Discretion, scope of judicial review and institutional balance in european law

Common Market Law Review

Volumn 47, Issue 2, 2010, Pages 361-403

  Fritzsche, Alexander ^a  

^a NONE

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EID: 77954165203     PISSN: 01650750     EISSN: None     Source Type: Journal    
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References (200)

1. Consolidated Version of the Treaty on the Functioning of the European Union, O.J. 2008, C 115/47. In the following all Treaty Articles will be numbered according to the Treaty of Lisbon where a change in substance compared to the EU and EC Treaties has not been effected.
2. Art. 6 ECHR cases on this matter include for example Case 44/1994/491/573, 22 Nov. 1995, Bryan, paras. 44 et seq.; Case 52/1993/447/526, 26 April 1995, Fischer, paras. 34 et seq.; Case 28/1992/373/447, 21 Sept. 1993, Zumtobel, paras. 31 et seq.; Case 6/1989/166/222, 28 June 1990, Obermeier, paras. 70 et seq.; Case 14/1989/174/230, 28 June 1990, Skärby, paras. 20, 28; Case 7/1984/79/123-126, 26 June 1986, van Marle, paras. 36 et seq.
3. O.J. 2000, C 364/1.
4. Consolidated Version of the Treaty on European Union, O.J. 2008, C 115/13.
5. See e.g. Galligan, Discretionary Powers, A Legal Study of Official Discretion (Clarendon Press, Oxford, 1986), p. 3.
6. As to European law, Ibanez, The Administrative Supervision and Enforcement of EC Law: Powers, Procedures and Limits (Hart, Oxford, 1999), p. 199.
7. Some authors tend to stress the first dimension, though "discretionary power may be defined as the margin of freedom of action that the administration is granted, explicitly or implicitly ..., by the law"; Odudu, "Article 81 (3), Discretion and Direct Effect", 23 ECLR (2002), 17, at 20-21: "By discretion I mean that there is 'an express grant of power conferred on officials where determination of the standards according to which power is to be exercised is left largely to them'. 'To have discretion is, then, in its broadest sense, to have a sphere of autonomy within which one's decisions are in some degree a matter of personal judgment and assessment'."(citing preliminary remarks of Galligan).
8. Some authors tend to emphasize this test when defining and justifying discretion: Vesterdorf, 1 Eur. Comp. J. (2005), 3, at 17: "It seems to me, however, that whenever an issue involves a complex assessment which may lead two reasonable persons to disagree as to the conclusion to be drawn, we are not in the realm of pure fact but in the realm of appreciation of facts where a margin of appreciation ought to be left to the Commission as the institution entrusted with making those complex assessments".
9. Similarly Bailey, "Scope of Judicial Review under Article 81 EC", 41 CML Rev. (2004), 1327, at 1336, 1342.
10. Craig, EU Administrative Law (OUP, 2006), pp. 433-434. This type embraces Craig's first and third category of discretion, for at least for our purposes there is no significant difference between them.
11. Montag, "The System of Legal Exception", 37 CDE (2001), 145, at 150.
12. Schaub, "Modernisation of EC Competition Law: Reform of Regulation No. 17" in Hawk (Ed.), Annual Proceedings of the Fordham Corporate Law Institute, International Antitrust Law & Policy 1999 (New York, 2000), pp. 143, 152.
13. This is of significance especially for the German translations as German administrative law attaches severe consequences to the characterization of something as "Ermessen" (discretion) or "Beurteilungsspielraum" (margin of appreciation).
14. Cf. e.g. Joined Cases T-259/02 et al., Raiffeisen Zentralbank Österreich AG and Others v. Commission, [2006] ECR II-5169: In para 220 the CFI refers to the Commission's power to impose fines and clarify its interpretation in the form of guidelines as "pouvoir discrétionnaire" and two paragraphs later as "pouvoir d'appréciation". Similarly, in many competition cases the courts have referred to discretion as " faculté" (Joined Cases 8/66 et al., Société anonyme Cimenteries C.B.R. Cementsbedrijven N.V. and others v. Commission, [1967] ECR 93, 117), "marge", or "pouvoir d'appréciation" (e.g. Case 26/76, Metro SB-Großmärkte GmbH & Co. KG v. Commission, [1977] ECR 1875, para 30: "pouvoir d'appréciation", para 45 "marge d'appréciation").
15. The most commonly used phrase is found for example in Case 42/84, Remia BV and others v. Commission, [1985] ECR 2545, para 34 (see infra the citation to note 72).
16. Protocol on the Statute of the Court of Justice annexed to the Treaty on European Union, to the Treaty establishing the European Community and to the Treaty establishing the European Atomic Energy Community (current version available at accessed 8 March 2010).
17. Rules of procedure of the Court of First Instance of the European Communities (current version available at accessed 8 March 2010).
18. Joined Cases 46, 47/59, Meroni & Co., Erba Meroni & Co., Milan v. High Authority, [1962] ECR 411, 418 et seq. (under the ECSC; Treaty establishing the European Coal and Steel Community of 18 April 1951).
19. See e.g. Cases 18/57, Firme J. Nold KG v. High Authority, [1959] ECR 41, 51 (under the ECSC); C-367/95 P, Commission v. Sytraval and Brink's France, [1998] ECR I-1719, para 67; C-265/97 P, VBA v. Florimex, [2000] ECR I-2061, para 114; T-231/99, Colin Joynson v. Commission, [2002] ECR II-2085, para 131; Lasok and Millett, Judicial Control in the EU: Procedures and Principles, (Richmond Law & Tax, Richmond, 2004), para 107.
20. Arts. 64, 65 CFI Rules of Procedure provide that certain measures may be adopted.
21. Case T-138/98, ACAV and Others v. Council, [2000] ECR II-341, para 72.
22. Schermers and Waelbroeck, Judicial Protection in the European Union, 6th ed. (Kluwer Law International, The Hague et al., 2001), § 1460.
23. E.g. Remia BV and others v. Commission, para 34: "as a general rule the Court undertakes a comprehensive review of the question whether or not the conditions for the application of Article [101] (1) are met". Therefore, the definition of the ECJ of its own role in Case C-225/91, Matra SA v. Commission, [1993] ECR I-3203, para 23: " in the context of an action challenging legality, the Court's function is solely to ascertain whether the contested decision is vitiated by one of the grounds of unlawfulness set out in Article [263] of the Treaty, and the Court cannot substitute its own assessment of the facts, especially in the economic sphere, for that of the author of the decision", is at least partly misleading.
24. Tiili and Vanhamme, 22 Fordham Int. L. J. (1999), 885, at 896-897.
25. Cf. e.g. Remia BV and others v. Commission (competition).
26. Cf. e.g. Case C-301/97, Kingdom of the Netherlands v. Council, [2001] ECR I-8853, para 74 (agriculture).
27. A definition is tried in Case T-380/94, AIUFFASS and AKT v. Commission, [1996] ECR II-2169, para 59 (State aid): "In order to establish that the Commission committed a manifest error in assessing the facts ..., the evidence adduced by the applicants must be sufficient to make the factual assessments used in the decision implausible.".
28. Opinion of 17 Feb. 2005, Case C-40/03 P, Rica Foods (Free Zone) NV v. Commission, [2005] ECR I-6811, para 45.
29. This category is congruent with what A.G. Léger characterizes as "political discretion".
30. Case C-372/97, Italy v. Commission, [2004] ECR I-3679, para 83; similarly Cases C-225/91, Matra SA v. Commission, [1993] ECR I-3203, paras. 24-25, T-17/03, Schmitz-Gotha Fahrzeugwerke GmbH v. Commission, [2006] ECR II-1139, para 41 and C-333/07, Société Régie Networks v. Direction de contrôle fiscal Rhône-Alpes Bourgogne, judgment of 22. Dec. 2008, nyr, para 78.
31. Joined Cases 62 & 72/87, Exécutif Régional Wallon and SA Glaverbel v. Commission, [1988] ECR 1573, para 34 (referring to Art. 107(3)(b) and (c) TFEU).
32. Case T-110/97, Kneissl Dachstein Sportartikel AG v. Commission, [1999] ECR II-2881, para 46.
33. Case T-214/95, Het Vlaamse Gewest v. Commission, [1998] ECR II-717, para 89.
34. Joined Cases 62 & 72/87, Exécutif Régional Wallon and SA Glaverbel v. Commission, [1988] ECR 1573, para 21.
35. Joined Cases C-75/05 P & C-80/05 P, Germany et al. v. Kronofrance SA, judgment of 11 Sept. 2008, nyr, para 60.
36. Most obviously, increasing the "individual earnings of persons engaged in agriculture"(Art. 39 (1)(b) TFEU) potentially collides with ensuring reasonable prices of agricultural products (Art. 39 (1)(e) TFEU). The ECJ has recognized the possible conflict of goals: "In pursuing these objectives, the Community institutions must secure permanent harmonization made necessary by any conflicts between these aims taken individually and, where necessary, allow any one of them temporary priority in order to satisfy the demands of the economic factors or conditions in view of which their decisions are made."(Case 5/73, Balkan-Import-Export GmbH v. Hauptzollamt Berlin, [1973] ECR 1093, para 24).
37. see also Usher, EC Agricultural Law (OUP, 2001), p. 34 et seq.
38. Case 265/87, Hermann Schräder HS Kraftfutter GmbH & Co. KG v. Hauptzollamt Gronau, [1989] ECR 2237, para 22; see also Joined Cases C-37 & 58/06, Viamex Agrar Handels GmbH et al. v. Hauptzollamt Hamburg Jonas, [2008] ECR I-69, para 34.
39. Netherlands v. Council, cited supra note 26, para 65 is another example concerning part four of the EC Treaty. The plaintiff sought annulment of a Council regulation introducing safeguard measures against the importation of rice originating in certain associated overseas countries and territories (OCTs). The Court, however, stated that the Council must not only take into account the goals of the association with the OCTs laid down in Art. 199 TFEU but also the other principles of Community law, including those relating to the Common Agricultural Policy. In weighing the various objectives the Council enjoys a considerable margin of discretion reflecting the political responsibilities entrusted to it by Treaty Articles such as Art. 203 TFEU. Para 75: "The Community court's review must be limited in particular if, as in the present case, the Community institutions have to reconcile divergent interests and thus to select options within the context of the policy choices which are their own responsibility".
40. Cf. e.g. Cases C-119/97 P, Ufex and others v. Commission, [1999] ECR I-1341, paras. 88-97; T-24/90, Automec v. Commission II, [1992] ECR II-2223, paras. 76-98.
41. Ufex and others v. Commission, cited supra note 44, para 88.
42. In the field of competition: Art. 7(2) of Commission Regulation 773/2004 relating to the conduct of proceedings by the Commission pursuant to Arts. 81 and 82 of the EC Treaty, O.J. 2004, L 123/18.
43. Automec v. Commission II, cited supra note 44, para 81.
44. Ufex and others v. Commission, cited supra note 44, para 93.
45. See the enumeration in Ortiz Blanco (Ed.), EC Competition Procedure, 2nd ed. (OUP, 2006), paras. 12-13.
46. Compare the standard of review stated at note 43 with Automec v. Commission II, cited supra note 44, para 80: "the review of legality which the Court must undertake focuses on whether or not the contested decision is based on materially incorrect facts or is vitiated by an error of law, a manifest error of appraisal or misuse of powers.".
47. Council Regulation of 22 Dec. 1995 on protection against dumped imports from countries not members of the European Community, O.J. 1996, L 56/1.
48. Case T-132/01, Euroalliages, Pechiney électrométallurgie, Vargön Alloys AB and Ferroatlántica, SL v. Commission, [2003] ECR II-2359, paras. 47-50, 48.
49. A more detailed account of the relevant criteria is given by van Bael and Bellis, Anti-Dumping and other Trade Protection Laws of the EC, 4th ed. (Kluwer Law International, The Hague et al., 2004), pp. 295-303.
50. Case C-269/90, Technische Universität München v. Hauptzollamt München, [1991] ECR I-5469.
51. Supreme federal tax court.
52. The order for reference is cited by A.G. Jacobs in his Opinion of 11 July 1991, Technische Universität München v. Hauptzollamt München, cited supra note 54, para 11.
53. Technische Universität München v. Hauptzollamt München, cited supra note 54, paras. 13-14.
54. Commission Regulation 2784/79 of 12 Dec. 1979 laying down provisions for the implementation of Council Regulation 1798/75 on the importation free of Common Customs Tariff duties of educational, scientific or cultural materials, O.J. 1979, L 318/32, Art. 7(5): "the Commission shall ... notify a group of experts composed of representatives of all the member states, who shall meet ... in order to examine the matter.".
55. Case C-185/90 P, Commission v. Walter Gill, [1991] ECR I-4779, para 24 (denial of invalidity pension).
56. As discussed under section 4.1 supra. See particularly the citation at note 33 supra.
57. E.g. Cases T-299/05, Shanghai Excell M&E Enterprise Co. Ltd. et al. v. Council, judgment of 18 March 2009, nyr, paras. 79 et seq.; T-35/01, Shanghai Teraoka Electronic Co. Ltd v. Council, [2004] ECR II-3663, para 48; T-155/94, Climax Paper v. Council, [1996] ECR II-873, para 98.
58. Case 138/79, SA Roquette Frères v. Council, [1980] ECR 3333, para 25; to that extent, see also Case 166/78, Italian Republic v. Council, [1979] ECR 2575, para 14; Case C-34/08, Azienda Agricola Disarò Antonio et al. v. Cooperativa Milka 2000, judgment of 14 May 2009, nyr, para 37 and concerning implementation of transport policy, Case C-248/95, SAM Schiffahrt GmbH and Heinz Stapf v. Germany, [1997] ECR I-4475, paras. 23-25.
59. Art. 8(5) and (7) of Council Regulation (EC) No. 2026/97 of 6 Oct. 1997 on protection against subsidized imports from countries not members of the European Community (O.J. 1997, L 288/1) have the same content, cf. as to the discretion conferred by the provisions on the Commission, Case C-398/05, AGST Drahtund Biegetechnik GmbH v. Hauptzollamt Aachen, [2008] ECR I-1057, paras. 31-34.
60. Council Regulation 139/2004 of 20 Jan. 2004 on the control of concentrations between undertakings, O.J. 2004, L 24/1.
61. Cases 56/65, Société Technique Minière v. Maschinenbau Ulm GmbH, [1966] ECR 235, 249-250; Remia BV and others v. Commission, cited supra note 16, para 18; T-328/03, O2 (Germany) GmbH & Co. OHG v. Commission, [2006] ECR II-1231, para 71; see also Commission Guidelines on the application of Art. 81(3) of the Treaty, O.J. 2004, C 101/97, para 16: "Agreements between undertakings are caught by the prohibition rule of Article [101 (1) TFEU] when they are likely to have an appreciable adverse impact on the parameters of competition on the market, such as price, output, product quality, product variety and innovation.".
62. Council Regulation 1/2003 of 16 Dec. 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty, O.J. 2003, L 1/1.
63. Cf. e.g. the leading Case C-68/94 et al., France et al. v. Commission, [1998] ECR I-1375, para 232: "In this respect, however, the basic provisions of the Regulation, in particular Article 2 thereof, confer on the Commission a certain discretion, especially with respect to assessments of an economic nature."Newer cases are T-342/99, Airtours v. Commission, [2002] ECR II-2585, para 64 and T-5/02, Tetra Laval v. Commission, [2002] ECR II-4381, para 119.
64. Remia BV and others v. Commission, cited supra note 16, para 34 (emphasis added); see also Case C-7/95 P, John Deere Ltd v. Commission, [1998] ECR I-3111, paras. 34-35 and T-65/98, Van den Bergh Foods Ltd. v. Commission, [2003] ECR II-4653, para 80.
65. Just see Cases C-56/93, Belgium v. Commission, [1996] ECR I-723, para 10 et seq.; Joined Cases T-126/96 & 127/96, BFM and EFIM v. Commission, [1998] ECR II-3437, para 81; C-328/99 & C-399/00, Italy and SIM v. Commission, [2003] ECR I-4035, para 39; C-341/06 P & C-342/06 P, Chronopost SA and La Poste v. UFEX et al., judgment of 1 July 2008, nyr, para 143; T-196/04, Ryanair Ltd. v. Commission, judgment of 17 Dec. 2008, nyr, para 41; see also A.G. Kokott, Opinion of 1 Feb. 2007, Case C-525/04 P, Spain v. Commission, [2007] ECR I-9947, paras. 70 et seq.
66. Opinion of 27 Oct. 2005 in Case C-222/04, Ministero dell'Economia e delle Finanze v. Cassa di Risparmio di Firenze, [2006] ECR I-289, paras. 111-112.
67. Id., citing Case C-39/94, SFEI v. La Poste, [1996] ECR I-3547, paras. 60-62.
68. Case T-33/91, Calvin E. Williams v. Court of Auditors, [1992] ECR II-2499, para 43; one of the earliest cases is 35/62, Leroy v. High Authority, [1963] ECR 197 in which A.G. Lagrange noted in his Opinion at p. 212: "Frankly, only an elaborate investigation would be capable of checking the accuracy of the criticisms .... The applicant has in fact asked for such an investigation but ... I believe that to do this would substitute the Court's judgment for that of the responsible authority.".
69. Judgments of the Court have traditionally been quite short whereas CFI judgments nowadays often amount to several hundred paragraphs.
70. A.G. Cosmas, Opinion of 13 Nov. 1999, Case C-83/98 P, French Republic v. Ladbroke Racing Ltd. and Commission, [2000] ECR I-3271, para 16: "a tendency may be observed in the case-law of the Court of Justice towards a dynamic broadening of judicial review and a strengthening of jurisdiction even in instances where it is necessary to solve complex legal problems".
71. For the area of competition law Lenaerts and Gerard, "Decentralisation of EC Competition Law Enforcement: Judges in the Frontline", 27 World Comp. (2004), 313, at 340 note that "despite the language of Article [263 TFEU], the 'manifest error of appraisal' standard for reviewing the application by the Commission of Article [101 (3) TFEU] for instance has considerably evolved over time towards a 'full review standard'".
72. As expressed e.g. by van Bael, "Discretionary powers of the Commission and the legal control in trade and antitrust cases" in Schwarze (Ed.), Discretionary Powers of the Member States in the Field of Economic Policies and their Limits under the EEC Treaty (Nomos, BadenBaden, 1988), p. 173: "The Court seems to adhere to the principle of in dubio pro commissione".
73. Cf. the preamble of the Council Decision of 24 Oct. 1988 establishing a Court of First Instance of the European Communities, O.J. 1988, L 319/1: "in respect of actions requiring close examination of complex facts, the establishment of a second court will improve the judicial protection of individual interests"; Schermers and Waelbroeck, op. cit. supra note 22, § 1495. The CFI did not formulate new standards of judicial review but referred to the traditional standards developed by the Court, e.g. in Joined Cases T-39 & 40/92, Groupement des Cartes Bancaires "CB" and Europay International SA v. Commission, [1994] ECR II-49, para 109 cites the Court's Remia set phrase, as cited supra at note 72.
74. Van der Woude, "The Court of First Instance: The First Three Years", 16 Fordham Int. L. J. (1993), 412, at 468-469.
75. AIUFFASS and AKT v. Commission, cited supra note 27, para 59 (on State aids): "In order to establish that the Commission committed a manifest error in assessing the facts such as to justify the annulment of the contested decision, the evidence adduced by the applicants must be sufficient to make the factual assessments used in the decision implausible.".
76. One of the first Commission decisions to be annulled due to a manifest error of assessment in determining whether competition could be excluded for a substantial part of the products in question (Art. 101(3)(b) TFEU) was found flawed just because the CFI did not share the Commission's assessment of the evidence, cf. Case T-185 et al./00, Métropole Télévision SA (M6) v. Commission, [2002] ECR II-3805, para 83: "All the information provided to the Court of First Instance thus goes to show that, contrary to what the Commission concludes in the contested decision, the sub-licensing scheme does not guarantee competitors of EBU members sufficient access to rights to transmit sporting events". Why, if there was an error of assessment, that error was manifest, was not addressed.
77. E.g. Cases C-360/92 P, The Publishers Association v. Commission, [1995] ECR I-23, para 48: "It must therefore be held that the reference to the Dutch Books case is manifestly inappropriate and thereby constitutes a defect in the statement of reasons"; T-44/90, La Cinq SA v. Commission, [1992] ECR II-1, para 94: "It follows that the Commission failed to fulfill its obligation to take account of all the relevant facts [breach of principle of sound administration] and that, consequently, the decision at issue is vitiated by a manifest error of appraisal [substantive ground of review]".
78. Nehl, Principles of Administrative Procedure in EC Law (Hart, Oxford, 1999), pp. 103-105, at p. 145.
79. see also Tiili and Vanhamme, "The 'Power of Appraisal' (Pouvoir D'Appréciation) of the Commission of the European Communities vis-à-vis the powers of judicial review of the Communities' Court of Justice and Court of First Instance", 22 Fordham Int. L. J. (1999), 885, at 892-893, 895.
80. Cf. e.g. Commission v. Sytraval and Brink's France, cited supra note 20, para 67; Case T-168/01, Glaxosmithkline Services Unlimited v. Commission, [2006] ECR II-2969, para 54; Case T-93/02, Confédération nationale du Crédit mutuel v. Commission, [2005] ECR II-143, para 67.
81. E.g. the Commission's market definition in competition cases has always been subject to a comprehensive review, yet in at least two cases the CFI does without adequate explanation otherwise, see Cases T-65/96, Kish Glass & Co. Ltd v. Commission, [2000] ECR II-1885, para 64 (Art. 102 TFEU); T-155/98, Société internationale de diffusion et d'édition (SIDE) v. Commission, [2002] ECR II-1179, para 71 (State aid).
82. A.G. Cosmas, Opinion in French Republic v. Ladbroke Racing Ltd and Commission, cited supra note 78, at 3278, footnote 3. However, the A.G. misses the opportunity to reason why he thinks the courts have the power to determine their scope of review in every single case.
83. This was one of the complaints the Commission made about the CFI's review of its decision on the merger of Tetra Laval and Sidel, Case C-12/03 P, Commission v. Tetra Laval BV, [2005] ECR I-987, paras. 19-31.
84. This has been noted by Herdegen and Richter, "Die Rechtslage in den Europäischen Gemeinschaften" in Frowein (Ed.), Die Kontrolldichte bei der gerichtlichen Überprüfung von Handlungen der Verwaltung (Springer, Berlin et al., 1993), p. 244.
85. The flexibility is also stressed by Schwarze, "Die gerichtliche Kontrolle der europäischen Wirtschaftsverwaltung" in Schwarze and Schmidt-Aßmann (Eds.), Das Ausmaß der gerichtlichen Kontrolle im Wirtschaftsverwaltungsund Umweltrecht (Nomos, Baden-Baden, 1992), p. 271 who suggests (though without providing evidence) that the intensity of review varies according to the individual interest in judicial protection in each case.
86. Paradigmatic is the early judgment in Joined Cases 56, 58/64, Consten S.à.R.L. and Grundig-Verkaufs-GmbH v. Commission, [1966] ECR 299, 347: "Furthermore the exercise of the Commission's power necessarily implies complex evaluations on economic matters. A judicial review of these evaluations must take account of their nature by confining itself to an examination of the relevance of the facts and of the legal consequences that the Commission deduces therefrom" (emphasis added).
87. It has been frequently noted that the courts rarely lay open their reasons for limiting review, and employ a flexible strategy based on the unstated particularities of the case at hand, see Herdegen and Richter, op. cit. supra note 91, p. 244.
88. von Danwitz, Verwaltungsrechtliches System und europäische Integration (Mohr Siebeck, Tübingen, 1996), p. 185.
89. Schwarze, "Judicial Review of European Administrative Procedure", (2004) Public Law, 146, at 161: " The Community courts rather use a flexible strategy according to the necessities of the particular case to define to what extent judicial review should limit economic administrative power.".
90. E.g. in connection with Art. 261 TFEU or Art. 103(2)(d) TFEU.
91. Lenaerts and Verhoeven, "Institutional balance as a guarantee for democracy in EU governance" in Joerges and Dehousse (Eds.), Good Governance in Europe's Integrated Market (OUP, 2002), pp. 44-49.
92. See the detailed account given by Craig, "Democracy and rule-making within the EC: An empirical and normative assessment", 3 ELJ (1997), 105, at 107-109.
93. Bieber, "The settlement of institutional conflicts on the basis of Article 4 of the EEC Treaty", 21 CML Rev. (1984), 505, at 519 uses the observed political "abuse" of the term to contest the principle in substance.
94. It is a "phantom" and an "empty formula". Yet, the ECJ held otherwise (see in particular Case C-70/88, European Parliament v. Council, [1990] ECR I-2041, paras. 21-22).
95. See e.g. Roquette Frères v. Council, cited supra note 65, para 33: "the institutional balance intended by the Treaty" and European Parliament v. Council, cited supra note 96, para 26: "the institutional balance laid down in the Treaties establishing the European Communities".
96. Case 9/56, Meroni & Co., Industrie Metallurgiche, SpA v. High Authority, [1957] ECR 133, 152. The courts also trace the principle of institutional balance in the Treaty establishing the European Atomic Energy Community (Euratom), cf. Cases C-233/02, France v. Commission, [2004] ECR I-2759, para 40; and T-240/04, France v. Commission, [2007] ECR II-4035, para 31.
97. Cf. the 1992 consolidated version of the Treaty establishing the European Community, O.J. 1992, C 224/6, 18.
98. Roquette Frères v. Council, cited supra note 65, para 33. See also Case 139/79, Maizena GmbH v. Council, [1980] ECR 3393, para 34; Case 817/79, Roger Buyl and others v. Commission, [1982] ECR 245, para 16 and the Opinion of A.G. Mancini of 13 Oct. 1987, Case 20/85, Mario Roviello v. Landesversicherungsanstalt Schwaben, [1988] ECR 2805, para 8.
99. See Jacobs, "The evolution of the European legal order", 41 CML Rev. (2004), 303, at 311: " a concern for institutional balance led the court to re-write the Treaty".
100. European Parliament v. Council, cited supra note 96, paras. 21-22.
101. Similarly Prechal, "Institutional balance: A fragile principle with uncertain contents" in Heukels, Blokker and Brus (Eds.), The European Union after Amsterdam (Kluwer Law International, The Hague et al., 1998), p. 274.
102. Jacqué, "The Principle of Institutional Balance", 41 CML Rev. (2004), 383.
103. This provision is repealed by the Treaty of Lisbon, as measures in the Area of Freedom Security and Justice should henceforth be adopted by the same procedures as apply in other areas.
104. Case C-133/06, Parliament v. Council, [2008] ECR I-3189, paras. 52-57.
105. See Case 415/85, Commission v. Ireland, [1988] ECR 3097, paras. 8-9 (According to the Court it is within the discretion of the Commission whether and why to bring an action pursuant to Art. 226 EC against a Member State. Due to the balance of powers established by the Treaty, the Court cannot decide on whether such an action is brought for proper motives); Order of the President of the Court in Case 109/75 R, National Carbonising Company Limited v. Commission, [1975] ECR 1193, para 8: "It is therefore for the Commission to adopt the measures which it considers necessary. It would in fact be contrary to the balance between the institutions which derives from the Treaty for the judge hearing the proceedings or the adoption of interim measures to substitute himself for the Commission in the exercise of a power which belongs primarily ... to the Commission." See also A.G. Jacobs, Opinion of 13 July 2000, Case C-99/98, Republic of Austria v. Commission, [2001] ECR I-1101, para 143; Lenaerts and Verhoeven, op. cit. supra note 95, p. 45; Prechal, op. cit. supra note 104, p. 281.
106. Smismans, "Institutional balance as interest representation. Some reflections on Lenaerts and Verhoeven" in Joerges and Dehousse (Eds.), Good Governance in Europe's Integrated Market (OUP, 2002), p. 91.
107. European Parliament v. Council, supra note 96, para 23: "The Court, which under the Treaties has the task of ensuring that in the interpretation and application of the Treaties the law is observed, must therefore be able to maintain the institutional balance and, consequently, review the observance of the Parliament's prerogatives when called upon to do so by the Parliament, by means of a legal remedy which is suited to the purpose which the Parliament seeks to achieve.".
108. Cases T-68 et al./89, Società Italiana Vetro SpA et al. v. Commission, [1992] ECR II-1403, para 319; T-374/04, Germany v. Commission, [2007] ECR II-4431, para 146; T-165/06, Fiorucci v. Office for Harmonisation in the Internal Market, judgment of 14 May 2009, nyr, para 67.
109. Case 60/81, IBM v. Commission, [1981] ECR 2639, para 20.
110. "Each institution shall act within the limits of the powers conferred upon it by this Treaty.".
111. E.g. Hilf, Die Organisationsstruktur der Europäischen Gemeinschaften: rechtliche Gestaltungsmöglichkeiten und Grenzen (Springer, Berlin u.a., 1982), p. 312.
112. Bernhardt, Verfassungsprinzipien Verfassungsgerichtsfunktionen Verfassungsprozessrecht im EWG-Vertrag (Duncker & Humblot, Berlin, 1987), p. 93.
113. see also A.G. Saggio, Opinion of 16 July 1998, Case C-159/96, Portuguese Republic v. Commission, [1998] ECR I-7379, para 72: "a general rule of law".
114. Lenaerts, "A New Institutional Equilibrium? In Search of the 'Trias Politica' in the European Community" in Engel and Wessels (Eds.), From Luxembourg to Maastricht: Institutional Change after the Single European Act (Europa-Union, Bonn, 1992), p. 159.
115. see also the functional rather than organic reformulation of the principle of separation of powers by Lenaerts, "Some reflections on the separation of powers in the European Community", 28 CML Rev. (1991), 11, at 13-14 which is shared by Prechal.
116. This can be seen from the fact that the Court has declined standing sought by individuals solely arguing a breach of the institutional balance and not being individually and directly affected, see Case C-345/00 P, Fédération nationale d'agriculture biologique des régions de France v. Council, [2001] ECR I-3811, para 41.
117. Bogdandy in Bogdandy (Ed.), Europäisches Verfassungsrecht: theoretische und dogmatische Grundzüge (Springer, Berlin et al., 2003), p. 170.
118. For instance, standards for air pollution are set by the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety, a power assigned to it by § 48 Bundesimmissionsschutzgesetz (Federal Emmission Control Act).
119. See Craig, Administrative Law, 4th ed. (Sweet & Maxwell, London, 1999), pp. 363 et seq.
120. E.g. Art. 109 Clean Air Act (42 U.S.C.A. § 7408) confers the power on the administrator (Environmental Protection Agency) to set standards concerning air pollutants, see as to the.
121. Judgments of the Federal Constitutional Court, vol. 68, p. 86.
122. Maurer, "Der Verwaltungsvorbehalt", 43 Veröffentlichungen der Vereinigung der Deutschen Staatsrechtslehrer (1985), 150 speaks accurately of the "modeling clay" of separation of powers.
123. Lenaerts and Verhoeven, Bogdandy in Bogdandy and Bast (Eds.), Principles of European Constitutional Law (Hart, Oxford, 2006), p. 48 notes "that the distribution of powers in the Union ... is not a problematic deformation, but rather an appropriate expression of the Union's peculiar system of authority".
124. Bailey, op. cit supra note 8, 1327, at 1356-58 regards this as a consequence of the specialization of the CFI and the judges' increasing familiarity with the subject matter; Prechal, op. cit. supra note 104, p. 274 mentions as sources of change of the institutional balance also the amendment of the Treaties and the reinterpretation of provisions by the Court.
125. The horizontal scope is also stressed by de Witte, "Institutional principles: A special category of general principles" in Bernitz and Nergelius (Eds.), General Principles of European Community Law (Kluwer Law International, The Hague et al., 2000), p. 143.
126. Unlike A.G. Poiares Maduro (Opinion of 26 March 2009, Case C-411/06, Commission v. Council and Parliament, paras. 6-7) A.G. Mengozzi (Opinion of 1 March 2007, Case C-443/05 P, Common Market Fertilizers SA v. Commission, [2007] ECR I-7209, para 106) does not distinguish between the horizontal and vertical dimensions. Conflicts between EC institutions and Member States are to be subjected to the principle of limited powers as laid down in Art. 5(1) EC (now in substance contained in Art. 5(2) TEU).
127. It is consented that discretion and the separation of powers are linked on the Commu-nity level, see already Schermers and Waelbroeck, op. cit. supra note 22, § 806; Tiili and Vanhamme, op. cit. supra note 24, 885, at 886. As mentioned at note 2 supra, human rights issue of review of administrative discretion are not addressed in depth in this article.
128. Opinion of 25 May 2004, Commission v. Tetra Laval BV, cited supra note 90, paras. 86, 89.
129. Van der Woude, "The Court of First Instance: The first three years", 16 Fordham Int. L. J. (1993), 412, at 468-469.
130. This is also acknowledged by Bay and Ruiz Calzado, "Tetra Laval II: The coming of age of the judicial review of merger decisions", 28 World Comp. (2005) 433, at 452.
131. Cooke, "Changing responsibilities and relationships for Community and national courts: The implications of the White Paper" in The Modernisation of European Competition Law: The Next Ten Years, University of Cambridge Centre for European Legal Studies Occasional Paper No. 4 (Cambridge, 1999), p. 61.
132. Nicholson, Cardell and McKenna, "The Scope of Review of Merger Decisions under Community Law", 1 Eur. Comp. J. (2005), 123, at 132.
133. "the natural division of responsibilities between the administration and the judiciary, and considerations of judicial self-restraint, would dictate that the Court will not intervene" (emphasis added).
134. Ehlermann and Atanasiu, "The modernisation of E.C. Antitrust Law: Consequences for the future role and function of the E.C. courts", 23 ECLR (2002), 72, at 74-75.
135. Illustrative is also A.G. Cosmas interpretation cited above at note 89.
136. "An appeal to the Court of Justice shall be limited to points of law.".
137. Commission v. Tetra Laval BV, cited supra note 90, para 37: The Commission "complains that the Court of First Instance infringed Article [263 TFEU] by exceeding the limits of its power of review established by case law". The Court goes on to address this ground of appeal.
138. See Colin Joynson v. Commission, cited supra note 20, para 32: "It must be remembered that individuals derive from Community law a right to complete and effective judicial protection ..., and that it was intended, in the Treaty, to establish a complete system of judicial protection against acts of Community institutions which are capable of having legal effects". 138. In this sense Herdegen and Richter, op. cit. supra note 91, p. 225.
139. Steindorff, Die Nichtigkeitsklage im Recht der Europäischen Gemeinschaft für Kohle und Stahl (Klostermann, Frankfurt am Main, 1952), p. 164.
140. Lasser, Judicial Deliberations: A Comparative Analysis of Judicial Transparency and Legitimacy (OUP, 2004), pp. 318, 352.
141. "the Court's shorthand reference to, and axiomatic application of, such systemic policies as 'the effectiveness' of Community law, 'legal certainty and uniformity', and/or 'legal protection' of Community rights tend to leave much and at times, virtually everything unsaid. One need only look, for example, as the ECJ's repeated, contradictory, largely unexplained, and yet utterly determinative references to 'the system of the Treaty' and to 'institutional balance' in such major cases as Comitology and Chernobyl to find the limits of the ECJ's explanations. ... decisions therefore remain quite uninformative and thus remarkably discursively unaccountable" (emphasis in the original, citation omitted, the Chernobyl case has been cited above at note 96).
142. See the line of cases connecting political discretion to political responsibility, examples are cited above at notes 41 and 42.
143. E.g. in the area of anti-dumping measures: Case 260/84, Minebea Company Limited v. Council, [1987] ECR 1975, para 15: "It should be noted that the choice between the different methods of calculation specified in [the requisite regulation] requires an appraisal of complex economic situations. The Court must therefore, as it has held in particular in [the Remia case], limit its review of such an appraisal to ...".
144. Lasser, op. cit. supra note 140, p. 313 stresses the functions of individually published and signed judicial opinions for accountability and transparency of the judicial process that is controlled by a discursive process. A prominent example is the judgment written by Chief Justice Marshall in Marbury v. Madison, 5 U.S. 137 (1803) in which the Chief Justice at length defines the Court's relationship to the President (at 165-167) and the legislature (at 176-180).
145. Just compare the justification of limited review of professional performance reports cited supra at note 76 with the German court's (here just outlined) reasoning on why examinations should not be second guessed by administrative courts: "When finding their evaluation examiners must rely on appraisals and experiences which they have developed in the course of their career in comparable examinations and apply them consistently. This is expressly stipulated by the definition of the available grades contained in the respective examination regulations as far as they refer to average performance. ... Since the complex considerations on which the evaluation of the candidates' performance rest cannot be sufficiently specified, judicial review would lead to a distortion of standards. ... According to the principle of equal opportunity, that governs the law of examinations, examinations have to be conducted under comparable circumstances and evaluated according to assessment criteria. This principle would be violated if some candidates by filing a complaint to the administrative court received the chance of an evaluation independent of the appropriate frame of reference." (Judgments of the Federal Constitutional Court, vol. 84, p. 34, at 51, translation by the author).
146. Weiler, "Epilogue: The judicial après Nice" in de Búrca and Weiler (Eds.), The European Court of Justice (OUP, 2001), p. 225.
147. "the Court should abandon the cryptic, Cartesian style which still characterizes many of its decisions and move to the more discursive, analytic, and conversational style associated with the common law world though practised by others as well, notably the German Constitutional Court. ... And it must amply explain and reason its decisions if they are to be not only authoritarian but also authoritative".
148. Council Regulation No. 2299/89 of 24 July 1989 on a code of conduct for computerized reservation systems, O.J. 1989, L 220/1.
149. This functional approach has also been advocated e.g. by Schmid-Lossberg, Kontrolldichte im EG-Wirtschaftsrecht (Peter Lang, Frankfurt am Main et al., 1992), pp. 228-229.
150. 139, pp. 100, 109.
151. Ipsen, Europäisches Gemeinschaftsrecht (Mohr Siebeck, Tübingen, 1972), p. 200.
152. The Court has for instance drawn connections between competences and operability, Case 208/80, Rt. Hon. Lord Bruce of Donington v. Eric Gordon Aspden, [1981] ECR 2205, para 17: "It is a matter for the Parliament to decide which activities and travel of [its] members ... are necessary or useful ... The autonomy granted to the Parliament in this matter in the interest of its proper functioning also implies the authority ...".
153. See e.g. Case 8/55, Fédération Charbonnière de Belgique v. High Authority, [1956] ECR 292, 299-300; Case 792/79 R, Camera Care Ltd v. Commission, [1980] ECR 119, para 18; Joined cases C-6 & 9/90, Andrea Francovich and Danila Bonifaci and others v. Italian Republic, [1991] ECR I-5357, paras. 32-34: "the full effectiveness of Community rules"; Case C-213/89.
154. Order of the President of the Court in National Carbonising Company Limited v. Commission, cited supra note 107, para 8 (emphasis added).
155. Schwarze, Europäisches Verwaltungsrecht, 2nd ed. (Nomos, Baden-Baden, 2005), pp. 283-284.
156. Everling, (1987) Neue Zeitschrift für Verwaltungsrecht, 1, at 7.
157. "As a general proposition, judges are not generally qualified by training or experience to adjudicate on questions of economics, especially when competing economic theories are finely balanced.".
158. Technische Universität München v. Hauptzollamt München, cited supra note 54, para 13.
159. Schuppert, "Self-restraint der Rechtsprechung Überlegungen zur Kontrolldichte in der Verfassungsund Verwaltungsgerichtsbarkeit", (1988) DVBl, 1191, at 1200.
160. Lasok, Law and Institutions of the European Union, 7th ed. (Butterworths, London, 2001), pp. 162-163.
161. See e.g. Glaxosmithkline Services Unlimited v. Commission, cited supra note 87.
162. Tetra Laval v. Commission, cited supra note 71, upheld by the ECJ on appeal in Commission v. Tetra Laval BV, cited supra note 90.
163. Just see Remia BV and others v. Commission, cited supra note 16, para 34; Joined cases 142 & 156/84, British-American Tobacco Company Ltd. and R.J. Reynolds Industries Inc. v. Commission, [1987] ECR 4487, para 62; John Deere Ltd v. Commission, cited supra note 72, para 34; Glaxosmithkline Services Unlimited v. Commission, cited supra note 87, para 57.
164. Just see Établissements Consten S.à.R.L. and Grundig-Verkaufs-GmbH v. Commission, cited supra note 92, 347; Van den Bergh Foods Ltd. v. Commission, cited supra note 72, para 80; Glaxosmithkline Services Unlimited v. Commission, cited supra note 87, para 241.
165. Case 294/83, Parti écologiste "Les Verts" v. European Parliament, [1986] ECR 1339, para 23: "the European Community is a community based on the rule of law".
166. Just see Colin Joynson v. Commission, cited supra note 20, para 32.
167. As to the meaning of "question of law" see Craig, op. cit. supra note 10, p. 431.
168. Just see Craig, op. cit. supra note 10, p. 435 with references to the courts' jurisprudence. However, Craig's contention that the courts occasionally qualified this general rule (p. 438) is not well founded. In the cited case (730/79, Philip Morris Holland BV v. Commission, [1980] ECR 2671, paras. 14-26) the ECJ did not leave latitude with respect to the abstract standards to be applied but only with regard to whether the conditions of the rule could be assumed in the case at hand. Yet, Craig himself qualifies errors in the evaluation of the facts of specific cases in light of the law as factual errors (p. 432).
169. The boarders are blurry, though, especially with respect to the courts' assessment of proportionality of a measure.
170. Pernice and Mayer in Grabitz and Hilf, Das Recht der Europäischen Union (C.H. Beck, München, 2006), annotation 19 to Art. 220 EC (translation by the author).
171. See in detail infra section 6.2.
172. Cf. supra section 2.4.
173. See Schmalensee, "Horizontal merger policy: Problems and changes", 1 J. Econ. Perspectives (1987) 41, at 42.
174. "industrial organization economics is hardly an exact science. Economists cannot testify with the confidence of experts on ballistics or fingerprints or at least they should not. They cannot now predict the precise quantitative effects of any particular merger on costs or prices, and the net impact on buyers, sellers, and society as a whole is even harder to quantify." Although, progress has undoubtedly been made, Schmalensee's basic proposition is still true.
175. See Legal, "Standards of proof and standards of judicial review in EU competition law".
176. "Analysis in economics starts at a very primary level, to the point that there is no such thing as pure economic facts, any quantification being the result, not the origin, of an intellectual construction.".
177. U.S. courts are much more aware of these limitations, as they are required to decide about the admissibility of expert evidence introduced by the parties according to Rule 702 Federal Rules of Evidence. The rule incorporates the standards set by the Supreme Court in a trilogy of cases (see Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993); General Electric Co. v. Joiner, 522 U.S. 136 (1997); Kumho Tire Co. v. Carmichael, 119 S. Ct. 1167, 1171 (1999)).
178. See also the Reference Manual on Scientific Evidence, 2nd ed. (Washington, 2000) published by the Federal Judicial Center.
179. Gavil, "Defining reliable forensic economics in the Post-Daubert/Kumho-Tire era: Case studies from antitrust", 57 Wash. & Lee L. Rev. (2000), 831.
180. Kaye, "The dynamics of Daubert: Methodology, conclusions, and fit in statistical and econometric studies", 87 Va. L. Rev. (2001), 1934.
181. XXXIInd Report on Competition Policy-2002, SEK/2003/0467 final, para 306.
182. Roeller, "Economic analysis and competition policy enforcement in Europe" in van Bergeijk and Kloosterhuis (Eds.), Modelling European Mergers: Theory, Competition Policy and Case Studies (Edward Elgar, Cheltenham, 2005), p. 14.
183. Art. 5 Commission Decision 2001/462/EC, ECSC of 23 May 2001 on the terms of reference of hearing officers in certain competition proceedings, O.J. 2001, L 162/21.
184. Remia BV and others v. Commission, cited supra note 16, para 34.
185. The basic proposition of Technische Universität München (cited supra note 57) is still quite true.
186. Commission v. Tetra Laval BV, cited supra note 90, para 39 (emphasis added). The CFI takes up this phrase again e.g. in Glaxosmithkline Services Unlimited, cited supra note 87, para 242 concerning Art. 101 TFEU.
187. A.G. Tizzano, Opinion in Commission v. Tetra Laval BV, cited supra note 90, para 86.
188. Identical in "Certain reflections in recent judgments reviewing Commission merger control decisions" in Hoskins and Robinson (Eds.), A True European, Essays for Judge David Edward (Hart, Oxford, 2003), p. 143.
189. See A.G. Tizzano, Opinion in Commission v. Tetra Laval BV, cited supra note 90, para 94.
190. The court "plainly overstepped the bounds of its judicial review"; Gerber, "Courts as economic experts in European merger law" in Hawk, op. cit. supra note 12, pp. 482-483.
191. "At a number of points in the decisions, [the CFI] implicitly adopts the role of economic expert by assuming that it has sufficient skill and knowledge in economic analysis to reject the Commission's conclusions on the basis of its own skill as an economic analyst".
192. Commission v. Tetra Laval BV, cited supra note 90, para 43.
193. For example, in the Reference Manual on Scientific Evidence, supra note 176.
194. Scheffman and Coleman, FTC Perspectives in the Use of Econometric Analyses in Antitrust Cases, p. 4 present a "best practice" catalogue with respect to econometrics.
195. Seidman Diamond, "Reference guide on survey research" in Reference Manual on Scientific Evidence (supra note 176), p. 232.
196. Florian and Walker, "The correct use of empirical analysis in competition policy", 26 ECLR (2005), 320: "no black box approach".
197. Rubinfeld, "Reference guide of multiple regression" in Reference Manual on Scientific Evidence (supra note 176), pp. 202-203.
198. Rubinfeld, "Econometrics in the Court Room", 85 Colum. L. Rev. (1985), 1048, at 1095.
199. Everling, "Zur Begründung der Urteile des Gerichtshofs der Europäischen Gemeinschaften", (1994) EuR, 127, at 141.
200. Habermas, Between Facts and Norms: Contributions to a Discourse Theory of Law and Democracy (MIT Press, Cambridge, MA, 1996), p. 198.