The Agencies of the European Union: Legal Issues and Challenges

DECEMBER 2023

Table of Contents

1. EU Agencies: shifting Paradigms of EU Administration

Merijn Chamon

2. ‘Live and let die?’ The Meroni Doctrine in 2023

Marta Simoncini

3. EU Agencies within the common foreign, security, and defence Policies

Graham Butler

4. On EU Agencies with Enforcement Powers

Miroslava Scholten

5. EU Agencies and financial Regulation: the Proliferation of a new Mode of Governance

Jonathan Bauerschmidt and Diane Fromage

6. The Contribution of EU Agencies to managing the COVID-19 Pandemic: a polycentric Approach to public Health

Ruben Della Pia and Mariolina Eliantonio

7. Unchecked Action of AFSJ Agencies: an Issue for Delegation of Powers

Annalisa Volpato

8. Selecting the Seat of EU Agencies – one Year after the Judgments of the Court of Justice

Tomáš Buchta

9. EU decentralised Agencies Engagement with European non-Member States

Marko Milenković

10. Quasi-judicial Review in EU Agencies: Opportunities and Challenges

Oana Stefan

11. Science to the People? The Reach of Transparency into EU Agency Science

Marta Morvillo

12. Policy Implementation and Enforcement through EU Migration Agencies: a brave new World?

Evangelia (Lilian) Tsourdi

EU Agencies: shifting Paradigms of EU Administration

Merijn Chamon

The European Union (EU) agencies to which this symposium is dedicated are permanent executive bodies set up by the EU institutions pursuant to EU public law. The agencies’ general role is to contribute to the implementation of EU policies. As the title of the present opening Op-Ed suggests, the EU agencies constitute a paradigm change in the administration of EU law. This is so because despite being excessively detailed for a constitutional charter, the EU Treaties still reflect the administrative governance setup of the European Economic Community in 1958. Reading the current Treaties, one is still presented with a picture of EU law being implemented, as a rule, by the national administrations (so called ‘indirect administration’, reflected in  Article 291(1) TFEU). The Treaties themselves entrust some specific implementation tasks directly to the Commission (notably in competition policy) and allow EU secondary legislation to deviate from the rule of indirect administration by entrusting the implementation of specific acts to the Commission or the Council (so called ‘direct administration’, reflected in  Article 291(2) TFEU). It needs little explaining however that this is not the way in which EU law is being implemented today or how the multi-level European administration is currently composed.

Since the Single European Act, the objectives pursued through the EU’s policies have become increasingly ambitious and, conversely, the two basic options offered by the Treaties to ensure the implementation of these policies have become increasingly inadequate. It is illusory to entrust the implementation of EU law to, at least, 27 different national administrations and expect a uniform application of that law in the entire internal market. At the same time, it is politically unimaginable to entrust the implementation to the Commission. While this might ensure uniformity, it would require Member States to strengthen a central (federal) administration at the expense of their own national administrations.

The politics of EU agencification

EU agencies have proven to be an effective and politically acceptable way out of this conundrum: they are EU bodies that bring together, in their governance structure, the relevant national administration or authorities. They thereby increase the administrative capacity of the EU, bringing together scientific and/or technical expertise, without directly strengthening a supranational Commission and without entirely displacing national authorities. They find themselves ‘in between’ (see  p. 48) the Member States and the Commission, although  political science research suggests that ‘EU agencies tend to lean more towards the Commission than to any other potential masters.’ In any event though, the paradigm of EU administration has shifted to administration through hybrid structures of which the EU agencies are the primary examples. By now, a  logic of appropriateness permeates thinking among policy makers whereby EU agencies are a preferred and logical tool to address obstacles to the realization of the EU’s objectives. The pandemic has unequivocally demonstrated that EU agencies are no longer relegated to secondary roles in EU governance. Instead, some of these agencies have emerged as prominent leaders in the battle against the health crisis, such as the ECDC, EMA, ECHA, EFSA, and EU-OSHA, as Ruben Della Pia and Mariolina Eliantonio   will discuss in their Op-Ed.

The establishment and empowerment of EU agencies may also have a political signalling function. Commission President  Juncker’s emphasis on a social Europe that does not allow social dumping was, for instance, made visible by the establishment of the  European Labour Authority, even if that agency has limited concrete powers itself to tackle social dumping. To be clear, it is not suggested here that agencies merely have such a political signalling function. As

The Agencies of the European Union: legal Issues and Challenges

noted above, EU agencies have genuinely become indispensable in many fields. The deep integration of EU financial markets in the EU, for instance, depends on the cooperation between national and EU authorities made possible by the agencies in the financial sector, discussed in the Op-Ed by Jonathan Bauerschmidt and Diane Fromage. The European Supervisory Authorities thereby provide a further illustration of both the logic of appropriateness noted above and the catalyst function of crises, since the establishment and empowerment of these bodies would not have been politically feasible had the global financial crisis of 2007-2008 not shaken the foundations of the financial system.

Constitutional terra incognita

Since the original agencies date back to the 1970’s, the Treaty authors have been presented, and have missed, numerous opportunities at  intergovernmental conferences to update EU primary law in order to recognize the existence of EU agencies and to put them on a more sound constitutional footing. That in 2023 the EU agencies still largely find themselves in constitutional terra incognita means that the phenomenon of agencification itself presents legitimacy challenges for the EU as a polity and that also individual agencies are presented with legitimacy problems. Some of those challenges will be touched on in the present Op-Ed and will be elaborated in subsequent contributions to the symposium. The lack of the EU agencies’ anchoring in primary law could have been partially remedied by the EU institutions themselves. Prior to the Lisbon Treaty the Commission had indeed  proposed to establish a framework addressing some of the horizontal questions raised by agencification, but the Council balked at the prospect of a binding framework. Instead, the three institutions agreed on a non-binding Common Approach on EU Decentralised Agencies to rationalize the functioning of individual agencies and the process of agencification as a whole.

The quantitative dimension to agencification

EU AGENCIES: BUDGET SIZE, NUMBER AND TOTAL STAFF

1 - Source: Chamon, p. 46 complemented with the Court of Auditors’ annual reports on the EU agencies for the most recent years

The figure above shows the amplitude of the quantitative dimension of that process, whereby the total combined annual budgets of the EU agencies now amounts to more than 4,5 billion euros, more than 10500 staff positions are foreseen in the agencies’ establishment plans and more than 35 EU agencies have been established. How many agencies there are exactly is unclear, since there is no official definition of EU agencies. Of the many critiques (see  here and  here) on the

Figure

The Agencies of the European Union: legal Issues and Challenges

Common Approach, that is a first and primary one. In the framework Instrument ‘governing’ agencification, the EU institutions failed to set out a definition of the object it regulates. This has i.a. meant that whenever the establishment of a new ‘hybrid’ structure is being proposed by the Commission, negotiations between or within the institutions can become protracted over the question whether the new body would qualify as an EU agency and therefore be subject to the principles of the Common Approach (as happened with the European Cybersecurity Competence Centre).

One important political dimension to such discussions is that the Common Approach provides that there should be a geographical spread in the seats of EU agencies (para. 6). This implies that whenever an EU agency is set up, a decision is to be made on where the agency will be located. That process used to be one of horse-trading between the Member States whereby Parliament and Commission would be side lined. Following the relocation of the EU agencies located in the UK, there was some rationalization of the process of selecting the seat of an EU agency, setting a new precedent Of fundamental importance however were the judgments (1,  2) of the Court of 14 July 2022 in which it rejected the Member States’ and the Council’s long held conviction that choosing the seat of an EU agency is the prerogative of the Member States pursuant to  Article 341 TFEU. Instead, and since agencies are established by the EU legislator, that decision has to be decided by the EU legislator. These judgments and their implications will be discussed in an Op-Ed by  Tomáš Buchta.

Granting EU agencies powers

Returning to the shortcomings of the Common Approach, it must be noted that it is also completely silent on an important aspect of the qualitative dimension of EU agencification, i.e. the question which powers can be granted to EU agencies. That question will form the subject of a dedicated Op-Ed authored by Marta Simoncini. It suffices to note here that while these limits are typically referred to, in a shorthand manner, as the  Meroni doctrine, it may be more appropriate to refer to them as the  Short-selling doctrine since it is in that  2014 judgment that the Court nominally upheld  Meroni while at the same time hollowing out that original doctrine. Today, the EU institutions are still barred from granting ‘discretionary’ powers to EU agencies and instead such powers need to be ‘precisely delineated’. Recent case law like  FBF, ruled in 2021, shows how the actual threshold applied by the Court is less restrictive than what its language suggests. At the same time, the  2022  Banco Popular cases (1,  2,  3,  4,  5) illustrate  how the EU Courts still struggle in coherently applying  Short-selling and  Meroni to the complex decision-making constellations created by the EU legislator.

The review of complex scientific or technical decisions

EU agencies bringing together scientific and/or technical expertise implies that where they are granted decision-making powers, they will often adopt decisions based on complex scientific and/or technical considerations. Where this is the case, the EU legislator has been remarkably consistent in providing for a specific mechanism of internal specialized administrative review that needs to be exhausted before parties can challenge the agency’s decision before the General Court. The precise role of these  Boards of Appeal, established within decision-making agencies, is only recently being clarified by the Court of Justice itself. In Aquind v. ACER, ruled in 2023, the Court of Justice confirmed that the Boards of Appeal should provide a more intense scrutiny of agency acts compared to the review offered by the General Court. The Court’s own proposal of November 2022 to amend Article 58a of the Court’s Statute would underscore the growing importance of the Boards of Appeal. Article 58a would prescribe that there is no automatic right of appeal before the Court of Justice anymore in those cases where the General Court reviewed the decision of a Board of Appeal. The latter would thus de facto be turned into specialized tribunals in the sense of Article 257 TFEU without the Boards of Appeal, which remain administrative bodies, meeting the requirements of judicial independence. One may wonder how this fundamental reform should be assessed in light of the Court’s Repubblika judgment, if it applies mutatis mutandis to the EU itself, where it prohibits Member States from amending their legislation in such a way as to bring about a reduction

The Agencies of the European Union: legal Issues and Challenges

in the protection of the value of the rule of law. The many questions raised by the Boards of Appeal and the filtering mechanism will be explored in an Op-Ed authored by Oana Stefan.

Risk regulation and throughput legitimacy

Of course, legitimacy issues do not only arise when binding decision-making powers are granted to EU agencies. The EU’s approach to risk regulation, for instance, is based on a distinction between risk assessment and risk management. The latter remains the responsibility of the political actors such as the Commission, while risk assessment is left to (scientific) experts. Today those experts at EU level are often housed in EU agencies, such as the European Medicines Agency, the European Food Safety Authority and the European Chemicals Agency. Their risk assessments are crucial for the risk management by the Commission, thus raising questions on how these agencies make their assessments, who makes these assessments, how to ensure that there are no  conflicts of interests, and how accessible they are (or should be) to the broader public. The role and transparency of agencies in risk regulation will be dealt with more elaborate in the Op-Ed by Marta Morvillo.

New types of powers and more acute fundamental rights challenges

Returning to the  Short-selling doctrine, it may further be presumed that the question of how it should be applied will only become more acute. While the EU legislator is not, so far, testing the limits of how far it can go in empowering EU agencies under the  Short-selling doctrine, it is arguably granting a new type of power to the EU agencies. As Miroslava Scholten will discuss in her Op-Ed, EU agencies are increasingly granted enforcement powers, which are powers traditionally exercised by national authorities (apart from the enforcement of competition policy, where the Commission has important powers). Of the many questions this raises, how the  Short-selling doctrine applies to these type of powers (rather than the rule-making power at issue in Short-selling) is an important one.

So far, the agencies mentioned in this Op-Ed could be situated in the traditional fields of EU law which have a direct connection to the internal market. However, the EU legislator is also agencifying the Area of Freedom, Security and Justice (AFSJ) as will be discussed by Lilian Tsourdi in her Op-Ed. EU agencies with a mandate focusing on migration in the AFSJ are thereby increasingly entrusted with executive and enforcement powers, not dissimilar to some of the enforcement powers flagged previously. Frontex is a case in point. Following the  2019 revision of its mandate, it will further increase its capacity for deployments through its own so-called standing corps amounting to 10000 border guards by 2027. The original idea in 2004 (when Frontex was established) that the agency would simply provide support whereby the Member States would remain solely responsible for the ‘boots on the ground’ has thus shifted.  This provides another illustration of how crises (in casu the 2015-2016 migration crisis) can fundamentally shift paradigms. Also, the EU Agency for Asylum saw its operational tasks beefed up in the  2021 revision of its mandate. The challenge for these agencies of ensuring accountability for their actions and respecting fundamental rights will therefore only become more acute, while the EU legislator appears to struggle to foster that the agencies meet these challenges. These problems, especially in their judicial dimension, will be explored in the Op-Ed authored by Annalisa Volpato.

EU agencies and the wider world

While EU agencies mostly have an inward focus (e.g. ensuring the proper implementation of the internal market rules), most of them also have an external dimensionto their mandate. The extent of that external dimension may vary but given the agencies’ crucial role in the realization of the internal market and given the latter’s gravitational pull, a lot of EU agencies are open for participation by third countries, first and foremost the countries of the European Economic Area. In addition, EU agencies will often also establish informal or formal relations with their third country counterparts. Marko Milenković in his Op-Ed will zoom in on the issues raised by the involvement of third (European) countries with EU agencies. In contrast, the three EU agencies within the Common Foreign and Security Policy (CFSP) and the Common

The Agencies of the

European Union:

legal Issues and Challenges

Security and Defence Policy (CSDP), despite being related to EU external relations, are entirely inward-looking and have no external relations themselves. They are also the odd ones out, given that they are primarily associated with the Council, and not the Commission as is ordinarily the case for most EU agencies. In his Op-Ed dedicated to these agencies, Graham Butler asks the permanent question which case can be made to maintain some of them, or whether they should not be abolished or merged with other agencies.

The future of agencification

The present Op-Ed has already identified a number of (legitimacy) challenges raised by the phenomenon of agencification and challenges put by and to the individual agencies. The Op-Eds that will follow in this symposium will no doubt develop these and raise further ones. What should be clear however is that the agencification of the EU administration will continue. This arguably requires the EU institutions to reflect more meaningfully on some of the challenges raised. This Symposium will contribute to that reflection. The present Op-Ed would just add that notably the accountability of the EU agencies should be better thought out. Importantly, this should not be read as a claim that agencies today are insufficiently accountable. Instead, the main argument is that ultimately the accountability regime for EU agencies should be informed by a shared understanding of the role and position of the EU agencies in the EU’s institutional setup. On that fundamental question, the three institutions could not find agreement in the 2012 Common Approach (and have not found an agreement in the decade since). This is very visible in how the Common Approach conceptualizes the agencies accountability: the executive directors of EU agencies should be accountable before their Management Boards (in which the Member States are represented) and before the EU budgetary authority for their use of the subsidy which they receive from the EU budget (para. 15). While a clear accountability regime is thus created for the Directors, the institutions have omitted to define the accountability of the Management Board itself (and it is the Management Board that defines the policy of the agency). The accountability of EU agencies as conceptualized by the Common Approach is therefore  partial and incomplete. As a result, a revision of the Common Approach, which is a long-standing  request of the European Parliament, would thus seem imperative. Allowing the relentless agencification of the EU administration to continue in a haphazard ad hoc way that is not supported by a genuinely shared common understanding of the role and position of EU agencies only risks aggravating the legitimacy challenges faced by the EU as a polity and by the EU agencies as individual actors.

Merijn Chamon is Professor of EU Law at the Vrije Universiteit Brussel (VUB). The title of this Op-Ed is the same as that of an intensive seminar that he teaches together with Professor Ellen Vos at the College of Europe, Bruges.

SUGGESTED CITATION: Chamon, M., ‘EU Agencies: Shifting Paradigms of EU Administration’, EU Law Live, 25/09/2023, https:// eulawlive.com/op-ed-eu-agencies-shifting-paradigms-of-eu-administration-by-merijn-chamon/

‘Live and let die?’ The Meroni Doctrine in 2023

Marta Simoncini

1. Introduction

On 6 June 2017, the ECB announced that Banco Popular Español, the sixth largest Spanish banking group, was ‘failing or likely to fail’, because of a liquidity crisis, mainly due to the significant outflow of deposits. On the following day, the Single Resolution Board (SRB) adopted a resolution decision, transferring all shares and capital instruments of Banco Popular to Banco Santander for one euro. Less than one hour later, the European Commission approved the SRB’s decision and Banco Popular was sold.

This was the first case that the Single Resolution Mechanism (SRM) under the European Banking Union was applied to a credit institution in Europe. All account holders were spared, but the resolution cost over 3 million euros to shareholders and creditors. The bail-in procedure created a centralised and independent decision-making process on bank resolution, based on the close cooperation between an EU agency (the SRB) and an EU institution (the Commission).

Is the SRB the hidden decision-maker under the SRM? This is the question behind the shareholders and creditors’ action, as they contended the legitimacy of the procedure before the General Court. They particularly questioned the proactive role of the SRB, claiming that it has very broad decision-making powers, whereas the Commission is simply rubber-stamping the SRB’s decision. If the responsibility of the SRB covers policy choices, the mechanism would sit in contradiction with the so-called  Meroni doctrine setting the limits and the criteria for the delegation of powers to EU agencies.

This is only the last case where the issue of the range of powers that EU agencies can exercise has emerged. The original severity of the non-delegation doctrine in fact does not square with the current system of European governance where EU agencies are key actors of internal market integration. My claim is that the Meroni doctrine has been eroded overtime. Such  erosion occurred not only  de facto by pragmatically involving EU agencies in the regulatory process, but in the last decade also  de jurethrough the straining evolution of the case law of EU courts. The effects of such erosion on the reach and the limits of EU agencies’ powers still need to be understood and organised coherently by the courts, the agencies, the competent authorities, and the markets. The result is that the more EU agencies are involved in internal market policies, the more their action can be subjected to strategic litigation under the Meroni doctrine.

2. The tenets of the Meroni doctrine

Under the non-delegation doctrine, the institutions established in the Treaties cannot delegate their powers to other bodies and abdicate their public functions. The so-called  Meroni  doctrine represents a specific application of the nondelegation principle to agencies’ tasks and responsibilities. It concerns whether EU institutions can delegate powers to agencies and, if so, to what extent such delegation is feasible.

The doctrine has been developed in distinct rulings of the Court of Justice: Meroni v High Authority (cases 9/56 and 10/56) and Romano. Although held in very different stages of growth of the EU legal order, these judgments have elaborated the constitutional rule about the delegation of powers to agencies, which still represent a strong legacy. Through the limitation of agencies’ powers, the Court of Justice ensured that the structure of powers as set in the Treaties was kept unchanged.

The Agencies of the European Union: legal Issues and Challenges

In the absence of the guiding principle of separation of powers as it exists in individual Member States, the principle of institutional balance under EU law safeguarded the institutional design of powers as conferred by the Treaties.

In the  Meroni  case, the Court set the conditions for the lawful delegation of powers and about twenty years later in  Romano  explicitly secured that agencies cannot be delegated regulatory powers. To ensure the institutional balance of powers,  Meroni  allowed agencies to exercise only ‘clearly defined executive powers’ amenable to judicial review and entirely subject to the supervision of the delegating institution. It thus forbade the delegation of ‘discretionary power, implying a wide margin of discretion which may, according to the use which is made of it, make possible the execution of actual economic policy’, meaning wide discretionary powers which may unlawfully shift the competence conferred by Treaty establishing the European Coal and Steel Community (ECSC).

In the  Romano case, the CJEU further developed the principles of the non-delegation doctrine by preventing an administrative commission with no legal basis in the then Treaty establishing the European Community (EEC) from the adoption of ‘acts having the force of law’. The CJEU made clear that agencies could only adopt non-binding decisions.

This case law has constrained the establishment, the remit, and the instruments at disposal of EU agencies and hence their capability to contribute to the implementation of the internal market’s goals. Yet, the constitutional concern behind this timid approach to EU agencies’ powers has not stopped the expansion of their powers in the implementation of the internal market.

3. The de facto erosion of the Meroni doctrine

As internal market integration asked for the centralisation of (some) administrative powers at the EU level and their allocation to specialised supranational expert bodies, the  Meroni doctrine remained at odds with the compelling need to develop agencies’ tasks for the better implementation of the internal market. The participation of EU agencies in sector-specific regulation thus occurred through instruments different from autonomously adopted, legally binding acts. The formal compliance with the Meroni doctrine required the development of sophisticated and complex systems of governance, which pragmatically rely on EU agencies’ expertise.

For instance, EU agencies participate in the Commission’s rule-making process. The participation of the European Supervisory Authorities in the financial markets (ESAs) the setting of delegated technical standards under Art. 290 TFEU and implementing technical standards under Art. 291 TFEU is a special case. The ESAs do not merely infuse technical expertise in the non-legislative rulemaking by the Commission, but they initiate the procedure, draft the acts and structure the general technical framework for regulation. The byzantine procedure stretches the procedure under Art. 290 and Art. 291 TFEU by strongly limiting the Commission in the exercise of its delegated powers and as Busuoic observed (p. 117), it creates ‘a gap between the treaty text and legal realities’.

In addition, EU agencies autonomously issue guidelines and recommendations that aim to shape supervisory practices and to ensure the consistent application of EU law. Although not legally binding, such soft law acts have become difficult to avoid or ignore for the recipient competent authorities and market operators. As  Craignoticed with regard to the EASA’s certification specifications (p. 164), the rules of conduct concerning product requirements are ‘codes … that are in effect complex, highly detailed regulatory provisions regarded as binding by the industry, even though they do not have the force of law’.

Soft law in fact creates a method of informal governance, which shapes market regulation through formally rebuttable instruments of enforcement. Firstly, the technical content of the rules of conduct contributes to sidelining deviations. In addition, the introduction of procedural burdens strengthens the reputation of compliant actors. For instance, the

The Agencies of the European Union: legal Issues and Challenges

duty to justify deviations as well as the publication of non-compliant entities are legal requirements that feed namingor-shaming mechanisms so to favour compliance. Diversity has a price, so that what is not legally binding may become necessary in the practice. Based on the pragmatic need to ensure the effectiveness of governance, the use of non-traditional coercive techniques has become a key instrument to promote the enforcement of regulation beyond the legal constraints set in Meroni and Romano.

This method however burdens the legal certainty of rights and obligations, as it complicates the identification of the source of authority and the legal effects of acts. To avoid any shift of responsibility and the conferral of undue, hidden powers to EU agencies, adequate instruments of protection need to be ensured beyond the distinction between binding and non-binding acts.

On the one hand, the gap in the legal remedies against soft law has been partially filled by the public participation in the decision-making process of EU agencies. However, the power of EU agencies to decide who, when and how can participate in the proceedings – within the limits of the general principles set in the establishing regulations – do affect the selection of the relevant interests and the content of their decisions.

On the other hand, judicial remedies have been progressively expanded by the Court of Justice so to enhance protection against the non-binding acts adopted by EU agencies. In the recent FBF v Autorité de contrôle prudentiel et de resolution, the Court ensured the judicial review of the validity and the interpretation of the guidelines adopted by the European Banking Authority (EBA) on governance and product control mechanisms through the preliminary reference procedure (Art. 267 TFEU). Although the Court confirmed the annullability of only legally binding acts and the acts intended to produce legal effects under Art. 263 TFEU, it did ensure some justiciability to the EBA’s guidelines.

4. From the de jure erosion of the Meroni doctrine in the ESMA short-selling case…

In the last decade, the EU case law on the interpretation and application of the  Meroni doctrine has also evolved. In the  2014 ESMA short-selling  case, the Court of Justice revisited for the first time the  Meroni doctrine and reshaped the reach and the limits of EU agencies’ powers. Although the legacy of the  Meroni doctrine is still undeniable,  the Court ‘mellowed’ Meroni and recognised some space for the regulatory intervention by the European Security and Markets Authority (ESMA) in the short selling markets. The Court held that as long as objective criteria and circumscribed conditions leading the exercise of the powers are amenable to judicial review, delegation could involve some ‘margin of discretion’ when a ‘high degree of expertise’ is required to pursue the objective of financial stability. According to the Court, two sets of reasons justify the possibility to confer such powers on an EU agency: the changed framework of the Treaties, where EU agencies’ acts, including acts of general application, can be challenged in courts; and the legislative context, which conferred the powers in question on ESMA. To be legitimate, agencies’ powers shall be exercised according to the conditions fixed in the enabling EU legislative acts, and effective guarantees of institutional supervision and judicial review should be in place.

In addition, the Court dismissed the applicability of  Romano, because in the changed framework of the Treaties EU agencies are ‘expressly’ allowed to adopt acts of general application. The Court thus raised the key issue of the legal status of the entity who has been delegated the power and recognised the changed status of EU agencies under the Treaties. Unfortunately, this part of the judgment remains underdeveloped in the reasoning of the Court and did not secure clear legal consequences.

As I argued elsewhere (p. 31), the ESMA short-selling case shows that insofar EU agencies exercise regulatory tasks within the priorities set and the policy choices made by EU legislative acts, no significant transfer of responsibilities occurs. However, instead of introducing the distinction between legislative and administrative powers known in national contexts,

The Agencies of the European Union: legal Issues

and Challenges

the Court perpetuated the Meroni’s dichotomy between political and technical tasks. This makes the identification and the justification of non-political, discretionary powers still uncertain, while EU agencies’ competence firmly rests on technical expertise.

5. …to the chronic erosion in the Banco Popular Español cases

The five rulings by the General Court (T-481/17;  T-510/17;  T-523/17;  T-570/17;  T-628/17) in the case of the resolution of Banco Popular contributed to relentless erosion of the Meroni doctrine. In the attempt to apply Meroni to the complex technical assessments by EU agencies, the General ended up by adding new elements to the doctrine and further extending EU agencies’ powers. This created some contradictions in the interpretation of three key aspects: 1) the identification of the decision-making authority; 2) the understanding of the notion of discretion; and 3) the access to judicial protection.

To stick to the  Meroni condition that no shift of responsibility should occur, the General Court distinguished the competence of the SRB and the Commission on the basis of the technical nature of the SRB’s powers and the discretionary competence of the Commission in the procedure. The informal participation of the Commission in the SRB’s resolution decision was a sufficient procedural element to ensure that it could make an informed assessment of the discretionary aspects of the final decision and could be the effective decision-making authority.

As Chamon underlined, even the High Authority in the  Meroni case had the status of observer with veto power in the Board of agencies responsible for the functioning of the financial mechanism for the supply of scrap, but this condition had not saved the architecture of the equalisation mechanism under the ECSC. In the General Court’s interpretation, instead, participation integrates a new condition capable of smoothing out the rigidity of the Meroni doctrine.

In addition, according to the General Court, the informed participation by the Commission excludes the need to define conditions for the exercise of its powers as per under the ESMA short-selling case. Participation is considered sufficient evidence that the SRB does not exercise any autonomous power involving any margin of discretion in the resolution procedure. The assumption of responsibility by the Commission is therefore an alternative to definition of the criteria and the conditions for the exercise of the power.

Evidence of the Commission’s responsibility however passes through a relaxed duty to give reasons of its decision. Because of the limited time available and the need not to repeat elements already pointed out by the SRB, the General Court held the reference to the SRB’s motivations sufficient for the legitimate endorsement of the resolution scheme. Yet, as Brito Bastos explained, this seems in contrast with the Meroni doctrine because this does not allow to understand whether the Commission has effectively exercised its discretionary powers or has merely validated the decision of the SRB. Conversely, the duty to give reasons could have been an effective instrument to demonstrate that no shift of responsibility has occurred.

The  General Court also stressed the division of competence between the SRB and the Commission, so that the latter cannot change the (technical) resolution scheme adopted by the Agency, but the production of legal effects follows from (the approval of) the identification of the public interest in the resolution by the Commission. However, the General Court also finds out that the SRB’s decision is not a preparatory act and produces autonomous legal effects after the endorsement by the Commission. It can thus be challenged in courts with no need to challenge the Commission’s decision, and its annulment would roll over to the Commission’s decision. This expands judicial protection but creates contradictions. The recognition of the competence of the SRB shows that it does exercise powers autonomously, including an assessment of the public interest in the resolution; however, the General Court does not refer to the ESMA short-selling case, but to the general principles of legal certainty and effective judicial protection.

The Agencies of the European Union: legal Issues and Challenges

All this demonstrates the difficulties to understand and offer protection against the complex technical assessments adopted by EU agencies in the framework of the  Meroni doctrine. Pending the appeals before the CJEU, we need to wait and see if and how these new developments are interpreted, and the single resolution mechanism reconciled with the Meroni doctrine.

6. Shall we get rid of Meroni?

EU agencies’ powers are designed to respond to the failures of individual States’ regulations and to the need to apply rules in a uniform manner throughout Europe. Beyond EU agencies’ informal governance and although interpretation of the Court has unblocked the legal recognition of some discretionary powers for EU agencies, yet tensions remain between the functional need to strengthen the agencies’ role and the doubts about their compatibility with the EU legal order. The issue is that constitutional checks-and-balances for the operation of specialised agencies in the internal market are not completely unravelled. This can be attributed to the Meronidoctrine, which probably has never been fit for setting limits to the delegation of powers to agencies and conversely contributed to the complication of the governance. When rethinking such doctrine, the latest case law has expanded EU agencies’ powers without fixing the relevant theoretical issues beyond the Meroni restrictions.

To get rid of the uncertainties generated by and because of the  Meroni doctrine, the Court of Justice should address two critical aspects. Firstly, the notion of discretion needs to be further elaborated and the existence of administrative discretion as a power circumscribed by the law needs to be refined. The Court should consider discretion acceptable insofar as priorities and policy choices have already been made by the legislative power and it should abandon the dichotomic distinction between political and technical powers as a ground for EU agencies’ action. Complex technical assessments require technical expertise, but they are not neutral and may require some value judgments.

Secondly, if some discretion is acceptable, the exercise of the tolerable discretionary powers needs to be entrenched in the legal system. The unclear setting of EU agencies’ powers under the Treaties affects such entrenchment and the development of an adequate accountability framework for EU agencies’ action. Treaties unchanged, it should be up to the legislation to clarify how responsibilities are shared between EU agencies and EU institutions in the single proceedings and to identify instruments that make the exercise of such administrative powers accountable.

Marta Simoncini is Assistant Professor of Administrative Law at Luiss University, Rome. She authored the volume ‘Administrative regulation beyond the non-delegation doctrine. A study on EU agencies’ (Oxford: Hart Publishing, 2018).

SUGGESTED CITATION: Simoncini, M.: ‘ “Live and let die?” The Meroni doctrine in 2023’, EU Law Live, 26/09/2023, https://eulawlive. com/op-ed-live-and-let-die-the-meroni-doctrine-in-2023-by-marta-simoncini/

Introduction

EU Agencies within the common foreign, security, and defence Policies

Graham Butler

The EU’s Common Foreign and Security Policy (CFSP) and the Common Security and Defence Policy (CSDP) remain peculiar areas of the EU legal order. For between the adoption of the Treaty of Maastricht (1992) and the Treaty of Lisbon (2009), they were what was known as the ‘Second Pillar’. Today, the CFSP/CSDP is now incorporated fully into the EU legal order as a fundamental part of the EU’s external relations, with the same set of objectives guiding  all the EU’s international relations.

The three agencies within the domain are the European Defence Agency (EDA), the European Union Satellite Centre (SatCen, or EUSC), and the European Union Institute for Security Studies (ISS, or EUISS). Given that all EU agencies have some form of external relations, the ultimate contradiction is seen with respect to these three agencies is that, whilst are centred  around EU external relations, they are all, fundamentally, operating  internally within the EU legal order, and do not engage in external relations themselves. This irony, whereby they merely serve the internal machinery of the EU, by reinforcing the institutional structure and capabilities of the EU to manifest, as a whole, its external relations, means that their place, or their justification to be standalone agencies, is particularly weak.

EU agencies within the CFSP/CSDP

The three ‘CFSP agencies’ are known as so owing to the fact that the establishing legal basis for each of the three agencies is to be found within the CFSP articles of the TEU: Articles 23-45 TEU. Their exceptional status has been highlighted before, yet each are rarely probed in-depth as to their status within the overall EU institutional framework.

First, the EDA, sitting in Brussels, was initially established through a CFSP Joint Action by participating Member States, because at the time of its establishment in 2004, not all Member States participated in EU actions have defence implications. With Denmark forgoing its defence opt-out in 2022, all twenty-seven Member States are now participating Member States.

The EDA is a coordinating EU agency, in that its mandate is to develop the defence capabilities of Member States, improve research into technological advancement, and to be one of the venues of military cooperation for its Member States under the auspices of EU policies. Since it’s development, it has, however, been an agency in search of a purpose, given that for much of its existence, visible progress has been slow. It is headed by the High Representative of the Union for Foreign Affairs and Security Policy – one of that officeholder’s many hats – though the EDA is managed day-to-day by a Chief Executive.

The EDA is one of only a small handful of EU agencies that must exist according to the EU Treaties (the others being Eurojust and Europol), whereby it is given explicit reference in Articles 42 and 45 TEU. Those two provisions are the legal basis of the agency, but given the explicit mandate in the EU Treaties, it is in a privileged position of being immune from closure on foot of a Council decision, barring amendment to the Treaties themselves. Uniquely amongst all EU agencies however, across the entire EU legal order, it is the only EU agency where the Steering Board is composed of members of the Council (i.e. the Ministers of Defence of Member States).

The Agencies of the European Union: legal Issues and Challenges

Second, SatCen was technically established in the EU legal order in 2001 but was not created then. Rather, it was instigated by the Western European Union (WEU) in the early 1990’s as a ‘subsidiary body’ of the WEU for a temporary period of three-years, before eventually being incorporated into the EU with the rise of the EU’s CFSP. It sits in Madrid and is headed by a Director.

It is an information and assistance EU agency and supports the EU’s CSDP missions in their respective mandates, as well as other related CFSP matters. In other words, it supports  the EU, and not its Member States. Nor does it interact with the public. In essence, it collects geospatial information based on satellite imagery for the EU’s overseas operations, by providing them the necessary information and assistance through the EU institutional machinery.

The legal basis of SatCen is Article 28 TEU and Article 31(1) TEU, and thus, firmly within the CFSP provisions of the EU Treaties. However, SatCen has been actively trying to turn its attention to non-CFSP matters beyond its mandate, like getting involved in the EU Space Strategy for Security and Defence, which is under the auspices of the Commission, and even more-widely coordinated Copernicus Programme, involving both EU and non-EU actors. Theoretically, going forward, this work pattern ought to necessitate a redesign, legally speaking, of the establishing legal basis of the agency; or alternatively, merged into another existing EU agency or body.

Third, just like SatCen, ISS was also technically established in the EU legal order in 2011 but was not  created then. The WEU initiated it in 1989, before eventually being incorporated into the EU as a CFSP agency, with Articles 28 TEU and 31(1) TEU as its legal basis. It sits in Paris and has a very small number of staff. In addition, it has a small liaison office in Brussels to be theoretically closer to the decision-making sphere of the EU. It is an information EU agency and orientated around the work of the Council and the European External Action Service (EEAS). It walks and talks like a think-tank, in that it merely collects, analyses, and subsequently publish its research. It is headed by a Director.

Inherited non-EU bodies made as EU agencies

Whilst most EU agencies are associated with the Commission, all three EU agencies within the CFSP are not, and instead, are more closely linked to the Council and the EEAS. They are not intergovernmental of any sort, but rather, fully within the EU legal order. None of the three are decision-making authorities in the classic sense of the term, and they all operate without a broader mandate, other than to be supportive of the actual EU decision-making institutions. They thus have no independence from their institutional masters.

Whilst decision-making within the CFSP has been predominantly centred around the Council, the full grips of the EU  acquis is slowly beginning to circle away from the CFSP, with the stranglehold that the Council has historically had on the field of EU law slowly being loosened. Put another way, there is increased overlap between CFSP and non-CFSP policy matters, making various EU policies in the field of external relations evermore indistinguishable from one another.

Thus, the EEAS (headed by the High Representative) is an active body in external relations; the Commission is becoming more assertive, even on CFSP matters; the Parliament is demanding a greater role as ever; and the Court of Justice, when asked in cases before it, has always agreed to expanding its jurisdiction over the CFSP, notwithstanding the potential for a textual reading of the EU Treaties that might exclude it. In other words, the mindset of ‘separateness’ of CFSP matters from non-CFSP matter is the Council’s and three EU agency’s ways of thinking, but is one that is not wholly shared across the EU institutional architecture. Seeing the views of other institutions, bodies, and offices of the Union will have a different way of thinking, in that there is no longer a complete ‘separateness’ of the CFSP from other areas of EU external relations. Coherence is, in theory, growing.

The Agencies of the European Union: legal Issues and Challenges

What is apparent as regards both SatCen and ISS is that the EU inherited them from a former international organisation, the WEU, and there was no perfect way to neatly incorporate them into the EU. They could have been abolished, rather than incorporated, but incorporation was chosen for some unbeknownst reasons. One way of looking at SatCen and the ISS, therefore, is that they are merely stepchildren from other relationships of the Member States. Accordingly, officials of the agencies in both Madrid (SatCen) and Paris (ISS) have long had the fear that a decision could be taken by the Council to shut them down, for their services they provided may be surplus to requirements, or done elsewhere within the EU institutional architecture. Given the growth of other actors within the EU in the sphere of external relations, those officials fears are well-founded.

Thus, both EU agencies have gone out of their way to promote their work to, not to the public at large necessarily, but rather, to the political masters in the Council. In particular, SatCen have recently been at pains to highlight their alleged importance of their work when they got to host a recent ministerial meeting at their premises in 2023, that tied in with the Spanish presidency of the Council. Unlike the EDA, neither SatCen or ISS are treaty-mandated to exist, and therefore, are afforded no special legal protection.

Rationale for existence

Regarding SatCen’s work in supporting the CSDP, whilst the use of satellite imagery is undoubtedly necessary for EU purposes, particularly CSDP missions that operate in some of the most difficult environments around the world, that does not render SatCen immune from scrutiny. Whether a standalone EU agency like SatCen is needed to achieve such satellite imagery, particularly when it does not control satellites of its own, is debatable. After all, the EU has recently revamped its Agency for the Space Programme (EUSPA). Thus, the overlap between SatCen (a CFSP agency) and EUSPA (a non-CFSP agency) brings up genuine questions about a potential merging, in favour of the better equipped EUSPA.

Similarly, the work of ISS can be easily questioned as to its value-proposition. There is no apparent need for the EU to have a separate CFSP agency, fully funded by the EU, to have a non-independent think-tank situated within its legal order. After all, it effectively conducts research on matters that really ought to be researched from an external, independent perspective. There is nothing that the ISS does, or provides, that cannot be otherwise be provided externally by engaging with independent think tanks, or alternatively, internally, in-house within the EEAS through a dedicated unit. The value-for-money proposition of ISS being a standalone EU agency does not withstand scrutiny.

With SatCen and ISS having originally come from the WEU, and the WEU’s position in the international security architecture having largely been minimal, owing to the eventual development of the EU’s CFSP, but also, the more prominent role played by the North Atlantic Treaty Organization (NATO) over time, it is remarkable that SatCen and ISS were salved by throwing them into the CFSP as EU agencies when the WEU itself was dissolved in 2011. Questions thus linger, beyond strict legal analysis, for why these were retained, and the EU now appears stuck with them until decided otherwise. After all, the WEU in its time had nine subsidiary bodies, of which SatCen and ISS were the only survivors. The remainder were abolished or moved into existing EU structures, like the Council.

It should be mentioned that the European Security and Defence College (ESDC) is sometimes portrayed as an EU agency within the CFSP. Despite possessing  its own legal personality, it is officially housed within the EEAS. Furthermore, the numerous CSDP missions of both civilian and military character, are not EU agencies, but are instead treated as ‘bodies’ within the EU legal order.

The

Conclusion

The Council still acts as the custodian of the CFSP, despite the creeping onwards of other actors within the EU legal order. It thereby controls the three agencies in question either directly or indirectly, within each of the three have no real decision-making powers, and even performing tasks that might otherwise be better done elsewhere within the EU institutional architecture.

No study of EU agencies is in any way complete without acknowledging the existence of the three agencies as they are now, for their purpose, their powers, and their contribution towards to objectives of the EU’s external relations is very much an unsettled matter. As a matter of both law and policy, the standalone nature of these three agencies will sooner or later have to be reevaluated.

Graham Butler is Full Professor of Law, University of Southern Denmark.

SUGGESTED CITATION: Butler, G., ‘EU agencies within the common foreign, security, and defence policies’, EU Law Live, 2/10/2023, https://eulawlive.com/op-ed-eu-agencies-within-the-common-foreign-security-and-defence-policies-by-graham-butler/

On EU Agencies with Enforcement Powers

Miroslava Scholten

Since 2000s, the enforcement power of the Union has started to expand. The EU legislator has been prescribing more on national enforcement of EU law. Promotion of enforcement has been organised via an increasing number of EU networks of national enforcers and transnational arrangements alike. And, most relevant for this symposium,  EU agencies have become involved in promoting enforcement, including via receiving direct enforcement powers, i.e. powers to monitor compliance with EU laws by private actors, investigate possible violations and sanction for noncompliance. While the shift of enforcement power to the same governance level as where the norm has originated from can be explained (e.g. by  the theory of functional spill-over) and may seem necessary, especially if the ‘default rule’ (enforcement at the national level) does not work, this shift and evolution of power lead to a number of questions. These are  the questions of legitimacy, controls, and effective enforcement. These questions are even more peculiar in the case when EU agencies receive enforcement powers: neither EU’s enforcement competence nor EU agencies are the issues that are clearly defined by the treaties. This Op-ed discusses these questions to highlight this emerging actor –‘EU enforcement agency model’ – on the EU governance landscape, which, as it argues, necessitates further public and academic debate to ensure democratic credentials of the Union and the rule of law.

Who should be enforcing EU law?

The Treaties recognise an institutional role for enforcing of EU law of the EU Commission, the Court of Justice and national administrations (Articles 17 TEU, 19 TEU, 197 TFEU, 258-260 TFEU, 291 TFEU). Clearly, competences of the Union may vary depending on the policy area (Articles 2-6 TFEU and other sectoral provisions) and indeed enforcement of EU laws has been developing in different ways across the policy areas (see  the 2023 Edward Elgar Research Handbook on the Enforcement of EU law). However, from the outset of the EU integration, there has been a division between regulatory and enforcement competences: we pass laws and rules at the EU level and we enforce nationally. National sovereignty concept promoted via such principles as conferral, subsidiarity, proportionality and national procedural autonomy, can explain such division. The area of competition law has been the only exception (Articles 101-103 TFEU).

With the revisions of the treaties, the term ‘agencies’ or alike (bodies, offices, etc) has made it to the treaties but rather on an ad hoc basis, ie mentioning agencies in approximate 25 treaty articles, mostly of general application like in Article 263 TFEU on the possibility to review the legality of agencies’ acts by the Court, and discussing the creation and operation of a few agencies of the former second and third pillars (see, for instance, the Op-Ed by Graham Butler). The Treaties have not explicitly delineated the enforcement power and limits of it of the Union, the possibility to create EU agencies, and the possibility to grant such agencies enforcement powers. At the same time, the EU secondary law offers a growing number of examples of EU agencies with enforcement powers. The most powerful EU agency in this light is the European Securities and Markets Authority (ESMA). In relation to specific financial markets participants, it can monitor compliance with EU laws, investigate possible violations and sanction for non-compliance. The legal bases upon which such secondary legal texts are passed, do not mention the possibility to create EU agencies explicitly. This questions the legitimacy of creation of EU agencies, especially with enforcement powers.

The Agencies of the European Union: legal Issues and Challenges

Is it legitimate to create EU enforcement agencies?

The discussion of the legitimacy of EU agencies has existed for quite some time, see also Op-ed in this symposium by Marta Simoncini on the delegation doctrine. Clearly, the EU institutions and national administrations need support in enforcing EU laws and it is conventional that  legal systems may develop delegation doctrinesas to how to organise such support and supporting bodies. The question is what the limits and conditions should be for the possibility to delegate and who is entitled to determine these. So far, there has been great reliance on the Court of Justice to set up these limits if litigation would arise (see the landmark judgements such as Meroni and ESMA-Shortselling). The Court  has upheld the creation and delegation of some powers to EU agencies. The question of delegation of enforcement powers to EU agencies has not been addressed by the Court yet, though we may receive some answers from an ongoing litigation (Case C-256/23, ECHA). At the same time, as the matter of delegating powers to EU agencies is interconnected with a somewhat bigger  question of what role the EU should play in enforcing EU laws, which deserves normative debate in academia and clearly by the EU citizens and by parliaments to ensure democratic credentials and democratic controls in the Union. Shifting enforcement powers from national to EU levels and amongst EU institutions and agencies impacts the established institutional balance, which needs to be reconsidered, also in light  of the evolution of some institutions, and necessitates addressing the issue of controls for such powers because enforcement power may have direct and intrusive effect upon private actors’ rights and freedoms (see my  Jean Monnet EULEN working paper on the rule of law and effectiveness of supervision of financial markets); think about possible high amounts of fines that an enforcer may impose (see examples of ESMA’s fines here) or even a possibility to revoke license to operate in a market.

In terms of the well-known distinction of input, throughput and output types of legitimacy, the lacking clear framework for the creation and operation of EU agencies make the input legitimacy a point of fierce discussion. At the same time, the throughput and output legitimacy of these agencies is not that clear cut either. The processes how these agencies are being established and operate can be unclear and with questionable success (see for instance  De Coninck 2023 on the recent case concerning Frontex). And even if EU agencies’ effectiveness has been recognized by EU institutions, like it has been the case with the financial agencies (see Commission’s report ‘On the operation of the European Supervisory Authorities (ESAs)’ COM(2022) 228 final, of May 2022), it could be (methodologically) difficult to assess truly a real added-value of an EU agency in comparison with a situation where we would have had national enforcers (or networks) instead because the latter case can be not possible to construct and assess. Moreover, successful enforcement depends on a great number of factors and necessitates tailored design in light of policy and legal objectives, specifics of the markets, to name but a few. A comprehensive enforcement strategy is therefore key for further integration.

Are enforcement powers of EU agencies under control?

The secondary laws establishing EU agencies create systems of controls over these bodies, this is what delegation doctrines request upon delegation and controls should be proportionate to the tasks delegated (for instance, judicial controls for decisions with legally-binding effects and political controls for making policy discretionary choices). The set up of secondary legislation is not always aligned to set up relevant controls for all the various tasks that an EU agency may enjoy and to a multi-jurisdictional setting of the EU. So, what we do have normally are somewhat general provisions on political accountability of the agency (hearings before the European Parliament, reporting obligations, appointment and removal procedures of the top level officials), clauses on judicial control via the Court of Justice for decision adopted by EU agencies and preliminary review procedure, financial controls via the annual budgetary and discharge procedures and the Court of Auditors, anti-fraud, Ombudsman and at times special mechanisms in light of specifics of a particular agency, like a Fundamental Rights officer of Frontex. However, these mechanisms are for all tasks, which for instance, do not request necessarily reporting on enforcement in reports Research has showed a number of problems to ensure meaningful controls in a mixed administration setting of the EU: divergent interpretations of Fundamental rights, unclarity of which

The Agencies of the European Union: legal Issues and Challenges

type of control should be there for inaction by agencies,  limits of judicial control,  unclarities in effects and controls over soft law of agencies, to name but a few. The development of  Board of Appeals of EU agencies needs also to settle down within the emerging controlling system for enforcement. At this moment, the risk is that the affected parties by the enforcement powers of EU and national authorities may have limited, if at all, redress. This is clearly not sitting well with the values – democracy, rule of law – that the EU stands for.

Miroslava Scholten is Associate Professor of EU law enforcement, a member of the Utrecht Centre for Regulation and Enforcement in Europe (RENFORCE) and is the director of the LLM Law and Economics.

SUGGESTED CITATION: Scholten, M.: ‘On EU agencies with enforcement powers’, EU Law Live, 5/10/2023, https://eulawlive.com/oped-on-eu-agencies-with-enforcement-powers-by-miroslava-scholten/

EU Agencies and financial Regulation: the Proliferation of a new Mode of Governance

Jonathan Bauerschmidt and Diane Fromage

The phenomenon of agencification within the EU is admittedly not new, nor is it limited to a specific policy area or even to the supranational governance model, for Member States, too, have massively created independent executive agencies in the past decade. However, we posit that this phenomenon is more acutely visible in one of the EU’s domains of action, namely that of financial integration. Indeed, since the Great Financial Crisis, the EU has created no less than four agencies in this domain: the three European Supervisory Authorities (ESAs)–EBA , ESMA and EIOPA , which are part of the European System of Financial Supervision (ESFS) in 2010–, and the Single Resolution Board (SRB) in 2014.  All four of them were established using the internal market legal basis, Article 114 TFEU. Further to this, the Supervisory Board was created as an internal body of the European Central Bank (ECB), which plans and executes supervisory tasks as a preparatory body. Although not an agency, the question of delegating powers to the Supervisory Board was solved by letting the ECB’s Governing Council finally adopt supervisory decisions which thus assumes full legal and political responsibility for the ECB. Lastly, a body with no independent legal personality was introduced in the form of the European Systemic Risk Board (ESRB), which completes the ESFS.

Examining the proliferation of this new mode of governance thus appears to be crucial at this stage, not only because of its numerical importance and because of its determining role in EU financial integration, but also because these agencies have been subject to intensive litigation before the Union Courts. Our analysis proceeds by first mapping this phenomenon (1), examining these agencies’ involvement in the production of soft law (2), before it turns to the Meroni issues, which have arisen in this context (3 and 4). It then continues by considering the legal responsibility and the accountability regimes of these agencies (5 and 6), before drawing some conclusions (7).

1. Mapping Agencification – Complex Structure and Institutional Engineering

As noted in the introduction, a proliferation of agencies may be observed in the financial domain since 2010 with the ESAs, the SRB, and the  Anti-Money Laundering Authority (AMLA), which is currently under discussion by the Union legislator. ‘Agency-like’ structures also exist in parallel in the form of the ESRB and the ECB’s Supervisory Board. A particularly complex structure results from the existence of this myriad of actors dealing with closely-related and intertwined issues, which moreover seek to reconcile the need for action at the supranational level with a still relatively strong role for national institutions. However, perhaps the emergence of this very complex architecture was unavoidable to some extent, be it only because of the existing Treaty framework as it has been interpreted by the Court of Justice, or because of the co-existence between euro area and non-euro area Member States.

Yet, this complex structure also has a positive side: within the EU’s constitutional framework governing their creation and functioning, agencies allow for considerable institutional engineering. This is acknowledged by the EP, the Council and the Commission in their  Joint Statement and Common Approach on decentralised agencies of 2012 where they committed to streamlining the governance structure of agencies albeit in a ‘legally non-binding’ way, leaving the Union legislator considerable margins when setting up agencies.

The Agencies of the European Union: legal Issues and Challenges

An important example for institutional engineering is third country participation: the Union institutions apply a very rigid regime when it comes to participation of third country representatives to preserve their decision-making autonomy. Conversely, the ESAs Regulations for example allow third countries to participate in the work of the Authority in accordance with international agreements concluded between the Union and the third state and after its legislation has been deemed equivalent to the of the Union. Within the framework of these international agreements, the ESAs may enter into administrative arrangements allowing third country representatives to participate in meetings of the Board of Supervisors as observer with only small exceptions.

In addition to the complex governance structure, agencification raises numerous questions as regards their role and which kind of acts they can adopt.

2. ESAs’ Coordination and their Involvement in Soft-Law

The ESAs assume an important role in coordinating national authorities and elaborating soft-law measures. Indeed, already the  Romano judgment blessed that bodies established by secondary law may take on an advisory role and adopt acts without ‘having force of law’. In this vein, the ESAs have more of a coordinating role which they fulfil by pooling expertise, than an executive role. Many other legal acts give the ESAs coordination powers.

In addition, the ESAs elaborate a range of soft-law measures which can be  understood as instruments that do not have legally binding force as such, but may nevertheless produced certain (indirect) legal effects in Union law. To this end, the ESAs may draft regulatory technical stands and implementing technical standards. These drafts fulfil an important pre-law function until they are adopted as hard law by the Commission as delegated and implementing acts respectively.

The ESAs may also provide opinions, respond to questions and answers, and issue guidelines and recommendations. National competent authorities are obliged to make every effort to comply with these guidelines and recommendations and must comply or explain. Similarly, market participants are obliged to report, in a clear and detailed way, whether they comply with a given guideline or recommendation. The Court of Justice has clarified in the  FBF  case that neither guidelines nor recommendations can be regarded as producing binding legal effects for national authorities or financial institutions. Therefore, these soft-law instruments cannot be the subject of actions for annulment under Article 263 TFEU. However, since national authorities may follow these soft-law instruments and since national courts need to take them into consideration, especially when they are supplementing binding EU law, guidelines and recommendations may be reviewed by the Court of Justice in preliminary reference procedures pursuant to Article 267 TFEU.

Finally, the ESAs can be involved where a national competent authority has not applied relevant legal acts or applied them in a way which appears to be in breach of Union law under Article 17. The ESAs may carry out investigations and subsequently issue recommendations. In case of non-compliance, the Commission may initiate infringement procedures pursuant to Article 258 TFEU and the ESAs may adopt certain measures accompanying those procedures.

3. Meroni and Exceptional Intervention Powers of ESMA

Beyond the coordination role, financial agencies may sometimes receive real executive powers. In this regard, the Court already held in the  Meroni  judgment of 1958 – as also explained by  Marta Simoncini – that it is incompatible with the balance of powers (now institutional balance) to confer ‘discretionary powers implying a wide margin of discretion which may, according to the use which is made of it, make possible the execution of actual economic policy.’ This doctrine was tested during the Great Financial Crisis when the Union legislator conferred exceptional intervention powers on ESMA in the Short Selling Regulation (SSR) based on Article 114 TFEU.

The Agencies of the European Union: legal Issues and Challenges

Article 28 SSR allows ESMA to take action when there are serious threats for financial markets, subject to  substantive and procedural conditions. On substance, ESMA may only intervene if there are threats to the integrity of financial markets or the stability of the Union’s financial system. To guide ESMA, the Commission has adopted a  Delegated Regulation setting out the criteria to determine those adverse events or developments. Moreover, ESMA may only act if national measures cannot adequately address the threat. On procedure, ESMA must consult the ESRB and notify national authorities of the intended measures. And finally, all measures must be reviewed every 3 months and elapse if not reviewed.

This was called into question by the United Kingdom in the  Short Selling case. First, the UK claimed that this empowerment went beyond  Meroni as ESMA was conferred large margins of discretion. In response, the Court noted that the SSR does not give ESMA any powers beyond the regulatory framework of the ESMA-Regulation (para. 44). Moreover, ESMA’s powers are sufficiently framed by the substantive and procedural conditions in Article 28 SSR which circumscribes ESMA’s margin of discretion (paras. 46 et sq.). And since the empowerment is precisely delineated and its exercise amenable to judicial review, ESMA is not vested with a large margin of discretion allowing it to set actual economic policy (paras. 53 et sq.).

Second, the UK also argued that Article 28 SSR circumvented the Romano judgment because it allowed to adopt quasi legislative measures of general application. In response, the Court recalled that Articles 263 and 277 TFEU were revised in the Lisbon Treaty to also include bodies, offices and agencies, which shows that the institutional framework expressly permits such Union entities to adopt acts of general application (paras. 64 et sq.).

Third, as regards the UK’s argument that Article 114 TFEU is not the appropriate legal basis because national law is not harmonised but rather national decisions are replaced by supranational decisions,  Advocate General (AG) Jääskinen showed some openness. This echoes  criticism by  scholars. In response, the Court did not follow its AG but rather pointed towards the broad discretion of the Union legislator to choose the most appropriate technique for the approximation of laws. This discretion is particularly important if it requires highly technical and specialist analyses to be made. Thus, the Union legislator may deem it necessary to establish an agency responsible for contributing to the implementation of a process of harmonisation (paras. 102–104). Moreover, it may also empower such a body to issue binding decisions for specific market participants to address serious threats to the orderly functioning and integrity of the financial markets or the stability of the financial system (para. 108).

The  Short Selling judgment is an important confirmation of the  Meroni case-law that decision entailing a wide margin of discretion must not be conferred on Union agencies. At the same time, the Court also significantly developed its case law taking into account  discussions in the European Convention that agencies may even adopt measures of general application, provided the empowerment is strictly circumscribed and its exercise subject to judicial review. This clarification has been largely welcomed by scholars.

In conclusion, it should be underlined that ESMA uses its powers in Article 28 SSR very restrictively. In the course of the Covid-19 Pandemic,  ESMA lowered the reporting threshold for net short positions to 0.1% of the issued share capital and renewed the measure three times. Rather than prohibiting trade which is also possible under Article 28 SSR, ESMA sought to enable national authorities to better monitor financial markets and then  coordinated their action in accordance with Article 26 SSR. To bring about a permanent change for the reporting threshold, the Commission adopted a Delegated Regulation after receiving a favourable Opinion by ESMA . This shows how ESMA uses its powers cautiously to adopt autonomous measures and then primarily advises the Commission which as a Union institution has broader discretion to adopt the necessary acts to safeguard financial stability.

4. Meroni and the Resolution of Banks

Meroni  issues have also arisen in the context of the actual resolution of a credit institution, namely regarding Banco Popular. In accordance with the Meroni doctrine, the SRB could not be empowered to decide autonomously to resolve a bank since this goes beyond mere technical assessments and involves the weighing of different policy objectives. Thus, the resolution procedure in Article 18 SRM-Regulation involves the SRB in an initial assessment phase to determine whether a bank is failing or likely to fail (together with the ECB); whether there is a prospect of private sector measures; and whether resolution is in the public interest. In a subsequent adoption and endorsement phase, it is for the Commission to endorse the resolution scheme with regard to the discretionary aspects and potentially involve the Council.

Hence, while the SRB has an important function in preparing resolution, it may not act without the involvement of Union institutions. In view of the very limited time available to conduct the resolution of banks –often ‘over the weekend’–, the restricted timeline for the Commission’s involvement (and possibly the Council’s), has led some to question their ability to effectively control the SRB’s exercise of power. In one Banco Popular case, the General Court found that the Commission does not merely ‘rubber stamp’ the SRB’s resolution scheme (para. 229). Rather, the SRB is under a general obligation to cooperate and exchange information with the Commission, the Council and the ECB. Moreover, Commission representatives participate in the meetings of the SRB as permanent observers and have access to all documents. With this early involvement, the Commission is able to assess the discretionary aspects and its endorsement of the resolution scheme ‘is not a mere formality’ (paras. 231 et sq.). These findings of the overall  Meroni compliance of the resolution procedure have become res iudicata since the applicants in the Banco Popular cases decided not to go on appeal on these questions.

However, an important question remains open: are direct actions pursuant to Article 263 TFEU to be brought against the SRB because it adopted the resolution scheme or against the Commission because it endorsed this scheme (or even both)? This goes to heart of the legal responsibility of agencies.

5. Legal Responsibility of Agencies

In a Union based on the rule of law, the Treaties not only establish a complete system of legal remedies against acts adopted by  institutions, but also by other  bodies, offices and agencies. What had already been established by the Court, is since the Treaty of Lisbon also enshrined in Articles 263(1), 2nd sentence and 267(1)(b) TFEU. Moreover, Article 263(5) TFEU also confirms the previously existing practice that the acts setting up agencies may lay down specific conditions and arrangements before direct actions can be brough before the Court by natural or legal persons. Thus, Articles 58 et sqq. ESAs Regulations create a Board of Appeal as a joint body which is responsible to review certain decisions addressed to those persons or of direct and individual concern. Similarly, Article 85  SRM-Regulation creates an Appeal Panel for reviewing some of the SRB’s decisions addressed to persons or of direct and individual concern to them. Only after such an appeal procedure is conducted, may those persons bring direct actions before the General Court.

Determining the legal responsibility of agencies is particularly challenging in organisations with a sophisticated division of labour as many persons are involved to varying degrees in taking decisions. This ‘problem of many hands’ makes it often difficult to determine who should take responsibility in complex organisations. In EU law, there are three particular complexities in relation to agencies’ legal responsibility.

First, stemming from the types of acts: soft-law measures such as guidelines and recommendations of the ESAs cannot be the subject of actions for annulment under Article 263 TFEU as they do not produce binding legal effects. However, as the Court clarified in the  FBF case, these soft-law measures may be reviewed in preliminary reference procedures under Article 267 TFEU.

The Agencies of the European Union: legal Issues and Challenges

Second, stemming from the institutional structure: many agencies, such as the ESAs and the SRB, are endowed with legal personality and can be as such defendant in actions before the Union courts. However, some entities lack such legal personality, such as the ESRB for example. For those the case-law on bodies, offices and agencies remains relevant requiring that any act of a Union body intended to produce legal effects vis-à-vis third parties must be open to judicial review. Since the ESRB, however, acts through soft-law measures issuing warnings and recommendations, it is highly unlikely that it would be the subject of direct actions.

Third, stemming from the decision-making procedure: in complex procedures such as the resolution of a bank, the  Meroni judgment is also relevant for identifying the author of the resolution action and the act which may be attacked to review its legality. In fact, the Court in Meroni focused also on the shift of responsibility between institutions and additional bodies established in the framework of the Treaties. And it was precisely because only institutions are empowered to take decisions entailing large political margins of discretion, that such powers may not be delegated to independent bodies. In other words, the broad political responsibility may only be borne by institutions which are then also legally responsible for their acts. This is also supported by the  IBM v Commission line of reasoning since in the complex administrative procedure involving several stages only the Commission’s endorsement definitively lays down the Union’s position in the resolution procedure. Thus, there are good reasons why the Commission is the main defending institution in case of a resolution action. This question is currently before the Court of Justice in another Banco Popular case where only the SRB’s resolution scheme was attacked.

These three examples show the complexities surrounding the legal responsibility of agencies and how the Court’s caselaw helps to solve them.

6. Democratic Accountability of Agencies

Next to these questions of legal responsibility, there are also numerous complexities regarding the democratic accountability of agencies.

First, as concerns the ESAs, the democratic accountability frameworks have been reinforced on the occasion of the 2019 ESAs review. Nevertheless, the existing obligations are limited to the bodies and agencies at the EU level and do not cover National Competent Authorities whose democratic accountability is governed by national law.

Admittedly, Level 1 and Level 2 texts strongly influence the ESAs’ preparatory tasks (Regulatory Technical Standards and Implementing Technical Standards) as well as their coordination functions (soft law measures). And Level 1 and Level 2 texts are indeed elaborated in the course of decision-making procedures, in which the democratically accountable Commission as well as both branches of the Union legislator or Member States are involved. Yet, complexities remain in the whole policy domain owing to the strong influence played by international standards, such as those elaborated in the framework of the Basel Committee on Banking Supervision, where democratic control is rather limited.

This notwithstanding, because soft law measures such as guidelines are not as technical and as insignificant as it could seem as is visible from their content and their perception of financial institutions, the issue of the democratic control over the ESAs remains.

Second, the situation is, however, quite different for the SRB (and the ECB in its supervisory capacity). Original and comparatively strong democratic accountability mechanisms which provide for the involvement of the Council (Eurogroup for the ECB) and the European Parliament, as well as the Commission in this SRB’s case have been put in place. The involvement of national parliament is also possible, bearing in mind the potential impact that resolution actions may have on public finances.

The Agencies of the European Union: legal Issues and Challenges

Third, practice shows that national parliaments have made scarce use of their right to be involved. This result needs not necessarily be assessed negatively though as there have been only few cases of banking crises and even fewer resolution cases since the creation of the Banking Union and as parliamentarians’ willingness to use their prerogatives may well be influenced by national traditions as well. Their closer involvement in the future could, however, further evolve especially in the area of supervision, should supervisory issues arise.

7. Conclusion: Viability of the New Mode of Governance

The complex institutional architecture that has resulted from the creation of numerous agencies in the financial domain presents no few challenges, as it also entails numerous advantages. As complexities grew, so did novel mechanisms to involve agencies, such as the ESAs, in the preparation of level 2 rules and other soft-law measures. Moreover, in strictly circumscribed situations, agencies, such as ESMA, may intervene and adopt temporary acts of general application, or agencies have an important role in the preparation of decisions endorsed by Union institutions, as is the case in banking resolution by the SRB. The soon-expected creation of AMLA may lead to new challenges, as the new agency will likely borrow features from the ESAs and will need to coordinate closely with the ECB’ Supervisory Board and other supervisory authorities. Against this backdrop, one could wonder whether this new mode of governance as it has developed since the Great Financial Crisis is viable. Based on existing experience with these agencies and the litigation they were involved in, the existing constitutional framework has demonstrated remarkable resilience and flexibility in accommodating agencification. Thus, the question of viability should be answered in the affirmative and it is safe to say that we have not yet seen the end of agencification in the EU.

Jonathan Bauerschmidt, Dr. iur., is Member of the Legal Service, Council of the European Union and Visiting Professor at Université catholique de Louvain. The views expressed by the author are strictly personal and do not engage the institution for which he works.

Diane Fromage is Professor of European Law and Deputy Director of the Salzburg Centre of European Union Studies, University of Salzburg and Affiliated researcher at Sciences Po Law School, Paris.

SUGGESTED CITATION: Bauerschmidt, J. and Fromage, D.: ‘EU Agencies and Financial Regulation: the proliferation of a new mode of governance’, EU Law Live, 9/10/2013, https://eulawlive.com/op-ed-eu-agencies-and-financial-regulation-the-proliferation-of-a-new-modeof-governance-by-jonathan-bauerschmidt-and-diane-fromage/

The Contribution of EU Agencies to managing the COVID-19 Pandemic: a polycentric Approach to public Health

Ruben Della Pia and Mariolina Eliantonio

1. Introduction

The global impact of the COVID-19 pandemic was profound, wreaking havoc on economies, societies, and lifestyles worldwide. Due to its wide-ranging effects on multiple sectors, it required a cooperative cross-sectoral approach extending beyond national boundaries. After a first phase, characterised by inward-focused national policies, horizontal and vertical cooperation eventually emerged among Member States and between the EU and its Member States. In this evolving scenario, the EU gradually assumed a leading role, also thanks to the actions undertaken by EU Agencies. The latter assumed distinct responsibilities in addressing the pandemic, each following its specific role, yet all driven by the overarching goal of improving public health.

Public health, defined as ‘the art and science of preventing disease, prolonging life, and promoting health through organised societal efforts’, was formulated by  Acheson in 1998, building upon  Winslow ’s 1920 definition. Today, it is acknowledged that public health, in its effort to enhance the health and well-being of individuals and populations, is influenced by a diverse array of factors collectively referred to as determinants of health. These determinants encompass socio-economic, environmental, health system, commercial, and individual factors. With this definition in mind, this post shall examine the agencies’ roles during the pandemic, extending our focus beyond the core context of health.

Some agencies were primarily concerned with the SAR-CoV-2 spread, monitoring, understanding, and strategies for containment and eradication. These agencies include the  ECDC,  EFSA ,  ECHA ,  EUOSHA ,  ERA ,  EASA , and  EMA . Some other agencies were tasked with comprehending the pandemic’s repercussions on the population and the economies of Member States and how to deal with it. The  FRA ,  EIGE,  Eurofound,  ELA ,  Eurojust,  Europol,  EMCDDA ,  EBA ,  EIOPA and  ESMA can be found in the latter group.

2. Confronting the pandemic head-on

2.1. Understanding SARS-CoV-2

Above all, the successful implementation of public health policies to address emergencies like the COVID-19 pandemic necessitates establishing a robust and reliable monitoring and surveillance system. This vital role was carried out by the ECDC, which ensured the coordination of scientific guidance between the EU and national risk assessors throughout the pandemic. The Agency persistently collected, compared, and dispensed  surveillance outputs and epidemiological and microbiological analyses. This data has been published in multiple formats, including the Rapid Risk Assessments, which hugely supported the Member States and the Commission by providing an appropriate summary of the ongoing health threat and suggesting countermeasures. Additionally, it provided guidance regarding the persistence of the virus in the environment and offered suggestions for cleaning procedures in both healthcare and non-healthcare environments.

The Agencies of the European Union: legal Issues and Challenges

The EFSA collaborated with the ECDC to assess the health risks of the coronavirus in animals. This was done, inter alia, by publishing a  scientific opinion addressing various aspects, including the susceptibility of different animal species to SARS-CoV-2, the associated risks to both animal and public health, and strategies for monitoring, prevention, and control. This information helped EU risk managers adapt monitoring systems for different  animal categories. Additionally, they investigated the role of food in virus transmission but found no evidence supporting it as a source or transmission route.

2.2. Living alongside SARS-CoV-2 while striving for eradication

Once the transmission methods were understood, attention shifted to weathering the virus to minimise its spread while long-term solutions were explored and readied for implementation. In this context, several EU entities contributed, ranging from DG-HERA and the European Civil Protection Mechanism (ECPM), which were involved in sourcing and distributing medical countermeasures, to ECHA and EU-OSHA, respectively, responsible for overseeing the safe production and distribution of disinfectants and ensuring workplace safety and health. Additionally, EMA played a pivotal role in ‘overseeing’ the development and approval of COVID-19 vaccines and pharmaceuticals COVID-19 related.

ECHA partnered with the Commission to alleviate disinfectant shortages. They ensured compliance with ECDC guidelines for disinfection in enclosed spaces by extending deadlines for chemical companies, simplifying biocidal product authorisation, and expanding the list of approved active disinfectant substances, ensuring the practicality of ECDC guidelines for disinfection in enclosed spaces. However, these relaxations allowed companies to exploit the situation by importing unsafe disinfectants. To address this issue, ECHA and the Commission collaborated to create guidance on essential criteria for  effective antiviral substances. ECHA and the European Anti-Fraud Office bolstered this cause by sharing pertinent information gathered during inquiries conducted amidst the pandemic.

The next critical step was the safe management of workplaces and transportation facilities. Drawing upon assessments from the ECDC, the EU-OSHA, ERA, and EASA collaboratively crafted guidelines tailored to their respective areas of expertise.  EU-OSHA developed guidelines and strategies addressing occupational safety and health by providing recommendations regarding risk assessment and appropriate precautions, reducing exposure to infectious diseases, utilising PPE, and developing/revising crisis contingency plans for future shutdown and startup scenarios. It  partnered with the ECDC, contributing insights to integrating rapid antigen detection within workplace settings, including self-testing RAT.  ERA and  EASA specifically signed protocols with the ECDC to customise ECDC guidelines for the  railwayand  aviation sectors. Their objective was to implement measures that would enable operations to proceed as close to normal as possible while maintaining a high level of safety.

Simultaneously, EMA had been collaborating with pharmaceutical companies to pursue remedies to tackle the pandemic, focusing primarily on vaccines as the only viable approach to eradicate the virus. The EMA was pivotal in the Commission’s  EU strategy for COVID-19 vaccines. It ensured vaccine quality, safety, and efficacy via the  Conditional Marketing Authorization process. The process provided a substantial advantage to Member States in their battle against the pandemic, as it significantly reduced the time needed for vaccine authorisation, enabling swift responses to the pandemic. A key element was the  rolling reviews, which allowed the Agency to assess data for promising medicinal products or vaccines as soon as they became available instead of waiting until all trials were concluded.

The process was complemented by an integrated system for monitoring the safety and efficacy of COVID-19 vaccines during the post-approval phase. These included the sponsor’s pharmacovigilance activities, the independent data collection and analysis conducted by national competent authorities, and the collaborative efforts of the ECDC and the EMA. In collaboration with the pharmaceutical industry and the Member States, the EMA implemented a fast-track monitoring system to anticipate drug shortages.  This system strengthened the single point of contact for national medicine agencies

The Agencies of the European Union: legal Issues and Challenges

(SPOC) and introduced a single industry point of contact (i-SPOC). By utilising the i-SPOC system, pharmaceutical companies could directly inform the Agency about any concerns regarding the accessibility of vital medicines against SARS-CoV-2. Simultaneously, they could maintain their reporting obligations to their respective Member States.

3. Dealing with the consequences of the pandemic

Public health is influenced by factors such as income, employment, and social support networks, which the pandemic has significantly impacted. EU agencies have also played an active role in collecting essential data, empowering European and national institutions to address these challenges effectively.

Eurofound, specialising in working and living conditions, published reports,  some in collaboration with the ECDC, highlighting the  pandemic’s severe impact. It emphasised how young people and women experienced reduced wellbeing, worsened work-life balance, and historic lows in mental health, increasing the risk of depression. Existing inequalities were amplified, and trust in national governments declined, increasing vaccine hesitancy. Rising living costs added to the  uncertainty many European workers faced. The EIGE backed up these findings, which conducted a gender-based evaluation when assessing the socio-economic impact of COVID-19. It focused on specific occupational sectors, such as essential and healthcare workers, vulnerable workers, and domestic workers. Cepol took notice of the rise in gender-based violence, analysing the need for operational training on domestic violence and child abuse due to the COVID-19 lockdown.

Containment measures imposed by Member States to combat the pandemic had adverse consequences, impacting individual rights and fundamental freedoms. The FRA collected and analysed data to evaluate how these measures affected people’s rights and confirmed once more that the pandemic worsened existing challenges and inequalities

Social distancing and confinement also increased teleworking, affecting cross-border workers. This raised concerns for workers in one Member State but working in another and those operating across multiple Member States. In this context, ELA assessed measures taken by  Member States to support teleworking employees, collaborating with local labour inspectors for effective implementation of labour mobility.

Several other EU agencies collected information and took action by providing guidance and recommendations, particularly in finance, security, and justice. The banking, insurance, pension, and securities sectors all felt the impact of the COVID-19 pandemic and the measures adopted by Member States to address its economic repercussions, including measures concerning payment moratoriums to assist borrowers in managing short-term operational and liquidity issues. In this regard, the EBA issued guidelines, including clarifications on which legislative and non-legislative payment moratoria would not trigger forbearance classification and the definition of default in distressed restructuring cases. Moreover, the EBA ensured data accuracy in banks’ internal models, considering the potential challenges arising from intertwined COVID-19 support measures. At last, it published  guidelines demonstrating how flexibility and pragmatism could be applied within the Supervisory Review and Evaluation Process framework.

EIOPA, meanwhile, aimed to preserve the insurance sector’s stability, recognising its importance for business continuity and long-term investments that may contribute to economic recovery. For these reasons, it recommended that insurance companies suspend dividends, share buybacks, and bonuses. In addition, it provided insurers flexibility in supervisory reporting deadlines and public disclosures to alleviate operational challenges during the pandemic, including deadlines for the Holistic Impact Assessment for the 2020 review of Solvency II.

A prominent role was assumed by ESMA, in partnership with National Competent Authorities, as it maintained vigilant supervision of the ongoing effects of the pandemic on EU financial markets. The Authority encouraged participants in

The Agencies of the European Union: legal Issues and Challenges

the financial markets to prepare for implementing their  contingency plans through a set of targeted recommendations. ESMA carried out a crucial advisory role vis-à-vis national competent authorities recommending supervisory forbearance Moreover, it urged issuers to meet  transparency and  disclosure requirements concerning their financial statements and positions.

Another outcome of the pandemic dealt with by EU agencies has been pandemic-related crimes.  Eurojust worked closely with national authorities to combat COVID-19-related crimes, preventing a fraud scheme involving counterfeit facemasks.  Europol also played a role in countering the distribution of counterfeit protective equipment, pharmaceuticals, and fake COVID-19 tests and vaccines. Cybercrime surged as more people relied on online services, with  Eurojust supporting authorities in addressing ransomware attacks on critical IT infrastructure. Drug production and trafficking have displayed remarkable adaptability in response to the pandemic. EMCDDA noted that while the restrictions imposed due to the pandemic did  not significantly disrupt the drug supply chain, they did drive the  retail market into the digital realm, prompting an increased adoption of innovative technologies to streamline the distribution of drugs. This prompted calls for greater integration and the use of digital technologies.

4. Conclusion: EU Agencies as the ‘rising stars’ in EU administrative governance

Three key insights emerge from this overview of the agencies’ activities amid the COVID-19 pandemic.

First, in contrast to the relatively contained 2009 pandemic episode, the advent of SARS-CoV-2 firmly solidified EU agencies, and the ECDC in particular, as central players in health crisis management. This assertion is underscored by its numerous new partnerships, from Memoranda of Understanding with the EASA , Mexico, the United Kingdom, and South Korea to collaborations with the  WHO and the  African Union. Second, it propelled the expansion of the  EMA and the ECDC mandate, with others currently under consideration for similar growth. This picture aligns with the pattern of crisis- establishment/reinforcement of the EU Agencies in the past.

Moreover, the wide range of actions undertaken show EU Agencies’ capability to effectively manage critical situations comprehensively, providing valuable insights to their ‘peers’ and other institutional stakeholders throughout the entire duration of these challenges, spanning various perspectives.

Equally noteworthy is the increasingly prominent role these bodies are assuming. Their function as a systemic force, either substituting, collaborating with, or complementing the efforts of Member States in executing EU laws, policies, and guidelines, reinforces the concept that an  alternative or complementary European governance framework to the Community Method is steadily maturing.

Ruben Della Pia is PhD researcher at the University of Pisa and Maastricht University.

Mariolina Eliantonio is Full Professor of European and Comparative Administrative Law and Procedure at Maastricht University.

Della Pia, R. and Eliantonio, M., ‘The Contribution of EU Agencies to Managing the COVID-19 Pandemic: a Polycentric approach to Public Health’, EU Law Live, 12/10/2023, https://eulawlive.com/op-ed-the-contribution-of-eu-agencies-to-managing-the-covid-19-pandemic-apolycentric-approach-to-public-health-by-ruben-della-pia-and-mariolina-eliantonio/.

Unchecked Action of AFSJ Agencies: an Issue for Delegation of Powers

Annalisa Volpato

The responsibility of EU agencies for fundamental rights violations has become an important issue in relation to agencification, especially in the Area of Freedom, Security and Justice (AFSJ). Beyond the implications for the system of fundamental rights protection in the EU, the recent legislative and judicial developments raise significant questions also from the perspective of the delegation of powers to these agencies and their limits.

Strengthened powers of AFSJ agencies

The relevance of AFSJ agencies –namely, Europol; the European Union Agency for Law Enforcement Training (CEPOL); Eurojust; the EU Fundamental Rights Agency (FRA); the European Monitoring Centre for Drugs and Drug Addiction (EMCDDA); the European Border and Coast Guard Agency (Frontex); the EU Agency for Asylum (EUAA); and the EU Agency for the Operational Management of Large-Scale IT Systems in the AFSJ (eu-LISA) – has been significantly increasing in the last years. From the 2019  reform of Frontex to the recent transformation of EMCDDA and EASO respectively into the  European Union Drugs Agency and the  European Union Agency for Asylum, their mandate has been strengthened and their operational powers extended, in an area which is substantially far from the technical and scientific areas where the initial instances of agencification arose.

Remarkably, these strong empowerments of AFSJ agencies were often met with growing concerns about the possible violations of fundamental rights and the inadequacy of the control mechanism to avoid them. The most discussed case is undoubtedly the alleged violations of the principle of non-refoulement and the right to asylum in return operations carried out jointly by Frontex and national authorities, which has been denounced not only by  reporters and  NGOs committed to fundamental rights protection, but also by EU authorities which concur to the accountability of EU agencies. In particular, Frontex’s activities have been the object of inquiries by  OLAF, by the European Court of Auditors, by the European Ombudsman, and, recently, of a much criticised judgment of the General Court (Case T-600/21, WS and Others v Frontex). But potentially problematic for the protection of fundamental rights are also the activities of Europol, Eurojust and eu-LISA as concerns the right to the protection of personal data. In particular, the amendment of the Europol Regulation has been  criticised, and even  challenged, by the European Data Protection Supervisor (EDPS) for its weaking of data protection supervision, while a case has been recently decided by the General Court on a violation of data protection occurred during the technical assistance of Europol to an operation of the Slovak police (Case T-528/20, Kočner v Europol; the case is currently under appeal).

Both the abovementioned judicial cases –  WS and Others v Frontex and  Kočner v Europol –  were actions for damages based on Article 268 TFEU. Both concerned violations of fundamental rights occurred in situations of shared enforcement involving AFSJ agencies and national authorities. Both failed for the difficulty, in such situations, to establish a causal link between the conduct and the damage since the attribution of the unlawful conduct to the agency was uncertain (in  Kočner v Europol) or indirect (WS and Others v Frontex). Both cases have been critically analysed, for  WS and Others v Frontex, from the crucial perspective of fundamental rights protection in a multi-layered legal system (here,  here,  here and  here) and, for  Kočner v Europol, from the perspective of joint and several liability (in particular, the Opinion of Advocate General Rantos was analysed here). For the purposes of this Symposium, however,

The Agencies of the European Union: legal Issues

and Challenges

it is worth taking the opportunity offered by these recent judgments to reflect on their implications for the phenomenon of agencification in the AFSJ and, more in general, in the EU.

Exposing blind spots in EU agencies activities

Clearly, these judgments are tangible signs of the paradigm shift of AFSJ towards agencification and shared administration. It is the strengthening of AFSJ agencies’ powers and their involvement in operational activities on the ground which made more probable (but not inevitable) for them to incur in fundamental rights violations and to stand before the Court in cases such as the ones mentioned. In this sense, the pronouncement of these judgments exposes the governance model of agencification as a victim of its own success in the AFSJ.

Moreover, they expose a type of activity of EU agencies which, although not completely new, has often been underrated –if not neglected– in agencification literature (and EU administrative law literature in general, with few  exceptions): physical acts or factual conduct. Operational support or administrative cooperation do not often result in formal acts, but instead qualify as a factual conduct of EU administration. As such, factual conduct is not endowed with legal effects, but may give rise to compensation rights if unlawful. If notable exceptions exist precisely in relation to the empowerment of Frontex (see Melanie Flink’s article), the bulk of general studies on the classification or conceptualisation of EU agencies focuses precisely on the legal effects of EU agencies’ acts (eg. whether their decisions are legally binding or not, of general or individual application), whereas limited attention is devoted to operational powers of these bodies. Also the limits to the empowerment of EU agencies were established in the case law in relation to  decisions adopted by EU agencies, and not physical acts.

Previous  research has pointed out the accountability gaps in the judicial control of factual conduct, which are felt in a particularly acute manner after WS and Others v Frontex. Historically, it would not be the first time AFSJ agencies fall in a blind spot of judicial review. Being part of the Third Pillar, these agencies remained outside judicial scrutiny longer than agencies active in other policy fields. While in  Sogelma v European Agency for Reconstruction  (case  T-411/06) the Court had ruled for the admissibility of the annulment of EU agencies’ acts in the name of the EU being a community based on the rule of law (by analogy with Les Verts), in Spain v Eurojust(case C-160/03) the Court still refused to take such an principled step in relation to Eurojust. It is only with the Lisbon Treaty –and the abolition of the pillar structure– that also AFSJ agencies fell under the jurisdiction of the Court of Justice according to Article 263 TFEU. Clearly, while the exclusion of AFSJ agencies was then based on primary law, this is not the case anymore. Although Article 268 TFEU curiously does not expressly mention EU agencies, it settled case law that it includes any EU body. However, several gaps were identified in relation to the practical difficulty of attributing the conduct in joint operations, only partially specific to EU agencies, as well as to the existing uncertainties in the case law on essential notions of EU liability.

Open questions on delegation of operational powers

These gaps arguably emerged in  WS and Others v Frontex and  Kočner v Europol.  Should the restrictive approach of the General Court be confirmed in appeal, we will be left to wonder what these accountability gaps would mean for the legitimacy of EU agencies. After all, for EU agencies judicial accountability is an important tenet not only for the compliance with the right to effective judicial protection under Article 47 Chater and the general principle of the rule of law, but also because one of the conditions for a lawful delegation of powers (even after the erosion of the Meroni doctrine) is precisely that their powers remain “amenable to judicial review” (Case  C-270/12, Short Selling). But how should this requirement be understood in the absence of a legal measure to ‘bring’ before a judge? Does this requirement of judicial review extend also to factual conducts?

The Agencies of the European Union: legal Issues and Challenges

Although not endowed with legal effects  per se, physical acts are still acts which entail some voluntary change in the physical world by generating some factual effects. It is generally considered that, when carried out by a public authority in the exercise of some duty or function provided in law, also these acts constitute a form of exercise of public power which, in the case of EU agencies, was vested in them through a delegation of powers. Accordingly, it is arguable that, in case of unlawful conduct, the specific requirement of the  Meroni doctrine demands a judicial remedy. In this understanding, the requirement of ‘judicial review’ is interpreted not literally but teleologically, in the sense of the possibility of judicial control of the exercise of public powers –whatever form these powers may take and beyond the strict meaning of ‘review’. However, does the remedy provided by an action for liability actually fulfil this requirement? The specific purpose of this action for liability is to make good of damages and, although the unlawfulness is one of the conditions for liability, it is not always ascertained by the court, like in  WS and Others v Frontex.  Is this sufficient to comply with the requirement or does this mean that the exercise of operational tasks by AFSJ agencies escapes the judicial review required by the  Meroni doctrine? More in general, to what extent does the  Meroni requirement of judicial control then differ from the right to an effective remedy and the general need for a complete system of judicial protection for individuals, based on the rule of law?

Considering the difficulties in bringing these questions to the Court, especially for non-privileged applicants, it is doubtful that the legality of the AFSJ agencies’ empowerment will ever be questioned in this respect and, in the light of the Court’s approach vis-à-vis agencification, that these arguments would be sufficient for the Court to consider the delegation of operational powers unlawful. Yet, the judicial control of AFSJ agencies’ factual conducts, so fraught with obstacles, reveals once again the uncertainties of the  Meroni doctrine and the need for more scholarly research on the conceptualisation of administrative factual conduct, especially of EU agencies.

Annalisa Volpato is assistant professor at the Università degli Studi di Padova. She authored the volume “Delegation of Powers in the EU Legal System” (Routledge, 2022).

SUGGESTED CITATION: Volpato, A.: ‘Unchecked action of AFSJ agencies: an issue for delegation of powers’, EU Law Live, 18/10/2023, https://eulawlive.com/op-ed-unchecked-action-of-afsj-agencies-an-issue-for-delegation-of-powers-by-annalisa-volpato/

Selecting the Seat of EU Agencies – one Year after the Judgments of the Court of Justice

Tomáš Buchta

Introduction

Selecting the seat of an EU agency has always been a challenging task involving the determination of the objective criteria, launching the call for applications, the evaluation of individual offers and the decision locating the agency itself. From the legal perspective, the decisions determining the seat of EU agencies have been enshrined both in the EU legal acts establishing the agency, and in the decisions of the Representatives of the Governments of the Member States. The practice of selecting the seats of EU agencies by the decisions of the Representatives of the Governments of the Member States has been challenged at the Court of Justice with respect to the location of two EU agencies – the European Medicine Agency and the European Labour Authority. Consequently, the Court had an opportunity to assess the legality of the procedure whereby the seat is chosen as a part of intergovernmental decision-making.

The judgments

The three judgments in five cases (Joined Cases  C-59/18, Italy v Council and   C-182/18, Commune di Milano v Council, Joined Cases   C-106/19, Italy v Council and Parliament and  C-232/19, Commune di Milano v Parliament and Council  C-743/19, Parliament v Council) from 14 July 2022 meant a clarification of the powers of the Member States and the EU institutions to determine the seat of EU agencies. The Court maintained its established case-law and confirmed that it has jurisdiction to review only the acts of EU institutions, bodies, offices and agencies, but it does not have jurisdiction to review the legality of the decisions of the Representatives of the Governments of the Member States  C-59/18 and C-182/18, para. 61,  C-743/19, para. 37). In order to ensure that the decision at stake does not represent a hidden decision of an EU institution, the Court proceeded with the verification of the question who has the competence to determine the seat of an EU agency (C-59/18 and C-182/18, para. 62, C-743/19, para. 38).

The Court ruled that Article 341 TFEU, which enables the Member States to determine the seats of EU institutions, does not cover the selection of the seat of EU agencies (C-59/18 and C-182/18, para. 69–97,  C-743/19, para. 45–73). To this effect, the Court applied the literal interpretation of Article 341 TFEU and distinguished it from the other Treaty provisions, in particular, from Articles 340 and 342 TFEU, which also refer to EU institutions, albeit in the Court’s view, in a different context (C-59/18 and C-182/18, para. 77–81, C-743/19, para. 49–53). The decisions of the Representatives of the Governments of the Member States, which have been used to determine the seats of EU agencies have been qualified by the Court as being deprived of any legal effects under EU law (C-59/18 and C-182/18, para. 106–114, C-743/19, para. 83–92). Consequently, the Court decided that the only way to determine the seat of EU agency is by an EU legislative act.

Comments

I have criticised the judgments previously regarding the problematic judicial interpretation of Article 341 TFEU. The first surprising element of the judgment is the lack of any reference to the  travaux préparatoires of Article 341. During the recent years the Court  took more account of the preparatory works of the individual provisions when interpreting the primary law. Cases like  Pringle or  Wightman confirm this approach of the Court. However, in the cases at hand the

The Agencies of the European Union: legal Issues and Challenges

Court simply notes that Article 341 has remained practically unchanged from its introduction as Article 216 of the EEC Treaty, without drawing any implications from this for answering the question whether this supports a static or rather a dynamic interpretation of this provision. Given the importance of Article 341 as a horizontal provision providing a legal certainty to employees of EU institutions one would have expected a more elaborated approach regarding the intentions of the authors of this clause.

Moreover, the author still maintains the view that the conclusion of the Court stating that Article 341 TFEU has the purpose of only establishing the seats of EU institutions is problematic. This interpretation is not taking into account the fact that the only way to establish or to amend the seat of an EU institution enshrined in the Protocol No 6 is the ordinary revision procedure. Should the Member States come to the conclusion that they formally wish to determine the seat of the European Council (the only institution without established seat), or to amend the seat of any existing institution, the adoption of only a decision of the Representatives of the Governments of the Member States based on Article 341 TFEU is not sufficient in this respect. In order to embed the seat of the European Council into Protocol 6, or to amend the seat of an existing institution the Member States must follow the ordinary revision procedure enshrined in Article 48 TEU. The use of simplified revision procedures provided in the same provision is not possible, as Protocol 6 is not placed under part Three TFEU as required by para Article 48 para 6 and does not relate to the voting arrangements as provided by para 7. Consequently, the Court has not clarified the interplay between Article 341 TFEU and the ordinary revision procedure embedded in Article 48 TEU for the purposes of establishing or amending the seat of EU institution. Moreover, nothing prevented the Court from using similar wide interpretation of the concept of EU institutions enshrined in Article 341 TFEU as in Articles 340 and 342 TFEU. This means that the explanation of the purpose of Article 341 TFEU provided by the Court as related exclusively to the determination of the seat of EU institution is problematic.

According to  some views the involvement of the European Parliament (‘EP’) will make the process more democratic and transparent. This institution should be certainly involved into the process of adoption of rules of general application. The EP is a legislative body directly elected by the EU citizens and has a democratic legitimacy to adopt general rules enshrined in EU legislation. However, the situation is different with respect to decisions having an individual nature. In this regard,  another major objection was related to the individual nature of the decision stipulating the seat of EU agency, which is in my view not fit for an adoption by a general legislative process. In particular, the preference for a specific city may impact the traditional divisions in the EP along the political fractions and transforming them into divisions along the national lines. This may to a large extent distort the legislative process and complicate the creation of a coherent position of the EP to both general provisions of the legislative proposal and the provision determining the seat of the agency.

Moreover, the judgments imply the need to resolve the situation of those agencies which have their seat mentioned only in the decisions of the Representatives of the Governments of the Member States. Given the conclusion of the Court that these acts are deprived of any legal effects under EU law, and pursuing the goal of providing a legal certainty for employees of these agencies, the establishing legislative acts should be amended. This amendment can have a form of a simple provision determining the seat of the agency but may be also covered by a revision of the legislative act envisaged by the final provisions. So far, I am not aware of any proposal that should align the existing legislative acts with the judgments.

The Agencies of the European Union: legal Issues and Challenges

What next?

Currently there are two pending legislative procedures, where the seat of an EU agency is at stake. The first agency to be impacted by the judgments is the Anti-Money Laundering Authority (AMLA). More than one year after the judgment, little is publicly known regarding the course of the proceedings. In any case it seems that the Council recognises the practical difficulties related to the implementation of the judgments. In April 2023 it approved a letter to the Commission where it asked this institution to act as an honest broker and to assist the Council in the preparation of objective criteria that could be subsequently agreed by the EU co-legislators. At the time of finishing this paper the Commission launched a call for applications for AMLA seat. This represents an important step towards selecting the seat and subsequently to close to legislative file as a whole. However, how the EP decides to seize the process of selection of the seat remains only to be seen.

The second agency seat affected by the judgments is the EU Centre on Child Sexual Abuse, where the Commission proposed the Hague as the seat of the agency. According to the  available documents the EP  is asking the alignment of the proposal with the case law of the Court of Justice. In particular, the EP requests to replace the reference to The Hague by insertion of general criteria, leaving the mention of a specific city empty. It is obvious that the EP started using the prerogatives stemming from the judgment, consequently impacting the overall decision-making process related to the establishment of the new agencies.

Consequently, more than one year after the judgments, their impact on the selection process of the seat of EU agencies is obvious. Bearing in mind the importance of both envisaged agencies, the question arises whether the co-legislators will be able to achieve an agreement on the modalities of functioning and the seat by the end of the EP legislative term in 2025. Given the latest developments related to the selection of the AMLA seat, in particular the launch of the call for applications, there are signs of important progress in the process of selecting the seat of this agency. Given the time needed to ensure a fair competition between individual offers and their evaluation, this goal remains challenging, but at the same time achievable.

Tomáš Buchta is Legal Adviser, Permanent Representation of the Slovak Republic to the EU. The views expressed in this Op-ed are only those of the author and do not represent an official position of any institution.

SUGGESTED CITATION: Buchta, T.: ‘Selecting the seat of EU agencies – one year after the judgments of the Court of Justice’, EU Law Live, 23/10/2023, https://eulawlive.com/op-ed-selecting-the-seat-of-eu-agencies-one-year-after-the-judgments-of-the-court-of-justice-by-tomasbuchta/

EU decentralised Agencies Engagement with European non-Member States

Marko Milenković

EU decentralised agencies have become an essential feature of the EU governance, working on implementation of the Union law and providing a necessary expertise in regulatory process across the Union competences. They remain largely in constitutional terra incognita opening a numerous legal challenges as contributions to this Symposium attest.  No other institutions or bodies of the Union have become so important for the regulatory governance in the EU, while providing opportunity for (almost full) participation of non-Member States. As agencies roles increased over time, so did  external engagements and as it was argued ‘in order to do so, the agencies enter into more or less binding arrangements of a sometimes not entirely well- established legal nature’. There is an increasing interest in the scholarship on the participation of third countries in EU agencies and sectoral bodies. This Op-Ed concentrates on the engagement with, and participation in, European non- EU Member States with the EU decentralised agencies and the potential they have as channels for Europeanisation and acquis transfer, especially for the EU candidate countries.

Categories of third European countries engaging with the EU decentralised agencies and legal basis for their engagement

We can distinguish between different categories of European countries that already have or are stepping up their engagement with the EU agencies. Firstly, members of European Free Trade Agreement (EFTA), three of which are parties to the European Economic Area –Norway, Iceland and Lichtenstein, together with the fourth EFTA member Switzerland. These represent a group of highly developed European nations intentionally choosing not to become EU Member States, but still profoundly integrated with the EU and aligned with its  acquis. EEA countries have most comprehensive relations with the EU agencies. After leaving the EU, the post-Brexit United Kingdom is now no longer a part of EU agencies it used to be.  In words of  Kaeding , the country has ‘moved from a decisive and respected EU decision maker during 47 years of full EU membership in all EU agencies to one of many rule takers with the status of “just another third country”’. Following is the group of European countries that were offered prospects of the EU membership – candidates and potential candidates. These include decade long prospective candidate Turkey as well as Western Balkan States. Engagement of the  EU agencies with the Eastern Neighbourhood countries got a completely different tone as of 2022 after Ukraine and Moldova became candidate countries as well as Georgia a potential candidate, moving them from regular association partnership closer to status of candidate countries.

The legal basis for third country membership in agencies as well as participation in agencies’ activities and programmes is multifold. Participation is regularly governed by the establishing acts of the respective agencies. A number of founding regulations of the EU agencies contains the standardised provision: ‘agency shall be open to the participation of third countries which have concluded agreements with the EU which provide for the adoption and application by these countries of Community law in the area covered by the basic act. Under these agreements, arrangements shall be made specifying, in particular, the nature and the manner in which these countries will participate in the agency’s work, including provisions on participation in certain internal bodies, financial contributions and employment of staff.’ For countries with highest degree of involvement it is based on the EEA Agreement and decisions of the EEA Joint Committee. Furthermore, participation of individual EFTA States in several other EU agencies is provided by the bilateral

The Agencies of the European Union: legal Issues and Challenges

agreements with the EU. Such is also the case with Turkish membership in the European Environmental Agency (EEA) and European Monitoring Centre for Drugs and Drug Addiction (EMCDDA). The engagement of candidate countries with the EU decentralised agencies  is based on the  1997 Luxembourg Council presidency conclusions stipulating that agencies in which applicant countries will be able to participate will be determined on a case-by-case basis. This has led to the engagement of all potential candidates with various EU agencies, which helped them over the past 25 years to better acquaint with the acquis as they are preparing for prospective membership.

Types of engagement between EU agencies and third countries

There are various examples of third country participation and/or engagement with EU agencies. Motivations of the EU and third countries for these involvements are also multifold. As Chamon, Hofmann and Vos have  argued, the activities of agencies on the international stage ‘involves a variety of actions that are closely linked with their mandate and powers in their respective founding regulations’, that range from training, sharing know-how and capacity-building activities, to the development of common procedures, to exchange of information and joint operations in setting standards.

Lavenex has outlined two main rationales for engagement of agencies with  third countries: a foreign policy rationale and a sector specific interdependence  logic. The first one assumes agencies acting more politically and supporting EU foreign policy agenda and promoting EU values. The second is more in service of sectoral cooperation in various regulatory areas. As Shyrokykh and Rimkutė note, ‘third countries’ involvement in the operations of EU agencies is often perceived as a technocratic form of integration into the EU, a sort of de facto technocratic membership’. Based on  Rimkutė and Shyrokykh it is possible to distinguish between special bilateral agreements and ad hoc arrangements between agencies and candidates. Many times there are both, as our examination of engagement with Turkey and Western Balkans attest.

Countries of EFTA EEA are as outlined by  Bekkedal ‘the only non-EU States that have been allowed, on a regular basis, to participate in the work of EU agencies governing the internal market.’ They are now  engaged with 19 decentralised agencies as members or observers. Membership of these countries does enable them to participate in management boards and other bodies of the agencies, brings the obligation to contribute to the budget of the agencies, but doesn’t entail voting rights reserved for representatives of EU member states, making this type of membership almost full. Similarly, Turkish membership in the environmental agency and EMCDDA also does not entail voting rights. However, this type of engagement does bring European non-members closer to participating in EU governance.  As  outlined by the European Commission 20 years ago when the first prospects of the membership were offered to the Balkans: ‘The EEA countries have demonstrated, participation in Community programmes can also be of benefit to countries that are likely to remain associated countries for a long time or indefinitely…it encourages the exchange of useful experience, especially helpful in cases where a pan-European approach is called for… A similar approach should be taken to the countries of the Western Balkans.’ In our previous work , out of 34 decentralised agencies analysed for the 1999-2021 period, we have found some type of engagement with five candidate countries, often on ad hoc basis but sometimes more stable and structured, for 23 agencies.

Ways forward – EU agencies as channels of Europeanisation and acquis transfer in absence of the EU membership?

European Union is currently in an important moment as it simultaneously reconsiders its governance and enlargement. This process might shape its governing structures for decades to come. It is most likely that important part of that future will be EU agencies. Even though they have been around for more than 30 years, agencies still remain both theoretical and practical challenge in the EU constitutional landscape. Their engagement with and participation of third countries in their work presents both a challenge and opportunity. Decentralised agencies are ‘more autonomous than core EU bodies’ offering potentially  ‘more leeway to craft flexible integration arrangements.’ The process of EU enlargement has been

The Agencies of the European Union: legal Issues and Challenges

relatively slow and hampered by numerous factors both on the EU side and among the prospective members. With new candidates (Ukraine and Moldova) the process of enlargement might get new impetus, however it is also gaining greater complexity. As agencies are pivotal for the governance of the EU and its regulatory outreach to partner countries, the question arises whether structured and formalised participation of candidate candidates in EU agencies present a meaningful and sustainable alternative to EU membership in the decade(s) ahead? The answer to this question should definitely be positive, with candidate countries getting more structured opportunities for comprehensive participation and membership in the agencies.

Marko Milenković is a Jean Monnet Fellow at the European University Institute – Robert Schuman Center. He is a Senior research fellow at the Institute of Social Sciences in Belgrade and Affiliated research fellow at the Center for Constitutional Studies and Democratic Development at Johns Hopkins School of Advanced International Studies in Bologna.

SUGGESTED CITATION: Milenković. M; “EU Decentralised Agencies Engagement with European Non-Member States”, EU Law Live, 03/11/2023,  https://eulawlive.com/op-ed-eu-decentralised-agencies-engagement-with-european-non-member-states-by-markomilenkovic/

Quasi-judicial Review in EU Agencies: Opportunities and Challenges

Oana Stefan

No matter if we look at EU’s agencies through an experimentalist governance lens, or from the perspective of the principal/ agent theory, two important conclusions emerge. EU agencies are some sort of work in progress, as we experiment with regulation in complex, highly technical areas; and control, for political scientists, or accountability, for the lawyers, in such evolving landscapes  is tricky to pin down. This is reflected better in the puzzling case law and institutional or regulatory practice regarding the Boards of Appeals of EU agencies (BoAs) which places the latter’s work at various points of a spectrum ranging from a purely administrative to a quasi-judicial character. There are currently 38 EU agencies, eleven of which enjoy such independent internal body tasked with reviewing their decisions (there is one Joint Board of Appeal –JBoA– for the financial agencies). The literature on BoAs is abundant, including a recent monograph, whilst an empirical project aims to create a systematic data base of all their decisions. This contribution limits itself to sketching some of the opportunities and challenges of such review fora.

BoAs: new opportunities for enhanced review

BoAs instil extra accountability channels for the work of EU agencies.  As documented by Krajewski, the BoAs present the opportunity of being more thorough in technical assessment, as well as engaging deeper with the litigants, enhancing the legitimacy of the dispute resolution process. The Court of Justice holds these boards  to very high standards of review. In  Aquind,  the Court found that, in the interest of individual rights protection, BoAs are expected to perform thorough substantive reviews of contested decisions. Since the Court has limited jurisdiction to check agency decisions only with regards to manifest errors of appraisal, misuse of powers, or manifest excess of discretion, the review bodies seem more appropriate for a more comprehensive control including complex technical and economic appraisals. Indeed, research and practice show that Boards are engaging in more sophisticated analysis, suggesting a positive outlook for individual rights.

The BoA system also alleviates to a certain extent the docket of the European Courts, whilst offering specialised ways of redress. This is mentioned in the regulatory framework instituting these BoAs. EASA’s founding Regulation refers to the need for remedies suited to the special character of the field of aviation; ACER’s Regulationmentions procedural economy as a  raison d’etre for the BoA. Procedural reforms of the Court reflect concerns around the case load. In 2019, Article 58a was added in the Statute of the Court of Justice, creating a filtering mechanism for appeals against decisions of the General Cout concerning a decision of an independent BoAs of four EU agencies, or independent BoAs set up after May 2019. Accordingly, such appeals are allowed to proceed by the Court of Justice only in so far as they raise issues which are significant with respect to the unity, consistency, or development of Union law. A current proposal for further reform extends the application of the filtering mechanism to independent BoAs of other agencies existing already in 2019 but not mentioned in the Statute.

The Agencies of the European Union: legal Issues and Challenges

BoAs: ambiguous status and rule of law challenges

In Aquind, the Court of Justice made sweeping statements tagging BoAs of agencies as ‘administrative revision bodies’ which perform ‘quasi-judicial’ functions (para. 59). Such general approach is problematic, as these boards are very different.

Pander Maat and Scholten identify different configurations of organisational and functional independence of BoAs. They have procedures and powers that resemble to a varying degree those of a mini-court. In  Scope Rating , the JBoA was deferent to the ‘margin of appreciation’ to which ESMA was entitled because it did not consider itself to be in ‘functional continuity’ with the Board of Supervisors, similarly to  EASA’s BoA , but unlike  EUIPO’s BoA. Some BoAs have inquisitorial features, such as the EUIPO and CPVO, and have the obligation to  assess all relevant matters of fact and of law, even if a specific grounds of appeal was not brought by the appellants. Yet, other boards, such as that of the ECHA, employ adversarial procedures, and are limited to assess only the issues raised by applicants (as confirmed by the Court  hereand  here). In this context, it is hard to consider that BoAs provide for proper judicial review.  De Lucia warns that the current filtering mechanism of Article 58a of the Statute of the Court of Justice (and implicitly its potential extension) might lead to outcomes contrary to Art. 47 of the Charter of fundamental rights. This is because, already now, very few appeals are, in practice, allowed to proceed. Moreover, not all agencies can bring cases against their BoAs decisions in front of the General Court. Whilst the solution mostly lies with the legislator in strengthening the independence of these bodies, practices of the General Court might need to change, such as that of not admitting new elements of law and fact in appeals.

The remit of BoAs’ powers also varies, which might undermine coherence. For instance, the BoAs of  EUIPO ,  CPVO, and ECHA may exercise any power which lies within the competence of the Agency. However, as observed by Chamon and Volpato, this competence has a different meaning in the case of ECHA, as its BoA can only address points raised by applicants. A  2019 reform limited ACER’s BoA competence to either confirm a decision, or remit the case to the competent body. If the latter is chosen, the BoA ‘is capable of shaping the decisions taken by the Agency in so far as the latter is bound by the statement of reasons of the Board of Appeal’ (T-735/18, 55). Yet, the decision-making procedures by agencies involve rounds of consultations with the stakeholders and structured input from market operators or national competent authorities. Following such processes whilst complying to the letter with the decision of the BoA becomes a rather complex enterprise.

It emerges that some of the challenges of the BoAs system are intrinsic in the sheer variety of these bodies. At the same time, the legislative framework and the organisational infrastructure is not yet allowing to unleash the whole individual rights protection potential of BoAs.  Academics and even  Court members have been actively calling for more control over non-binding, informal instruments, such as the soft law issued copiously by EU agencies. These instruments are not directly reviewable by EU Courts, although they can  be checked indirectly following preliminary references. Yet, BoAs  were not granted the competence to assess agency soft law instruments, although this  was proposed by the European Parliament. Another issue for reform is locus standi. In most of the cases, the Agency Regulations mirror the restrictive pre-Lisbon procedures on direct actions against EU acts in front of the Court of Justice, requiring for direct and individual concern to be satisfied for challenges of decisions which are not addressed to the appellant. As confirmed by decisional practice, BoAs interpret direct and individual concern in the same way these are interpreted by the Court under Article 263 TFEU. Yet, given that some of the challenged Agency decisions might fit the description of regulatory acts, it appears that in certain cases the threshold for standing is more stringent in the front of the BoA than in front of the Court. Far from being of only academic interest, this issue was flagged by a BoA (commentary here), and is currently pending before the General Court. From an organisational infrastructure point of view, requiring high standards of substantive review from all BoAs appears to disregard the fact that resources available to these bodies are not equal. As

The Agencies of the

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documented, the boards of EU financial agencies are very different in the support they get, and lack appropriate registries. At the same time,  ECHA’s BoA enjoys members who are employed full time and have supporting staff. ACER’s BoA has a separate budget line in the budget of the agency, yet this budget is limited to start with, as ACER can only raise fees in relation to certain services it performs whilst relying otherwise on donations and voluntary contributions. It seems thus rather idealistic  to claim that resources are immaterial and that the BoAs should exercise their duties under any circumstances.

A somewhat paradoxical challenge is that the current setting appears sometimes detrimental to procedural economy. An example is HUAT, where the General Court annulled both a BoA decision confirming a decision by ACER and part of a Commission Regulation on which ACER’s decision was based. During all this back and forth from the BoA to the General Court, a bidding auction for a project was launched as required by the contested ACER decision, yet it was abandoned as there was no interest from the market. Lacking both object and legal basis of the contested ACER decision, the resumption of proceedings in front of the BoA appears rather superfluous. Yet, Article 266 TFEU requires the institution whose act has been declared void to take the necessary measures to comply with the judgment of the Court of Justice. Thus, in HUAT, proceedings were relaunched before the BoA, parties were invited to submit observations, which lead to a quite lengthy decision that there was no need to pursue the case.

Stemming from this example, a more general observation is that proceedings before BoAs and subsequent appeals to the General Court take time. Yet, time is of essence in most of the sectors in which EU agencies are active. Add to this sudden crises shifting the very paradigms on which entire sectors are based, and it does not require much imagination to envisage situations in which the BoAs and the Courts decisions on cases lag behind the rapidly evolving regulatory frameworks. This can  challenge principles such as non-retroactivity, as  BoAs are required to conduct their assessment in the light of new legal provisions which were not in force at the time when the contested decision was issued.

Conclusion

This contribution appears to have dedicated a larger word space to the challenges raised by BoAs in the European system of administrative and judicial review. Yet, it is fair to state that the benefits of the BoAs outweigh these challenges, with  Stefan&den Hertog and  Volpato calling for strengthening control of agencies lacking such bodies. Whilst BoAs could prove themselves useful in providing for more effective review of the impressive output of EU agencies, outstanding issues with the design of the system show that compliance with the rule of law is a work in progress. This requires holistic reforms involving, beyond mere extensions of the filtering mechanism at the Court of Justice level, a substantive tweaking of the rules with regards to the independence, composition, procedures, and powers of the BoAs themselves.

Dr Oana Stefan is Reader (Associate Professor) in European Law at King’s College London. She has taught amongst others at Sciences Po Paris, HEC Paris, University College Dublin, the College of Europe, ESSEC and Bocconi Milano and has worked as an advisor for European integration during Romania’s accession. Dr Stefan researches on the European Union, in particular energy, State aid law, soft law and judicial politics. A selection of Dr Stefan’s publications is available here

SUGGESTED CITATION: Stefan, O.; “Quasi-judicial review in EU agencies: opportunities and challenges, EU Law Live, 08/11/2023, https:// eulawlive.com/op-ed-quasi-judicial-review-in-eu-agencies-opportunities-and-challenges-by-oana-stefan/

Science to the People? The Reach of Transparency into EU Agency Science

Marta Morvillo

The past years have seen momentous developments in terms of transparency of EU agency science. The European Food Safety Authority (EFSA) has undergone a  far-reaching reform, following two landmark judgments of the Court of Justice of the European Union (Tweedale and  Hautala) and wide public contestation over the authorisation of the pesticide glyphosate (see here and here). The COVID-19 pandemic put the European Medicines Agency (EMA) in the spotlight, in particular with regard vaccines approval. The Agency reacted with an unprecedented level of disclosure of clinical trial data. These developments have been taking place against the backdrop of growing mistrust in regulatory science, often fueled by concerns over agencies’ independence and the quality of their scientific opinions. What is the role of transparency in a field, such as risk regulation, characterised by high technical complexity? And where do EU agencies stand when it comes to making the scientific studies underpinning their assessments accessible to the public? In this Op-ed, I will articulate four dimensions of transparency in risk regulation and argue that, while in the aftermath of scandals and crises EU agencies seem to have taken a promising path towards proactive transparency, issues of fragmentation and opacity persist.

At the juncture of science and public interest

The scientific studies assessed by EU agencies are located at a critical juncture of the EU’s decision making in the field of risk regulation. The collection and evaluation of scientific data, such as those contained in clinical trials and toxicity studies, lies at the core of the activities EFSA, ECHA, and EMA carry out in the context of registrations and marketing authorisations for products such as  chemicals,  pesticides, and  human medicines. The Agencies’ risk assessments form the basis of the Commission’s risk management measures (e.g. the authorisation or registration of a product or substance).

These procedures entail a strong public interest component, in so far as they aim at ensuring the quality and safety of the products entering the internal market, for humans, animals, and the environment. In this context, it is important to keep in mind that the scientific data on which agencies’ risk assessments are based is  in large part provided by private actors seeking the authorisation or registration of their products. As a result, they often contain information which is claimed to be commercially confidential.

Four dimensions of transparency

What is the role of transparency in this context? First, considering the highly influential yet contested nature of EU agencies’ risk assessments, a high standard of accountability is of the essence, and transparency can play an important role in these respects: by making decision-making processes, including their scientific bases, visible, it is a precondition for effective public scrutiny.

Second, transparency enhances trust. In the landmark  Tweedale  and  Hautala cases, the Court of Justice stated that: ‘by allowing divergences between various points of view to be openly debated, [transparency] also contributes to

The Agencies of the European Union: legal Issues and Challenges

increasing those citizens’ confidence in those institutions’ (para. 75). At a time of mistrust in science, making the scientific evidence underpinning risk management decisions publicly available can therefore play a critical role in fostering citizens’ confidence in the EU’s experts.

Third, the transparency of scientific studies opens up the peer-review process to the scientific community at large. Scientists beyond the experts working at EU agencies can therefore contribute to ensuring the very epistemic quality of the agencies’ risk assessments.

Fourth, transparency is key to the broader goal of open science: by granting wider access to raw data, research protocols and methodologies, it fosters a more inclusive and sustainable scientific process, based on data sharing and avoiding duplication of studies.

Horizontal and sectoral transparency regimes

Transparency is ingrained into the EU legal order at constitutional (Article 11 TEU and Article 15(1) and (3) TFEU) and legislative level. Article 1 of the  Access Regulationestablishes the principle of the ‘widest possible access’ to all documents held and generated by EU institutions and also applies to the scientific studies examined by EU agencies. The Aarhus Regulation sets an even higher transparency standard for environmental information, for which it establishes an overriding public interest in disclosure (Article 6(1)). Both the meaning and the reach of environmental information have been  interpreted broadly by the Court of Justice. Transparency is however not an absolute value. The EU legal framework also provides protection to competing interests that might be hindered by disclosure, such as commercial confidentiality, the administration’s space to think, and personal data (Article 4(2) Access Regulation). These are however exceptions and should be interpreted strictly.

Besides the horizontal rules enshrined in the Access and the Aarhus regulations, the public accessibility of scientific studies is governed by the sectoral rules set out in the  EFSA ,  ECHA , and  EMA founding regulations and transparency policies (here,  here, and  here). These sectoral frameworks have direct implications on the level of transparency enjoyed by the scientific studies, depending on the agency considered: until recently, for example, only the EMA provided for a definition of commercially confidential information.

Proactive transparency

It is precisely these sectoral frameworks that have undergone significant developments in the last few years.

The EMA has been the first pharmaceutical regulator worldwide to publish  clinical trial data. Their publication is now enshrined in the Clinical Trials Regulation. Since 2005, EMA also publishes a Public Assessment Report (EPAR) for each of its authorisation procedures, including information over the product and the Agency’s risk assessment process. The EPAR is published upon conclusion of the procedure and includes a public-friendly overview.

The reform of the General Food Law (GFL) re-designed EFSA’s transparency policy: the agency is now adopting a system of notification of studies, offers pre-submission advice to applicants, and requires applicants to submit two versions of the application dossier, one for immediate disclosure, the other to be checked by the Agency for the presence of commercially or otherwise confidential information (see the ‘new’ Article 38(1) GFL). EFSA’s new transparency policy has been mainstreamed into all the sectoral regulations in the food safety realm and entered into force in 2021.

These developments have been seen as signaling a shift from reactive to proactive transparency. The former is based on requests for access to documents lodged by individuals according to the Access Regulation. Proactive transparency, on the other hand, presupposes the systematic disclosure of scientific data by the agencies, regardless of specific requests.

The Agencies of the European Union: legal Issues and Challenges

In a context of proactive transparency, the comprehensibility of the disclosed information to a non-expert audience becomes of the essence. For transparency not to become a merely performative exercise, it is critical that the new transparency mechanism take communication strategies (e.g. laymen summaries and risk communication more generally) seriously.

Sectoral fragmentation

While the shift towards proactive disclosure is a welcome development, the picture of agency science’s transparency remains a fragmented one. First, this shift has not yet reached the ECHA. Once a pioneer of open and collaborative governance, the Chemicals Agency is currently lagging behind in terms of transparency. Its transparency policy dates back to 2014 and,  as noted by Hickey and Weimer, the REACH regulation does not include the possibility of an overriding public interest in disclosure leaving instead space for presumptions of confidentiality for certain categories of information (see Article 118 REACH).

Second, research shows that even between EFSA and EMA, differences remain on crucial elements such as the meaning and scope of commercially confidential information. Article 39(2) of the GFL contains an exhaustive list of the information for which confidential treatment can be requested, while the EMA still enjoys significant discretion when defining the content of commercial confidentiality. These different degrees of discretion are problematic in so far as they concern a key element in the balance between transparency and confidentiality. While they may be explained with the different regulatory contexts in which the agencies operate, they seem hard to justify in light of the numerous areas in which agencies are required to cooperate, such as antimicrobial resistance and pesticides residues in food.

Outlook

The shift from reactive to proactive transparency has far-reaching implications. On the systemic level, it represents an important change of ‘regulatory mindset’, where transparency is effectively the rule and confidentiality the exception, to be granted only in cases of a clearly substantiated and legitimate interest. It also poses the question of what will be the future of access to documents: will it become residual vis-à-vis the consolidation of proactive transparency, at least in the field of risk regulation? Will this shift be able to reinvigorate the long-stalled discussion over the  reform of the Access Regulation?

On the more pragmatic level, proactive transparency significantly increases the agencies’ workload. For agencies to be able to fully carry out their tasks under a proactive paradigm, including ensuring the comprehensibility of the information they disclose, their new tasks need to be met with adequate resources in terms of both finances and staff.

The developments discussed above have been taking place through a circulation of transparency mechanisms from one agency to the other. Think for example of pre-submission advice, an established practice within EMA, which has now been adopted also by EFSA. One can therefore wonder whether the innovations introduced through the reform of the GFL will ‘circle back’ to EMA and perhaps even reach ECHA, in what looks like an incremental development of proactive transparency. Against this background, addressing the existing discrepancies in terms of agency discretion and reach of the exceptions to disclosure is a priority in order to ensure the effectiveness of proactive transparency in a context of increased agency collaboration.

The Agencies of the European Union: legal Issues and Challenges

Marta Morvillo is Assistant Professor in European Legal and Economic Governance at the Department of European Studies, University of Amsterdam and author of   ‘The role of experts in political decision-making’ Max Planck Encyclopedia of Comparative Constitutional Law (2022); ‘Who shapes the CJEU regulatory jurisprudence? On the epistemic power of economic actors and ways to counter it’  European Law Open (2022) (with Maria Weimer).

This Op-ed builds an article co-autored with Alie de Boer and Sabrina Roettger-Wirtz: ‘Fragmented Transparency: The Visibility of Agency Science in European Union Risk Regulation’ European Journal of Risk Regulation (2023).

SUGGESTED CITATION: Morvillo, M.; “Science to the people? The reach of transparency into EU agency science”, EU Law Live, 10/11/2023, https://eulawlive.com/op-ed-science-to-the-people-the-reach-of-transparency-into-eu-agency-science-by-marta-morvillo/

Policy Implementation and Enforcement through EU Migration Agencies: a brave new World?

Evangelia (Lilian) Tsourdi

The EU’s implementation and enforcement landscapes in migration have been shifting. EU migration agencies, especially the  European and Border Coast Guard Agency(known as Frontex) and the  European Union Agency on Asylum (EUAA), have gained executive and enforcement powers. Joint implementation patterns between national administrations, and Frontex and the EUAA respectively, have proliferated. In terms of enforcement, these agencies have been equipped with supervisory functions and Fundamental Rights Offices that deploy monitors and are responsible for the operationalisation of novel ombuds-type administrative accountability processes.

Despite the greater attention paid to the administrative aspects of EU migration policies, Member States have been ambivalent about the empowerment of EU agencies. These agencies’ stronger role in implementing and enforcing EU migration policies raises several challenges, including accountability for fundamental rights violations and effective management of their co-dependence on EU institutions and the Member States.

Rise in executive powers and joint implementation patterns

Joint implementation patterns, i.e. agency and/or deployed national experts working alongside national authorities implementing EU’s external border control policy, have been part of the functioning of FRONTEX since 2007. Nonetheless, operational deployments were initially  emergency-driven. However, the EU is moving away from such emergency-driven conceptions of agency involvement (and indirectly of intra-EU solidarity and fair sharing). On the policy level, the latest Frontex Regulation enounces the implementation of integrated border management as a ‘shared responsibility ’ between the agency and the relevant national authorities.

On the operational level, this is further exemplified by FRONTEX’s move to increase its operational (i.e. statutory) staff to 3,000 by 2027, while the number of staff to be provided by Member States for long-term secondments (i.e. minimum of 24 months, extendable once for an additional 12 or 24 months) should reach 1,500 by 2027, and for short-term deployments should reach 5,500 by 2027. The total would amount to 10,000 (see Annex I, Frontex Regulation). These numbers point to structural involvement in policy implementation, and consequently to structural forms of interstate responsibility-sharing.

While initially circumscribed by its previous mandate, the EUAA also gradually engaged in joint implementation with national authorities. For example, since 2016, based on Greek national law, asylum agency experts conducted interviews and issued non-binding opinions on the admissibility of claims and at the merits stage. While the final decision formally remained with the Greek Asylum Service, evidently the agency had a significant, if not decisive, impact on the outcome of applications.

The agency’s current  2021 Regulation further boosts its operational role. It establishes an asylum reserve pool of a minimum 500 national experts holding different profiles who should be available for immediate deployment. It explicitly decouples operational assistance from a situation of disproportionate pressure, while recognising that it will be particularly pertinent in such circumstance. The text of the new instrument reflects better, but not fully, the agency’s role in asylum processing.

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The emergence of novel enforcement mechanisms

Traditionally, policy enforcement was primarily meant to be operationalised at the national level (Member State direct enforcement), with the EU holding indirect enforcement powers through processes enabling the supervision of public authorities. Direct enforcement powers at the EU level were scarce. As Miroslava Scholten evokes in her  Op-Ed in this Symposium the EU level enforcement powers have expanded. These trends in enforcement are also evidenced in migration. I adopt a broad understanding of enforcement which encompasses: i) steering policy implementation; ii) monitoring policy implementation, and iii) ensuring actor accountability.

In terms of  steering functions, an example is Frontex’s ‘technical and operational strategy for European integrated border management’. This is part of a multiannual policy cycle whereby the agency works closely with the Commission to ensure the effectiveness of integrated border management. Based on the agency’s strategy, Member States establish their own national strategies which should be in line both with the technical and operational strategy of FRONTEX, and with the multi-annual strategic policy. The EUAA on the other hand, has pivotal steering functions related to the analysis on country of origin information, an important element in asylum decision-making, co-produced by agency and Member State experts. The agency’s Management Board endorses these ‘guidance notes’. While not legally binding, they have the potential to influence national policy.

Frontex and the EUAA have also gained  supervision functions. Frontex undertakes the ‘vulnerability assessment’ and the EUAA’s mandate includes a ‘monitoring mechanism’, which for now remains inoperative. These monitoring exercises are linked with a feedback loop connected with a gradation of measures depending on the situation on the ground. These measures range from recommendations of the Management Board, to the involvement of the European Commission, to the Council mandating agency deployments in the territory of a specific Member State through an implementing act. Thus, the mechanisms have ‘teeth’. The Frontex Fundamental Rights office includes further monitoring functions, such as fundamental rights monitors (statutory Frontex staff) and a pool of forced return monitors drawing from Member Staff made available and Frontex statutory staff.

Finally, both Frontex and the EUAA have seen the establishment of novel, internal, ombuds-like accountability mechanisms set up as part of their Fundamental Rights offices. The individual complaints mechanism is an administrative avenue through which individuals (or those representing them) whose rights are directly affected by the actions of an expert participating in agency-coordinated operational activities will have access to. Depending on the affiliation of the agent involved (ie agency staff member or deployed expert), admissible complaints lead to either follow up, such as disciplinary measures, by the respective agencies (Frontex or the EUAA), or the home state of the (deployed) expert.

Challenges in an evolving migration governance landscape

The emergence of an increasingly integrated administration should not be viewed as a linear process. The increasing empowerment of EU migration agencies raises controversies and challenges. First, the Member States and EU institutions are ambivalent about an increasingly integrated administration through the workings of EU migration agencies. The instruments of the New Pact on Migration and Asylum are an illustrative example of this trend. They only partly recognise EU agencies’ increased involvement in the implementation and enforcement of the EU’s migration, asylum, and external border control policies. At the same time, the instruments do not satisfactorily embed the novel functions of EU agencies, such as their increased executive powers. This means that, for example, new procedural steps introduced by the Pact such as the screening at the external borders or the border procedure, neither take to account the particularities of the potential involvement of EU agencies in these processes, nor do they adequately frame these executive powers.

The Agencies of the European Union: legal Issues and Challenges

In addition, the introduction of a monitoring function for the asylum agency was an extremely contentious point in the negotiations of its revamped 2021 regulation. In the end it was agreed that the monitoring mechanism will only become operational in 2024, and only partially. The gradation of measures I outlined before will only commence as and when an agreement will be reached within the New Pact instruments on the issue of responsibility-sharing in migration management. This attests to the salience that Member States place on the enhanced EU agency functions.

Moreover, the exercise of executive powers and tasks entailing executive discretion by EU agency (deployed) staff result in greater direct interaction with individual migrants, consequently potentially affecting their fundamental rights. Thus, both respect for fundamental rights and accountability for fundamental rights violations become key challenges. While both agencies are subject to a mosaic of accountability processes there are pronounced gaps. Judicial accountability at EU level remains largely inaccessible to individuals due to the strict rules pertaining to EU remedies on admissibility, standing, and establishment of liability. An additional complexity analysed aptly by Annalisa Volpato in her contribution to this Symposium is the fact that operational support or administrative cooperation in this field most often do not often result in formal legal acts, but instead qualify as factual conduct. EU remedies are primarily geared towards the scrutiny of legal acts which ties with the initial implementation and enforcement paradigm based on executive federalism. The EU’s involvement in implementing and enforcing policies was meant to be limited and indirect.

A final challenge relates to agencies’ co-dependence to EU institutions and Member States. Independence is an element that is highlighted in the agencies’ founding regulations, however, EU agencies remain both institutionally and functionally dependent on EU institutions and Member States. This is exemplified through the design of their internal governance structures, specifically the Member State-dominated management boards and the process by which these agencies operationalise their mandate, which is inherently collaborative. With increasing operational, steering, and monitoring roles, there is a delicate balance to be struck between: accountability and co-dependence (as outlined above); expertise and co-dependence (e.g. the imperatives of quality and accuracy of the country of origin guidance and its endorsement through the management board); and, supervision and joint implementation.

To conclude, administrative integration in EU migration policies is neither inherently positive, nor negative. It can enhance harmonisation of practices and boost administrative capacities thus contributing to the sharing of responsibilities. However, it brings with it its own set of challenges in being effective, while remaining within the constitutional boundaries of the EU legal order, including the rule of law and fundamental rights. Further thinking needs to go into the appropriate framing and monitoring of the EU’s evolving integrated administration.

Evangelia (Lilian) Tsourdi is Jean Monnet Chair in EU Migration Law and Governance at the Faculty of Law of Maastricht University. She co-edited the Research Handbook on EU Migration and Asylum Law (Edward Elgar 2022).

SUGGESTED CITATION: Tsourdi, E.; “Policy Implementation and Enforcement Through EU Migration Agencies: A Brave New World?”, EU Law Live, 28/11/2023,  https://eulawlive.com/op-ed-policy-implementation-and-enforcement-through-eu-migration-agencies-abrave-new-world-by-evangelia-lilian-tsourdi/