: Limits and future prospects
Infringement proceedings are generally regarded as being rather effective: the Commission processes, on a yearly basis, over 3 000 complaints which concern suspected infringements of EU law by Member States’ authorities. In the last five years, the Commission opened, on average, almost 800 new procedures per year, the vast majority of which could be closed during the pre-litigation phase. Only some 30 cases were eventually referred to the Court each year, with around half of those being withdrawn before the judgment, given that the Member States concerned had, in the meantime, taken the necessary measures to comply with EU law. Where the cases proceeded to judgment, the Commission was predominantly successful.
However, that does not mean that the procedure under Article 258 TFEU is necessarily free from flaws. In particular, the significant duration of the procedure hasbeen a perennial problem. Indeed, the administrative stage of the procedure may easily last for 2 years or more, and another 17-20 months must be added for the judicial stage. Furthermore, the imposition of sanctions may normally come only after the completion of a second set of proceedings. Thus, it is inevitable that the alleged infringements may continue for several years before the recalcitrant Member States may be hit by any sanction. To address this issue, a number of proposals de lege ferenda have been explored but, so far, with little or no success. The only measure that could significantly impact the overall duration of the proceedings would probably be to empower the Commission (in all cases, or only in some) to declare an infringement by way of decision, which the Member State in question could, where appropriate, challenge before the EU Courts. This would 'cut in half’ the procedure by making the judicial phase only optional. However, such a change would require a Treaty amendment and thus the agreement of all the Governments of the Member States.4
Against that background, the recent decisions of the Court in Commission v. Belgium and Commission v. Poland are of the greatest interest.
In the first place, given its relatively broad scope of application, the procedure set out in Article 260(3) TFEU should substantially reduce the duration of the proceedings necessary to compel Member States to transpose more quickly (and in full) directives adopted under the ordinary legislative procedure. In those cases, the threat of sanctions kicks in from the very first proceedings brought by the Commission before the Court, and the Member States will not be able to escape them by simply sending the Commission incomplete or unclear notifications. To that end, the Court’s ruling had to leverage the Member States’ obligation to notify transposition measures to the Commission, an obligation which is not expressis verbis in the Treaties but that the Court derives from Article 4(3) TEU.
The consequences of this obligation, as the Court sees it, are very far reaching: in practice, the judgment makes the submission of correlation tables by Member States almost mandatory. However, it must be borne in mind that there has been a long-standing disagreement between the Commission and Parliament on the one side, and the Council and the Member States on the other, on whether correlation tables could be systematically required. A common position on this matter was eventually found in 2011, when two Joint Political Declarations (‘JPD’) were issued.  In essence, according to the JPD, the Commission could request, on a case-by-case basis and with proper justification, the transmission of ‘explanatory documents’ by the Member States which, if the Member States consider it useful, could also take the form of correlation tables. The explanatory documents were meant to illustrate the relationship between national transposing rules and the specific provisions of a given directive. One may wonder whether the JPD on this point have not been superseded by the judgment of the Court.
It is true that the new mechanism concerns only one specific type of infringement cases (so-called ‘non-communication cases’). However, one must not overlook the fact that they have consistently represented a significant percentage of the overall number of infringement cases started by the Commission. That said, there are naturally a number of interpretative issues which the Court will need to address in the future which might have an impact on the functioning of the new mechanism. Some cases are currently pending before the Court. In two such cases a hearing before the Grand Chamber took place on 10 December 2019, and AG Tanchev delivered his Opinions on 5 March 2020.
To begin with, the Court has, wisely, avoided falling into the trap of having to distinguish between partial transposition and erroneous transposition. Yet, the prima facie test devised by the Court to check whether a notification of transposition measures is sufficiently clear and complete does not seem very different from that proposed by the Commission. It remains to be seen how the Court’s examination on this matter will work in practice, especially in those cases where — unlike Belgium in the case at hand ' — the defendant Member State does not expressly acknowledge the shortcomings of its communication.
In addition, should the Commission explain why it has chosen to make use of the mechanism set out in Article 260(3) TFEU in a specific case and, if so, elaborate on its choice made with regard to the requested sanctions? On the one hand, an argument could be made that the expression ‘when it deems appropriate’ included in Article 260(3) TFEU (and not in Article 260(2) TFEU) means that that institution is to duly outline the motivations for its choices. On the other hand, however, the Commission has so far enjoyed almost unfettered discretion in deciding whether, when, on which grounds and against which Member States to institute infringement proceedings, any different approach under Article 260(3) TFEU appears unlikely. It would also be hard to imagine how the Court could actually review the Commission’s (largely policy-based) choices, even under a manifest error of assessment standard. In any event, would such an exercise be reasonable? After all, if the Court comes to the conclusion that the sanctions requested are not proportionate to the infringement committed, it could always reduce the amounts or impose no sanction at all. AG Tanchev, in his Opinions of 5 March 2020, also proposed to dismiss the arguments of the defendants on this point.
In this context, it must be stressed that the boundaries of the Court’s discretion with regard to the choice of types and amounts of sanctions under Article 260(3) TFEU are not entirely clear. According to that provision the Court may impose a lump sum or penalty payment ‘not exceeding the amount specified by the Commission’. Consequently, unlike in proceedings under Article 260(2) TFEU, the amount of the penalties proposed by the Commission constitutes a ceiling which the Court cannot go beyond. Two issues in that regard remain, however, not settled.
First, is the Commission entitled to use the same methods of calculation of the sanctions it proposes under Article 260(2) and (3) TFEU? Some Member States have argued that the Commission should use, under Article 260(3) TFEU, a ‘lighter touch’ than under Article 260(2) TFEU. The reason would be that the former provision penalises a simple infringement (non-communication of transposition measures), whereas the latter provision concerns a ‘compound’ infringement (original infringement and subsequent failure to comply with the judgment of the Court given under Article 258 TFEU). The judgment in Commission v Belgium does not provide detailed guidance in that regard. AG Wathelet, AG Tanchev and AG Szpunar, however, saw no problem in adopting a coherent approach under both provisions.
Second, the text of Article 260(3) TFEU does not explicitly state whether the
Court may depart from the Commission’s request as to the type of sanction(s) to be imposed. Therefore, whether Article 260(3) TFEU restricts the Court’s discretion in that regard is unclear. On the one hand, AG Tanchev suggested that the Court should be able to alter the type of sanctions, as long as it remains within the amount proposed by the Commission. On the other hand, AG Wathelet and AG Szpunar, took the opposite view: the Commission’s choice of sanctions would be binding on the Court. The latter position seems based on a combined reading of the first subparagraph of Article 260(3) TFEU (‘the Commission ... may ... specify the amount of the lump sum or penalty payment to be paid’) with the second subparagraph of that provision (‘the Court ... may impose a lump sum or penalty payment ... not exceeding the amount specified by the Commission’). More importantly, given the intrinsic difference between lump sums (one-off payments) and periodic penalty payments (recurring payments for a period that cannot be determined a priori), how could their amounts be combined (or converted) in order to ensure that the overall amount does not exceed that specified by the Commission? That accounting operation seems very hard, if not impossible, to carry out.
A related question is whether the Court may impose both a lump and a penalty payment at the same time (regardless of whether that is possible only at the Commission’s request or also ex officiel). Arguably, the Court’s reasons for answering positively to the question in respect of Article 260(2) TFEU should apply equally with regard to Article 260(3) TFEU, given the identical wording on this point. However, one may wonder whether the fact that, as mentioned, the new provision concerns a simple infringement whereas the old provision concerns a ‘compound’ infringement might be relevant in this context. Finally, it may be noted that, in paragraph 90 of the judgment, the Court stated that, in a case such as that at issue, the imposition of degressive penalty payments would be likely to compromise the effectiveness of that penalty. Does that mean that such adjustments to the penalty payments are generally excluded under Article 260(2) TFEU?
In the second place, as far as Article 279 TFEU is concerned, there is little doubt that the Court order in the Bialowieza Forest case is nothing less than revolutionary. The Court decision opens new scenarios for the enforcement of EU law against Member States in default. In particularly serious and urgent cases, the Commission now has at its disposal a very effective and rapid tool that may coerce recalcitrant
Member States to comply without delay with any measure provisionally issued by the Court pursuant to Article 279 TFEU.
That said, it must be recognised that this decision too leaves a number of issues open. To begin with, what will the procedure look like, when a Member State does not comply with an order from the Court and the penalty payments become due? The order does clarify the respective roles of the Commission and defendant Member State in the resumed procedure However, one cannot fail to note that, in that context, the Court would have to carry out a substantive and final assessment of whether the Member State in question has failed to comply with the previous order. Such an assessment is typical of a main action brought under Article 260(2) TFEU. It is, conversely, a novelty in the context of a summary procedure where any determination by the Court is meant to be provisional and the analysis is limited to the establishment of a prima facie case.
The Court’s accounting principles are also unclear: how did it arrive at the amount of the daily penalty payment of ‘at least' EUR 100 000? More importantly, had Poland not complied, what criteria could the Court have made use of to fix the specific amount of the penalty payments? Interestingly (and regrettably), there was nothing on this point in the Commission’s additional application. Furthermore, it is not a given that the principles laid down in the Commission’s communications regarding Article 260(2) and (3) TFEU could, mutatis mutandis, be applied in this rather different context. Indeed, the logic followed by those communications, and the criteria and parameters used therein may, or may not, be easily transposable to a procedure under Article 279 TFEU. From a more practical angle, what if penalty payments are finally imposed, but the Commission’s main action is subsequently dismissed: are the monies paid by the Member State concerned to be paid back (arguably, plus interest)? Logically, the answer should be negative: those monies were meant to induce compliance with an order that was, as a matter of fact, not complied with. Accordingly, their fate should not depend on the result of the main action. However, may that consequence be reconciled with the Court’s statement according to which penalty payments should not 'be seen as a punishment’?
Finally, and crucially, it remains to be determined whether penalties under Article 279 TFEU will be granted only in circumstances as exceptional as those of the Bialowieza Forest case. Few would disagree that, quite apart from the particularly serious threat of environmental damage, the explicit refusal by Poland to abide by a previous order of the Court called for some drastic measure. Yet, now that the principle is acquired, could penalty payments also be ordered in more mundane situations?
In conclusion, the two recent decisions of the Court in Commission v. Belgium and Commission v. Poland should be warmly welcomed, notwithstanding the many issues that remain open under both Article 260(3) and Article 279 TFEU. These decisions enlarge and strengthen the arsenal at the disposal of the Commission to act before the Court against infringements of EU law committed by Member States’ authorities. They also enable the Court, in some specific situations, to impose sanctions upon Member States in default more rapidly than under the standard infringement procedures. However, it is hardly necessary to point out that the simplification and acceleration of the sanctioning procedures is not an end in itself. The purpose is not to create a draconian system of enforcement to the benefit of the Union budget. As for any other regime of penalties, the underlying idea is, obviously, that the mere threat of sanctions should, ideally, induce recalcitrant Member States to act more quickly beforehand, in order to avoid proceedings altogether.
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