by Kilian Klinger & Linda Senden
The Court’s recent ruling in the Elliott case can be seen as a landmark decision as it was the first time the Court had to decide upon the normative value of European harmonised technical standards (HTSs). This took its starting point in the mere question brought before the Court, whether or not such acts, adopted by private European standardisation bodies (ESBs), are subject to the Court’s jurisdiction to give a preliminary ruling on their interpretation pursuant to Art. 267 TFEU. Before substantiating on the central argumentative underpinnings of the Court’s judgment, let us first briefly summarize the facts of the case.
The case under consideration concerned a dispute between James Elliott Construction Ltd., an Irish construction company, which was in charge of the construction of a youth facility building in Dublin, and the Irish Asphalt Ltd. – the defendant –, which provided aggregates to be used in the construction process pursuant to a contract with the applicant. According to the terms of the contract, the defendant was obliged to supply aggregates produced in accordance with the Irish national standard for aggregates. This national standard itself implemented into Irish law a HTS adopted by an ESB following a mandate given under a “New Approach” Directive on construction products. Due to the fact that the aggregate Irish Asphalt supplied did not meet the contractually required standards, as specified in the HTS and applied by the national standard, massive damages occurred to the building. James Elliott Construction sought compensation from Irish Asphalt for the financial damage occurred due to the remedial work that had to be carried out. In the main proceedings, the Irish Supreme Court expressed doubts regarding the “legal nature” of European harmonised technical standards as such and the “interpretation of the scope and content” (para. 30) of the particular standard under dispute. It therefore decided to make a reference to the CJEU for a preliminary ruling. Most importantly, the referring court inquired whether the interpretation of a HTS is a matter upon which the Court may actually give a preliminary ruling pursuant to Article 267 TFEU.
Ruling of the CJEU
In response to this question the Court made clear that „the first paragraph of Article 267 TFEU must be interpreted as meaning that the Court has jurisdiction to give a preliminary ruling concerning the interpretation of a harmonised standard.” (para. 47) With this conclusion the Court followed the opinion of Advocate General (AG) Campos Sanchez-Bordona. The reasoning of the Court, however, is primarily founded on the following two arguments:
- European harmonised technical standards are part of EU law
Whereas the AG in his opinion explicitly concluded that HTSs “must be regarded as ‘acts of the institutions, bodies, offices or agencies of the Union’” (para. 40) for the purpose of Art. 267 TFEU and therefore called upon the Court to claim jurisdiction over the interpretation of such standards, the Court seemed to chart a slightly less straight-forward argumentative path to reach this conclusion. Without explicitly referring to HTSs as acts of the Union pursuant to Art. 267 TFEU, the Court ruled that European harmonised standards do “form[s] part of EU law” (para. 40), insofar as they are to be considered, by their very nature, as “a necessary implementation measure” of an act of EU law, in casu the “New Approach” Directive that defines only the essential requirements to be complied with by construction products in order to gain free access to the internal market. In stating that HTSs constitute essential supplements to “New Approach” Directives, the Court established the necessary link between the HTSs, as voluntary acts adopted by private standardisation bodies, and EU law.
- European harmonised technical standards do have legal effects
Secondly, the Court explicitly stated that HTSs adopted by ESBs must be considered as having legal effects, regardless of the fact that such standards are of a voluntary nature only, in the sense that compliance of a particular good with the essential requirements laid down in the directive may, in principle, be evidenced “by means other than proof of compliance with harmonised standards.” (para. 45) According to the Court, also the fact that these HTSs are issued by organisations governed by private law, which cannot be considered as “institutions, bodies, offices or agencies of the Union” within the meaning of Art. 267 TFEU (para. 43), “cannot call into question the existence of the legal effects of a harmonised standard.” (para. 42)
Several considerations underlie the Court’s reasoning in reaching these conclusions and which, to some extent, the AG has also highlighted in his opinion. In both the Court’s judgment and the AG’s opinion, particular emphasis has been placed on the fact that the process of drawing up such HTSs is subject to the rigid control of the Commission and takes place within the strictly defined confines of a mandate the Commission has issued under the “New Approach” Directive. Furthermore, when it concluded on the legal nature of HTSs, the Court – as well as the AG – particularly emphasized that the legal effects of such HTSs arise from their prior publication by the Commission in the Official Journal of the European Union. (para. 43) Only this grants the benefit of the presumption of compliance to all those products which are produced in accordance with this standard.
What becomes clear from the above is that the Court’s judgment in Elliott can be seen as a landmark decision insofar as it provides for the long-desired clarification on the legal nature of European harmonised technical standards and the question whether or not they are subject to the Court’s jurisdiction. Even more remarkably, the reasoning of the Court in the case at issue appears to give some further indications as to the legality of private party rule-making at EU level in general. By highlighting certain conditions that are deemed to be crucial in the assessment of the legal nature of HTSs, the Court, arguably, established an assessment framework that is of pertinence to the general question whether or when private regulatory acts may be considered as acts of EU law having legal effects. More precisely, what may be inferred from the judgment is that in order for a private regulatory act to be considered as having legal effects as part of EU law, it is required that:
- a close connection to an EU legislative act exists which strictly governs the exercise of powers by the private delegatee and which clearly confines the scope thereof,
- a sufficiently strong involvement of the delegating authority (primarily the European Commission) in the drawing up process of the private regulatory act can be evidenced and finally
- public accessibility of such acts is guaranteed, in casu, through their publication in the Official Journal.
As to the first aspect highlighted above, the Elliott judgement might also give some guidance as to how to draw the distinction between “private” and “public” acts. The opinion of the AG in Elliott reflects on this question. At least implicitly it can be inferred from the opinion that the line between the private and public nature of private regulatory acts can be drawn by reference to their institutional framework. It appears to be crucial in this respect to establish whether the private act at issue is linked to secondary legislation. According to the AG, those private regulatory acts that are drawn up on the basis of a particular mandate of the legislator, cannot be treated as “purely private” and “unconnected to EU law.” (para. 46) Conversely, this would allow to draw the conclusion that purely self-regulatory arrangements, which have no direct link to EU secondary legislation, can never be considered as acts or as part of EU law. It becomes apparent from the above that in Elliott the Court takes up, in essence, this rationale.
A further aspect that merits attention at this point is that this judgment seems to be, to some extent, a logical continuation of the “delegation of powers” doctrine the Court has established in its famous Meroni, Romano and ESMA judgments. In the said judgments the Court made first of all clear that delegation of rule-making competences to public actors not formally recognised within the primary law framework, such as agencies, is admissible, thereby actually concluding that the hierarchy of norms in Articles 289-291 TFEU is not a closed one. The Elliott judgment implicitly confirms this. But the Court also made clear that judicial reviewability of acts of such bodies constitutes a prerequisite for this admissibility. Given this case law and given the fact that the entrustment of ESBs with the drawing up of HTSs based on a “New Approach” Directive constitutes – as the AG puts it – a “controlled legislative delegation” (para. 50), one can say that the Court had its hands tied when it had to consider the question whether to claim jurisdiction over such HTSs and that answering it in the affirmative was the only logical and viable option for it. For considering the strict requirements the Court established in its case law with regard to judicial reviewability of delegated powers to agencies and similar bodies, and which have also been codified by the Treaty of Lisbon in the judicial remedies the TFEU provides for, rejecting jurisdiction over HTSs established by private standardisation bodies would have meant an irreconcilable disparity in approach between delegation of powers to public and private bodies. With that said, the Court was facing a dilemma: either to undermine its own doctrine by opening the doors for powers delegation beyond the judicial control of the Court, or to sacrifice, to some extent, the functionality of this regulatory approach by forcing such voluntary acts of private standardisation bodies into the institutional corset of EU law. Clearly, the Court opted for the latter.
While the Court can be applauded for strengthening the role of HTSs from the viewpoint of legality, it may be critically remarked – as also pointed out by Medzmariashvili 2016 – that this might have come at the expense of the effectiveness of this regulatory approach, by reducing the flexibility in its use.