6 - 10 January 2024
TABLE OF CONTENTS
IN-DEPTH:
Clash of Prosecutors: The European Public Prosecutor’s Office as a Guarantor of the Croatian Rule of Law
Sinan Kurt & Tim Huyeng
Fiscal Sovereignty meets EU Law in the Dutch Dividends Case: What comes next?
Giulio Giacomo Cimini
The average Consumer, fixed: Compass Banca (C-646/22)
Filippo Morello
Professional Ethics vs. Profit: the Independence of Lawyers in CJEU Judgment Halmer Rechtsanwaltsgesellschaft (C-295/23)
Markus Frischhut
THE LONG READ
2024. 10 Leading Judgments of the Year
Daniel Sarmiento
HIGHLIGHTS OF THE WEEK
IN-DEPT H
Clash of Prosecutors: The European Public Prosecutor’s Office as a Guarantor of the Croatian Rule of Law
Sinan Kurt & Tim Huyeng
Corruption must be prosecuted in a State governed by the rule of law. But what if the rule of law has two faces? This is how the Croatian population might feel at the moment. Since 15 November 2024, there has been intense debate about who is allowed to prosecute corruption in the country. After Health Minister Vili Beroš and seven other individuals were arrested due to a corruption scandal involving the procurement of medical equipment, an unprecedented conflict is unfolding between the Croatian Public Prosecutor’s Office (DORH) and the European Public Prosecutor’s Office (EPPO), which was only established in 2021. The initial hope for good cooperation between the national and European prosecutors has shattered in Croatia, and the typically European ‘tug-of-war’ is creating a worrying friction between the institutions. The conflict culminated in a letter to the Commission in which the EPPO denounced systematic rule of law deficits within the meaning of the Rule of Law Conditionality Regulation (2020/2092) and called on the Commission to intervene. Overall, it is clear that the EU is currently gaining new legitimacy in Croatia, particularly through the work of the EPPO, because it is actively combating corruption. Croats are therefore beginning to perceive the EU not just as a bureaucratic imposition, but as a powerful institution that promotes justice and combats abuses that are not addressed by its own judiciary.
Corruption in the Healthcare Sector
On 15 November 2024, the Croatian anti-corruption agency USKOK searched the home of Health Minister Vili Beroš at 7:10 a.m. and arrested him on suspicion of undue influence. At 9 a.m. USKOK appeared before the press and only half an hour later the Minister of Health had already been removed from office. At 10 a.m., the EPPO announced that it had been investigating eight suspects, including Beroš, on more serious charges since July. At the centre of these charges is Hrvoje Petrač, who, according to the EPPO, led a criminal organisation that distributed bribes to manipulate tenders for medical equipment. The aim was allegedly to take funds from the EU-funded Croatian National Recovery and Resilience Plan 2021-2026 as well as from the Croatian State budget. On that very day, the EPPO planned to press ahead with the investigation by applying for a judicial search and arrest warrant. The raid was to take place four days later. Unless it was a highly unlikely coincidence, one has to ask why the national judiciary beat the EPPO to the punch at the last moment.
In any case, the EPPO only found out about the investigations and the arrest by USKOK through press reports. The two public prosecutors’ offices do not appear to have coordinated their investigations in this way. The exchange of information and notification obligations provided for under EU law (Art. 24 Regulation 2017/1939) were obviously circumvented.
The fact that USKOK and the EPPO have brought different charges against Beroš with completely different penalties is also cause for scepticism. While USKOK ‘only’ accused Beroš of having given his acquaintance Saša Pozder from the company Medical Innovation Solutions (MIS) advantages in the awarding of robotic microscopes at Krešimir Rotim’s neurosurgery clinic, the EPPO has made more extensive accusations, including that the minister himself is alleged to have accepted bribes. In the manipulated tenders, the sales prices are also alleged to have been two to three times the usual market value, resulting in a total loss of more than 600 thousand euros.
The misuse of European funds relates in particular to a tender in the clinic KBC Split in 2022. This multimillioneuro project was to be fully financed by funds from the EU Recovery and Resilience Facility (RRF). However, the clinic directors refused to get involved in the deal. As a result, the EPPO came across a network of criminal activities that went far beyond this individual case and also embezzled national funds. These national projects could be related cases in accordance with Art. 22 para. 3 Regulation 2017/1939, meaning that the EPPO would also have jurisdiction in these cases.
USKOK argues, however, that the majority of later successful bribes only involved national funds. In the case in Split, there were also six months between the attempted bribery and the actual tender; moreover, the bribery never materialised. Therefore, no European funds had been misappropriated and the three decisive cases only concerned the national budget. The extension of the jurisdiction of the European Public Prosecutor’s Office, according to Attorney General Turudić, constituted ‘an unjustified intrusion’. Accordingly, there was pressure to hand over the file and merge the investigations. Even though the EPPO initially invoked its right of evocation, Turudić decided in favour of the Croatian public prosecutor’s office without further coordination and took over the EPPO files. On 21 November, however, the EPPO contradicted the opinion of the Attorney General in a press release, criticising, among other things, its sole jurisdiction as being contrary to EU law and wrote a formal letter to the Commission in connection with the complaint of systemic rule of law deficits.
Conflicting Responsibilities, Judicial Authorities and Systemic Deficits
The present case highlights the challenge of a mixed system that was created through a political compromise and initially leaves the decision to national authorities in the event of a conflict. Investigations by the EPPO generally enjoy priority (Art. 25(1) Regulation 2017/1939). However, in the event of a conflict, according to Art. 25(6), the authority that is responsible for the allocation of prosecution responsibilities at national level should decide on the subject matter jurisdiction. This means that, at least at the initial stage, the Union does not have the authority to determine jurisdiction itself. As long as European and national law enforcement authorities cooperate with each other, this trouble spot has no effect. However, if there are disagreements about the jurisdiction for criminal prosecution (as in Croatia in March) or general doubts about the interest in prosecution, there is a national possibility of blocking investigations, even if these concern damage to the EU budget. It is precisely such investigations that are now being obstructed by the Croatian Attorney General, whose decision has already been accompanied by protests and has been viewed with scepticism internationally, by counteracting the right of evocation of the EPPO (Art. 27(3) Regulation 2017/1939) with a decision in favour of USKOK. The EPPO
argues that these are criminal offenses to the detriment of the financial interests of the Union or indirectly related criminal offenses and that USKOK must therefore drop its investigations (Art. 27 (5) Regulation 2017/1939). Turudić objects to this in accordance with Art. 25(1) Regulation 2017/1939 because, in his view, only national funds were involved (see Art. 22(1) Regulation 2017/1939).
The sole decision-making power of the Attorney General (NN 146/20 Art. 8) is classified by the EPPO as contrary to EU law. However, it remains unclear from the press release what the infringement of EU law actually relates to. The question of the Prosecutor General’s independence from political instructions may be considered. Recital 62 of the EPPO Regulation provides in principle that the decision on the allocation of jurisdiction within the meaning of Article 25(6) Regulation 2017/1939 is to be taken by a national judicial authority. Both public prosecutor’s offices and courts are generally covered by this (C-452/16 PPU para. 31 et seq.). In the case of the Croatian Prosecutor General, the government – unlike in Germany – has no power to issue instructions; he acts as an independent and autonomous body that is elected on the proposal of the government but with parliamentary approval (Art. 125 Constitution of the Republic of Croatia). In this respect, the general legal status of the Prosecutor General under Croatian law should not violate Union law.
The fact that there is no legal protection against the decision of the Attorney General is more likely to be decisive. This is because Art. 42(2)(c) Regulation 2017/1939 provides that in the event of conflicts of jurisdiction, the Court of Justice shall rule on the interpretation of the regulation in preliminary ruling proceedings. This provision is of particular importance if a Member State does not leave the resolution of conflicts of jurisdiction to a court but to another judicial authority. Consequently, the Member State must implement a means of legal protection that enables recourse to the Court of Justice and thus to a uniform interpretation of the regulation within the framework of the preliminary ruling procedure pursuant to Art. 267 TFEU. In Germany, where the Federal Public Prosecutor General has primary jurisdiction, Section 142b(2) sentence 2 Courts Constitution Act, for example, opens up the route to the Federal Court of Justice (‘Bundesgerichtshof’) and thus also to the Court of Justice via Art. 267(3) TFEU.
Croatian law would therefore have to be amended, also in order to prevent unauthorised blockades by the Attorney General in the future. The opposition is calling for the Supreme Court, rather than the Attorney General, to decide on conflicts of jurisdiction in future. This would be in line with the requirements of EU law. The Sabor, the Croatian parliament, is currently preparing an application to the Constitutional Court for a review of the current regulations.
The Unease in Croatian State Culture
Many questions remain unanswered for the Croatian public. The line between legitimate concerns and conspiracy theories is becoming increasingly blurred. A leaked WhatsApp exchange between the main players in this affair confirms the widely held concerns of many Croatians. The idea of ubiquitous political influence on the judiciary and the corrupt intertwining of business and politics, particularly through public tendering procedures, has long since become a kind of Croatian State culture. The Minister of Health appears to be just a ‘small fish’, while the
key protagonists continue to be protected. For many sceptics, the scandal showed that the criminal networks obviously do not want to tamper with European money because there is a real risk of prosecution. In contrast, USKOK gave the impression that it still wanted to protect Beroš and parts of the clan.
As the EPPO in Croatia is aware of the abuses in the national prosecutor’s office – its employees often previously worked at USKOK themselves – it is suspected that it deliberately kept the national authorities out of the loop for as long as possible. According to these theories, the uncoordinated USKOK raid, which preceded the EPPO by just a few days, was primarily intended to make evidence disappear that could incriminate other circles (and above all the Prime Minister himself). The representatives of the EPPO have not only been deprived of months of preparation, but also face criminal prosecution for passing on investigative information via the so-called Lex AP (Article 307.a of the Criminal Code). The fact that the ruling party is once again treating the scandal as a ‘bad apple’ is part of a series of 30 ministers who have had to resign under Plenković since 2016 due to allegations of corruption. Another sign of the ‘superiority of the underworld ’ in Croatia is the fact that Tamara Laptoš, the European Public Prosecutor in Croatia, has applied for police protection in connection with the case.
Visible Rule of Law
By reprimanding systematic deficiencies in the rule of law, the EPPO is taking a confrontational stance with the Croatian authorities. It is thus demonstrating its determination to assert itself as a young but self-confident EU institution by robustly defending its area of competence. It remains to be seen how the Commission will react to this move. For the time being, the Parliament’s request for a review of standards and amendments to Croatian law could pacify the conflict in accordance with EU law. Should the Commission suspend payments from the reconstruction and resilience facility (AFR), the pressure on the Croatian authorities could increase massively. The EPPO’s press release does not provide any specific details, but infringements within the meaning of Arts. 4(2)(a), (c) and (e) Regulation 2020/2092 could lead the Commission to take measures under Art. 5 Regulation 2020/2092, which serves to protect the EU budget (Art. 322 para. 1 lit. (a) TFEU). The actual link between EU budget funds and the value of the rule of law must therefore be proven for each infringement. The concept of the rule of law must not be overstretched in order to establish a general supervision of values through the conditionality regulation. The direct obstruction of corruption investigations by the EPPO, however, probably impairs the financial interests of the Union in ‘a sufficiently direct way’ (C-156/21, para. 147) and should therefore correspond to a narrow definition of the rule of law. The disadvantage for EU funds even appears to be much easier to justify than in previous applications (Hungary and Poland); however, the dynamics of the escalation are surprising, as an individual infringement procedure would also have been conceivable as a requirement.
Currently for many Croatians, the EU is the powerful institution that actually ensures order. Rarely before have so many words of praise been written about it in the comment columns of news portals. While Prime Minister Andrej Plenković speaks of an exaggerated victimisation of the EPPO and President Milanovic claims that it is a ‘legal prosthesis’ and also highly politically dependent under the leadership of Kövesi, it could become a beacon of hope for parts of the population. Many Croats currently remember why they voted for EU accession. Not because
they receive money from the EU, not because the EU is abolishing roaming charges, and certainly not because they no longer have to change their money abroad, but because the EU is accusing those people of preventing them and their children from receiving modern healthcare. The fight against corruption is no longer expected from the ‘own’ judiciary – it is rather accused of being part of the problem itself. Croats are beginning to appreciate the strong arm from Brussels and Luxembourg, which not only regulates the sale of raw milk cheese and private distilling, but also puts the hated criminal elite in a headlock in the form of EPPO intervention.
This Op-Ed was first published in Verfassungsblog: Clash of Prosecutors
Die Europäische Staatsanwaltschaft als Garant für den kroatischen Rechtsstaat
Sinan Kurt is a research associate at the Forschungskolleg normative Gesellschaftsgrundlagen and doctoral candidate in European and Constitutional Law at the University of Bonn.
Tim Huyeng is a research associate at the Forschungskolleg normative Gesellschaftsgrundlagen and a lecturer in sociology at the University of Bonn. He is writing his doctoral thesis on informal institutions and corruption in Croatia.
Kurt, S. and Huyeng, T.; “Clash of Prosecutors: The European Public Prosecutor’s Office as a Guarantor of the Croatian Rule of Law”, EU Law Live, 08/01/2025, https://eulawlive.com/op-ed-clash-of-prosecutors-the-european-public-prosecutors-office-as-a-guarantor-of-the-croatian-rule-of-law/
Fiscal Sovereignty meets EU Law in the Dutch Dividends Case: What comes next?
Giulio Giacomo Cimini
On 7th November 2024, the Court of Justice delivered its judgment in Case C-782/22, XX v Inspecteur van de Belastingdienst.
The ruling flows from litigation between the Dutch Tax Authority and a UK-based insurance undertaking selling unit-linked products to institutional investors.
As is well known, unit-linked insurance contracts are life insurance products that combine death coverage with investment, where premiums are allocated into underlying assets or investment funds upon whose performance the policy’s value will depend, and where the financial risk is ultimately borne by the policyholder rather than the undertaking.
Thus, once a premium is encashed, the money is invested in one or more baskets of unit securities linked to units of account and, in exchange, units are allocated to customers. The latter are then assigned a value corresponding to the number of those units, multiplied by the value of the unit at the time at which they are entitled to a payment.
A Summary of the Decision
The bone of contention before the Court of Justice was whether the fact that dividends coming from shares of Netherlands-based companies were subject to double taxation – i.e., dividend tax in the Netherlands and income tax in the UK – constitutes a breach of Article 63(1) of the TFEU prohibiting any restrictions on the free movement of capital. As a matter of fact, the case at hand originated from the British undertaking’s denied request to the Dutch Authorities that the dividend tax be offset.
The British insurance undertaking claimed that the Dutch fiscal laws illegitimately discriminated against foreign persons. That is, despite the same dividend tax being directed to Netherlands-resident taxpayers, their payment would in fact be deemed an advance levy in respect of the corporation tax for which they should be liable. The tax at stake could thus be offset in full against the corporation tax due and, in case of the latter being lower than the dividend tax, the difference would be refunded.
The same cannot happen in the case of non-Dutch taxpayers.
According to the Dutch Court of Appeal, which referred the matter to the Court of Justice, a resident company would in fact not be taxed on dividends, since, when determining the taxable profit for corporation tax purposes, the increase in commitments to customers by way of unit-linked insurance contracts would be deemed an expense.
Thus, the net corporation tax base in respect of those dividends would be zero, a reasoning which was upheld by the Court of Justice.
What, on the other hand, was not upheld was the Dutch Government’s argument according to which the burden represented by the dividend tax on gross dividends, to which the dividends paid to non-resident companies are subject, should be compared with the tax burden resulting from the levying on net dividends of the corporation tax, to which the dividends paid to resident companies are subject.
In the end, the parallel treatment of dividends was considered to be in conflict with Article 63(1) of the TFEU and capable of deterring non-resident undertakings from making investments – in this context – in the Netherlands. Cross-border activities were therefore impeded.
All the while, the Court of Justice reminded that despite its own caselaw – in particular C-572/20 also known as the ACC Silicones case – which stressed that safeguarding a balanced allocation between EU Member States of the power to impose tax is one of the overriding public interest reasons which are capable of justifying a restriction on the free movement of capital, such a ground cannot justify the taxation of non-resident companies receiving dividends when tax resident companies are not taxed with respect to that exact type of income.
The Devil in the Details: Signalling a Bigger Picture
Prima facie, the Court of Justice’s stance can be said to have simply underscored the importance of aligning tax treatment with the economic reality of the specific entities being taxed.
Yet, this is a crucial point. Especially in times like the present ones where resources are dramatically needed.
As a matter of fact, whereas Western public debt is rising, the energy sector is still not out of the tunnel and the automotive industry no longer seems able to provide a public form of anchor. The insurance and banking sectors on the other hand continue to be perceived by governments as cashflow stable, if not cash-rich.
It is widely known – as recently documented for instance by an IMF Working Paper and continuously reported in the financial press – that EU Member States, given their banks’ historically high profits due to the transitional delayed pass-through of the monetary policy tightening to deposit rates, have started to introduce new fiscal impositions on credit institutions. The fact that these profits could have been used to increase countercyclical capital buffers and are instead targeted to make up for the rainy days ahead, further signals the aforementioned contingent market tendency and highlights that rulings such as the present one will necessarily represent a form of guidance on how fiscal impositions should be structured.
Exempli gratia, not unlike others, the Italian government, struggling to efficiently plug a budget deficit and provided with a large market to fish from, has notably been trying to impose windfall taxes on both banks and insurance undertakings operating in its territory. Yet, in the context of life insurance, these have also been presented with a fiscal imposition – the payment of a stamp duty – which once used to be a deferred payment at
the point of policy maturity, surrender or claim and is now, instead, under the new Budget Law, due in instalments directly as of January 1st 2025.
The tricky point is that such an anticipated payment is envisaged for Class III and Class V insurance policies only. I.e., as listed in Annex II of Directive Solvency II, unit-linked and capitalisation contracts, typically offered by companies operating cross-border. It is not envisaged for Class I contracts, namely traditional term-life/whole-life insurance, commonly linked to separate management funds which invest in Italian public debt.
Thus, one may speculate that, since the ruling at hand will act as a bellwether for any new taxes or impositions of the sort, the financial sector generally speaking could be fertile ground. As seen, Member States increasingly appear to be turning to financial institutions to bolster strained public coffers and may, as illustrated in the juridical distinction between insurance Classes, end up targeting, de facto, those entities which better serve the purpose without harming domestic interests.
Yet, however successful such a hunt may be, case C-782/22 serves as a reminder – and as a benchmark – that fiscal impositions can only be designed in compliance with EU principles, particularly ensuring they do not disproportionately impact foreign financial institutions or excessively tip the balance in favour of domestic entities.
Given all the above, some challenges surely lie ahead.
Giulio Giacomo Cimini is a financial lawyer based in Milan and teaching assistant at University of Bergamo. His most recent publication is G. G. Cimini, ‘IRRD: When Insurance Undertakings Become Banks’ International Company and Commercial Law Review (10) (2024)
Giacomo Cimini, G.; “Fiscal Sovereignty meets EU Law in the Dutch Dividends Case: What comes next?”, EU Law Live, 08/01/2025, https://eulawlive. com/op-ed-fiscal-sovereignty-meets-eu-law-in-the-dutch-dividends-case-what-comes-next/
The average Consumer, fixed: Compass Banca (C-646/22)
Filippo Morello
Introduction
The fortress of the average consumer standard is wobbling. The average consumer is a yardstick for evaluating the unfair character of a commercial practice under Directive 2005/29/EC. In short, for a practice to be unfair, it must be such that it is likely to distort the decision of an average consumer. As an objective criterion that guides the ex-post assessment by the courts, irrespective of the actual capabilities and conditions of the individual consumer, the average consumer standard applies to both consumers and businesses. For the former, it sets the benchmark for fair marketing and thus determines the extent of consumer protection in this subject. For the latter, it allows firms to tailor their practices to an abstract and prototypical counterparty, avoiding the costs of personalised disclosure and presentation. In this view, aligning the standard with growing scientific evidence and the reality of consumer transactions, as the Court attempted to do in the Compass Banca case (C-646/22, 14th November 2024), should benefit both businesses and consumers. In fact, the Court’s cautious acknowledgement that consumers are not perfectly rational traders erodes the average consumer standard but does not clearly redefine it, to the ultimate dissatisfaction of both consumers and businesses. From a consumer law perspective, then, this welcome development in the law is overshadowed by a persistent difficulty in identifying and articulating the very notion of the average consumer.
Compass Banca v. AGCM
Compass Banca was cross-selling consumer loans and unrelated insurance policies to consumers. The Italian Competition and Market Authority (AGCM) intervened and asked the bank to separate the signing of the two contracts by at least seven days. After Compass refused to do so and only gave consumers a seven-day withdrawal period, the AGCM sanctioned it. In the appeals before the TAR (Regional Administrative Court) and the Consiglio di Stato (Administrative Supreme Court), the AGCM reiterated that the marketing of the products, framed as part of a unique package and delivered with insufficient information, was aggressive. The Consiglio di Stato rightly questioned the average consumer benchmark: the same practice can be fair to an informed, experienced and rational consumer paradigm and unfair to a prejudiced, inexperienced and impulsive consumer. Accordingly, the preliminary questions referred to the Court of Justice concern the definition of the average consumer (1), the aggressive nature of the cross-selling of financial products (2), the power of the AGCM to impose a seven-day cooling-off period (3), (4) and the alleged reversal of the burden of proof in sanctioning aggressive practices (5).
The first question is explicitly formulated as a contrast between the models of homo economicus and bounded rationality, and it is rooted in the dispute over the joint marketing of a personal loan and an insurance policy.
The Court avoids the question of economic theory and reiterates that the average consumer is ‘reasonably well informed, reasonably observant and circumspect’ (para. 47). It does, however, make the important clarification that this abstract standard must be understood as the ‘typical reaction of the average consumer in a given case’ (para. 50) and must, therefore, be calibrated to the nature of the service or product offered, to the information actually provided by the undertaking and to the prejudices likely to affect the consumer’s choice. In answering the second question, the Court does not fully address the implications of this, i.e. that the way in which the loan and the insurance policy were formulated could well give the impression that the latter was compulsory and could, therefore, be regarded as an aggressive or otherwise unfair practice. The judgment goes into the rather technical concepts of Directive 2005/29/EC, such as the notion of ‘aggressive’ and ‘in all circumstances unfair’ practices and ‘undue influence’. It concludes that while the framing of the contracts itself is not an unfair practice, the presentation of the products without sufficient information may well be misleading and suggest to the average consumer that the insurance contract is compulsory as part of a unique package. Interestingly, this is not consistent with the AGCM’s finding that the practice in question was aggressive but leaves the door open for the Authority’s autonomous assessment. Accordingly, in answer to questions 3 and 4, the Court finds that neither Directive 2005/29/EC nor Directive 2016/97/EU on insurance distribution prevent the AGCM from imposing a sevenday cooling-off period such as that imposed on Compass Banca.
Average or Typical?
The shift from a neo-classical to a behavioural understanding of the average consumer is an important and longawaited step in consumer protection. The Court of Justice follows this path very cautiously, i.e. it recognises the assumption of bounded rationality but does not overturn the rational agent model. Rather, it modestly corrects it. As a result, on the one hand, the concessions to an alternative paradigm of the consumer are narrow and dependent on the information received – a result that anyone vaguely familiar with the literature on consumer bias and the effectiveness of information regulation cannot but reject. Moreover, the idea that the average consumer, according to Compass Banca, will remain an informed and circumspect trader, if ever subject to decision-making biases when inadequately informed, is at odds with the reality of consumer transactions. On the other hand, the few openings left to the less rational consumer do not provide companies with an objective standard against which to target their marketing. The average consumer indeed varies according to market sector and practice, and careful information plays a role in avoiding distortions. However, the mere statement that the rational consumer may be subject to distortions does not redefine the standard with sufficient clarity. Ultimately, it thus misses the point of the average consumer criterion.
However, only a little of this is the fault of the Court. The average consumer standard, as formalised by Directive 2005/29/EC, is inherently flawed as it is torn between at least two different meanings. With reference to the spectrum of knowledge and experience displayed by consumers, the average can be interpreted as the middle ground between the two antipodes: the medium level of rationality in the distribution of consumer rationalities. On the contrary, a different notion emerges if one considers the representativeness of the standard: in terms of likeliness, the average consumer is the one with whom firms trade more, or on average. This is more akin to the
‘statistical’ notion of the average consumer, which the Court says it does not want to follow. For those interested in maths, the former is the median value; the latter is the mode. In the Court of Justice’s (and Advocate General Emiliou’s) reasoning, the terms ‘average’ and ‘typical’ express the same difference. The tension between the two is visible since, when referring to the average consumer, the Court assumes an overall informed trader, the median one. At the same time, while rejecting the ‘statistical’ notion of the average consumer, it uses the ‘typical’ – i.e., the statistically more likely – lexicon to mitigate it and lower the standard. If and under what conditions the average and the typical so intended coincide is very hard to tell in the abstract, and it really depends on the market and practice taken into consideration. In any case, the tension between the average and the typical consumer is there to stay. The further step of recognising that the typical consumer is much less rational than the average one, which certainly has some intuitive appeal, could not have been done by the Court of Justice within the positive law interpreted in the case.
Filippo Morello is a Max Weber Fellow at the European University Institute
Morello, F.; “The average Consumer, fixed: Compass Banca (C-646/22)”, EU Law Live, 09/01/2024, https://eulawlive.com/op-ed-the-average-consumerfixed-compass-banca-c-646-22/
Professional Ethics vs. Profit: the Independence of Lawyers in CJEU Judgment Halmer Rechtsanwaltsgesellschaft (C-295/23)
Markus Frischhut
The European Union (EU) is often perceived by some citizens as a neo-liberal monster, accused of putting too strong an emphasis on economic considerations. While it is true that EU integration started with economic integration (in the field of coal and steel), it has later been complemented by human rights (first via the Court of Justice, later the CFR) and a political dimension (Maastricht Treaty). The Lisbon Treaty has finally turned the EU into a Union of values. Likewise, this criticism is not well-founded, as the Court of Justice is willing to acknowledge the sensitive characteristics of distinct fields. This is true, for example, for the field of public health, where the Court of Justice has stated that health ranks foremost among the assets and interests protected by the Treaty, and therefore the Member States can ‘determine the level of protection which they wish to afford’ and also ‘the way in which that level is to be achieved’ (Blanco Pérez, C-571/07, para. 44). This approach can be explained by the vertical distribution of competences (Art. 168 TFEU). A similar situation can be observed in the case at hand, also due to the link to the EU’s values (Art. 2 TEU).
In this German case of national restrictions on law firm ownership (Halmer Rechtsanwaltsgesellschaft, C-295/23), the Grand Chamber of the Court of Justice had to balance the economic free movement rights of the internal market (Art. 26 TFEU) with non-economic concepts. In the past, the Court already had to deal with the question of a Dutch prohibition of multi-disciplinary partnerships between lawyers and accountants (Wouters, C-309/99). While such a multi-disciplinary partnership has the advantage of being able to better respond to the needs of clients, the risk of conflicts of interest and a lack of independence come as disadvantages. This German case was not about a multi-disciplinary partnership of lawyers and accountants, but purely financial investors, as 51% of the shares of the German law firm were transferred to an Austrian investment company. This could negatively influence the operational activities of this law firm.
While Wouters (C-309/99) was mainly about EU competition law, in Halmer (C-295/23) the Court of Justice had to balance the economic free movement rights with non-economic concepts. The two applicable free movement rights were, on the one hand, the freedom of establishment (Art. 49 TFEU), which enables the shareholder to ‘exert a definite influence on a company’s decisions and to determine its activities’, as well as the free movement of capital (Art. 64 TFEU), where shares are ‘acquired solely with the intention of making a financial investment without any intention to influence the management and control of the undertaking’ (Halmer, C-295/23, para. 51).
Non-Economic Considerations and their Provenance
The non-economic perspective in this case was not related to the vertical distribution of competences (as in the case of public health), but to one of the EU’s values (Art. 2 TEU), specifically democracy. The independence of
lawyers is a cornerstone of the EU’s legal system, essential for the proper administration of justice. As the Court of Justice has aptly stated, lawyers ‘are assigned the fundamental role in a democratic society of defending litigants’, which is linked to independent legal advice and the lawyer’s duty ‘to act in good faith towards his or her client’ (Halmer C-295/23, para. 66).
In Omega (C-36/02, paras. 32-35) the Court took into account human dignity, nowadays an EU value, for the interpretation of the justification of public policy. In Halmer, the Court accepted the following overriding reasons as justifications, which can be seen as linked to the fundamental role lawyers play in a democratic society: ‘the protection of litigants’ and ‘the proper practice of the legal profession’ (Halmer C-295/23, para. 65). In addition, the sound administration of justice is an overriding reason in the public interest, acknowledged in the Services Directive (Art. 4 para. 8 and recital 40 Directive 2006/123).
Independence, Integrity and Ethical Standards
Lawyers are bound to certain standards and, according to the German Federal Lawyers’ Code, the involvement of others (not bound by these standards) could be ‘incompatible with the profession of practising as a lawyer, in particular with a lawyer’s position as an independent agent of the administration of justice, or could jeopardise the trust placed in its independence’ (Halmer C-295/23, para. 20). Hence, these standards for lawyers should not be compromised from the outside, neither by accountants (Wouters, C-309/99), nor by financial investors (Halmer C-295/23).
Such a negative influence can be related to the size or the intention of the other party. Too big a proportion of (non-lawyer) partners, such as accountants, could lead to an unbalanced situation, compromising the lawyers’ obligations. As firms of accountants have ‘become gigantic organisations’, such a partnership would rather resemble, as the appellants submitted in Wouters ‘the marriage of a mouse and an elephant than a union of partners of equal stature’ (Wouters C-309/99, para. 78).
In the case of purely financial investors, their possible influence on the decisions and activities of a law firm could compromise the ‘independence and integrity of the profession of practising as a lawyer’ and the objective ‘to ensure compliance with the principle of transparency and the obligation of legal professional privilege’ (Halmer C-295/23, para. 64). As in the case of the sensitive field of public health, Member States enjoy some discretion in this area as well. They can reject such a partnership with purely financial investors, because a ‘lawyer would not be able to exercise his or her profession independently and in compliance with his or her professional and ethical obligations’, as these investors ‘are neither practising lawyers nor members of any other profession subject to the moderating effect of rules of professional conduct’, even more so if ‘such an investor intends to acquire the majority of the shares in the law firm in question’ (Halmer C-295/23, para. 73).
In this context of the principles of independence, integrity and transparency, the Court also emphasises that ‘the absence of conflicts of interest is essential to the practice of the profession of lawyer and requires, in particular, that lawyers should be in a situation of independence, including financial, vis-à-vis the public authorities and other
operators, by whom they must never be influenced’, as otherwise ‘economic considerations focused on a purely financial investor’s short-term profit could prevail over considerations guided exclusively by the defence of the interests of the law firm’s clients’ (Halmer C-295/23, para. 71).
Values and Ethics, Implicit vs. Explicit
In EU law we can observe an increasing reference to ethics (Frischhut, 2019), where at this interface of EU law and ethics, values and human rights shall play an important role (Frischhut, 2022). Ethics, values and human rights are important to foster citizens’ trust, which the Court of Justice has also emphasised in this context of lawyers’ independence.
There are various fields where the Court of Justice applies judicial self-restraint and leaves more leeway to the Member States. This is true, for example, for public morality (Conegate, C-121/85; SPUC, C-159/90), public health (because of the above-mentioned vertical distribution of competences), and also where professional and ethical obligations shall not be compromised by profit. This is not new and has already been accepted in the case of pharmacies, where the employment of pharmacists could compromise their independence (EC v Italy [pharmacies], C-531/06, para. 64; see Frischhut, 2024). Independence, integrity, transparency and the avoidance of conflicts of interest are all concepts that are highly relevant in ethics. While the Court tends to avoid referring to ethics (Mayr, C-506/06, para. 38), and also refers less to values, it has a tendency to rather refer to principles (Frischhut, 2022), such as independence and the absence of conflicts of interest, transparency, etc.
Likewise, in this German case the Court of Justice did not refer to democracy (as one of the values enshrined in Art. 2 TEU), but only to the fundamental role of lawyers in a democratic society. While it is to be welcomed that the Court is reluctant to decide based on non-legal concepts such as ethics, Art. 2 TEU would allow the Court of Justice to put a stronger emphasis on the values such as democracy, or in this case, also the rule of law.
Conclusion
In any case, the accusation levied against the Court (and EU law at large) of putting too strong an emphasis on economic considerations and profit is clearly not well-founded. However, the current discretion granted to Member States leads to different levels of protection in different Member States (Halmer, C-295/23, para. 72), like in the above-mentioned case of public health (Blanco Pérez, C-571/07), allowing them to determine different levels of protection and different ways how to achieve them. Instead, the author suggests an approach of putting a stronger emphasis on the EU’s common values. This would lead to a more uniform and less diverse situation. Nonetheless, the question remains whether similar restrictions as in the case of lawyers can be justified for other professions with significant public responsibilities.
Markus Frischhut is Jean Monnet Professor at Management Center Innsbruck, Austria and Adjunct Professor at the Università di Bologna, Italy. He has been speaker for various EU institutions, etc. (EP, ECB, EIB) and is the author of ‘The Ethical Spirit of EU Values’, Springer, 2022.
Frischhut, M.; “Professional Ethics vs. Profit: the Independence of Lawyers in CJEU Judgment Halmer Rechtsanwaltsgesellschaft (C-295/23)”, EU Law Live, 09/01/2025, https://eulawlive.com/op-ed-professional-ethics-vs-profit-the-independence-of-lawyers-in-cjeu-judgment-halmer-rechtsanwaltsgesells chaft-c-295-23/
THE LONG READ
2024. 10 Leading Judgments of the Year
Daniel Sarmiento 1
Another year and yet another round of seminal rulings from the Court of Justice. 2024 was a fruitful period in the Kirchberg, where the Court delivered dozens of judgments on points of principle covering most areas of Union law. As in previous years, it was not easy to make a selection and some very important judgments have been left out in order to represent with only ten cases the overall production of the Court of Justice in a single year. The selection is, as always, very personal and subject to the author’s own prejudice and bias, but it reflects the richness of the Court’s jurisprudence and the direction in which Union law is heading.
2024 was also the year in which a partial transfer of the preliminary reference finally took place. The General Court started hearing preliminary references in some ‘specific areas’ and the very first ones arrived shortly before the end of the year. It was striking to see a preliminary reference being published in the Official Journal among the new cases registered in the General Court, but that is something to which we must grow accustomed in the coming years. This first and partial transfer will surely be only the first of many others to come.
The Court of Justice went through a massive renewal of sitting members, a reconfiguration that materialised in a tsunami of judgments delivered on 4 October 2024. Every three years both courts go through a partial renewal, but the expansion of sitting members, together with the doubling of judges in the General Court, have made this event a rather tumultuous one, particularly when a significant number of judges and advocates general leave the Court, as was the case in 2024. The uncertainty surrounding some appointments (or re-appointments) and the ever more stringent scrutiny of the 255 Committee have not made the Court’s life any simpler, with some appointments still awaited in 2025.
Is there a common thread to the selection of this year? Probably not. The only common feature is the (unsurprising) fact that all the rulings were delivered by the Grand Chamber or the Full Court. This year there are no judgments of the General Court, not because of the lack of important judgments, but due to the abundance of significant rulings coming from the higher instance.
Some features are common to several cases and they provide interesting developments going beyond the objective importance of the concrete case. 2024 was a year in which the Court of Justice underwent several implicit overrulings or ‘recalibrations’, one in KS & KD2 and another one in Quadrature du Net II. 3 These are not explicit reformulations of prior case-law, but a well-thought reconsideration of the scope of previous judgments in highly sensitive areas. There were also striking deviations or distinguishings from earlier and recent judgments, as is
1. Professor of EU Law at the University Complutense of Madrid and Editor-in-Chief of EU Law Live
2. Judgment of the Court of Justice of 10 September 2024, KS and KD (C 29/22 P and C 44/22 P, EU:C:2024:725).
3. Judgment of the Court of Justice of 30 April 2024, La Quadrature du Net II (C 470/21, EU:C:2024:370).
the case of Apple (Commission/Ireland),4 introducing a surprising twist that is sitting uncomfortably with prior rulings like Fiat (Commission/Luxembourg).5 A zig-zagging Court of Justice in major cases of principle is probably one of the striking features of 2024. Playing the role of a supreme court sometimes requires a change of mind, it is an inevitable fact of judicial life. There may have been a few too many in 2024.
Valančius (C-119/23)
The Court of Justice has spent several years setting the standards of judicial independence that Member States must respect under Union law, so it was just a matter of time until a case on the appointment of judges to the Court of Justice and the General Court itself made it to Luxembourg.6 The case was a reference made from the Lithuanian regional court of Vilnius, in proceedings brought by Virgilijus Valančius, the former Lithuanian judge of the General Court who had unsuccessfully applied for a renewed mandate. The national selection committee ranked him in first position, but the government decided to appoint a different candidate. Valančius challenged the decision in national court and the case was referred to the Court of Justice, that ruled in favour of the Lithuanian government. In reviewing the procedure and the criteria used to select the candidate to sit in the General Court, the Court of Justice interpreted Article 254 TFEU and fleshed out the basic standards that must govern the Member State’s decision to propose a candidate to the Union courts. The paradox is that, once the national procedure is over, the next phase in the selection process that takes place in Brussels is not very much in line with what the Court of Justice is requesting the Member States to comply with. While Valančius provides an important benchmark for future Member State conduct in the process of selecting European judges, it also stands as a stark reminder of the serious deficiencies that the selection process suffers from once it reaches the Union level, where an inter-governmental logic applies, devoid of all judicial review and transparency. Food for thought.
Real Madrid v. Le Monde (C-633/22)
In a bold move that took many by surprise, the Court of Justice introduced a powerful exception to the recognition of civil and commercial judgments under the Brussels I Regulation, in cases in which a serious breach of a fundamental right is at stake.7 The public policy clause has always been interpreted very strictly to avoid undermining the logic of the Brussels I Regulation. However, in a case concerning the freedom of the media and damages actions brought against a newspaper, the Court decided to stretch the margins of the public policy clause beyond its traditional strictures. The case is hugely important as it sets the tone for rule of law concerns in the field of judicial cooperation in civil and commercial matters, having already introduced some standards in criminal matters in previous years, but remaining mostly silent when it came to civil and commercial litigation. It is also a relevant ruling that fleshes out the basic contours of the freedom of the media, as recognised in the
4. Judgment of the Court of Justice of 10 September 2024, Commission v. Ireland (Apple) (C 465/20 P, EU:C:2024:724).
5. Judgment of the Court of Justice of 8 November 2022, Fiat (C 885/19 P and C 898/19 P, EU:C:2022:859).
6. Judgment of the Court of Justice of 29 July 2024, Valančius (C 119/23, EU:C:2024:653).
7. Judgment of the Court of Justice of 4 October 2024, Real Madrid Club de Fútbol v. Société Éditrice du Monde (C 633/22, EU:C:2024:843).
Charter, particularly at a time in which the European Media Freedom Act8 is now a binding Regulation, together with the Anti-SLAPP Directive,9 which provide a European framework to protect journalists and the integrity and autonomy of the press. The fact that the case stems from a dispute between a well-known football club and a well-established journal only adds further interest to what is undoubtedly the most relevant fundamental rights case of the year.
Illumina/Grail (Joined Cases C-611/22 P and C-625/22 P)
In March 2021, the Commission made a significant change to its policy regarding referrals under Article 22 of the EU Merger Regulation, with the aim of filling out gaps in the scope of EU merger control. According to the new policy, the Commission would accept referrals in certain circumstances and would also invite Member States to make such referrals even if they lacked jurisdiction under their own national rules, in order to capture competitively relevant transactions below threshold deals. In its Grand Chamber judgment of 3 September 2024,10 the Court of Justice overturned the Commission’s policy and opted for an orthodox interpretation of Article 22. The Court’s reasoning can be summarised with a simple ‘two negatives do not make a positive’. The fact that neither the Commission nor the national competition authority have jurisdiction, does not turn the situation into one in which the Commission ends up exercising jurisdiction. The Court pointed to the Member States, inviting them to legislate and lower their thresholds, so that no problematic transaction ends up outside the radar of competition policy. But the trend is going in the other direction, so eventually it will be for the EU legislature to clarify the scope of the Commission’s jurisdiction in the future. As an exercise in power-grabbing, the Illumina/ Grail saga is good proof that the Court of Justice is ready to draw a line on the Commission’s competition policy decisions, and that matters of jurisdiction are within the legal domain of the Court’s standard judicial review, and therefore not protected by the Commission’s broad margin of discretion.
Neves 77 (C-351/22) and KS & KD (C-29/22 P and C-44/22 P)
By the end of 2023 the negotiations between the European Union and the Council of Europe on the accession to the European Convention of Human Rights came to an end, having addressed all the (many) objections raised by the Court of Justice in Opinion 2/13, but one: the jurisdictional gap of the Union courts in the field of CFSP. It seemed as if this objection could only be surmounted by a Treaty amendment, until the Court of Justice stepped in and delivered its rulings in KS & KD and Neves 77. 11 Both judgments, but particularly KS & KD, provide a potential solution to the imbroglio caused by Article 275 TFEU, by introducing a ‘political question’ doctrine that
8. Regulation (EU) 2024/1083 of the European Parliament and of the Council of 11 April 2024 establishing a common framework for media services in the internal market and amending Directive 2010/13/EU, OJ 2024 L 1083.
9. Directive (EU) 2024/1069 of the European Parliament and of the Council of 11 April 2024 on protecting persons who engage in public participation from manifestly unfounded claims or abusive court proceedings, OJ 2024 L 1069.
10. Judgment of the Court of Justice of 3 September 2024, Illumina v. Grail (C 611/22 P and C 625/22 P, EU:C:2024:677).
11. Judgment of the Court of Justice of 10 September 2024, KS and KD (C 29/22 P and C 44/22 P, EU:C:2024:725), and judgment of the Court of Justice of 10 September 2024, Neves 77 Solutions (C 351/22, EU:C:2024:723).
allows Union courts to review CFSP acts in matters which do not affect strategic foreign policy decisions. The judgment is hugely important, not only because it potentially paves the way for (at last) a smooth accession to the ECHR in the near future, but it also resolves a deep anomaly in the Union’s system of judicial review, which hailed the Union’s adherence to human rights and the rule of law, but excluded judicial review of the Union’s foreign policy in extremely broad terms. This anomaly could come to an end if the practical implementation of this new approach in the case-law materialises in the years to come. For now, it is only an olive branch, but its importance and symbolism should not be understated.
Commission/Front Polisario (C-778/21 P and C-779/21 P) and Confédération paysanne (C-399/22)
External relations are always a fertile ground for important judgments of the Court of Justice. In 2024, the major development in this field was Front Polisario and Confédération paysanne, the second round of litigation concerning the EU-Morocco Association Agreement as a result of its application to the territory of the Western Sahara.12 Once again, the Court of Justice disagreed with the Union’s political institutions and forced their alignment with international law. Despite the pragmatic efforts of the Member States and the Commission to safeguard relations with Morocco, the Court of Justice once again rejected an attempt to negotiate with Morocco over a territory (Western Sahara) for which the UN supports the right of self-determination of its peoples. The Court of Justice insisted once again on its expansive notion of consent in international law, this time taking it even further by implicitly linking it to benefits. To some extent, the Court of Justice was also making pragmatic efforts to try to make ends meet between the imperatives of international law and the efforts of the political institutions in stabilising a bilateral relationship with Morocco. By doing so, the Court of Justice developed an original and broad notion of ‘consent’ under international law that is not in line with the opinio iuris on the matter. Once again, the autonomy of Union law allows the Court of Justice to go the extra mile when interpreting international law. It is yet to be seen if these acrobatic efforts will deliver the goods in the long term, or whether they will simply sow the seeds of discord and further litigation.
Google and Alphabet/Commission (Google Shopping) (C-48/22 P)
Exclusionary abuse was clearly one of the stars in this year’s menu. In the summer of 2024 the Commission published the draft text of its new guidelines, triggering a lively debate that has aroused concern among many in the competition field. And in September the Grand Chamber of the Court of Justice delivered the highly awaited judgment in the Google Shopping case.13 There are multiple reasons to include this ruling among the year’s leading cases, but two factors stand out. First, it confirms the trend in previous case law on Article 102 TFEU, departing from a formalistic approach towards judicial review and a more economic-centered analysis of Commission decisions in cases of abuse. Second, it provides valuable insights into the essential facilities doctrine applied
12. Judgment of the Court of Justice of 4 October 2024, Front Polisario (C 778/21 P and C 798/21 P, EU:C:2024:833) and judgment of the Court of Justice of 4 October 2024, Confédération paysanne (C-399/22, EU:C:2024:839).
13. Judgment of the Court of Justice of 10 September 2024, Google and Alphabet v Commission (Google Shopping) (C 48/22 P, EU:C:2024:726).
to digital markets. The notion of indispensability, which is at the core of the Bronner case-law, is recalibrated in Google Shopping by referring to an activity which is ‘indispensable to carrying on the undertaking’s business, inasmuch as there is no actual or potential substitute in existence for that infrastructure’. Google Shopping turned out to provide a useful benchmark for the Commission’s upcoming guidelines, and in ways that are not exactly in line with what the Commission originally had in mind. It looks as if exclusionary abuse will be back on the menu in 2025, but with the long shadow of Google Shopping hanging over it.
La Quadrature du Net II (C-470/21)
A judgment delivered in Full Court always deserves close attention. But this time around it is a peculiar Full Court, since the case was originally attributed to the Grand Chamber, only to be referred to the Full Court after the publication of the Advocate General’s first Opinion. 14 The Advocate General’s proposals in both Opinions were not entirely in line with the maximalist position traditionally held by the Court when it came to the protection of privacy in the digital sphere, thus hinting at the possibility of a recalibration. A change of approach could have been justified, since the European Court of Human Rights had taken a much more balanced analysis of these matters, and even the French Conseil d’État, the referring court of the case, had hinted in the past at the possibility of ignoring the Court of Justice’s strict stance and going solo. In the end, everybody could be disappointed and satisfied all at once. The Court of Justice did not reverse its case-law on the protection of digital privacy, but it certainly nuanced it when it came to the case of distinguishing between ‘typical’ and ‘atypical’ situations, to finally conclude that the French Hadopi law, which allowed public authorities to have access to data of non-serious copyright offences committed online, was in line with the Charter and, in particular, its proportionality test. The European Court of Human Rights could claim a victory too, since its approach and its balanced analysis was vindicated in the way that the Court of Justice approached the matter. Even the French Conseil d’État could be satisfied, having forced a Full Court in Luxembourg and a significant change of tone in digital privacy cases. It could be said that the Court of Justice landed in a terrain where all the players involved in this saga can now be comfortable, proving once again that developing a settled principled case-law in Europe requires time, patience and some clever nudging on the part of all the players involved.
Apple (Commission/Ireland, C-465/20 P)
The Apple judgment put an end to a saga that started some years ago in the US Senate, when Apple’s CEO admitted on the record that the company had received ‘a tax incentive arrangement’ in Ireland.15 From that moment onwards, the fight against aggressive tax planning started world-wide, and particularly in the European Union, where an impressive array of legislative measures was passed (DAC, ATAD 1, ATAD 2, the P2 Directive…) and the Commission transformed its state aid competence into an aggressive tax-planning combat zone. The Court of Justice was unimpressed by the Commission’s approach, as was confirmed in a number of judgments that
14. Judgment of the Court of Justice of 30 April 2024, La Quadrature du Net II (C 470/21, EU:C:2024:370).
15. Judgment of the Court of Justice of 10 September 2024, Commission v. Ireland (Apple) (C 465/20 P, EU:C:2024:724).
seemed to settle the matter, all of them delivered in Grand Chamber (Fiat, C-885/19 P and C-898/19 P, Engie, C-451/21 P and C-454/21 P, and Amazon C-457/21 P).16 The Court of Justice put state aid law back in its place, as a tool to combat selective tax advantages that derogate from the tax system of the Member State, but rejecting an imaginary and autonomous arm’s-length standard fabricated by the Commission that allowed it to indirectly legislate on tax matters through its state aid policy. But then, all of a sudden, the Apple judgment steps in and… surprise, surprise, the Court of Justice, in stark contrast with its previous rulings, decides to develop its own autonomous interpretation of the arm’s length principle (in terms that are not consistent with how international tax law conceives it) and ruled that the 13 billion euros (plus interest) of untaxed ocean profits of Apple belonged to Ireland. The judgment is even more puzzling, as shortly after, in UK and ITV v. Commission (C-555/22 P, C-556/22 P and C-564/22 P),17 the Court of Justice embraced the pre-Apple approach and confirmed its previous stance developed in Fiat, Engie and Amazon. The tax community was in shock, pointing at the multiple flaws of the Apple judgment in the tax assessment of the case, but mostly decrying the legal uncertainty created for tax authorities and multinational companies worldwide. The intentions of the Commission (and now of the Court of Justice) may have been noble, but the way in which they put them into motion produced one of the most notable reputational disasters for the Court of Justice (and the EU), leaving a long line of casualties along the way, including the Court’s reputation for thorough and quality technical analysis, and the principle of legal certainty.
EUIPO/The KaiKai Company Jaeger Wichmann (C-382/21 P)
Together with Polisario, KaiKai is the other leading judgment of the year in the field of external relations.18 The Court of Justice clarified the way in which Union secondary law must be interpreted in conformity with international agreements entered into by the Union. And the result is rather surprising: since the intent of the Union legislature was to exclude patents from the Community Designs Regulation, there is no possible consistent interpretation to be made in light of the Paris Convention on Industrial Property. Surprisingly, the General Court came to the opposite conclusion and ruled that the Regulation must include patents, but the Court of Justice saw it differently. The judgment is important because it sets the trend that puts Union secondary law at the forefront when it comes to its interaction with international agreements. By giving such a central role to the intent of the Union legislature, international agreements are put in a discrete and slightly subordinate role vis-à-vis Union secondary law, even in terms of interpretation. The all-mighty autonomy of Union law shows once again to what lengths its shadow can extend, and how its practical implications eventually sideline international law for the benefit of the Union legislature.
16. Judgment of the Court of Justice of 8 November 2022, Fiat (C 885/19 P and C 898/19 P, EU:C:2022:859), Judgment of the Court of Justice of 5 December 2023, Engie (C 451/21 P and C 454/21 P, EU:C:2023:948), Judgment of the Court of Justice of 14 December 2023, Amazon (C 457/21 P, EU:C:2023:985).
17. Judgment of the Court of Justice of 19 September 2024, UK and ITV v. Commission (C 555/22 P, C 556/22 P and C 564/22 P, EU:C:2024:763).
18. Judgment of the Court of Justice of 27 February 2024, EUIPO v. The KaiKai Company Jaeger Wichmann (C 382/21 P, EU:C:2024:172).
Commission/SRB (C-551/22 P)
Delegations within the EU’s institutional structure are frequent, but they are subject to strict conditions, particularly when the delegation comes from an institution and towards a technical agency. The Meroni doctrine was created for that reason in the 1950’s and it has acted as a constraint against unfettered delegation to technocratic bodies. However, in the years following the financial crisis, a sweeping number of reforms granted very broad powers to newly created EU agencies in the financial sector. One of the most spectacular examples of a powerful new agency was the Single Resolution Board, an agency with the power to resolve credit institutions and wipe out their capital for the sake of financial stability. To moderate the broad powers conferred on this agency, the Commission was given an endorsement ex-post power, to ensure that the final decision had the approval of an EU institution. In Commission v. SRB, the Court of Justice dealt with the powers of the SRB but in an even more complicated setting: bringing an action of annulment against the decisions of the SRB.19 In such a case, who must be taken to court?
The SRB as the technical agency with the expertise having made the material decision, or the Commission, due to its endorsement of the SRB’s previous actions? The Court of Justice reinstated a rather orthodox interpretation of the Meroni doctrine and settled the matter by arguing that the Commission was the only possible EU authority that could make the decision to resolve a bank (in this case, Banco Popular, a Spanish lender). Therefore, the shareholders wishing to challenge the decision in court had to bring an action against the Commission, not the SRB. Meroni orthodoxy has been restored, taking it a step further by extending it to judicial proceedings in Union courts.
19. Judgment of the Court of Justice of 18 June 2024, Commission v. SRB (C 551/22 P, EU:C:2024:520).
HIGHLIGHT F THE WEEK S O
Court of Justice to stream hearing on the validity of the appointment of a judge by the Polish National Council of the Judiciary
Tuesday 7 January
The Court of Justice’s Grand Chamber hearing in Rzecznik Praw Obywatelskich (Récusation d’un juge de droit commun) (C521/21), a case concerning a preliminary reference on the validity of a judge appointed by the Polish National Council of the Judiciary, was streamed on its website.
Read on EU Law Live
Action against Commission’s refusal of renewal of authorisation of smoke flavouring primary products, published in OJ
Tuesday 7 January
Official publication was made of an action, brought on 10 October 2024, by Kerry and Kerry Ingredients (UK) against the European Commission in regard to the refusal of the renewal of the authorisation of smoke flavouring primary product used in foodstuffs.
Read on EU Law Live
Preliminary reference on the applicability of the Services Directive to concessions of small-scale diversions and related power plants
Tuesday 7 January
A request for a preliminary ruling from the Corte Costituzionale (Italy), lodged on 7 October 2024, concerning the interpretation of Article 12 (1) and (2) of the Services Directive, was published in the Official Journal: Regione EmiliaRomagna (C-653/24).
Read on EU Law Live
ECtHR delivers judgment in cases regarding alleged “pushbacks” from Greece to Türkiye
Tuesday 7 January
The European Court of Human Rights handed down its judgments in A.R.E. v. Greece (application no. 15783/21) and G.R.J. v. Greece (application no. 15067/21), two cases concerning alleged “pushbacks” of a Turkish and Afghan national from Greece to Türkiye.
Read on EU Law Live
Action challenging ECB’s decision revoking VTB Bank’s license, officially published
Tuesday 7 January
Official publication was made of an action brought by VTB Bank against the ECB, by which the applicant credit institution seeks, in essence, the annulment of the decision, by which the defendant revoked its license: VTB Bank v ECB (T-568/24).
Read on EU Law Live
Regulation (EU) 2025/12 on the collection and transfer of advance passenger information for enhancing and facilitating external border checks, published in OJ
Wednesday 8 January
Official publication was made of Regulation (EU) 2025/12 of the European Parliament and of the Council of 19 December 2024 on the collection and transfer of advance passenger information for enhancing and facilitating external border checks, amending Regulations (EU) 2018/1726 and (EU) 2019/817, and repealing Council Directive 2004/82/EC
Read on EU Law Live
Regulation (EU) 2025/13 2024 on the collection and transfer of advance passenger information for the prevention, detection, investigation and prosecution of terrorist offences and serious crime, published in OJ
Wednesday 8 January
Official publication was made of Regulation (EU) 2025/13 of the European Parliament and of the Council of 19 December 2024 on the collection and transfer of advance passenger information for the prevention, detection, investigation and prosecution of terrorist offences and serious crime, and amending Regulation (EU) 2019/818.
Read on EU Law Live
General Court finds Commission liable for damages resulting from transfer of personal data to the US
Wednesday 8 January
The General Court (Extended Composition) delivered its judgment concerning an action against the transfers, initiated by the European Commission, when the applicant visited the website ‘https://futureu.europa.eu’ and registered for the ‘GoGreen’ event, on 30 March 2022, of the applicant’s personal data to recipients established in third countries without ensuring an adequate level of protection for the applicant, in breach of Chapter V of Regulation (EU) 2018/1725: Bindl v Commission (T-354/22).
Read on EU Law Live
Directive 2025/2 amending existing rules on macro-prudential tools and supervision of insurance and reinsurance companies, published in OJ
Wednesday 8 January
Official publication was made of Directive 2025/2 of the European Parliament and of the Council of 27 November 2024 amending Directive 2009/138/EC as regards proportionality, quality of supervision, reporting, long-term guarantee measures, macro-prudential tools, sustainability risks and group and cross-border supervision, and amending Directives 2002/87/EC and 2013/34/EU.
Read on EU Law Live
EDPS reprimands Frontex for breach of the Frontext Regulation when transmitting personal data to Europol
Wednesday 8 January
The European Data Protection Supervisor (EDPS) has reprimanded Frontex, the European Border and Coast Guard Agency, for not complying with the Regulation 2019/1896 (Frontex Regulation), when transmitting personal data of suspects of cross-border crimes to Europol, the EU’s agency for law enforcement cooperation.
Read on EU Law Live
Commission Implementing Regulations on definitive anti-dumping duty on imports of titanium dioxide and mobile access equipment from China, published in OJ
Thursday 9 January
Official publication was made of Commission Implementing Regulation (EU) 2025/4 of 17 December 2024 imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of titanium dioxide originating in the People’s Republic of China and Commission Implementing Regulation (EU) 2025/45 of 8 January 2025 imposing a definitive anti-dumping duty and definitely collecting the provisional duty imposed on imports of mobile access equipment originating in the People’s Republic of China.
Read on EU Law Live
Court of Justice clarifies excessive requests in data protection and the obligations of national supervisory authorities under the GDPR
Thursday 9 January
The Court of Justice delivered its judgment in Österreichische Datenschutzbehörde (Demandes excessives) (C-416/23) concerning the scope of “excessive requests” and the obligations of national supervisory authorities under the General Data Protection Regulation.
Read on EU Law Live
Data relating to the customer’s gender identity is not necessary for the purchase of a railway ticket, holds Court of Justice
Thursday 9 January
On 9th January, the Court of Justice handed down judgment in Mousse (C-394/23), a request for a preliminary ruling from the French Council of State concerning the interpretation of the GDPR.
Read on EU Law Live
Court of Justice interprets Articles 1 and 3 of Directive 2014/41/EU regarding the European Investigation Order in criminal matters
Thursday 9 January
On 9th January, the Court of Justice handed down judgment in Delda (C-583/23), a request for a preliminary ruling from the French Court of Cassation concerning the interpretation of Articles 1 and 3 Directive 2014/41/EU regarding the European Investigation Order in criminal matters.
Read on EU Law Live
AG Medina proposes that Court of Justice recognise ‘parallel imposition requirement’ in Commission Regulation No 330/2010
Thursday 9 January
On 9th January, Advocate General Medina delivered her Opinion in Beevers Kaas (C-581/23), a request for a preliminary ruling from the Court of Appeal in Antwerp (Belgium) concerning the so-called ‘parallel imposition requirement’ under Article 101 TFEU.
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Scope of “securities” under EU Prospectus Directive, clarified by Court of Justice in Schaerbeek and de Linkebeek (C-627/23)
Thursday 9 January
The Court of Justice delivered its judgment in Communes de Schaerbeek and de Linkebeek (C-627/23) addressing the interpretation of “securities” under Directive 2003/71/EC (the Prospectus Directive). This case arose from a dispute involving two Belgian municipalities, Schaerbeek and Linkebeek, and Holding Communal SA, concerning the legality of their subscription to a capital increase in the company without prior publication of a prospectus.
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AG Richard de la Tour: A Member State, acting in its capacity as an employer, may bring an action against an insurer under Article 13(2) of Regulation 1215/2012
Thursday 9 January
On 9th January, AG Richard de la Tour delivered his Opinion in Mutua Madrileña Automovilista (C-536/23), a request for a preliminary ruling from the Regional Court, Munich I (Germany), concerning the interpretation of Regulation 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.
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AG Medina interprets limits to payer’s right to reimbursement of amounts of unauthorised transactions under Directive 2007/64
Thursday 9 January
On 9th January, Advocate General Medina delivered her Opinion in Veracash (C-665/23), a request for a preliminary ruling from the French Court of Cassation concerning certain aspects of liability for unauthorised transactions set out in Directive 2007/64/EC on payment services in the internal market.
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Directive (EU) 2025/25 amending Directives 2009/102/EC and (EU) 2017/1132 as regards further expanding and upgrading the use of digital tools and processes in company law, published in OJ
Friday 10 January
Official publication was made of Directive (EU) 2025/25 of the European Parliament and of the Council of 19 December 2024 amending Directives 2009/102/EC and (EU) 2017/1132 as regards further expanding and upgrading the use of digital tools and processes in company law.
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Council Directive (EU) 2025/50 of 10 December 2024 on faster and safer relief of excess withholding taxes, published in OJ
Friday 10 January
Official publication was made of Council Directive (EU) 2025/50 of 10 December 2024 on faster and safer relief of excess withholding taxes, aiming to streamline and secure the process of relieving excess withholding taxes within the European Union (EU).
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Commission Implementing Regulation imposing an anti-dumping duty and collecting provisional duty on imports of polyvinyl chloride from Egypt and US
Friday 10 January
Official publication was made of Commission Implementing Regulation (EU) 2025/36 of 9 January 2025 imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of certain polyvinyl chloride originating in Egypt and the United States.
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European Court of Auditors highlights concerns over EU price interventions and sharing account data free of charge regarding digital payments
Friday 10 January
A new report by the European Court of Auditors (ECA) on digital payments found that there is no provision requiring the Commission to periodically review EU price interventions and that sharing account data free of charge may act as a disincentive to delivering high-quality open banking services in the EU.
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