case C-50/90 Sitnzest v provision. Commission [1991] ECR I-2917, paragraph 12.

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College of the Commission. If the College sition that, contrary to the submissions put of Commissioners had been against the forward by the Commission, the College of arrangement, it should have intervened as the Commission even expressly approved soon as it was informed of it. the Guidelines.

11 — Cf. the minutes of 17 April 2002 of the meeting on 9 April 2002 (PV(2002)1562 final, which can be found at the 12 — Article 46 VCLT reads as follows: ' 1 . A State may not following address: www.europa.eu.int/comm/secretariat_- invoke the fact that its consent to be bound by a treaty has general/meeting/archives_en.htm. The English version been expressed in violation of a provision of its internal reads: 'The Commission took note of the agreement law regarding competence to conclude treaties as invalidat- reached at technical level between the Community and ing its consent unless that violation was manifest and the United States on guidelines for regulatory cooperation concerned a rule of its internal law of fundamental and transparency (SEC(2002)386/2), which would be importance. ratified by means of political declarations by both parties 2. A violation is manifest if it would be objectively evident at the next EU/US summit on 2 May. It took note of the to any State conducting itself in the matter in accordance conditions for implementation of these guidelines as set out with normal practice and in good faith.' in the note distributed by Mr LIIKANEN (SEC(2002) 13 — Article 7(3) VCLT-IO reads as follows: 'A person is 386).' The French version reads: 'La Commission prend acte de l'accord intervenu, au niveau technique, entre la considered as representing an international organisation Communauté et les Etats Unis sur des lignes directrices sur for the purpose of adopting or authenticating the text of a la coopération et la transparence en matière de régulation treaty, or expressing the consent of that organisation to be (SEC(2002) 386/2) qui seront entérinées, par la voie de bound by a treaty if: (a) that person produces appropriate déclarations politiques des deux parties, lors du prochain full powers; or (b) it appears from the circumstances that it sommet UE/Etats Unis le 2 mai 2002. Elle prend note des was the intention of the States and international organisa- conditions de mise en œuvre de ces lignes directrices telles tions concerned to consider that person as representing the que reprises dans la note diffusée par M. LIIKANEN (SEC organisation for such purposes, in accordance with the (2002) 386).' rules of the organisation, without having to produce full powers.'

14 — Case 366/88 France v Commission, cited in tootnote Q , paragraph 9, relating to internal instructions. 15 — Judgment in Netherlands v Council (cited in footnote 9, paragraphs 25 to 27, relating to the Code or Conduct [93/73G7EC| governing public access to Council and Commission documents. ÒJ 1993 I. 340, p. 411. 16 — Article 11 VCLT reads as follows: 'The consent or a State 52. As already mentioned, the first para- to he hound by a treaty may be expressed by signature, exchange of instruments constituting a treaty, ratification, graph of Article 230 EC covers only those acceptance, approval or accession, or by any other means if measures which produce legal effects. Meas- so agreed.' 1 7 — Article 11(21 VCLT-IO reads as follows: 'The consent of an ures which have effects only within the international organisation to be bound by a treaty may be expressed by signature, exchange ot instruments constitut- administration itself are beyond legal scru- ing a treaty, act of formal confirmation, acceptance, tiny, for example. They give rise to no approval or accession, or by any other means it so agreed.'

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18 — Cf. in this regard the Opinion of Advocate General Tesauro of 16 December 1993 in Case C-327/91 France 19 — Cf. Opinion of Advocate General Tesauro (cited in v Commission [1994] ECR I-3641, I-3643, point 21. footnote 18, point 20).

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context of international treaties. It is there- 59. In addition to the wording and object- fore difficult to attribute a clear meaning to ives of the arrangement, the context in it. However, even if the use of the word which the Guidelines were agreed must also 'will' could be seen as enhancing the be taken into consideration. As is apparent binding nature — as the French Govern- from the introduction, the Guidelines were ment asserts —, the express statement in negotiated within the framework of the Point 7 of the Guidelines that they apply on Transatlantic Economic Partnership which a voluntary basis must still be borne in was launched at the London Summit in mind. This general statement must not be May 1998. That partnership is not based disregarded when interpreting the word on a binding international arrangement but 'will'. It is therefore impossible to draw constitutes a political agreement within the any conclusions as to the binding nature of framework of the New Transatlantic the Guidelines from the way in which the Agenda agreed as early as 1955. It is true procedural aspects are worded. that this does not preclude the parties from concluding a binding arrangement under the TEP. However, that context is an indicator that what is at issue is a political dialogue concerning improvements in cooperation on trade matters in general. This suggests that the Guidelines are like- wise to be regarded as a political arrange- ment and not a legally binding document.

regarded as a measure which, like the Code experience of that kind is particularly of Conduct agreed between the Council and desirable in the area of trade policy in the Commission governing public access to order to prevent trade conflicts which might documents, constitutes the expression of lead to dispute settlement procedures under purely voluntary coordination for the pur- the WTO. When the Commission concludes poses of subsequent decisions of the com- arrangements to that end, in order to steer petent institutions of the US Government the consultations along particular defined and the Commission in the context of the paths, it is exercising, rather than restrict- development of regulatory proposals. On ing, its right of initiative. Ways and means the basis of the judgment in Netherlands v are established which put the Commission Council, 21 the Guidelines must therefore, in a position to exercise its right of initiative on this analysis, be regarded as a non- in an appropriate manner. binding legal act.

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64. However, it seems inappropriate to sion does in practice conclude agreements regard the Guidelines at issue as having with non-Community States cannot sub- the legal status of an administrative agree- stantiate its power since the Court has ment. The Commission's submission that consistently held that a mere practice on the the arrangement was concluded between part of the institutions cannot create a administrative bodies, fell within its com- precedent binding on Community institu- petence and in particular within its right of tions with regard to the correct legal initiative, could be understood to that basis. 25 effect. It should be pointed out that there is no mention in the EC Treaty of the category of 'administrative agreement'. 22 It is therefore extremely doubtful whether the Commission is competent at all to conclude such agreements other than in the cases expressly referred to in the Treaty, such as Article 302 EC.

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that regard also it seems inappropriate to the one hand, and that the Guidelines attempt to classify the Guidelines arrange- restrict its right of initiative, on the other. ment at issue in this case as an adminis- trative agreement.

67. Finally, however, even if the Guidelines 1. The Commission's competence to con- do constitute an administrative agreement it clude the Guidelines would still have to be determined whether that agreement produced legal effects. For only then would there be an act against which an action for annulment may be brought. As stated above, however, the Guidelines are not binding on account of 69. The French Government claims that in their content, their objectives or the context principle the Commission is not competent in which they were negotiated. It must to conclude international arrangements. It therefore be concluded that the Guidelines points out that in Article 300 EC this right do not lay down binding rules and therefore is reserved to the Council. do not produce legal effects. Since there is no act against which an action for annul- ment may be brought, the action should therefore be dismissed as inadmissible.

70. That is in principle correct. As already stated, Article 300 EC is the expression of the institutional balance between Parlia- ment, Council and Commission. The Com- mission's role in this context is, in principle, merely to open the necessary negotiations B — Substance (Article 300(1) EC). It is the Council that concludes Community agreements after the Parliament has made the contribution required of it in each case.

Council gives the Commission special restricts the Commission's right of initia- authorisation to that effect (Article 300(4) tive. As already mentioned in the context of EC) or in other circumstances provided for the admissibility of the action, in exercising by the Treaty, e.g. Article 302 EC. Because its right of initiative the Commission must, of the need to maintain the balance between however, examine fully the circumstances institutions, there must be no additional in which the draft legislation is put forward. recognition of a general right accorded to It must enter into consultations with all the Commission to conclude arrangements. interested parties in order to examine the necessity and possible effects of any rules before submitting a proposal to the Parlia- ment and the Council. There is no apparent reason why governments of non-Commu- nity States should not be consulted as part of this process, especially given that the 72. For that reason, the proposition that technical regulations forming the subject- the Commission may conclude administra- matter of the consultations with the Amer- tive agreements with other governments ican authorities provided for in the Guide- must be rejected. lines may, in certain circumstances, be submitted by the USA within the frame- work of the WTO for examination as to their compatibility with the TBT Agree- ment. Thus, the consultations with the American authorities may be considered to 73. Thus, assuming that the Guidelines do be a measure to prevent not only legal produce legal effects they would have had conflicts, but also trade conflicts within the to be approved and concluded by the framework of the WTO. To that extent, Council. The Commission would not have there is in fact a duty to discuss the effects been competent in that regard and conse- of any rules envisaged with American quently the Community act by which the trading partners before such rules are Guidelines were approved by the Commis- proposed to the European legislature. Con- sion would have to be declared null and sequently, it cannot be concluded that there void. is an infringement of the Commission's right of initiative.

76. In the light of the foregoing conclusions, I propose that the Court should:

(1) dismiss the action;

(2) order the French Republic to pay the costs.

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