Re-thinking the European Constitution in an Enlarged
European Union
Challenging the Legality of Community Acts
Will the Reform Treaty make it any easier?
By Professor Derrick Wyatt QC
St Edmund Hall, Oxford
Jean Monnet seminar
Advanced Issues of European Law
University of Zagreb in Dubrovnik
It is recommended that participants read this text, and the following cases, in
advance
Case 120/86 Mulder [1988] ER 2321
Case 11/82 Piraiki Patraiki v Commission [1985] ECR 207
Case C-50/00 P Unión de Pequeños Agricultores v Council of the European Union.
[2002] ECR I – 6677 (please be sure to read the Advocate General’s Opinion as well
as the Court’s judgment)
Case C-125/06 P Commission v Infont WM AG judgment of 13th March 2008).
Mechanisms for challenging the validity of Community acts – direct action under
Article 230 EC and references from national courts under Article 234 EC
The EC Treaty provides two mechanisms by which the legality, or validity, of a
Community act, may be brought before the Community Courts. One is by means of a
direct challenge under Article 230 EC; the other is by means of reference from a
national court under Article 234 EC.
In the case of a direct action, a challenge to legality may be brought by either
“privileged applicants”, (a Member State, the Council, the European Parliament, or
the Commission), or by natural or legal persons.
The Member States, Council, European Parliament and Commission are described as
“privileged applicants” because they need not establish any particular interest in the
subject matter of the proceedings in order to bring a case; they are treated as
guardians of the public interest.1
The Court of Auditors and the European Central Bank may also initiate proceedings but only “for the
purpose of protecting their prerogatives.”
1
Natural or legal persons do not enjoy automatic standing to challenge Community
acts; they can only challenge decisions addressed to them, or regulations or decisions
addressed to third parties which are of “direct and individual concern” to them. These
standing rules are very strict, and for individuals and companies the possibility of a
national court making a reference to the Court of Justice under Article 234 EC may
provide the only means of securing a judgment on the validity of a Community act.
Both mechanisms provide the means of challenging all binding acts of the institutions.
The most significant categories of binding acts are those which comprise regulations,
directives and decisions within the meaning of Article 249 EC.
The effect of a successful challenge under Article 230 EC is annulment; the act in
question is normally declared void ab initio. The annulment is binding erga omnes. A
successful challenge under Article 234 EC leads to a ruling by the Court of Justice
that the act in question is void. This is not technically the same as annulment, but it
leads to the same result in practice. The ruling on invalidity is binding on the national
court, and the ruling entitles any other national court to regard the act as void. The
Community institutions are obliged to take the administrative and legislative measures
necessary to give effect to the Court’s judgment. This includes repealing the act in
question, and considering whether the unlawful act caused those subject to it damage
which has to be made good.2
The grounds for challenging the legality of Community acts
The grounds for challenging the legality of Community acts are described in Article
230 EC as:
“grounds of lack of competence, infringement of an essential procedural
requirement, infringement of this Treaty or of any rule of law relating to its
application, or misuse of powers.”
Although Article 234 EC does not repeat this formulation, it is established that the
grounds for challenging the validity of Community acts under Article 234 EC are the
same as the grounds for challenging the legality of such acts under Article 230 EC.
The grounds cited in Article 230 EC resemble chapter headings in a textbook on
administrative law, rather than a list of defects which are sufficiently precisely
defined in themselves to allow a confident diagnosis of legality or not in a particular
case.
The reference to “infringement of this Treaty or any rule of law relating to its
application”, includes infringement of general principles of Community law, such as
proportionality, equality, and legitimate expectation. The reference to “lack of
competence” includes circumstances where the Community institutions adopt an act
on the basis of a provision of the EC Treaty which does not authorise the adoption of
the act in question, or does not authorise certain provisions of the act in question.
2
Wyatt and Dashwood’s European Union Law, 5th edition, (2006), p. 527.
Illegality for lack of competence – the Tobacco Advertising Case
The law making competences of the Community institutions are based upon a system
of attributed powers – they enjoy only such powers as the Treaty bestows upon them.
This is expressly clearly in Article 5 EC, which states that the Community “shall act
within the limits of the powers conferred upon it by this Treaty, and of the objectives
assigned to it therein.” One of the powers conferred upon the Community is the power
to adopt legislation for the establishment and functioning of the internal market.
Article 95 EC provides that the Council, after consulting the Economic and Social
Committee, shall adopt harmonisation measures “which have as their object the
establishment and functioning of the internal market.” Article 95 refers to Article 14
EC, which defines the internal market as “an area without internal frontiers in which
the free movement of goods, persons, services and capital is ensured…”.
Directive 98/43/EC, prohibiting the advertising and sponsorship of Tobacco Products,
was adopted on the basis of Article 95 EC, as well as Treaty provisions relating
specifically to the free movement of services.
The Directive prohibited all forms of advertising and sponsorship of tobacco
products and prohibited any free distribution having the purpose or the effect of
promoting such products.3 The Directive did not however prohibit communications
between professionals in the tobacco trade, advertising in sales outlets or in
publications published and printed in third countries not principally intended for the
Community market.4 The Directive prohibited (with certain exceptions) the use of the
same names for tobacco products and for other products and services, and provided
(with certain exceptions) that tobacco products must not bear the brand name, trade
mark, emblem or other distinctive feature of any other product or service. 5 The
rationale of prohibiting such “diversification products” was to prevent tobacco
product manufacturers advertising their products indirectly by marketing and
advertising products such as clothing bearing the same trade mark as a tobacco
product.
The preamble of the Directive justified it as an internal market measure on the basis
that it removed obstacles to trade in advertising media products, and advertising
services, and removed distortions of competition.
Germany challenged the Directive under Article 230 EC,6 arguing that the Directive
was in reality a health measure, that health was in principle excluded from
harmonisation under the EC Treaty,7 that the Directive did not remove any
appreciable distortions of competition, and that banning advertising could not be said
to remove obstacles to trade in advertising services and advertising media products.
3
Article 3(1) and (4).
Article 3(5).
5
Article 3(2) and 3(3)(a).
6
Case C-376/98 Germany v Parliament and Council [2000] ECR I-8419.
7
Article 154(2)(c) EC excludes harmonisation of national rules in the field of public health.
4
The Court agreed with Germany that certain provisions of the Directive could not be
upheld. For numerous types of advertising of tobacco products, the Directive’s
prohibition could not be justified by the need to eliminate obstacles to the free
movement of advertising media or the freedom to provide services in the field of
advertising. That applied “in particular, to the prohibition of advertising on posters,
parasols, ashtrays and other articles used in hotels restaurants and cafés, and the
prohibition of advertising spots in cinemas, prohibitions which in no way help to
facilitate trade in the products concerned.”8
The Court’s approach seems based on the broad contention advanced by Germany, to
the effect that a total ban on advertising makes no contribution to trade in advertising
media or advertising services. The Court’s reasoning suggests that removing obstacles
to trade in a good or service by banning that good or service is not an option available
to the Community lawmaker.9
The Court adopted a similar conclusion as regards diversification products, in light of
the absence of a “free movement” clause for compliant products.
But in the Court’s view, some elements of the Directive could be upheld. The Court
held that it was essential that a Directive based on Article 95 EC made a genuine
contribution to the internal market. But providing that a directive made a genuine
contribution to the internal market, it was permissible for health considerations to play
a decisive role in the formulation of the measures in question. Some of the provisions
of the directive could make such a genuine contribution to the internal market.
Banning sponsorship (e.g., by Formula One Racing promoters) could prevent
appreciable distortion of competition, since differences between national rules could
actually determine in which Member State such sporting events would be held.
Similarly, banning tobacco advertising in newspapers and periodicals could facilitate
their free movement, since differences in national rules could prevent a newspaper
published in one Member State being marketed in another.
The Court annulled the Directive in its entirety, even though some of its provisions
could in principle be upheld. Partial annulment would have entailed amendment by
the Court of the provisions of the Directive. The Court considered that such
amendments were a matter for the Community legislature.
Invalidity for breach of general Principles of Law
Sources and subject matter of general principles of law in the Community legal order
General principles of law define and limit the scope of the competences of the
Union Institutions to adopt binding acts.10 They also place obligations on Member
8
Case C-376/98 Germany v Parliament and Council [2000] ECR I-8419, at paragraph 99.
Disparities between national rules on poster advertising and filmed advertisements in cinemas would
seem apt to comprise obstacles to trade – no doubt capable of justification – under Article 28 EC.
Prohibiting the use of a product for its main purpose, or one of its main purposes, (such as posters
advertising cigarettes, or filmed advertisements for showing in cinemas) amounts to a restriction on
imports, see Case C-473/98 Kemikalienspektionen v Toolex Alpha AB [2000] ECR I-5681.
10
But the application of human rights and fundamental freedoms is not necessarily limited to defining
the scope of Union competence to adopt binding acts. Under the TEU the Union “shall respect
9
States when the latter are acting within the scope of Union obligations, e.g., when
Member States invoke exceptions to fundamental Treaty freedoms, or adopt national
rules or administrative acts to implement Union legislation.
The EC Treaty has from the outset expressly laid down certain general legal
principles, such as the duty of co-operation which binds both Member States and the
institutions in ensuring fulfillment of the obligations arising from the Treaty; 11 and the
principle of non-discrimination on grounds of nationality.12 Some general principles,
such as proportionality, equality, and legitimate expectation, are wholly or mainly the
product of judicial development, though the principle of proportionality is now
expressly recognised in the Treaty as a constitutional principle of the Union legal
order, and the Union has been given competence to legislate to fight discrimination
other than that on grounds of sex and nationality. Fundamental rights traveled a
similar road to proportionality; first recognised by the Court’s case law, then endorsed
by declarations of the institutions, and finally written into the fundamental law of the
European Union. General principles such as these have important legal effects. They
place limits on the administrative and legislative competence of the Community
institutions, they govern the interpretation of provisions of Community law,13 and
they bind the Member States when the latter act within the scope of operation of
Union law.
The Court can hardly be said to have exceeded its jurisdiction by its recourse to the
general principles of law. No Treaty regime, let alone the “new legal order” of the
Community, could be interpreted and applied in a legal vacuum. International
tribunals have long been regarded as competent to draw upon the general principles of
municipal law as a source of international law,14 and the competence of the Court of
Justice in the interpretation and application of Community law could surely have been
intended to be no less. The Treaty might be said to imply as much. Article 220 EC
provides that “The Court of Justice shall ensure that in the interpretation and
application of this Treaty the law is observed.” While this formulation implies
commitment to the rule of law, it has been argued that this implies a corpus juris
outwith the express Treaty texts.15
Breach of the principle of equality leading to the invalidity of an EC Regulation
The general principle of non-discrimination has been held to supplement the
specific reference to non discrimination in Article 34(2) EC, which provides that the
common organizations of the agricultural markets “shall exclude any discrimination
between producers or consumers within the Community.” In Codorniu the Court held
fundamental rights…” (Article 6(2)), and such rights are applicable to e.g., the operational conduct of
the common foreign and security policy under Title V of the TEU, though the Court of Justice is not
given jurisdiction over alleged breaches.
11
Article 10 EC see below.
12
Article 12 EC see below.
13
Case 316/86 Hauptzollamt Hamburg-Jonas v. Krucken [1988] ECR 2213, para. 22; Joined Cases 201
and 202/85 Klensch [1986] ECR 3466, para. 10; Joined Cases C-90/90 and C-91/90 Neu and Others v.
Secrtaire d’tat  l’Agriculture [1991] ECR I – 3617, para. 12.
14
See Wyatt, “New legal Order, or Old?” (1982) 7 E.L.Rev. 147 at p. 157. C.f. Article 38 of the Statute
of the International Court of Justice, which lists as a source of international law, “the general principles
of law recognized by civilized nations.”
15
See Pescatore, “Fundamental Rights and Freedom in the System of the European Communities”
[1970] A.J.I.L. 343, at p. 348.
the foregoing principle includes the prohibition of discrimination on grounds of
nationality laid down in the first paragraph of Article 12 EC,16 which states that
“[w]ithin the scope of application of this Treaty, and without prejudice to any special
provisions contained therein, any discrimination on grounds of nationality shall be
prohibited.”17 In Ruckdeschel18 and Moulins19 proceedings arose from challenges in
national courts to the validity of a Council Regulation abolishing production refunds
on maize used to make quellmehl and gritz, while allowing the continued payment of
refunds on maize used to make starch, a product in competition with both quellmehl
and gritz. Producers of the latter product argued that they had been placed at a
competitive disadvantage by the Council’s discriminatory, and hence unlawful,
action. Referring to Article 34(2) EC, the Court observed:
“While this wording undoubtedly prohibits any discrimination between producers
of the same product it does not refer in such clear terms to the relationship
between different industrial or trade sectors in the sphere of processed agricultural
products. This does not alter the fact that the prohibition of discrimination laid
down in the aforesaid provision is merely a specific enunciation of the general
principle of equality which is one of the fundamental principles of Community
law. This principle requires that similar situations shall not be treated differently
unless differentiation is objectively justified.”20
The Court of Justice accepted that the Regulation removing the production refund in
issue was discriminatory and invalid.
Challenge came to the ECJ via a reference from national courts under Article 234 EC
It is to be noted that the question of the validity of the provision of the Council
Regulation in issue was brought before the Court of Justice by means of proceedings
before a national court which resulted in a reference under Article 234 EC. The
plaintiffs in the national proceedings before the German courts and the French courts
applied to the national authorities responsible for paying the production refunds for
continued payment of production refunds in respect of quelmehl and gritz. In each
case the national authorities (predictably) refused to pay, on the grounds that the
production refunds on these products had been abolished.
Case C-309/89 Codorníu SA v Council of the European Union. [1994] ECR I – 1853, para. 26.
The reference to “without prejudice to any special povisions contained therein” refers particularly to
other provisions of the Treaty in which the application of the general principle of non discriminatiion
on gorunds of nationality is given concrete form in respect of specific situations, such as free
movement of workers, the right of establishment and the freedom to povide services, see Case C186/87 Cowan [1989] ECR 195 at para. 14. Article 12 EC “applies independently only to situations
governed by Community law in regard to which the Treaty lays down no specific prohibition of
discrimnation,” see Case 305/87 Commission v. Greece [1989] ECR 1461 at para. 13.
18
Cases 117/76 and 16/77 [1977] ECR 1753.
19
Cases 124/76 and 20/77 [1977] ECR 1795.
20
Cases 117/76 and 16/77 Ruckdeschel [1977] ECR 1753 at 1769; Joined Cased 124/76 and 20/77
Moulins [1977] ECR 1795 at 1811. And see Case 300/86 Landschoot v. Mera [1988] ECR 3443; Case
C-37/89 Weiser [1990] ECR I – 2395; Case C-2/92 Bostock [1994] ECR I – 955, para. 23. The
principle applies as between identical or comparable situations, Case T-48/89 Beltrante [1990] ECR II
– 493 at para. 34.
16
17
The plaintiffs challenged these refusals before the German/French courts, arguing
that the abolition of the refunds was unlawful. In each case the national court referred
the question of the validity of the abolition of the refund to the European Court.
Breach of the principle of Legitimate expectations leading to the invalidity of an EC
Regulation
The principle of legitimate expectations, which may be invoked as against
Community rules only to the extent that the Community has previously created a
situation which can give rise to a legitimate expectation, 21 operates in particular to
protect individuals where they have acted in reliance upon measures taken by the
Community institutions.
The Mulder case illustrates that an EC Regulation which is incompatible with the
principle of legitimate expectation will be held to be invalid by the Court of Justice. In
order to stabilize milk production, Community rules provided for dairy farmers to
enter into non-marketing agreements for a period of five years, in return for which
they received a money payment. In 1984 reference quantities, also known as milk
quotas, were introduced, whereby milk producers would pay a super levy on milk
produced in excess of a quota determined by reference to their production during the
1983 marketing year. No provision was made for the grant of quota to those who did
not produce during 1983 because of the existence of a non-marketing agreement!
Having been urged to suspend milk production under Community rules, farmers were
then excluded from milk production when their non-marketing period came to an end.
One such farmer challenged the regulations in this regard. The Court of Justice held
that the relevant regulation was invalid to the extent that no provision for allocation of
quota was made in such cases. The basis of the ruling was the principle of legitimate
expectations. As the Court explained:
“where such a producer, as in the present case, has been encouraged by a
Community measure to suspend marketing for a limited period in the general
interest and against payment of a premium he may legitimately expect not to
be subject, upon the expiry of his undertaking, to restrictions which
specifically affect him because he availed himself of the possibilities offered
by the Community provisions.”22
Challenge came to the ECJ via a reference from national courts under Article 234 EC
It is to be noted that the question of the validity of the provision of the Council
Regulation in issue was brought before the Court of Justice by means of proceedings
21
Case C-375/96 Galileo Zaninotto v Ispettorato Centrale Repressione Frodi - Ufficio di Conegliano Ministero delle risorse agricole, alimentari e forestali. [1998] ECR I – 6629, para. 50. The CFI held
that three essential conditions have to be met in order to claim legitimate expectations: (i) precise,
consistent and unconditional assurances given by the institution to the individual; (ii) those assurances
must be as such as to create a legitimate expectation; (iii) the assurances must comply with the
applicable rules, e.g. Case T- 282/02 Cementbouw Handel and Industrie BV v Commission, judgment
of 23/02/06, nyr, (para 77).
22
Case 120/86 [1988] ER 2321, para. 24. For a survey of the case-law of the Court see Sharpston,
“Legitimate Expectation and Economic Reality” (1990) 15 EL Rev. 103.
before a national court which resulted in a reference under Article 234 EC. The
plaintiff in the national proceedings, after the end of his 5 year non marketing period,
applied for a milk quota from the relevant national authority. His application was
refused because he could not show evidence of milk production during 1983 (which
fell during his non marketing period).
Mr Mulder challenged that refusal before a national court, which referred to the Court
of Justice the question of the validity of the relevant Regulation to the extent that it
denied a reference quantity/milk quota to a dairy farmer whose reason for not
producing milk during 1983 had been compliance with a non marketing agreement.
Direct Challenges under Article 230 EC – the Problem of Standing
The text of Article 230(4) EC
It has already been noted that the standing rules for individuals to challenge
Community acts under Article 230 EC are strict. Article 230(4) EC states:
“Any natural or legal person may, under the same conditions, institute
proceedings against a decision addressed to that person or against a decision
which, although in the form of a regulation or a decision addressed to another
person, is of direct and individual concern to the former.”
Actions brought by natural or legal persons fall within the jurisdiction of the Court of
First Instance, pursuant to Article 225(1) EC and Article 51 of the Statute of the Court
of Justice.
No problem of standing arises in the case of a decision addressed to an individual or a
company. It is clear from the text of Article 230(4) that the person concerned can
bring an action directly challenging the decision in question.
But in cases where a decision is addressed to another person (which includes a
Member State), or in cases where a decision is “in the form of a regulation,” the
individual or company will only have standing if the act is “of direct and individual
concern” to that person.
Two problems raised by the reference to “direct and individual concern”
This reference to “direct and individual concern” raises two problems. The first is a
legal problem – when does a litigant wishing to challenge a decision or regulation
satisfy this condition? The second is a practical problem – it is generally agreed that
the condition is very difficult to satisfy.
The meaning of direct concern
The Court stated in Les Verts v Parliament23 that a measure was of direct concern to an
applicant where it constituted “a complete set of rules which are sufficient in themselves
and which require no implementing provisions”, since in such circumstances the
23.
Case 294/83 Les Verts [1986] ECR 1339, para 31.
application of the measure “is automatic and leaves no room for any discretion”. Thus, in
order to establish direct concern, an applicant must be able to show that, at the time the
contested act was adopted, the effect it would produce on him was substantially certain.
Where the applicant is only affected by a measure because of the way a third party has
exercised a discretion conferred on him and it was not possible to say in advance how he
would do so, the applicant will not therefore be able to establish direct concern. In Alcan
v Commission,24 for example, a decision addressed to two Member States refusing to
grant them import quotas was held not to be of direct concern to an applicant where the
allocation of any quota would have been a matter for the discretion of the Member States
concerned.
A measure requiring implementation by a third party may be of direct concern to an
applicant if the third party has no discretion in the matter.25 Similarly, an applicant may
be able to establish direct concern if, at the time the contested measure was adopted,
there was no real doubt how any discretion left to a third party would be exercised. In
Piraiki-Patraiki v Commission,26 for example, the applicants sought the annulment of a
Commission decision authorizing France to impose a quota system restricting imports of
cotton yarn from Greece during a specific period shortly after Greek accession. The
Commission argued that the applicants were not directly concerned by the contested
decision, since it required implementation by the French authorities, which were free not
to make use of the authorization. That argument was rejected by the Court, since the
contested decision had been adopted in response to a request from the French authorities
for permission to impose an even stricter quota system. In those circumstances, the Court
concluded that “the possibility that the French Republic might decide not to make use of
the authorization granted to it by the Commission decision was entirely theoretical, since
there could be no doubt as to the intention of the French authorities to apply the
decision”.27
The meaning of individual concern
Starting with the text……
The case law on this topic is complicated by the fact that although in virtually all
cases the Court has applied the test of individual concern consistently, and narrowly,
in a handful of cases the Court has adopted a more liberal approach, without,
however, providing a principled basis for that liberal approach to be developed in
future case law.
If we read the text of Article 230(4) EC with a view to deducing its aim, the core idea
seems to be that individuals and companies should be able to challenge decisions
addressed to them, and other acts (at any rate decisions addressed to third parties and
regulations) which, although not decisions addressed to them, are “aimed” at them in
much the same way as would be a decision addressed to them.
24.
Case 69/69 [1970] ECR 385.
25.
See e.g. Case 113/77 NTN Tokyo Bearing Company v Council [1979] ECR 1185.
26.
Case 11/82 [1985] ECR 207. Cf. Case C-404/96 P Glencore Grain [1988] ECR I-2435; Case T-80/97
Starway v Council [2000] ECR II-3099, para 68.
27.
Para 9 of the judgment.
“Individual concern” in the case law
This is borne out by an early statement on the meaning of “individual concern”, in the
Plaumann case, to the effect that:28
“Persons other than those to whom a decision is addressed may only claim to
be individually concerned if that decision affects them by reason of certain
attributes which are peculiar to them or by reason of circumstances in which
they are differentiated from all other persons and by virtue of these factors
distinguishes them individually just as in the case of the person addressed.”
In order for an individual to show that he is individually concerned, it seems to be
necessary to show that the decision maker adopting the act in question took him into
account, or should have taken him into account.
A person is individually concerned if the decision maker took him into account or
should have taken him into account
The point is illustrated in Piraiki-Patraiki v Commisson.29 In this case the
Commission, under Article 130 of the Greek Act of Accession to the EC, authorised
France to impose a quota system on imports into France of cotton yarn from Greece.
The decision was challenged by Greek exporters of cotton yarn, a number of which
had already entered into contracts for the export of cotton yarn from Greece to France
during the period affeced by the. The Court held that those exporters who had already
entered into contracts were individually concerned by the decision; those who had not
already entered into contract were individually concerned. Article 130(3) of the Greek
Act of Accession prvoided that ‘the measures authorised….may involve derogations
from the rules of the EEC Treaty… to such an extent and for such periods as are
strictly necessary….Priority shall be given to such measures as will least disturb the
functioning of the Common Market.” The Court held that in order to determine
whether a potential decision restricting imports meets the latter conditions, the
Commission must enquire into the negative effects its decision might have on the
undertakings concerned. The Court stated that the Commission
“must also consider, in so far as is possible, the contracts which those
undertakings, relying on the continuation of free trade within the Community,
have already entered into and whose execution will be wholly or partially
prevented by the decision authorising the protective measure.”
The Commission argued that it would have been impossible for it, during the brief
period within which it had to act, to make itself aware of the exact number of
contracts meeting that description. The Court rejected that argument in the
circumstances of the case, noting that, as the Commission admitted at the hearing, it
28
29
See Case 25/62 Plaumann [1963] ECR 95.
Case 11/82 [1985] ECR 207
had arranged a meeting with representatives of the Greek Government and the trade
interests concerned, which included certain of the applicants.
The Court concluded that those undertakings which had already concluded contracts
were individually concerned by the contested decision.
The Court also concluded that the decision was void as regards such contracts, since
“the Commission should have been more prudent in its attitude and should have…
taken into account, with a view to their possible exemption in whole or in part from
the application of the decision, contracts entered into in good faith before the date of
that decision and to be performed during the months covered by the protective
measures.”
It has sometimes been said that a person is individually concerned if a member of a
closed class of persons to which the challenged act applies. But the Court of Justice
has made it clear that this is only the case if there was a duty to take account of the
members of that class. As the Court of First Instance says in Case T-166/99 Luis
Fernando Andres de Dios [2001] ECR II – 1857, para. 54:
“For the existence of such a [closed] class to be a relevant factor
distinguishing the persons in question individually in relation to a legislative
act, it is settled case law that the institution adopting the contested act must
have been under an obligation to take account, at the time of the adoption of
the act, of the particular circumstances of those individuals…”
But the Court has allowed for “special cases”…
There is no doubt that applying the condition of individual concern in this way, while
technically correct, has the result that the condition is difficult for individuals to
satisfy. In some cases, the Court of Justice has been given way to the tempation to
relax the requirement of individual concern.
One such case is Codorníu SA v Council of the European Union.30 The Council
adopted a Regulation on the description and presentation of sparkling wines. Pursuant
to this Regulation the term 'crémant' was to be be reserved for quality sparkling wines
made in France or Luxembourg. The effect would be to prevent this term being used
to describe quality sparkling wines made in Spain, where wines had traditionally been
described in this way. Codorniu was a Spanish company manufacturing and
marketing quality sparkling wines psr (produced in a specified region),. It was the
holder of the Spanish graphic trade mark (marca gráfica) "Gran Cremant de
Codorniu", which it had been using since 1924 to designate one of its quality
sparkling wines. Codorniu was the main Community producer of quality sparkling
wines psr the designation of which includes the term "crémant". Other producers
established in Spain also use the term "Gran Cremant" to designate their quality
sparkling wines psr.
30
C-309/89 [1994] ECR I – 1853.
Since it took the view that the contested provision was unlawful Codorniu challenged
its validity under Article 230 EC. The Council argued that the action was inadmissible
since Codorniu was not individually concerned.
The Court dealt shortly with the question of admissibility, as follows:
“20 Natural or legal persons may claim that a contested provision is of
individual concern to them only if it affects them by reason of certain
attributes which are peculiar to them or by reason of circumstances in which
they are differentiated from all other persons (see the judgment in Case 25/62
Plaumann v Commission [1963] ECR 95).
21 Codorniu registered the graphic trade mark "Gran Cremant de Codorniu" in
Spain in 1924 and traditionally used that mark both before and after
registration. By reserving the right to use the term "crémant" to French and
Luxembourg producers, the contested provision prevents Codorniu from using
its graphic trade mark.
22 It follows that Codorniu has established the existence of a situation which
from the point of view of the contested provision differentiates it from all
other traders.”
The Court went on to hold that the contested provision was invalid because it was
discriminatory on grounds of nationality.
The view that Codorniu was individually concerned has generally been regarded as
generous, and out of line with the rest of the Court’s case law. The Court does not
suggest that the Council should have taken account of Codorniu’s specific
circumstances. The Court of First Instance (which now deals with all challenges under
Article 230(4) EC) has described Codorniu as being individually concerned because
the EC Regulation had the effect of “preventing the applicant from using its exclusive
rights or of depriving it of its rights”.31
The Court of Justice refuses to adopt a more generous approach to the concept of
“individual concern” in Unión de Pequeños Agricultores v Council of the European
Union (hereafter UPA)
This case once again concerned the common agricultural policy. The common
organisation of the olive oil markets, as amended, laid down schemes in respect of
intervention prices, production aid, consumption aid and storage, as well as imports
and exports.
On 20 July 1998 the Council adopted the contested regulation which reforms, in
particular, the common organisation of the olive oil markets. For that purpose, the
previous intervention scheme was abolished and replaced by a system of aid for
private storage contracts. Consumption aid and the specific allocation of aid to small
producers were discontinued. The stabiliser mechanism for production aid based on a
maximum guaranteed quantity for the Community as a whole was amended by being
apportioned among the producer Member States in the form of national guaranteed
Case T-2213/02 SNF SA v Commission of the European Communities [2004] ECR II – 3047, para.
68.
31
quantities. Finally, olive groves planted after 1 May 1998 are excluded, subject to
certain exceptions, from any future aid scheme.
By application lodged at the Registry of the Court of First Instance on 20 October
1998, Unión de Pequeños Agricultores, a trade association which represents and acts
in the interests of small Spanish agricultural businesses and which has legal
personality under Spanish law, brought an action, pursuant to Article 230(4) EC for
annulment of the contested regulation (with the exception of the aid scheme for table
olives).
The Council raised an objection of inadmissibility, and the Court of First Instance
dismissed the application as manifestly inadmissible. The applicant appealed to the
Court of Justice.32
According to the appellant, the disputed provisions of the contested regulation, did not
require any national implementing legislation, and did not occasion the taking of any
measures by the Spanish authorities. Consequently, the appellant cannot, under the
Spanish legal system, seek annulment of a national measure relating to the disputed
provisions. A reference under Article 234 EC to challenge its validity is therefore
precluded.
Advocate General Jacobs considered that the Court of Justice should depart from its
previous caselaw, and adopt a new approach to “individual concern”.
He considered that an individual should be regarded as individually concerned by a
Community measure “where, by reason of his particular circumstances, the measure
has, or is liable to have, a substantial adverse effect on his interests.”
He did not regard the alternative of seeking a ruling through Article 234 EC as
offering full and effective judicial protection, for the following reasons:

“It may be recalled, first of all, that the national courts are not competent to
declare measures of Community law invalid.33 In a case concerning the
validity of a Community measure, the competence of the national court is
limited to assessing whether the applicant's arguments raise sufficient doubts
about the validity of the impugned measure to justify a request for a
preliminary ruling from the Court of Justice” (para. 41 of Opinion).

“Access to the Court of Justice via Article 234 EC is however not a
remedy available to individual applicants as a matter of right. National
courts may refuse to refer questions, and although courts of last instance are
obliged to refer under the third paragraph of Article 234 EC, appeals within
the national judicial systems are liable to entail long delays which may
themselves be incompatible with the principle of effective judicial protection
and with the need for legal certainty” (para. 41 of Opinion).
Case C-50/00 P Unión de Pequeños Agricultores v Council of the European Union. [2002] ECR I –
6677.
33
Case 314/85 Foto-Frost [1987] ECR 4199.
32

“Third, it may be difficult, and in some cases perhaps impossible, for
individual applicants to challenge Community measures which - as
appears to be the case for the contested regulation - do not require any
acts of implementation by national authorities. In that situation, there may
be no measure which is capable of forming the basis of an action before
national courts “(para. 43 of Opinion).

Proceedings in the national courts, with the additional stage of a reference
under Article 234 EC, are likely to involve substantial extra delays and
costs. The potential for delay inherent in proceedings brought before domestic
courts, with the possibility of appeals within the national system, makes it
likely that interim measures will be necessary in many cases. However, …[the
grant of interim measures is] to some extent dependent on the discretion
of national courts. In any event, interim measures awarded by a national
court would be confined to the Member State in question, and applicants
might therefore have to bring proceedings in more than one Member
State. That would, given the possibility of conflicting decisions by courts in
different Member States, prejudice the uniform application of Community
law, and in extreme cases could totally subvert it” (para. 44 of Opinion).
Before the ECJ ruled in UPA, Court of First Instance followed AG Jacobs in JégoQuéré et Cie SA v Commission34
Commission Regulation (EC) No 1162/2001 aimed to reduce catches of young hake
(seafish). It applied to fishing vessels operating in the areas defined by it, and imposed
on them minimum mesh sizes, varying according to the areas concerned, for the
different net fishing techniques employed, irrespective of the type of fish which the
vessel in question was seeking to catch.
Jégo-Quéré was a fishing company established in France which operated on a regular
basis in the waters referred to the regulation. It brought proceedings under Article
230(4) EC to annul relevant parts of the Regulation. The Commission contested the
admissibility of the action on the ground that J-Q was not individually concerned.
The CFI considered that J-Q was not individually concerned within the meaning of
the case law of the Community Courts to date.
However, the applicant also asserted that, were its action to be dismissed as
inadmissible, it would be denied any legal remedy enabling it to challenge the
legality of the contested provisions. Since the regulation did not provide for the
adoption of any implementing measures by the Member States, the applicant
maintained that, in the present case, it would have no right of action before the
national courts.
The CFI accepted the latter argument:
34
[2002] ECR II - 2365
“45 However, as regards proceedings before a national court giving rise to a
reference to the Court of Justice for a preliminary ruling under Article 234 EC,
it should be noted that, in a case such as the present, there are no acts of
implementation capable of forming the basis of an action before national
courts. The fact that an individual affected by a Community measure may be
able to bring its validity before the national courts by violating the rules it lays
down and then asserting their illegality in subsequent judicial proceedings
brought against him does not constitute an adequate means of judicial
protection. Individuals cannot be required to breach the law in order to gain
access to justice (see point 43 of the Opinion of Advocate General Jacobs
delivered on 21 March 2002 in Case C-50/00 P Unión de Pequeños
Agricultores v Council, not yet published in the European Court Reports).”
And the CFI rejected the argument of the Commission that an action for damages for
non-contractual liability against the Community could provide an effective judicial
remedy, since it provided for compensation only in cases where the Community was
guilty of a sufficiently serious breach of a superir rule of law for the protection of the
individual.
The CFI concluded:
“51 In the light of the foregoing, and in order to ensure effective judicial
protection for individuals, a natural or legal person is to be regarded as
individually concerned by a Community measure of general application that
concerns him directly if the measure in question affects his legal position, in a
manner which is both definite and immediate, by restricting his rights or by
imposing obligations on him….
52 In the present case, obligations are indeed imposed on Jégo-Quéré by the
contested provisions. The applicant, whose vessels are covered by the scope of
the regulation, carries on fishing operations in one of the areas in which, by
virtue of the contested provisions, such operations are subjected to detailed
obligations governing the mesh size of the nets to be used.”
But the Court of Justice in UPA maintains its traditional position on “individual
concern”
Only two months after the CFI’s radical new departure from existing case law on the
concept of “individual concern”, the Court of Justice gave its ruling in UPA. Key
points in the Court’s judgment are:

The Treaty has established a complete set of legal remedies and procedures
designed to ensure judicial review of the legality of acts of the institutions, and
has entrusted such review to the Community Courts.

Where natural or legal persons cannot directly challenge measures of general
application under Article 230(4), because they do not satisfy the conditions for
admissibility, they may do so before the national courts and ask those courts to
make a reference on validity under Article 234 EC.
The Court added (para. 41 of its judgment) that is was for
“the Member States to establish a system of legal remedies and procedures which
ensure respect for the right to effective judicial protection.”
The Court added:
“42 In that context, in accordance with the principle of sincere cooperation
laid down in Article 10 of the Treaty, national courts are required, so far as
possible, to interpret and apply national procedural rules governing the
exercise of rights of action in a way that enables natural and legal persons to
challenge before the courts the legality of any decision or other national
measure relative to the application to them of a Community act of general
application, by pleading the invalidity of such an act.”
These passages are significant. The appellant had argued that since the contested
regulation had not involved any implementing measures, there was no national
measure to challenge before a national court, and therefore no possibility of a
challenge via Article 234 EC. The Court seems in effect to be making two points.
One point relates to the duty of national courts. It is for the national courts to interpret
and apply national procedural rules as far as possible in a way which enables
individuals to challenge contested regulations before national courts.
The other point relates to the broader duty of Member States, to establish a system of
legal remedies and procedures which ensures respect for the right of effective judicial
protection.
Placing these two duties together – it is for national courts to do the best they can with
the existing procedures in place in Member States. If that is not enough, then Member
States must legislate to make any necessary adjustments.
Further guidance on the duties of Member States is given by the Court of Justice in
Jégo-Quéré
The applicant had succeeded in the latter case, but the Commission appealed to the
Court of Justice, and in light of the Court’s earlier ruling in UPA, the outcome was a
foregone conclusion.35
But the judgement gives some further guidance as to the sort of adjustments which
national courts and Member States must make in order to ensure that individuals can
raise the validity of regulations in national proceedings with a view to a reference on
validity under Article 234 EC.
35
Case C-263/02 P [2004] ECR I – 3425.
It will be recalled that J-Q concerned a Commission Regulation specifying the mesh
size of nets to be used by those engaged in fishing activities. J-Q had argued that since
the regulation did not provide for the adoption of any implementing measures by the
Member States, no national measure existed which could be challenged before the
national court, so as to enable a challenge to the validity of the Regulation by a
reference under Article 234 EC. J-Q argued further that it would only be possible to
secure effective judicial protection by taking the step of breaking the Regulation in
question. [It will be noted that AG Jacobs had considered that limiting judicial
protection to such circumstances was insufficient to guarantee effective judicial
protection.]
The Court in J-Q repeated its reasoning in paras. 41 and 42 of UPA. And the Court
added:
“35. In the present case, it should be pointed out that the fact that Regulation
No 1162/2001 applies directly, without intervention by the national
authorities, does not mean that a party who is directly concerned by it can only
contest the validity of that regulation if he has first contravened it. It is
possible for domestic law to permit an individual directly concerned by a
general legislative measure of national law which cannot be directly contested
before the courts to seek from the national authorities under that legislation a
measure which may itself be contested before the national courts, so that the
individual may challenge the legislation indirectly. It is likewise possible that
under national law an operator directly concerned by Regulation
No 1162/2001 may seek from the national authorities a measure under that
regulation which may be contested before the national court, enabling the
operator to challenge the regulation indirectly.”
What did the Court have in mind? Presumably that an operator like J-Q could ask the
national authorities whether they intended to enforce the contested regulation. In the
event that the national authorities responded in the affirmative, national law could
permit J-Q to challenge the latter response, on the ground that it would be unlawful to
enforce an invalid Regulation. It seems that Member States are obliged to ensure that
a challenge such as this is actually possible.
English law permits a challenge by way of judicial review to the intention or
obligation of the United Kingdom Government to implement a Directive even though,
when the application was made, the period prescribed for implementation of the
Directive had not yet expired. It was on this basis that the Administrative Court
referred to the Court of Justice various questions on the validity of Directive
2001/37/EC on the manufacture, presentation and sale of tobacco products, in Case C491/01 The Queen v Secretary of State for Health ex parte British American Tobacco
(Investments) Ltd [2002] ECR I – 11453, see paras. 36-38.
Recent signs of relaxation of the concept of individual concern?
It was noted above that the Court of First Instanace held in the Luis Fernando case
that
“For the existence of such a [closed] class to be a relevant factor
distinguishing the persons in question individually in relation to a legislative
act, it is settled case law that the institution adopting the contested act must
have been under an obligation to take account, at the time of the adoption of
the act, of the particular circumstances of those individuals…”
More recently, the Court of Justice (upholding the judgment of the CFI) has endorsed
the proposition that where a decision affects a group of persons who were identified
or identifiable when that measure was adopted by reason of criteriao specific to
members of the group, those persons might be individually concerned inasmuch as
they form part of a limited class of traders. The Court added that “…this can be the
case particularly when the decision alters rights acquired by the individual prior to its
adoption” (Case C-125/06 P Commission v Infont WM AG judgment of 13th March
2008).
It is perhaps significant that neither the CFI, nor the Court of Justice, placed specific
reliance upon the judgment of the Court in Codorniu. It seems that if an applicant is a
member of a closed class, who was identified to the decision maker, or was
identifiable by the decision maker at the time the contested act was adopted, that is in
itself enough to amount to individual concern, at any rate where the decision in
question alters rights acquired by the applicant prior to its adoption.
Amendment of Article 230(4) EC by the Reform Treaty
The Reform Treaty amends Article 230 EC in the following relevant respects.
Article 230(1) EC becomes Article 263 of the Treaty on the Functioning of the
European Union, and is amended as follows
The Court of Justice of the European Union shall review the legality of legislative
acts, of acts of the Council, of the Commission and of the European Central Bank,
other than recommendations and opinions, and of acts of the European Parliament and
of the European Council intended to produce legal effects vis-à-vis third parties. It
shall also review the legality of acts of bodies, offices or agencies of the Union
intended to produce legal effects vis-à-vis third parties.
Article 230(4) becomes Article 263(4) TFEU, as follows:
Any natural or legal person may, under the conditions referred to in the first and
second subparagraphs, institute proceedings against an act addressed to that person or
which is of direct and individual concern to them, and against a regulatory act which
is of direct concern to them and does not entail implementing measures.
The latter text is the same as that used in the Constitution Treaty. The reference to
“regulatory acts” appears to be a reference to non-legislative acts, that is to say,
“European regulations” and “European decisions” within the meaning of the
Constitution Treaty.36 In the Reform Treaty, corresponding non-legislative acts
36
See e.g., Wyatt and Dashwood’s European Union Law, 5th edition,, page 378.
would seem to comprise the “non-legislative acts of general application” referred to in
Article 290(1) of TFEU; these comprise acts adopted by the Commission under
powers delegated by legislative acts.37
It follows that individuals may challenge a Commission act of general application if
they are directly concerned by it and the act “does not entail implementing measures”.
If the Commission act entails implementing measures, it seems that individuals must
challenge the validity of the Commission act by challenging the implementing
measures in a national court, and seeking a reference under Article 234 EC.
There is possibly some ambiguity about the meaning of “implementing measures”.
The words clearly cover national legislative rules implementing a Commission act.
What if a provision of a regulatory act concerned the payment of money by national
authorities on the authority of the regulatory act? Would individual non discretionary
decisions of the national authorities amount to implementation? If such
“implementation” allowed individuals to challenge the validity of the regulation under
which the payments were made in a national court, this would enable the national
court to make a reference under Article 234 EC. It might be said that a regulatory act
“entails implementing measures” whenever implementation by a national authority
enables individuals directly concerned to bring a challenge to the regulatory act before
a national court with a view to a reference under Article 234 EC. This approach might
however, not be conducive to legal certainty, and this might argue in favour of
treating a regulatory act as only entailing implementing measures when it requires the
adoption of binding national provisions by Member States.
In all other cases (apart from that of a decision addressed to an individual) the
established rule of requiring individual as well as direct concern applies. Thus if the
facts of J-Q recurred, the applicant would have standing to challenge the Regulation.
But if the facts of UPA recurred, the applicant would not have standing to challenge
the Regulation.
A further provision of the Reform Treaty relevant in this context is Article 19 TFEU,
which provides, inter alia, that
“Member States shall provide remedies sufficient to ensure effective legal protection
in the fields covered by Union law.”
This would seem to reinforce the statements of the Court of Justice in J-Q and UPA as
regards the duty of Member States and national courts to ensure that individuals are
able to bring proceedings in national courts so as to challenge the validity of
Community acts.
37
A legislative act may delegate to the Commission the power to adopt non-legislative acts to
supplement or amend certain non-essential elements of the legislative act.