Ceci n’est pas une pipe (sorry, Magritte)
Seven Member States – the Republic of Lithuania, the Republic of Bulgaria, Romania, the Republic of Cyprus, Hungary, the Republic of Malta and the Republic of Poland – have been seeking annulment of certain provisions of legislative measures forming part of the EU’s ‘Mobility Package’, proposed by the Commission in 2017 and adopted in 2020, resulting in fifteen joined cases. According to the advocate-general Pitruzella, these fifteen joined cases (C-541-20 till C-555-20 against European Parliament and Council of the European Union as co-legislators, and joined by the Federal Republic of Germany, the Republic of Austria, the Kingdom of Sweden, the Grand-Duchy of Luxembourg, the Hellenic Republic, the Kingdom of the Netherlands, the French Republic, the Kingdom of Denmark and the Italian Republic, which intervened in support of the Parliament and the Council) “have a truly exceptional dimension. Rarely has a legislative undertaking given rise to such a grouped and intense contentious reaction at EU level.
Such a reaction was expected, given the debates and, in some cases, the opposition expressed by a number of Member States during the legislative procedure leading to the adoption of the three measures making up the Mobility Package. On an issue that is fundamental to the internal market, the proposal brings clearly into view the risk of a split between two visions of the European Union. Over and above the legal issues at stake, it is therefore also, in a way, the pursuit of a desire to live together on common economic and social foundations that is at stake in these actions.”
Lots of ink will flow on these cases but in the context of the current debates about the Commission’s Omnibus packages (which von der Leyen II (VDL II) in a perceived reversal of VDL I politics and direction intends to propose at an unprecedented speed and with an unusual procedure), attention should be given to one point in particular: the annulment of one provision on the basis of the infringement of the principle of proportionality “on the ground that the EU legislature has not sufficiently established that it had examined the proportionality of the provision”.
It is settled case law that the EU legislature does not need to have at its disposal an impact assessment in every circumstance nor that such an impact assessment is binding (as the interinstitutional agreement itself is not binding). But it “must base its choice on objective criteria and examine whether the aims pursued by the measure chosen are such as to justify even substantial negative economic consequences for certain operators. It follows that the legislature must, when the act at issue is the subject of judicial review, at the very least be able to produce and set out clearly and unequivocally the basic facts (emphasis added) that had to be taken into account as the basis of the contested measures of that act (…)”. The Court argues that, although the contested obligation was not itself the object of an impact assessment, the fact that co-legislators relied on data contained in the impact assessment is not the same as setting out clearly and unequivocally the basic facts which formed the basis of the exercise of its discretion. Neither were the other basic data relied on by the co-legislators before the Court good enough as they were not related to the obligation expressed in the contested provision or they were presented in an excessively succinct manner. With other words, the format of the information (whether part of an impact assessment or not) is not crucial, but the content is. Co-legislators may rely on other sources, and consequently may also adopt other measures than those subject to an impact assessment. According to Pitruzella, it is established case law that co-legislators must take into account, during the legislative procedure, the scientific data and other findings that have become available, including scientific documents used by the Member States during Council meetings that the Council itself does not have. The legislature may also take into account information which is in the public domain and which is accessible to any individual or undertaking with an interest in the matter.
So, here we are. VDL II is planning to re-open agreed legislative texts in various fields via Omnibus packages. The usual procedure of two-year gestation before coming out with a proposal has been wiped under the carpet by the Commission, not hindered by a non-binding interinstitutional agreement (or the stocktaking in a fixed period of at least six months at the start of the Commission which Draghi advocated). Once a directive is proposed, unless it is a quick fix, co-legislators need on average two years for debate. Taking into account settled case law, they will need for their decisions to “examine whether the aims pursued by the measure chosen are such as to justify even substantial negative economic consequences for certain operators (…) and must, when the act at issue is the subject of judicial review, at the very least be able to produce and set out clearly and unequivocally the basic facts that had to be taken into account as the basis of the contested measures of that act (…)”. Draghi mentioned that the co-legislators have no methodology in place to measure the impact of amendments they propose to draft EU legislation and suggested even a single methodology for all impact assessments. So, in case of lack of any impact assessment, the Commission has only made the life of its co-legislators more difficult and prone to judicial review.
On a side note, even if the co-legislators conclude in two years their debates (which given the contentious nature of the expected Omnibus packages may not be the case), Member States will still need a transposition period of 18 to 24 months and further adaptations of delegated regulations may also be required. That brings the earliest conclusion to September 2028 (without another pandemic or major event) but given the experience of other controversial packages, this may even be optimistic. VDL II ends November 2029….
In the meantime, for companies and other stakeholders, and potentially thereafter, it risks be confusion galore.
Ceci n’est pas better regulation.
Lieve Lowet
February 2025
