A Role for the ECJ after Brexit?

Tobias Lock

Although the UK government’s position is to end the jurisdiction of the European Court of Justice internally after Brexit, the EU is likely to expect the ECJ to be involved in UK-EU relations in some form, writes Tobias Lock. He argues that, while the shape of that involvement will depend on eventual Brexit arrangements, the judicial model of the European Economic Area is a starting point for the EU27.

A Role for the ECJ after Brexit?
Court of Justice of the EU, Transparency International, CC-NC-ND-2.0

The role of the European Court of Justice (ECJ) after Brexit is likely to become one of the most hotly contested issues in the Brexit negotiations. The two sides have set themselves up for a clash: Theresa May’s Lancaster House speech expressly promises to ‘bring an end to the jurisdiction of the European Court of Justice in Britain’, whereas the European Commission’s position papers on the Brexit negotiations envisage its continued jurisdiction in a number of areas, notably the enforcement of citizens’ rights.

Both positions follow their own logic: from the UK perspective, leaving the EU means no longer being bound by the decisions of EU institutions, including the ECJ. For the EU this is not necessarily the case, because it is a constitutional order and the Brexit process must be compliant with its constitutional requirements. One of these requirements may be a continued role for the ECJ with regard to Brexit-related disputes.

It is the aim of this article to unpick the EU’s position and show in how far it is determined by non-negotiable constitutional demands – after all enforced by the ECJ itself – and in how far there may be room for negotiations.

Defining Brexit-Related Legal Disputes

One can broadly identify four types of disputes that are likely to arise after Brexit and which may warrant ECJ involvement. These are disputes over (1) cases that arose before Brexit; (2) the interpretation of the withdrawal agreement, in particular on citizens’ rights; (3) the interpretation of possible transitional arrangements, which may replicate some EU law; and (4) the agreement(s) on the future relationship between the EU and the UK.

Before coming back to these categories, it is important to outline the ECJ’s jurisdiction over international agreements concluded by the EU and its attitude towards competing fora for dispute settlement (ie international courts and tribunals).

According to Article 344 TFEU, the EU Member States must not submit disputes over the interpretation or application of the EU treaties to another court but the ECJ. According to the ECJ, this is confirmation of its broader exclusive jurisdiction over the interpretation and application of all EU law. This means that the EU cannot conclude an agreement with a third country – such as the UK in the future – which would hand over such jurisdiction to a court other than the ECJ. This in itself would not act as much of a hurdle if jurisdiction over EU law were interpreted narrowly.

However, the ECJ not only considers EU law ‘proper’ – the EU treaties and EU secondary law – to be included in this, but it also says that international agreements concluded by the EU form an ‘integral part’ of the EU legal order once they are in force. It follows that the ECJ has jurisdiction to interpret these agreements internally, in particular through the preliminary reference and infringement procedures. Again, this is not much of a problem for the third country concluding the agreement with the EU. That third country must ensure that it complies and it is not the EU’s business to decide how it ensures compliance.

This then brings us to the question of how disputes between the parties to the agreement – in the case of Brexit, the EU and the UK – are resolved. Here the ECJ is at first glance rather generous: it held in Opinion 1/91 that an international agreement providing for a system of courts to settle disputes between the contracting parties – which includes the interpretation of the agreement – is compatible with the EU law.

However, the devil is in the detail. In that very same opinion – which concerned the first draft of the European Economic Area (EEA) Agreement and its dispute resolution mechanism – the ECJ held that, where an agreement replicates EU law, any court charged with the interpretation of that agreement would in essence interpret EU law. And because these interpretations would be internally binding on the ECJ – given the international agreement as interpreted by the international court forms an integral part of EU law – it would interfere with the ECJ’s exclusive jurisdiction and cannot be concluded.

The result of Opinion 1/91 is the dispute settlement arrangement based on two pillars that we now find in the (revised) EEA Agreement: the ECJ interprets its rules in binding form for the EU-side and the EFTA Court – formed as a reaction to Opinion 1/91 – interprets its rules for the remaining three non-EU members of the EEA. In doing so, the EFTA Court is bound by ECJ case law handed down before the entry into force of the EEA Agreement and in practice follows the ECJ’s newer case law as well (the so-called principle of homogeneity).

The ECJ’s main concern is with the autonomy of the EU legal order. That autonomy – established long ago in the foundational van Gend en Loos decision – is sacrosanct. It means, in particular, that the decisions of an international court must not have the effect of binding the EU and its institutions to a particular interpretation of the rules of EU law.

Scoping the ECJ’s Role Post-Brexit

The problem for the drafters of the various agreements necessary to bring about Brexit is that the doctrine of autonomy does not have a fully fixed content. The EU Member States experienced this to their surprise with the agreement on the EU’s accession to the European Convention on Human Rights. The drafters had gone through a huge effort to circumvent the various hurdles they thought the autonomy of EU law presented only to find out in Opinion 2/13 that the ECJ had erected new ones by adopting a very strict approach and partly conflating the (alleged) internally binding effect of decisions by the European Court of Human Rights with their externally binding character.

What does this mean for the ECJ’s role after Brexit? Returning to the categories identified above one, can see that much will depend on the precise content of any agreement(s) concluded between the EU and the UK.

For disputes where the material facts arose before Brexit, but which are litigated after Brexit (Category 1), we can assume that they will still be governed by EU law. For disputes with a UK element arising in the EU27, nothing will change. National courts will retain the option to refer cases to the ECJ and will sometimes be under a duty to do so. The only question is whether British courts will also continue to have this possibility.

This will depend on the withdrawal agreement. There is nothing in EU law that would prevent the EU from agreeing to a continued role of the ECJ. At the same time, there is no precedent in the ECJ’s case law that would suggest that such a continued role would be mandatory. But then, there is nothing to prevent the ECJ – if asked – from establishing this as a condition for the compatibility of the withdrawal agreement with the treaties.

Dispute resolution concerning the interpretation of the withdrawal agreement itself (Category 2) and possibly the transitional arrangement (Category 3) may need to be agreed in line with Opinion 1/91. Assuming that the withdrawal agreement provides for the continuation of certain citizens’ rights and for the continued temporary application of aspects of the law relating to the internal market and the customs union, the withdrawal agreement would partly be a replica of EU law and thus very similar to the EEA Agreement.

Accordingly, the ECJ would not accept another court such as a bespoke arbitration mechanism established to decide disputes over the interpretation and application of the withdrawal agreement. Disputes arising in the EU27 would need to be decided exclusively by the ECJ. Disputes arising in the UK could either remain referable to the ECJ or they could be decided by a new body established for this purpose (in analogy to the EFTA Court) or indeed by the UK courts themselves.

The jurisdiction over disputes over the future EU-UK relationship agreement(s) (Category 4) is difficult to predict. If that agreement is a mere free trade deal, which does not attempt to mirror EU rules, there is nothing to prevent the EU and the UK from setting up a bespoke court or tribunal for dealing with disputes over that agreement. The closer the agreement resembles the EEA Agreement, however, the more likely it is that the ECJ will request a solution akin to that found under the EEA Agreement.

Bargaining Position v Red Line

Having established the baseline for the requirement of giving the ECJ jurisdiction over these types of disputes, it is now appropriate to take a closer look at the EU’s negotiating stance to see in how far it reflects these requirements and how much room the UK has for negotiation.

The European Commission, as the institution negotiating on behalf of the EU, is bound by the EU Council’s negotiating mandate. This mandate mentions the ECJ in relation to the dispute settlement procedures and requires – echoing the ECJ’s own case law – that this ‘should be done bearing in mind the Union’s interest to effectively protect its autonomy and its legal order, including the role of the Court of Justice of the European Union’. This has now been fleshed out by the Commission in a position paper on governance.

The Commission’s paper relates to the enforcement of the withdrawal agreement (alone) and envisages two types of enforcement. As far as citizens’ rights and the continued application of EU law are concerned (which presumably includes a transitional deal), nothing would change as compared with the status quo: the European Commission would retain the right to monitor compliance by the UK and bring the UK before the ECJ under Article 258 TFEU. In a similar vein, the UK courts would remain competent – and in certain cases obliged – to request a preliminary ruling from the ECJ.

As far as other provisions of the withdrawal agreement are concerned, the dispute settlement mirrors the solution found in the EEA Agreement: there would be a joint committee consisting of both parties to resolve disputes diplomatically. If this proved impossible, the ECJ would again have jurisdiction to decide.

The Commission’s proposals go beyond what is strictly required by EU law. It is not constitutionally necessary to provide the European Commission with a monitoring role. Neither is it necessary to confer jurisdiction on the ECJ over the interpretation of the withdrawal agreement in all cases, provided that any interpretation rendered by another body (eg a UK court or another dispute settlement forum) is not binding on the EU and its institutions.

One word of caution is warranted, however. The UK’s withdrawal from the EU is an unprecedented step. In particular the question of enforcing citizens’ rights guaranteed by an international agreement concluded by the EU – or a question comparable with it – has never been raised before the ECJ. It is therefore possible that the ECJ will require its own involvement in the manner suggested by the European Commission – that is, on the basis that it would be the only court capable of ensuring continued and equal application of rights acquired by individuals during the UK’s EU membership.

Will we ever find out? There is a possibility that the ECJ will never be asked for its opinion on the withdrawal deal. At the same time, Article 218(11) TFEU provides for a procedure to ensure compliance with the treaties and every EU institution and Member State can initiate it. Coupled with the ECJ jurisdiction to incidentally review the compliance of an EU agreement with the treaties in other procedures, there is a practical need to ensure it is ECJ-proof. It seems nonetheless as though the Commission’s position paper is a mere opening gambit and that it may well be flexible on some of its demands.

Tobias LockEdinburgh Europa Institute LogoTobias Lock
University of Edinburgh

Dr Tobias Lock is Senior Lecturer in European Union Law and Co-Director of the Edinburgh Europa Institute at the University of Edinburgh. His research focuses on the EU’s multilevel relations with other legal orders, including the European Convention on Human Rights.

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