Thursday, June 21, 2012

This Week in Luxembourg

This week’s Grand Chamber judgement (per Judge Lõhmus) is well outside my area of expertise: In trademark law, the prejudicial questions concerned “the identification of the goods and services for which the protection of a trade mark is sought” under Directive 2008/95. Whether the Court’s answers actually clarify anything is apparently still up for debate. Chartered Institute of Patent Attorneys v. Registrar of Trade Marks Cf. IPKat

BNP Paribas and BNL v. Commission is a case about state aid law and banking crisis restructuring, combined with creative corporate income tax law in Italy, so I’ll limit myself to the play-by-play: The Commission said it was unlawful state aid, the General Court (Judge Vilaras) agreed, and now the CJEU (per Judge Fernlund) decided that the review by the General Court was insufficient, but that the Commission’s Decision should still be upheld.

In Access to Documents law, the Court (per Judge Malenovský) annulled the General Court’s judgement in IFAW Internationaler Tierschutz-Fonds v. Commission (per the German (!) Judge Dittrich) because, well, because the General Court hadn’t actually looked at the document in question. So now the General Court has to go and look at it to decide whether the Commission was entitled to refuse access on the grounds that the German government had prepared it and wanted it kept confidential. IFAW Internationaler Tierschutz-Fonds v. Commission

An interesting bit of copyrights law: Mr. Titus Donner will not get away with his attempts to circumvent the German copyrights law by ostensibly selling his infringing products from Italy. The Court (per Judge Schiemann) followed AG Jääskinen and chose reality over legal fiction, meaning that the defendant could go to jail for up to 5 years (cf. art. 106 and 108a of the UrhG). Donner

It sounds obvious enough when you say it out loud, but “the conditions of access to the labour market by Bulgarian students (…) may not be more restrictive than those set out in Directive 2004/114 on the conditions of admission of thirdcountry nationals for the purposes of studies, pupil exchange, unremunerated training or voluntary service.” Sommer v. Landesgeschäftsstelle des Arbeitsmarktservice Wien

The conclusion in Wolf Naturprodukte v. Sewar (per Judge Šváby) is simple enough: “Article 66(2) of Regulation 44/2001 [means] that, for that regulation to be applicable for the purpose of the recognition and enforcement of a judgment, it is necessary that at the time of delivery of that judgment the regulation was in force both in the Member State of origin and in the Member State addressed.”

In Sillogos Ellinon Poleodomon kai Khorotakton v. Ipourgos Perivallontos, Khorotaxias kai Dimosion Ergon, et al., the Court (per Judge Schiemann) goes over the law on environmental impact studies again.

I’m going to try not to say something harsh about ANGED v. FASGA et al. (per Judge Levits), at least not here: “Article 7(1) of Directive 2003/88 [precludes] national provisions under which a worker who becomes unfit for work during a period of paid annual leave is not entitled subsequently to the paid annual leave which coincided with the period of unfitness for work.”

On the same day as its reprimand by the CJEU in BNP Paribas and BNL v. Commission (see above), the General Court also got reprimanded by AG Bot for failing to “exercise its unlimited jurisdiction in considering the proportionality of the fine imposed by the European Commission on E.ON Energie AG”. Incidentally, the fine in question was € 38 million for breaking a seal. The Commission’s Decision is here, and the General Court judgement (per Judge Martins Ribeiro) is here. E.On v. Commission

AG Kokott, after citing Douglas Adams, sided with Italy in its ongoing dispute with EPSO. She argued that the General Court was wrong to conclude that a personnel posting that explicitly required a good knowledge of English, French or German needed to be published in full only in those three languages. According to the AG, the posting should have been in full in all 23 official languages. Italy v. Commission

AG Cruz Villlalón looks at the re-utilisation of the contents of databases under art. 7 of Directive 96/9 and comes up with an inconvenient answer. Whether it is also correct or not I do not have the expertise to say. Football Dataco et al. v. Sportradar

AG Bot’s opinion in Gülbahce v. Hamburg, which deals with – of course – the rights of Turkish workers in the Common Market, is a bit of a mixed bag for Turkish citizens. On the one hand, he explains that you cannot retroactively take away someone’s residence permit absent a showing of fraud, but on the other hand he proposed that the Court should put a stop to any attempt to leverage art. 10(1) of Decision 1/80 to get around the requirements listed in art. 6(1) for an extension of a residence permit.

Following last year’s Aladzhov, there is now another case before the Court about Bulgarians not being allowed to leave the country. This time, it’s not about an unpaid tax debt, but about an unpaid significant debt to another private citizen. AG Mengozzi concluded that such a ban on travelling abroad will not normally be consistent with EU law – which is in line with Aladzhov except formulated in reverse – and added that the plaintiff’s ability to challenge his travel ban in Bulgarian court left somewhat to be desired. Byankov v. Glaven sekretar na Ministerstvo na vatreshnite raboti

In competition law, the President of the Court two weeks ago upheld the decision of the President of the General Court not to allow Deutsche Bahn to intervene in the air freight cartel case. The fact that DB Schenker is a customer (as well as a potential competitor) of the cartel is not enough to give it a sufficient interest in the case, nor is the fact that it has a potential private damages claim. DB Schenker v. Lufthansa et al. (there are a whole number of orders but they are all the same).

Wednesday, June 20, 2012


Yesterday, EUObserver had an excellent - although perhaps somewhat optimistic - opinion article about the idea of creating a Benelux for the West-Balkans, or specifically for Albania, Macedonia, Kosovo and Montenegro. Before I focus on the little detail that particularly captivated me, I'd first like to briefly discuss the main idea.

In the words of the authors:
Albania, Kosovo, Macedonia and Montenegro should join forces to build a new and permanent co-operation structure aimed at boosting their political and economic relations, with a final common goal of accelerating EU membership.
To start with my main concern: As the Economist's Eastern Approaches explained only yesterday,
[People in the Balkan] are concerned about jobs, health care, the education of their children and pensions. These material worries preoccupy them much more than ethnic grudges or the desire to reconquer territory they believe their nation has lost to a neighbour.
That said, I foresee significant issues if Albania were to create such a union with Kosovo (90% ethnic Albanians), Macedonia (25%) and Montenegro (5%). The authors recognise that
It is important to convince the international audience that this is not some kind of greater Albania through the back door,
but offer no explanation as to how this should be done, or how the domestic audiences of the four participating countries should be convinced. Serbia and the Serb minority in Kosovo would go ballistic, and the Macedonians haven't forgotten about their country's brief civil war in 2001 either. Only Montenegro would seem to be confident enough about the place of their Albanian minority in overall society to consider joining AlMacKoM.

However, assuming this problem can be overcome, such a union would seem to me to be an excellent idea. It gives these countries a useful exercise in compromising and institution building at a small scale, allowing them to develop the skills they need to operate more effectively on the European and World stages. At the same time, great economic advantages are not to be expected, given how unimportant these countries are for each other's trade. Courtesy of the CIA World Factbook:
  • Albanian Exports: Italy 50.8%, Kosovo 6.2%, Turkey 5.9%, Greece 5.4%, China 5.5%
  • Albanian Imports: Italy 28%, Greece 13%, China 6.3%, Turkey 5.6%, Germany 5.6%
  • Macedonia Exports: Germany 20.2%, Italy 7.1%, Bulgaria 7.1%, Greece 6.4%
  • Macedonia Imports: Germany 11.5%, Russia 11.1%, Greece 8.3%, Bulgaria 8.2%, UK 7%, Turkey 5.1%, Italy 5.1%
  • Kosovo: No information available, but undoubtedly a major part of its trade is with Albania
  • Montenegro Exports: Serbia 17.5%, Hungary 16.9%, Croatia 10.1%
  • Montenegro Imports: Serbia 28.4%, Greece 7.9%, Bosnia and Herzegovina 7.6%

And that is before we even start talking about the low ratio of trade to GDP in many of these countries. In such a setting, the economies of these four countries have little to gain from integration, suggesting that the main advantage of creating an AlMacKoM are political and institutional.

So far so good. But where the article goes completely off the rails is here:
The sad truth is that EU accession might take a long time. Croatia achieved full territorial sovereignty in 1995 and is to join the EU in 2013. If we consider that Kosovo is today where Croatia was in 1995, we might envisage EU accession in 2030. That is too long.
I think we can all agree that this is completely insane. The likelihood of any of these four countries joining the EU by 2030 is extremely remote. That is true even for Macedonia and Montenegro, who already have candidate status. For once, this is not a problem of the EU's legendary "absorption capacity", but rather a question of the institutional capabilities of these countries. As such, admitting four more countries with a combined population of about that of Bulgaria wouldn't challenge the EU overly much, as long as these countries were well governed, with strong democracy, rule of law, etc. Given that, especially in Kosovo and Albania, these things are utterly and totally missing, the probability of Kosovo joining in the next two decades is exactly zero. In no sense of the word is Kosovo today "where Croatia was in 1995". Croatia in 1995 had a functioning system of government, whereas Kosovo has a government that is only saved from utter bankruptcy by the fact that it is unable to actually spend all the money it has budgeted. Quoting the CIA:
Until 2011, Kosovo maintained a budget surplus as a result of efficient value added tax (VAT) collection at the borders and inefficient budget execution
This is why the authors are ultimately correct. Such a regional union would bring much needed institution-building. However, using EU-accession as an argument is probably unwise. Accession is still so far off that a failure to achieve noticeable advances in that direction will only create resentment. Instead, AlMacKoM should be sold on its own merits, as a way of wrestling control away from the political and criminal clans that currently run these countries, as a way of improving relations between four countries that have much in common, and, yes, also as a way of improving their economies.

Access to Documents: Grexit edition

By way of unasked-for favour to my Ideas on Europe colleague Ron Patz, I thought I'd take a look at the pending case ofThesing and Bloomberg Finance v. ECB, which was in the news last week because the General Court held its hearing in the case. As far as Access to Documents cases go, this one is a whopper.
What the applicants want is access to two ECB documents about the way Greece cooked the books to get into the Euro, and about the way the EU authorities might have helped them or at least turned a blind eye:
  • A note entitled The impact on government deficit and debt from off-market swaps. The Greek case (SEC/GovC/X/10/88a);
  • A second note, entitled The Titlos transaction and possible existence of similar transactions impacting on the euro area government debt or deficit levels (SEC/GovC/X/10/88b).
The ECB argues, with some plausibility, that releasing these documents in 2010 would have caused insurmountable problems for Greece's credit position, and that releasing them now would still cause serious problems. (I'm distilling their arguments from this Bloomberg News article, because obviously the pleadings are not public and I did not personally attend the hearing. Note that the one of the authors of the article is Ms. Thesing, one of the applicants.)
"Disclosing the files when Bloomberg News first sought them in 2010 would have “fueled negative perceptions about Greece’s ability to honor its debt,” ECB lawyer Marta Lopez Torres said at a hearing of the European Union’s General Court in Luxembourg today. “It’s the same now with Spain” which “isn’t able to borrow money,” she said. “Markets are reacting in very volatile ways. It’s affecting the euro economy.”"
Unfortunately, that may or may not be an acceptable reason not to give access under the relevant legislation, includingRegulation 1049/2001.
Right off the bat, it is important to note that that Regulation only applies to the Commission, the Parliament and the Council, and not to the EU Agencies or to the ECB. (Cf. art. 1(a).) However, the Regulation implements art. 15 TFEU, which unfortunately also does not help the applicants:
 3. Any citizen of the Union, and any natural or legal person residing or having its registered office in a Member State, shall have a right of access to documents of the Union’s institutions, bodies, offices and agencies, whatever their medium, subject to the principles and the conditions to be defined in accordance with this paragraph.
Each institution, body, office or agency shall ensure that its proceedings are transparent and shall elaborate in its own Rules of Procedure specific provisions regarding access to its documents, in accordance with the regulations referred to in the second subparagraph.
The Court of Justice of the European Union, the European Central Bank and the European Investment Bank shall be subject to this paragraph only when exercising their administrative tasks.(...)
When supervising Greece's Euro-shenanigans, the ECB quite obviously was not exercising an administrative task. However, turning to the ECB's Rules of Procedure, we find in art. 23:
 Article 23
Confidentiality of and access to ECB documents
23.1. The proceedings of the decision-making bodies of the ECB and of any committee or group established by them shall be confidential unless the Governing Council authorises the President to make the outcome of their deliberations public.
23.2. Public access to documents drawn up or held by the ECB shall be governed by a decision of the Governing Council.
23.3. Documents drawn up by the ECB shall be classified and handled in accordance with the rules laid down in an Administrative Circular. They shall be freely accessible after a period of 30 years unless decided otherwise by the decision making bodies.
The documents that are the subject of the current application are documents drawn up by the ECB, but not covered by art. 23.1. So we look for the Decision mentioned in par. 2. The structure of this Decision is analogous to the structure of Regulation 1049/2001; access is given unless an exception applies. Unfortunately for Bloomberg, these exceptions include plenty of basis for refusing access to the documents under discussion here, assuming they are as explosive as claimed:
Art. 4
1. The ECB shall refuse access to a document where disclosure would undermine the protection of:
(a) the public interest as regards: (...)
— the financial, monetary or economic policy of the Union or a Member State,
— the internal finances of the ECB or of the NCBs, (...)
— international financial, monetary or economic relations,
— the stability of the financial system in the Union or in a Member State;
6. The exceptions as laid down in this Article shall only apply for the period during which protection is justified on the basis of the content of the document. The exceptions may apply for a maximum period of 30 years unless specifically provided otherwise by the ECB's Governing Council. (...)
So unless the ECB is significantly overstating the potential damage that would be caused by releasing these documents, I don't see how the applicants can win. I certainly do not read art. 4 of ECB Decision 2004/3 as requiring an explicit weighing of the public interest in disclosure, as claimed by the applicants in their application to the Court. Such a balancing exercise is appropriate when dealing with the exceptions of art. 4(2), where it is explicitly required:
 2. The ECB shall refuse access to a document where disclosure would undermine the protection of (...), unless there is an overriding public interest in disclosure.
From this it follows, reasoning a contrario, that no balancing is required under paragraph 1. Likewise, paragraph 3 also contemplates "an overriding public interest", but I do not read that as an alternative to paragraph 1, but rather as an additional filter. When it comes to internal documents, par. 3 says, the decision for which the documents have been prepared has to have already been taken, there has to be an overriding public interest justifying access, and only then do these documents get treated the same way as other documents.
In all of this I am somewhat hampered by the fact that I do not have access to the ECB's decision, or to the pleadings. From Bloomberg's application, it seems like the ECB also relied on art. 4(2) of Decision 2004/3, which is odd because the exceptions of par. 1 seem more than sufficient. So ultimately we shall have to see what the General Court does.

Monday, June 18, 2012

Grexit Cynicism

On Friday, I had dinner with some fellow die-hard cynics when another (and non-European) dinner guest raised the question of Grexit. To my surprise, their cynical answer was the complete opposite of mine.

My thinking on this matter was pretty much summed up in this post: Grexit and non-Grexit are both an unpredictable mess, except with different kinds of unpredictable. For this reason, I felt I could not make a recommendation either way, at least not on economics alone. Adding in my personal policy preferences, I suggested that Merkel should bite the bullet and cut the Greeks loose, and that the Greeks should try to stay in the Euro for as long as possible.

In terms of what I think will happen, this translates into the prediction that Mrs. Merkel will not spend a massive amount of political capital in order to do something that potentially cost just as many unknown hundreds of billions as kicking the Greeks out. This is a cynical prediction because it assumes that Mrs. Merkel will throw the Greeks, as well as the Portuguese, Spanish, Italians and Cypriots, under the bus for domestic political gain.

My interlocutors on Friday, however, deployed their cynicism in the opposite direction. To begin with, they denied the premise that European bailouts are unpopular in Germany. Instead, they argued that Grexit as such would be unpopular among German voters, because it would amount to a defeat for the European project. For this reason, they predicted that Mrs. Merkel would throw democracy under the bus to prevent a Grexit. In a nutshell, what they predicted was something along the lines of Piris' Two-Speed Europe, with a core of strong European countries like German, Finland and the Netherlands dictating a "growth package" to Greece as a condition for Greece staying in the Euro. This Growth Package would essentially mean that Greece would be mostly governed from Brussels.

In this scenario, not only would European democracy be sacrificed because this Growth Package would be pushed through at all cost, but even more seriously the Package would imply a serious and lengthy loss of sovereignty for bailout countries. No more right of veto for the Commission, but an outright Brussels diktat. All of this as the price for non-bankruptcy.

I have to say that it all sounds improbable to me. It came from intelligent and knowledgeable people, so I tried to consider the possibility carefully, but I don't see it happening.

To begin with, and even though I pointed this out on the night, I don't think they understand what fantastic amounts of money would be involved, and not just once but every year. Recently, Paul Krugman put the annual net transfer to Florida at $ 31 billion. That's a gift, not a loan. Likewise, as a result of the Savings & Loans crisis in the 1980s Texas received a gift of 25% of its GDP or $ 75 billion. When I did some back-of-the enveloppe comparisons between the suffering of net contributors in the EU and in the US in this post in March, I ended up with Denmark making a net contribution to the EU budget of 0,53% of its GDP and New Jersey losing out to the tune of 6,4%. The winners of this game, Lithuania and Mississippi, gained 5,33% and 16,9% of GDP, respectively. The paradox of the "political integration" idea is that, on the one hand, its proponents always repeat that the EU will never be like the US federal government - it will never govern social security, etc. in the same way - but on the other hand it is inevitable that it will have to generate comparable international money flows in order to do what it was meant to do: save the Euro.

These are two seemingly distinct yet connected problems. Political union will have to do one or both of two things: reduce the trade imbalance between the core and the periphery by creating growth among the latter, which seems difficult in the middle of a global economic crisis and ongoing banking issues, and prevent a further escalation of the debt crisis by replacing loans by grants. Put crudely: if we're not going to kick Greece out of the Euro, we're going to have to start giving them money outright. Not even ECB operations are enough to keep Greece solvent and liquid without them.

Now the question that the politicians will have to answer - if they want political union rather than Grexit - is: Which form do we give these transfers? The most obvious short-term candidate seems EU-FDIC. We insure periphery banks, and give them a prize for every bank they manage to collapse. And this is merely the most palatable policy initiative. Anything else that Merkel and Hollande could come up with to explain why they're sending money Southwards is going to be even more unpopular. The Wiedervereinigung is one thing, at least that involved sending massive amounts of money fellow-Germans and having massive numbers of fellow-Germans move in next door. How can such a thing ever be sold on a pan-European level?

The second big problem with the "throwing democracy under the bus" scenario is a legal one. While I was being accused of being "too much of a lawyer", I think that is too easy. While the Bundesverfassungsgericht has so far always limited itself to barking without biting, I don't think it would uphold a drastic Europeanisation of the power to tax-and-spend. Under the Lisbon-judgement, that is a core power of the democratically elected Bundestag that cannot even be transferred to the (in my opinion but not theirs) equally democratically elected European Parliament. While there is some uncertainty about whether the Ewigkeitsklausul of art. 79(3) GG also covers the writing of an entirely new Verfassung under art. 146 GG, in practice I don't see how such a loophole could matter, because I can't imagine the German people using it in order to overrule the Constitutional Court. For that, the status of the Court is much too high.

This is why I cannot escape the conclusion that throwing the periphery countries under the bus, rather than putting democracy there, is the path of least resistance for Mrs. Merkel and her Dutch and Finnish friends. Am I wrong?

Thursday, June 14, 2012

This Week in Luxembourg

This week’s Grand Chamber judgement (the first GC case for the Dutch Judge Prechal) is about child benefits for migrant workers. Joined cases Hudziński v. Agentur für Arbeit Wesel – Familienkasse and Wawrzyniak v. Agentur für Arbeit Mönchengladbach – Familienkasse

The European judiciary continues to examine the effects of the Charter:
·         AG Cruz Villalón struggles with the ne bis in idem rule of art. 50. As a first alternative, and after careful discussion of the relevant arguments, he concludes that the prejudicial question is inadmissible, because the case in question does not involve Sweden implementing EU law in the sense of art. 51(1) Charter. In the alternative, he argues that a duplication of criminal and administrative penalties does not violate art. 50, which is reasonable enough. In any event, he wants nothing to do with the ECHR question. Åklagaren v. Fransson Cf. Verfassungsblog and Laurens Ankersmit on European Law Blog
P.S. Note fn 42, where one of my EUI-colleagues, Bas van Bockel, is cited by the AG.
 ·         AG Bot examines art. 15(6) of Directive 2010/13, about “short extracts” – i.e. clips of Europa Leauge matches for the news – in copyright law in light of art. 16 and 17 Charter and finds no reason to recommend annulment of the former. Sky Österreich v. Österreichischer Rundfunk Cf. Recent Developments in European Consumer Law blog
For competition law geeks: in the case of Auto 24 v. Jaguar Land Rover France, the Court (per Judge Ó Caoimh) gives guidance about art. 1(1)(f) of Commission Regulation 1400/2002 (block exemption motor vehicle sector). Specifically, the referring court wants to know what is meant by “specified criteria” in the definition of a selective distribution system. The Court reigns in the French: the criteria have to be verifiable, but they don’t have to be objectively justifiable, non-discriminatory, etc. Cf. Kartellblog

The Court (per Judge Cunha Rodrigues) sided with the Commission against the Netherlands on the “3 out of 6” rule for study grants (i.e. “studiefinanciering”) for immigrants. According to the Court, the rule is prima facie discriminatory, and less discriminatory means are available to ensure that the subsidy only goes to people with a sufficient degree of attachment to the Netherlands. Commission v. Netherlands

In Banco Español de Crédito v. Calderón, the Court (per Judge Tizzano), gives more guidance on the powers of national courts when it comes to unfair consumer contracts under Directive 93/13. Contrary to the law in Spain, the national court has to be allowed to make a finding of unfairness sua sponte at any stage during the proceedings. Moreover, the correct remedy is for the unfair term not to be binding on the consumer (cf. art. 6(1) of the Directive), not for the national court to modify it.

My beloved Aarhus Regulation – the actual EU-internal one that was the subject of the conciliation procedure back in 2006 – scored two more victories today. The General Court (per Judge Wiszniewska-Białecka, both times) upheld the right of the environmental lobby to ask the European Commission to review a Regulation on pesticides and one on ambient air quality, respectively. Stichting Natuur en Milieu v. Commission and Vereniging Milieudefensie v. Commission Cf. UK Human Rights Blog

Wednesday, June 13, 2012

Westbahn v. ÖBB

Last week, AG Jääskinen published his opinion in Westbahn v. ÖBB Infrastruktur, a case that I actually care about enough that I spent some time trying to figure out what would happen back when I first heard about it a few months ago. Just like me, he concludes that it could go either way. However, because it is his job to actually make a recommendation, the AG decided to just make stuff up, ZGB-style.

The facts:
Last december, Westbahn entered the Austrian long-distance passenger transport market, starting a service between Vienna and Salzburg. (Italo did the same in Italy last April, putting those countries well ahead of the Netherlands, Germany, France and most other countries in continental Europe.) Because the open access regime in European law was mostly a theoretical possibility until now (on paper, it has existed in Germany since 1994, but so far no one has actually used it), they ran into a number of difficulties. One of those problems - the one that is the topic of this particular piece of litigation - is how to treat the different companies' services for the purposes of delay information. If a Westbahn train is delayed, passengers are given information about the main connections that are available to them now that they've missed the connections they were planning to take. But how can Westbahn give such information about connections to ÖBB trains unless it has real-time data about the ÖBB service?
ÖBB Infrastructure, the defendant here, refused to give this information, arguing that Westbahn should make a bilateral agreement with ÖBB Passenger transport. ÖBB Passenger transport declined to enter into such a contract, unsurprisingly. The regulator, Schienen-Kontrol Kommission, which apparently counts as a judicial entity (cf. par 26-30 of the AG's opinion), didn't know whether ÖBB was legally required to provide this information to Westbahn, so they asked a prejudicial question. (Well, two actually.)

The questions:
1.      Is Article 8(2) of, in conjunction with Annex II, Part II, to, Regulation (EC) No 1371/2007 of the European Parliament and of the Council of 23 October 2007 on rail passengers’ rights and obligations to be interpreted as meaning that information on main connecting services must include, in addition to scheduled departure times, notification of delays to or cancellations of those connecting services?
2.      If the answer to Question 1 is in the affirmative: is Article 5 of, in conjunction with Annex II to, Directive 2001/14/EC of the European Parliament and of the Council of 26 February 2001 on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure [and safety certification] to be interpreted, in the light of Article 8(2) of, in conjunction with Annex II, Part II, to, Regulation (EC) No 1371/2007, as meaning that the infrastructure manager is under an obligation to make real‑time data on other railway undertakings’ trains available to railway undertakings in a non‑discriminatory manner, in so far as those trains constitute main connecting services within the meaning of Annex II, Part II, to Regulation (EC) No 1371/2007?

My analysis:
This is an interesting way of getting where they want to go: dividing it up into two steps. As it turns out, neither of them is entirely obvious, but they are at least plausible. The article from the Passenger Rights Regulation mentioned in question 1 simply says that passengers have to be provided with the information listed in the Annex. Turning to Annex II, part II, we simply find a list:
Part II: Information during the journey
  • On-board services
  • Next station
  • Delays
  • Main connecting services
  • Security and safety issues.
So the information that must be provided to passenger includes "delays" and "main connecting services", but what about "delays of main connecting services"? Because the Annex is in list format, there is no way to tell either way.
The second question again requires a logical leap. The claim that infrastructure managers should do their thing on a non-discriminatory basis is reasonable enough. But is that enough to get Westbahn where they want to go? Again, the article in question talks in general terms about the services that have to be provided, in this case by the infrastructure manager to the operator, and the Annex is again in list-form. The items quoted by the AG, which presumably form the basis of Westbahn's claim, are:
(d)      train control including signalling, regulation, dispatching and the communication and provision of information on train movement;
(e)      all other information required to implement or operate the service for which capacity has been granted.
...which is not exactly very specific.
Just because this information has to be provided on a non-discriminatory basis, does not mean that the infrastructure manager has to inform the operators about each other's - in ÖBB's words - business secrets. It is perfectly possible for ÖBB Infra to act in a non-discriminatory manner by giving each company only information about other trains from the same company and from other operators to the extent that a bilateral agreement exists. That would be a perfectly neutral approach to take, although of course it would benefit the incumbent. (Which, I'm sure, never once crossed the mind of ÖBB Infra.)

The AG:
AG Jääskinen essentiall comes to the same conclusions. Regarding question 1:
40. A narrow interpretation of the provisions of Annex II, Part II, to Regulation No 1371/2007 concerning the information to be provided during a railway journey would limit the information to which passengers are entitled, with respect to main connecting services, to the departure times described in the timetable. However, such an interpretation would be contrary to the interests of passengers and would prevent the achievement of the objectives of Regulation No 1371/2007, among which include, in the case of late arrivals or departures, the right to be informed of them by the railway undertaking or the station manager, and as soon as such information is available (see, in addition to recital 4, Article 18(1) of Regulation No 1371/2007).
In other words, the provision could be read narrowly, but we don't want to because that would be contrary to the objective of the reform. The rest of his discussion of the first question just expands on this approach, quoting the different parties' submissions.
Regarding question 2, there is even less window-dressing. The key problem is simply ignored, and the AG immediately moves on to what is desirable:
47. By its second question, the Schienen‑Control Kommission essentially wishes to know whether a railway infrastructure manager has an obligation to communicate to railway undertakings real time data concerning the main connecting services of other rail transport providers.
48. The question therefore concerns whether there is a correlating obligation on a rail infrastructure manager, under Directive 2001/14, to make information available to railway undertakings that the latter are bound to supply under Article 8(2) of Regulation No 1371/2007.
49. I would answer this question in the affirmative. As was argued by the Polish Government, Directive 2001/14 cannot be interpreted in such a way as to impede the objectives envisaged under Regulation No 1371/2007.
A bit lower, we find some additional pragmatism:
54. A broad interpretation of what is ‘required’, of the kind I am here advocating, is particularly appropriate in the light of the manner in which the railway sector has been re‑organised in Austria as a consequence of liberalisation. This issue is linked with the alleged lack of independence of ÖBB‑Infrastruktur AG from the market leader ÖBB‑Personenverkehr AG. The Court will consider this question in the pending Case C‑555/10 Commission v Austria.
So yes, a narrow reading of the law would produce unpleasant results, so we will read it broadly instead.

It is important to emphasise that I do not think the AG got it wrong. Teleological interpretation is an established approach in EU law, and it has been abused much worse than it is here. When faced with two (or more) viable interpretations of the law, it is a reasonable solution to choose. The only problem is that the EU judiciary has a bit of a reputation in this regard, meaning that they have to be extra careful to motivate their analysis carefully. That means firstly examining carefully the more "objective" interpretation methods, such as a textual interpretation, and then carefully supporting the teleological interpretation not only with quotes from the recitals of EU railway legislation, but also from the travaux préparatoires. Quoting the submissions of parties is no substitute.
It seems quite likely that the Court will follow this opinion. Let's just hope, though, that their explanation will have more meat to it.

Finally, there is the question of what any of this has to do with the Swiss Civil Code. The answer is that the ZGB has a legendary - at least among legal history geeks - first article:
 Art. 1
1 Das Gesetz findet auf alle Rechtsfragen Anwendung, für die es nach Wortlaut oder Auslegung eine Bestimmung enthält.
2 Kann dem Gesetz keine Vorschrift entnommen werden, so soll das Gericht1 nach Gewohnheitsrecht und, wo auch ein solches fehlt, nach der Regel entscheiden, die es als Gesetzgeber aufstellen würde.
3 Es folgt dabei bewährter Lehre und Überlieferung.
In other words, the judge is instructed, if no other source can be found to answer a legal question, to give the answer that he would give if he were a lawmaker. Conceptually, that is fantastically interesting. It is also more or less what AG Jääskinen did in his opinion.

Thursday, June 07, 2012

This Week in Luxembourg

This week’s Grand Chamber judgement (well, the one that’s not about the CAP) upholds the General Court’s state aid judgement in EDF v. Commission. The Commission erred by not applying the private investor test to judge the offending tax waiver in the context of the French state’s overall relationship with EDF. Commission v. EDF (per Judge Arabadjiev) Cf. European Law Blog

Much as in economic terms there are only a few air passenger transport companies, legally every airline is still a separate company, and is entitled to be treated as such, for example when it comes to counting years of experience “with the company” for employee remuneration purposes. Counting in this way does not constitute unlawful age discrimination. Tyrolean Airways v. Betriebsrat Bord der Tyrolean Airways (per Judge Arabadjiev)

In Vinkov v. Nachalnik Administrativno-nakazatelna deynost (per Judge Toader), the prejudicial question was declared inadmissible on the grounds that it constituted a wholly internal situation. That’s a pity, because all sorts of fun could have potentially been had with the question of whether the right to an effective remedy (art. 47 Charter) requires access to court for any and all traffic tickets.

Professionally speaking, my case of the week is Westbahn v. ÖBB-Infrastruktur. Westbahn is a new entrant on the Austrian long-distance railway market (Vienna-Salzburg, to be precise), and they now have the support of AG Jääskinen for the claim that ÖBB should treat their trains and ÖBB’s own trains the same when it comes to passenger information in case of delay. It looks like the AG went with the objectives of the Regulation. Cf. Recent Developments in European Consumer Law Blog

There are quite a few interesting things going on in AG Trstenjak’s opinion in the asset freeze case of Al-Aqsa. On the one hand, Al-Aqsa is trying to get the CJEU to overrule the grounds upon which the General Court rested its holding, but not the holding itself. (After all, Al-Aqsa won.) The AG argues that you can’t appeal dicta. On the other hand, the Netherlands is still trying to salvage its SNAFU of having repealed the national decision upon which the EU decision rested immediately after said EU decision was taken, “because it was now redundant”. But no luck, Al-Aqsa’s assets remain unfrozen.

AG Bot argues that once again a Member State (Germany, in this case) should lose in a Turkish workers case. 3rd country nationals (a Thai, in this case) who have been married to Turkish workers for a significant amount of time are a “member of the family” of said worker, and therefore enjoy the same free movement rights. This is still true after they divorce. Dülger v. Wetteraukreis

The General Court rejected ICI’s action for annulment against its € 91 million cartel fine. (Cf. Commission Decision) As far as I can see, there is nothing but nuts & bolts competition law here. ICI v. Commission (per Judge Labucka)

Wednesday, June 06, 2012

Merger notifications

It is always interesting to see how railway reform, whatever its effects on overall efficiency, has the unerring ability create work for lawyers. The most recent reminder is the combination of reform and competition law. Specifically: merger review.

The history of this mess is as follows: When the Dutch railways were unbundled in 1995, the task of informing passengers about delays was given to both the transport companies (particularly: NS) and the infrastructure company (ProRail). From an engineering point of view, that makes sense, because they both do things that cause delays and they both do things that make delays go away. Unfortunately, economic logic rarely pays heed to engineering logic, and economic logic dictates that such a division of labour results in both parties constantly blaming each other for everything and anything that goes wrong. Which is exactly what happened. Plenty of blaming, not a lot of improvement. Not even when the Minister started handing out fines.

(Or, in the category of lies, damned lies and statistics, the percentage of passengers who rate the quality of information in case of delay with a 7/10 or higher went up from 33% in 2001 to 54% in 2011, which, I guess, technically qualifies as an improvement. Unfortunately, the government-set target for 2011 was 56%, which will increase to 58% by 2015.)

So it was decided that economic logic should prevail: Let the transport people inform passengers, and whatever information they need from ProRail they can get by yelling at them. This year's € 300.000 fine was the last time ProRail got in trouble with the government over passenger information.

Now back to the question of employment for lawyers: In order to give effect to the government's decision, NS has to "acquire" the department of ProRail that is responsible for information to passengers. Never mind that this department probably consists of two 0.4 fte staffers and a desktop computer, and never mind that both are 100% owned by the Dutch state. And because this acquisition is going to take place in a market full of competition problems, where the selling party has a 100% market share and the acquiring party a market share of about 90%, they have to jump through all the hoops set up by the Competition Act (Mededingingswet), including the official notification of an intended (!) merger, whereby interested parties are invited to comment on the intended merger, whereby a company of which the State is the only shareholder intends to acquire a department of another company of which the State is the only shareholder. (That's pretty much what it says in paragraph 1 of the notification.) If anyone wants to comment, they'd better hurry, because the term is 7 days after the date of posting, i.e. until tomorrow.

So yes, in these dire economic times, it is good to be a lawyer. Too bad those b**rds in Groningen gave me an LL.M. title without effet civile. But that's a conversation for another time...