Competence and conferral

Why is competence important:

- The EU was created and is constrained by the treaties, supranational organisation
- It has no innate power, or competence to take legally binding actions
- Eu has competence when such power is granted under the treaties, essentially the
treaties provide the power to undertake measure or legislate, treaties themselves
are giving the EU certain powers to act
- The principle of conferral is security

Principle of conferral:

Art 5 TEU:
“Under the principle of conferral, the Union shall act only within the limits of the
competences conferred upon it by the Member States in the Treaties to attain the
objectives set out therein. Competences not conferred upon the Union in the Treaties
remain with the Member States.”

- Eu in terms if taking measures or legislating will only be identifiable when the

treaties outline that it has power to do
- For example, its ability to control its internal market the EU can legislate on certain
issues that may affect this
- Member states are giving assession over the EU to decide over certain matters
- This is provided by agreeing to the treaties and becoming a member
- The EU has certain powers that will be reigned supreme when it comes to law
making
- Exercised exclusively or on a shared basis by the EU
- Constrained by what the treaties provide, EU cannot do beyond its powers which is
agreed by members of it

Competence:

Wherever the member states have not given competence to the EU to act, the member
states remain completely in control
- Providing the competence by agreeing to the treaties as well as controlling the
treaties
- But the measures have a specific legal basis
- The EU can only act to implement the provisions of the treaty and the competencies
are given by the treaty by which they can act
- If the union acts in an area that has not been given power the act will be annulled by
the European courts
Measures must have a specific legal basis
- The EU can only act to implement provisions of the treaty

If the union ever acts in an area where it has not been given power, then this act can be
annulled by the EU courts
 - What or when will the EDU have competence over a matter
- This is usually a centre of gravity test
- What is the purpose of the measure under qs?
- And to what extent does this fall under the competencies of the EU, this can lead to
unclarity

Transfer, or limitation, of authority:

The classic explanation of the grant of competence is found in Van Gen en Loos
- Case 26/62, EU:C:1963:1
- In this case van gen imported chemicals from Germany to the Netherlands and
authorities charged a certain tariff on them which initially was objected to paying
- They finally paid it and went to national courts and raised the case in order to get a
refund
- Case was based on the idea that the topic itself was against EU law and therefore
they wanted to claim his own rights as a national under EDU law
- This was raised to the court of justice; the basis was to see whether individuals were
capable of claiming rights under EU law

On the basis that treaties themselves were treaties of supranational organisations which
should have been between member states and the EU and not EU nationals and the EU
- The courts disagreed and stated that we have competence overtrade and therefore
if we provide rights to individuals, they can simply claim them

“The Community constitutes a new legal order of international law for the benefit of which
the states have limited their sovereign rights, albeit within limited fields and the subjects of
which comprise not only member states but also their nationals.”
- If we have competence over a certain matter and that competence signifies that we
will provide rights to certain nationals
- There is nothing we can do about it as EU law was the competence to decide on the
matter
- And if it decides certain nationals should have certain rights, these rights are capable
of claimed subject to EU law and subject to national law

• Competence has passed from the signatory MSs to the EU in the limited fields defined by
the Treaty.
– Limited not only by field, but also by purpose.
- Certain measure have more than open objective
- If it correlates with the field that the measure is in the EU, has the competence to
decide on certain matters then the EU decided whether the measure is undertaken,
or a legal issue needs to be undertaken subject to the rules that we consider
Conferral and competence:

- EU treaties that member states have agreed to, outlines competencies that are
within them (what the EU’s competencies are) defined by the member states
- The principle of conferral ensures that the EU, when it has competence to decide
over a matter it will decide over a matter only within the EU treaties
- With the power provided, if it goes outside of this ultra vires the power that is being
provided, the measure can be subject to annulment by the court of justice of the
European union

shades of competence:

Exclusive competence (art 3 TFEU), only the EU can act

- Examples: customs unions, common commercial policy
- Member states have relinquished control over this, only the EU can adopt measures
or legislate on these matters

Shared competence (art 4 TFEU): both the EU and member states can act
- For example: internal market, environment, consumer protection
- Both can adopt measures or legislation as well and who decides each time is based
on subsidiarity and proximity

Co-ordination role
- Competence to provide arrangements within which EU member states must
coordinate policy (art 5 TFEU)
- Examples: economy, employment, social matters

Competence to support, coordinate, or supplement actions of the member states (art 6

TFEU)
- Examples: health, culture, tourism
- EDU has no option to implement a measure on a legally binding measure, only aid to
help coordinate policy or supplement member states in things that are seen to be in
the public interest, political arrangement
Scope of EU’s competences:
- The principle of conferral dictates that the EU acts only within the limits of the
competences conferred by the treaties – it would then have a competence in the
ideas and principle of these competences
- The scope of EU’s competences is found within the treaties
- Interpret based on the centre of gravity test
- Interpreting the scope of treaties (whether legislation or the measure falls within the
competencies of the EDU)
- If it goes out of these limits set out by the treaty this will be annulled by the courts
due to the principle of conferral

 For example, Art16 (2) TFEU: “The European Parliament and the Council...shall lay
down the rules relating to the protection of individuals with regard to the processing
of personal data by Union institutions, bodies, offices and agencies, and by the
Member States when carrying out activities which fall within the scope of Union law,
and the rules relating to the free movement of such data.”
 EDU has competences in dictating how the rules will be undertaken bu the European
union, but it has competences to decide how these issues will be taken to secure
such data

In practice?
GDPR (Reg. 2016/679), [10]: “In order to ensure a consistent and high level of protection of
natural persons and to remove the obstacles to flows of personal data within the Union, the
level of protection of the rights and freedoms of natural persons with regard to the
processing of such data should be equivalent in all Member States... Regarding the
processing of personal data for compliance with a legal obligation, for the performance of a
task carried out in the public interest or in the exercise of official authority vested in the
controller, Member States should be allowed to maintain or introduce national provisions to
further specify the application of the rules of this Regulation.”
- Being attached onto national law, on the basis of the internal market which it has
shared competence with the member states to ensure whether the EU should
legislate

Arts 114 & 115 TFEU: The EU shall “adopt the measures for the approximation of the
provisions ... which have as their objective the establishment and functioning of the internal
market”.
- To ensure the uniform application of rules under the internal market
– If harmonising is connected to health, safety, environmental protection, or consumer
protection the EU will take as a base a “high level” of protection.
- Within the scope of the internal market as the key objective of the measure, this
would then fall in the competence of the European union
- But if it doesn’t health policy is not in the competence of the EU, so this would be
annulled
Contrast with Art 168(1) TFEU – “Union action, which shall complement national policies,
shall be directed towards improving public health, preventing physical and mental illness
and diseases, and obviating sources of danger to physical and mental health.”
- Only an understanding that the EU has to consider health when it comes under its
competences
- But not health directly (if the internal market is trying to establish an issue with
health policy, providing that the main focus is for the internal market this will still be
in the EU’s competencies)

Germany v parliament & council:

 Case C-376/98, EU:C:2000:544, [2000] ECR I-8419
 Directive banning tobacco advertising on certain products
 Based on arts 94/95 (now art 114/115 TFEU)
 Different standards across the community
 Low level of trade between member states in these products
 Measure must be more intended for protection of health
 No competence to establish free-standing health policy
 Directive annulled
But this wasn’t good for business (formula 1 was making money out of merchandise from
Michael Schumacher – Germany)
- The people they were idolising had tobacco merchandise on them, so they could not
sell the merch
- Action was brought within the directive itself to see whether the EDU had
competence to take the directive in this or not was the objective in the competitive
of the EU
- If it was it could not be annulled
- If this was not it would be going beyond the powers in the treaties and against the
principal of conferral
- So was it concerned with harmonising rules in the internal market or was it
concerned with setting health policy which was outside of the EU’s power
- This was in coordination role, so no competence
- There was low level of trade in this market between member states anyway, so the
court found it hard to establish that it was concerned with the facilitation of the
internal market so therefore it was decided by the court that it was concerned with
health policies

Directive is still in place, as a certain exception that is in place within the EU frame:

R v Secretary for health, ex parte BAT & imperial tobacco:

 Case C-491/01, EU:C:2002:741, [2002] ECR I-11453
 Directive making common health member states interfering with free trade
 Because in some member states health warning were higher than others
 Trade was made so that standards of labelling and health warning would be the
same
 Directive was valid because high amount of trade in tobacco and this measure would
facilitate free movement
 This fell within the competencies of the EU
Art 352 TFEU: residual competence:

“If action by the Union should prove necessary, within the framework of the policies defined
in the Treaties, to attain one of the objectives set out in the Treaties, and the Treaties have
not provided the necessary powers, the Council, acting unanimously on a proposal from the
Commission and after obtaining the consent of the European Parliament, shall adopt the
appropriate measures.”

- Tobacco advertising directive has been passed

- If the EDU lacks a form of power due to competencies article 235 can be used to
facilitate it, has to be within the treaties
- It has to be an objective of the treaties
- The commission has to consent, the parliament has to consent, and the council must
unanimously vote to pass this measure or legislation, exception to the rule

 Art. 352(3) “Measures based on this Article shall not entail harmonisation of
Member States' laws or regulations in cases where the Treaties exclude such
harmonisation.
 Art. 352(4) “This Article cannot serve as a basis for attaining objectives pertaining to
the common foreign and security policy and any acts adopted pursuant to this Article
shall respect the limits set out in Article 40, second paragraph of the Treaty on
European Union.”
 Declaration 42: Article 352 “cannot serve as a basis for widening the scope of Union
powers beyond the general framework created by the provisions of the Treaties as
a whole and, in particular, by those that define the tasks and the activities of the
Union. In any event, this Article cannot be used as a basis for the adoption of
provisions whose effect would, in substance, be to amend the Treaties without
following the procedure which they provide for that purpose.”

Teleological interpretation:

How should the union competences be interpreted?

 Strict principle of conferral: Competences should be interpreted restrictively based
on the historical intentions of the Member States.
 Would the centre of gravity test be interpreted in a narrow way, or how it is
implemented in general on a wide scope
 The latter approach is taken – teleological (Objective to what the member states
have tried to attempt to achieve at the time)
 Soft principle of conferral – competences can be interpreted based on teleological
interpretation to give the general objective meaning
 Competences within the EU – strict interpretation may not reflect the true objective
of member states of what they want the EU to do in the first place

Case C-84/94 UK v Council (Working Time Directive) ECLI:EU:C:1996:431

 The legal basis of the directive allowed the Union to “encourage improvements,
especially in the working environment, as regards the health and safety of workers”
  Main Issue: Can this provision be used to regulate organisation of working time?
 UK: Working time has no thematic link to health and safety - EU acted ultra vires
 “There is nothing in the wording of Article [153 TFEU] to indicate that the concepts
of "working environment", "safety" and "health" as used in that provision should, in
the absence of other indications, be interpreted restrictively, and not as embracing
all factors, physical or otherwise, capable of affecting the health and safety of the
worker in his working environment, including in particular certain aspects of the
organization of working time”.
 Teleological approach can be used to increase the scope of the competences to and
objective as this could hinder the ability of the internal market with reference to the
employment market, but how can this be determined for the future

Implied powers:
Express powers – flow from the natural reading of the treaty
Implied powers – derived by the court from given tasks or the objectives of the union
That gives effect to another providing that isn’t expressly states in the treaty
Narrow formulation – the existence of a given power
Wide formulation – the existence of a given objective or function

Competences are constrained by the principle of conferral – centre of gravity test

Subsidiarity:

Art5(3) TEU:
“Under the principle of subsidiarity, in areas which do not fall within its exclusive
competence, the Union shall act only if and in so far as the objectives of the proposed
action cannot be sufficiently achieved by the Member States, either at central level or at
regional and local level, but can rather, by reason of the scale or effects of the proposed
action, be better achieved at Union level. The institutions of the Union shall apply the
principle of subsidiarity as laid down in the Protocol on the application of the principles of
subsidiarity and proportionality. National Parliaments ensure compliance with the principle
of subsidiarity in accordance with the procedure set out in that Protocol.”

- This assumes that the EU will act when member states cannot act on their own

Subsidiarity:
There are 3 conditions to this provision:
- It should be an area which do not fall within the union’s exclusive competences
- It must not be possible for the member states to sufficiently achieve the objectives
of the treaties
- Circumstances must be such that they are better achieved by action at union level

Protocol (no2) on the principle of subsidiarity and proportionality:

- Increase the role of national parliaments (NPS) – an accountability mechanism for
the EU based on subsidiarity and proportionality
- All draft legislation must be sent to NPs containing a detailed statement on its
compliance with subsidiarity
 - NPs have eight weeks to respond that the draft measure does not accord with
subsidiarity
- If enough NPs respond the procedure is triggered

Yellow Card: 1⁄3 of MSs votes (or 1⁄4 in matters concerning Freedom, Security and Justice)
– the Commission shall review its proposal. • Orange Card: Majority of MSs votes.
– the Commission must review the proposal & if maintained must be approved by EP and
Council.
• Member States or the Committee of the Regions may challenge legislation if they feel it is
not in accordance with subsidiarity under Art 263 TFEU.

Commission – report on better law making (2003):

COM(2003)770 final

“Subsidiarity is a guiding principle for defining the boundary between MS and EU

responsibilities (Who should intervene?) ... If competence is shared between the
Community and the MSs, the principle clearly establishes a presumption in favour of
decentralisation. The Treaty indeed states that Community action is justified only whether:

 –  there are transnational aspects which cannot be satisfactorily regulated by

national measures (necessity test I);
If member states cannot deal with issues that exceed their own border, it will be considered
necessary for the EU to intervene
 –  national measures alone or lack of Community action would conflict with the
requirements of the EC Treaty or would otherwise significantly damage Member
States’ interests (necessity test II); and
Issues on national measures, if they do not concern any member state, the union law will
need to intervene
 –  action at Community level would provide clear benefits compared to national
measures (added value test).”
Unified approach – better results for national measures
GDP – uniform approach on how we regulate will be better, how data protection will be
protected at an EU level

Proportionality:

• Article 5(4) TFEU

“Under the principle of proportionality, the content and form of Union action
shall not exceed what is necessary to achieve the objectives of the Treaties”. • Case C-
181/84 Man (Sugar) EU:C:1985:359
“in order to establish whether a provision of Community law is in conformity with the
principle of proportionality it is necessary to ascertain whether the means which it employs
are appropriate and necessary to attain the objective sought.”

Protocol (no2) on the principles of subsidiarity and proportionality:

Article 5 “Any draft legislative act should contain a detailed statement making it possible to
appraise compliance with the principles of subsidiarity and proportionality. This statement
should contain some assessment of the proposal's financial impact and, in the case of a
directive, of its implications for the rules to be put in place by Member States, including,
where necessary, the regional legislation. ... Draft legislative acts shall take account of the
need for any burden, whether financial or administrative, falling upon the Union, national
governments, regional or local authorities, economic operators and citizens, to be
minimised and commensurate with the objective to be achieved.”

Commission report on better law-making:

“Proportionality is a guiding principle for defining how the Union should exercise its
competence, once it has been established that it should take action (what should be the
form, nature and extent of EU action?). In order to establish whether a measure complies
with the principle of proportionality, it must be ascertained whether:
– the means employed are suitable for the purpose of achieving the objectives
(effectiveness test);
– these means do not go beyond what is necessary to achieve the objectives (efficiency
test).”

British American tobacco:

Case C-491/01, EU:C:2002:741, [2002] ECR I-11453
“the Directive’s objective is to eliminate the barriers raised by the differences which still
exist between the Member States’ law ... on the manufacture, presentation and sale of
tobacco products, while ensuring a high level of health protections, in accordance with
Article 95(3) ... Such an objective cannot be sufficiently achieved by the member States
acting individually and calls for action at Community level, as demonstrated by the
multifarious development of national laws in this case ... It follows that ... the objective of
the proposed action could be better achieved at Community level ... Second, the intensity
of the action undertaken by the Community in this stance was also in keeping with the
requirements of the principle of subsidiarity in that ... it did not go beyond what was
necessary to achieve the objective pursued’

International air transport association et al

• Case C-344/04, EU:C:2006:10
“The principle of proportionality, which is one of the general principles of Community law,
requires that measures implemented through Community provisions should be appropriate
for attaining the objective pursued and must not go beyond what is necessary to achieve
it ... With regard to judicial review of the conditions referred to in the previous paragraph,
the Community legislature must be allowed a broad discretion in areas which involve
political, economic and social choices on its part, and in which it is called upon to undertake
complex assessments. Consequently, the legality of a measure adopted in those fields can
be affected only if the measure is manifestly inappropriate having regard to the objective
which the competent institution is seeking to pursue.”