Saturday, December 29, 2012

Victor Hugo

It was [Victor] Hugo, who, during the International Peace Congress that was held in Paris in 1849, declared, “A day will come when you France, you Russia, you Italy, you England, you Germany, you all, nations of the continent, without losing your distinct qualities and your glorious individuality, will be merged closely within a superior unit and you will form the European brotherhood.” The idea of the European Union has by now been allowed to seem so narrowly bureaucratic that it is hard for us to recall that it once shone with the light of a romantic vision. Each year, the British historian John Julius Norwich publishes a “Christmas Cracker,” a commonplace book full of fragments of funny reading from the pas twelve months; for 2012, he includes Gerry Hanson pointing out that, while the Lord’s Prayer contains sixty-nine words, and the Declaration of Independence two hundred and ninety-seven, an E.U. directive on duck eggs contains twenty-eight thousand nine hundred and eleven words.

O.K., it has its absurdities. But the dream of European union was for Hugo not just a way of preventing the disasters of war and approaching the problem of poverty; it was a larger way of insisting that cultural pluralism—indeed, pluralism of every kind—was essential to freedom. Hugo kept Republican liberalism from seeming fatuous by insisting that the liberal Republican has a singular, mystic insight into the intrinsic doubleness of life. At the height of the twentieth century’s calamities, Hugo’s Romantic Republicanism could seem fragile and unconvincing; the Javerts then held the floor. There are many things wrong or encumbering or even foolish about the European Union, but when we watch “Les Misérables,” we should save a thought for how much of Hugo’s vision has now been achieved. What Hugo wanted, and what he used all that melodramatic and storytelling power to promote, was a Europe accepting in its pluralism, and widely based in its prosperity. His ghost now has it.

Wednesday, December 19, 2012

Today in Luxembourg

Today the Court handed down its last judgements before its Christmas vacation:

The Grand Chamber (Judge Bay Larsen) clarified the meaning of art. 12(1)(a) of Directive 2004/83 in a case about three Palestinian refugees. Do they qualify as refugees, given that they originally qualified for UN support in a refugee camp in the region, but had to leave for reasons beyond their control? El Kott et al. v. Bevándorlási és Állampolgársági Hivatal

The Grand Chamber (Judge Šváby) also looked at an Italian public procurement case (cf. Directive 2004/18), where the Azienda Sanitaria Locale di Lecce asked the university of Salento to study the earthquake-sensitivity of various hospitals without a formal tender. While punting to the national court, the ECJ says that such tender-less contracting between public entities is not OK:  
“[1] where the purpose of such a contract is not to ensure that a public task that those entities all have to perform is carried out,
“[2] where that contract is not governed solely by considerations and requirements relating to the pursuit of objectives in the public interest or
“[3] where it is such as to place a private provider of services in a position of advantage vis-à-vis his competitors.”

For the second time in as many weeks, the Court handed out a fine for non-compliance with a judgement. Following last week’s Commission v. Spain (€ 20 million + € 50.000 per day), now it is Commission v. Ireland (Judge Bonichot), to the tune of € 2 million + € 12.000 per day. The offending case is Commission v. Ireland (2009, also by Judge Bonichot) about Directive 75/442 on waste. In a separate case, Ireland was ordered to pay a further € 1,5 million for failing to comply with a 2006 infringement case about environmental impact assessments. Commission v. Ireland (Judge Toader)

Heineken (NL, FR) and Bavaria (NL, FR) lost their appeals in the Dutch Beer Cartel case (NL). (Both judgements by Judge Silva de Lapuerta.) The General Court had annulled the non-price collusion part of the decision, and had ordered a further reduction of the fine as compensation for the extraordinary length of the procedure. Cf. Case T-240/07, Heineken v. Commission and case T-235/07, Bavaria v. Commission.

In the interesting state aid litigation of Mitteldeutsche Flughafen and Flughafen Leipzig v. Commission, the appeal was likewise rejected (judge Jarašiūnas). As before the General Court (NL, DE, FR), the appellants failed to convince anyone with their claim that airport construction is not an economic activity. Cf. European Law Blog

The Court (Judge Lõhmus ) affirmed that a trademark can be put to “genuine use” even if it is used in only a single Member State. Leno Merken v. Hagelkruis Cf. the IPKat

In the category of “really?” we have Gbagbo et al. v. Council, where Laurent Gbagbo and his associates are trying to get their asset freezes annulled. The General Court struck the cases from the docket on the grounds that they were manifestly inadmissible because they were untimely. Gbagbo argued that he didn’t know about the Decision in question in time, because of distance and because of the war (!). AG Cruz Villalón now argues that the General Court should have at least heard the parties on this point.

Tuesday, December 18, 2012

Ultimate Guarantor

Despite Marc de Werd's excellent newsletter on EU and ECHR law, I seem to have missed Longa v. the Netherlands. The problem of that case is pretty simple: Are individuals who are detained by the ICC "within the jurisdiction" of the Netherlands in the sense of art. 1 ECHR? The Court's answer is as follows:
73. The applicant was brought to the Netherlands as a defence witness in a criminal trial pending before the International Criminal Court. He was already detained in his country of origin and remains in the custody of the International Criminal Court. The fact that the applicant is deprived of his liberty on Netherlands soil does not of itself suffice to bring questions touching on the lawfulness of his detention within the “jurisdiction” of the Netherlands as that expression is to be understood for purposes of Article 1 of the Convention. 
74. It is however the applicant’s case that now that he has given his testimony, his continued detention by the International Criminal Court lacks a basis in law. The vacuum thus created can be filled only by the Netherlands legal order, in which the Convention is directly applicable.
75. The Court finds that as long as the applicant is neither returned to the Democratic Republic of the Congo nor handed over to the Netherlands authorities at their request, the legal ground of his detention remains the arrangement entered into by the International Criminal Court and the authorities of the Democratic Republic of the Congo under Article 93 § 7 of the Statute of the International Criminal Court. This is reflected in Trial Chamber I’s Order of 1 September 2011 and its Decision of 15 December 2011 (see paragraphs 23 and 24 above), which make it clear that the International Criminal Court is waiting to comply with its obligation under Article 93 § 7 (b) of its Statute to return the applicant to the Democratic Republic of the Congo once the reason for his presence on its premises has ceased to exist. There is thus no legal vacuum.

The Dutch courts have now followed this approach, as they are required to do by the Dutch constitution. Today, the Court of Appeals in The Hague held that three comparable individuals to Mr. Longa - defence witnesses detained by the ICC who asked for asylum in the Netherlands - are not being held unlawfully, but are rather being held pursuant to art. 93(7) Rome Statute, even though their testimony is already over. (Cf. par. 2.5, here.)

While I understand where the ECtHR is coming from, I find this result fundamentally problematic. This has to do with a sense of conservatism, but it is also a corollary of my rather drastic formalism when it comes to law generally and international law in particular. Let me explain each in turn.

From a vague sense of conservatism, I think it is important to protect The Great Writ. I know it is an English thing, and I know that it is not really under attack here, but I still don't like the proposition that "the fact that the applicant is deprived of his liberty on Netherlands soil does not of itself suffice to bring questions touching on the lawfulness of his detention within the “jurisdiction” of the Netherlands". Wherever else the Writ might run, it should at least run to every square centimetre of the Kingdom in Europe. The ICC Detention Centre is not so much a Centre as it is 12 cells in the former "Orange Hotel" in Scheveningen, under the same roof as the prisoners of the ICTY and as any number of ordinary Dutch prisoners. All of them should, ultimately, be able to ask a Dutch court to review the lawfulness of their detention.

This does not mean, of course, that the Dutch court then has to examine the issue exhaustively, i.e. de novo. It would be perfectly fine for the Court to defer to the decision of the Trial Chamber of the ICC, unless there is a good reason not to. In this case, the ultimate answer is fine: the detainees are held on the basis of art. 93(7). The ICC's Trial Chamber decided that this provision is still the legal basis even after the trial, during the period that the witnesses are waiting for the conclusion of their asylum proceedings, given the fact that they were being detained in Congo in the first place, before being sent to The Hague. This judgement is not unreasonable, so there is no violation of art. 5 (or 13) ECHR. Easy enough.

Ultimately, the reason why I find it important to take this extra step, illusory as it might be in the vast majority of cases, is that I am worried about cases like Kadi.

In Kadi, the Grand Chamber of the European Court of Justice, through the mouth of the Dutch Judge Timmermans, pretended that it had the authority to let human rights trump the obligation of the European Union to comply with UN law without ever explaining where that authority came from. Being quite formalist about such things, I prefer the approach of the General Court, which held that it did not have the right to carry out judicial review of the UN Security Council resolution in question, or of the EU's implementing legislation, except to the extent that a violation of ius cogens was alleged. (Cf. also this post about the Dutch Srebrenica litigation.) In general, the rule is that "in the event of a conflict between the obligations of the Members of the United Nations under the (...) Charter and their obligations under any other international agreement, their obligations under the (...) Charter [should] prevail", and that includes obligations that flow from the EU Treaties, which are still international agreements, and obligations that flow from the European Convention on Human Rights. (Cf. also the ECtHR's Nada case.)

The problem with this approach is that it leaves Mr. Kadi up the creek without a paddle. He can't get judicial review in Sweden, because the Swedish courts are bound by directly effective EU law, which trumps even the Swedish constitution. He can't get judicial review in Luxembourg, because UN law goes above EU law. And finally, he can't get judicial review at the UN level, because the ICJ does not allow private citizens to bring a case, and no other review body is available. It is this conundrum that caused the ECJ to make up a remedy out of whole cloth.

Personally, I prefer to see such creativity at the level of maximum legitimacy, which is to say at the level of the state. In my view, that is what sets the state apart from all other levels of government: The state is the ultimate guarantor of the compliance of all the other levels with the most basic aspects of Rechtsstaat. When the normal rules of law threaten to create a legal vacuum, it is at the level of the state that a solution must be found. Normally, that solution will involve a deliberate breach of international law by the state. (As a general matter, a state cannot plead domestic legal rules as an excuse for a failure to comply with international law.)

There is ample precedent for this approach, most famously the German Constitutional Court's Solange-I ruling, where the Court said:
in the hypothetical case of a conflict between Community law and a part of national constitutional law or, more precisely, of the guarantees of fundamental rights in the Basic Law, there arises the question of which system of law takes precedence, that is, ousts the other. In this conflict of norms, the guarantee of fundamental rights in the Basic Law prevails as long as the competent organs of the Community have not removed the conflict of norms in accordance with the Treaty mechanism.
(Translation courtesy of the Institute for Transnational law at the University of Texas at Austin.)

In some countries, such as the Netherlands, this is a result that is difficult to achieve. Under Dutch law, international law has direct effect even when it contradicts the constitution. (Treaties that contradict the constitution simply have to be ratified with a supermajority.) However, this means there is all the more reason to create some freedom of manoeuvre in this regard. Dutch courts should avoid saying anything that permanently rules out the use of the Ultimate Guarantor power. After all, all those who are present in the Kingdom in Europe should be able to rely on the Dutch courts to protect them if no one else will.

Thursday, December 13, 2012

This Week in Luxembourg

The Grand Chamber (Judge Arabadjiev) ordered Spain to pay a € 20 million lump-sum fine plus € 50.000 per day for failure to comply with a state aid judgement. Just for fun, look at the timeline: Commission Decision: December 1989, Action for annulment brought: December 1999, Judgement delivered: July 2002, first Commission requests for information: 2004, Commission letter of formal notice: November 2009, Art. 260 TFEU action brought: March 2011, Judgement: December 2012.  Commission v. Spain

Today was the long-awaited (by competition lawyers) ruling in Expedia v. Autorité de la concurrence and Others. AG Kokott took a serious trip in uncharted territory in this case, when trying to sort out what to do with a case that is based on a case of behaviour that is anticompetitive by object but not by intent, and that is alleged to be de minimis. The Court (Judge Lõhmus) agreed that the sole criterion is that there has to be an “appreciable restriction of competition”, but otherwise skipped over the details. Cf. Competition Policy Blog and Kartellblog

To the surprise of (pretty much) no one, the Court (Judge Von Danwitz) followed AG Mengozzi and slapped down the Parliament’s most recent attempt to reduce its number of trips to Strasbourg by one. France v. Parliament Cf. Euractiv, ECJ Blog and France v. Parliament (1997)

Yet more Court (Judge Ó Caoimh) interference in what we might consider the outer reaches of social security: “Article 45 TFEU must be interpreted as precluding legislation of a Member State which makes the grant to employers of a subsidy for the recruitment of unemployed persons aged over 45 years subject to the condition that the unemployed person recruited has been registered as a job seeker in that same Member State, in the case where such registration is subject to a condition of residence in the national territory”. Caves Krier Frères v. Directeur de l’Administration de l’emploi

In Forposta and ABC Direct Contact v. Poczta Polska, the Court (Judge Juhász) held that Polish public procurement law was a little bit too generous with automatically excluding bidders for past misconduct. Cf. art. 45(2)(d) of Directive 2004/17, which only allows such exclusion in cases of “grave professional misconduct”.

AG Jääskinen delivered the second batch of opinions in the 1st railway package infringement cases:
  • Commission v. Luxembourg (NL, DE, FR): The AG agreed with the Commission that the capacity allocation body was insufficiently independent from the incumbent passenger transport company.
  • Commission v. Poland (DE, FR): The AG agreed with the Commission that Poland had failed to create sufficient incentives for the infrastructure company to reduce its operational costs and the track access charges, and that it had unlawfully allowed indirect costs to be taken into account for the calculation of the track access charges. The AG did not agree, however, that Poland had failed to create the circumstances for the infrastructure to be managed without structural financial shortfalls, or that it had failed to sufficiently unbundle.
  • Commission v. Czech Republic (DE, FR): The AG agreed with the Commission that the Czech legal maximum for track access charges was unlawful, that it failed, like Poland, to create proper cost-reduction and access charges-reduction incentives, that its track access charging system is insufficiently performance-related, and that the Czech transport ministry has too much power over the regulator. He disagreed, however, with the Commission’s objection to the range of costs that are taken into account for access charging and its objection to the insufficient scope of powers of the regulator.
  • Commission v. France (NL, DE, FR): The AG agreed with the Commission that the French capacity allocator is insufficiently independent from SNCF, and that France does not have a sufficient incentive system for the infrastructure manager as required by art. 11 of Directive 2001/14. He disagreed with the Commission, however, regarding the need for an incentive system more generally.
  • Commission v. Slovenia (NL, DE, FR): Slovenia, too, was judged to have a capacity allocator who is insufficiently independent from its incumbent operator, an infrastructure company insufficiently incentivised to reduce costs and access charges, to improve reliability and performance more generally. 

AG Jääskinen also considered the clash between the powers of football and the powers of the EU. He concluded that UEFA’s and FIFA’s appeals against the judgements of the General Court should be dismissed. (Cf. General Court: UEFA v. Commission, FIFA v. Commission and FIFA v. Commission) The European and World Championships stay on the open net. UEFA and FIFA v. Commission

On the very same day that the Parliament voted to approve the unitary patent, AG Bot argued that the action against this enhanced cooperation project by the two nay-sayers, Spain and Italy, should be rejected. He argued that the most interesting objection – of  failure to respect the judicial system of the Union (cf. opinion 1/09) – was inadmissible, because it was too early. Also fun: the AG did not seem to have a problem with judging the “last resort condition”. I would have thought it was non-justiciable. Spain and Italy v. Council

AG Kokott had an opinion in Ziegler v. Commission, rejecting a stack of objections against the General Court’s judgement regarding its application of the de minimis notice and the motivation of the level of the fine, including the alleged failure of the Commission to take into account the applicant’s financial difficulties in setting the fine.

Former Judge Melchior Wathelet has returned to Luxembourg, this time as an Advocate-General. In his first opinion, he argues that “European Union law must be interpreted as meaning that, where a Member State levies a tax incompatible with European Union law – in the present case, Article 110 TFEU – that State must repay the amount of the tax and pay interest on that amount from the date of the payment by the taxpayer”, a conclusion he reaches without invoking more general principles of EU law or the Charter. Irimie v. Administraţia Finanţelor Publice Sibiu and Administraţia Fondului pentru Mediu

In the General Court, Electrabel lost its competition law challenge against Commission Decision C (2009) 4416, whereby the Commission imposed a fine of € 20 million for having gone through with the acquisition of the Compagnie nationale du Rhône before notifying the Commission. Ultimately, the acquisition was approved, but Electrabel still got a fine for being four years late asking. Electrabel v. Commission (FR)

In yet another asset freeze case relating to the Iranian nuclear programme, the Court annulled the Council’s decision against Sina Bank for a failure to state (sufficient) reasons. Sina Bank v. Council

Also in the General Court there were four challenges against the Commission’s Decision in the Calcium Carbide and Magnesium cartel case, none of them successful. The total haul stays at € 61 million, with Akzo Nobel being the snitch that got away for free. Novácke chemické závody v. Commission, 1. Garantovaná a.s. v. Commission, Ecka Granulate and non ferrum Metallpulver v. Commission and Almamet v. Commission Cf. the Antitrust Hotch Potch regarding the question of whether the Commission sufficiently took into account the applicants’ ability to pay

Monday, December 10, 2012


A more specific passage from the Cohn-Bendit & Verhofstadt book that makes me mad:
 « La zone euro ne souffre toutefois pas uniquement de ce manque de solidarité. La discipline est également défaillante, alors qu’elle constitue la seconde condition nécessaire à la pérennisation d’une zone monétaire. Tous savaient depuis longtemps que les Grecs étaient incapables d’apurer leur dette, mais personne ne s’en est soucié. Quant à la France et l’Allemagne, elles ont pu enfreindre les règles budgétaires sans pour autant être sanctionnées ni mises à la amende. Soit ces pays avaient de bonnes raisons de ne pas suivre les règles, et il aurait alors fallu changer le pacte de stabilité. Soit ils avaient tort, et ils auraient dû être sanctionnés. (…) Une chose est claire : la viabilité d’une monnaie requiert de la solidarité et de la discipline. »
(p. 22)

There are several elements here, some of which are actually quite sound. It is important, however, to begin by emphasising that the Eurocrisis was not caused - in a general sense - by any lack of budgetary discipline among the Member States. Greece is a separate story. They should never have been admitted to the Eurozone in the first place, no matter how you analyse the Eurocrisis, as long as they could not even produce accurate data about the state of their economy. The detailed analysis is available in a series of posts on Paul Krugman's blog, most importantly this one, but the general idea is that pre-crisis deficits and debt levels are a very poor predictor for whether or not a given country actually got in trouble. Spain and Ireland were doing particularly well, but still got in trouble, while France and Germany were also among the biggest sinners, but survived more or less unscathed. And this makes sense: the crisis is about current account imbalances, not debt.

It is not entirely clear to me whether, five years into the crisis, Cohn-Bendit and Verhofstadt are disputing this. After all, talking about Greece it is entirely right to focus on its lack of budget discipline. But the last sentence I quoted suggests that they still consider budget discpline to be an essential requirement for the health of the Eurozone in general, and that is quite incorrect.

The problem lies, perhaps, in the question who it is that should have "se soucié". In the context of this paragraph, it is clear that they are thinking of the Commission and the Council here, who did not invoke art. 104 EC. However, this overlooks a much more important group: the financial markets. It is the debtholders who somehow got the impression that Greek debt was now guaranteed by the other Eurozone states, notwithstanding the very clear language of the Treaties:
The Community shall not be liable for or assume the commitments of central governments, regional, local or other public authorities, other bodies governed by public law, or public undertakings of any Member State, without prejudice to mutual financial guarantees for the joint execution of a specific project. A Member State shall not be liable for or assume the commitments of central governments, regional, local or other public authorities, other bodies governed by public law, or public undertakings of another Member State, without prejudice to mutual financial guarantees for the joint execution of a specific project.
That's art. 103 EC, for those who are keeping score.

Now obviously this no-bailout clause would always be less harsh in practice than in theory, but to assume that Greek debt was now almost just as risky as German debt is absurd. Any Greek payment difficulty would involve a haircut as well as a bailout, the only question being the relative size of each. Assuming, for example, a haircut of 50% means that the appropriate Bund spread for Greek debt is half of what it was before Greece's entry into the Euro. In other words, Greece benefits, but it still pays a significant spread. The fact that it, and the other Eurozone countries that are currently in trouble, were able to borrow at such low rates for so long is a market failure, literally. And it is the banks and other investors who need to be punished for this SNAFU. The only reason why we are even talking about this is that letting the banks bear the consequences of their screw up would bankrupt them, and with them the entire world economy.

Which brings me to the one sensible point made in the quoted paragraph: "Soit ces pays avaient de bonnes raisons de ne pas suivre les règles, et il aurait alors fallu changer le pacte de stabilité. Soit ils avaient tort, et ils auraient dû être sanctionnés." Which is it? The answer is a little bit of both: the rules make sense from a political point of view, but not from an economic one.

From an economics point of view, all that matters is that the economic development of the Member States is as highly correlated as possible; they should all have their booms and busts at the same time. In other words, it matters little whether budget deficits are high or low. Instead, they should all be low or high at the same time, and one way to do that is to force Member States to push them to zero whenever possible. But there is no particular economic virtue in a balanced budget. On average, taken over the course of the business cycle, a state may run  a budget deficit that is equal, as a percentage of GDP, to the real growth rate of GDP. Anything less than that is sustainable indefinitely. In the short term, the deficit should be above the average sustainable rate during a recession, and that shortfall should be made up during the good years. This, however, is general macro-economics. The answer from monetary economics is a heartfelt shrug.

The politicians, on the other hand, realise that implicit in this analysis is that a Eurozone member should not default on its loans. (Since that would be an extreme case of asymmetry.) It follows that some Member States - the poor ones - should be constrained in their freedom to run deficits. But since one can't very well enact a rule of quod licet Iovi non licet bovi, the Treaty rule is that no one gets to have an excessive deficit. The overbroadness of this rule should then, in practice, be reduced by ignoring excessive deficits among healthy states like France and Germany while enforcing the rules strictly against poorer states like Greece and Portugal. But, as noted by Cohn-Bendit and Verhofstadt, such flexibility has its limits.

So does a viable monetary union require discipline in addition to solidarity? I think the correct answer is No. What it requires, instead of discipline, is a functioning system of financial markets, combined with credible signals about the form of an eventual bailout, if any. The latter should be supplied by the current crisis; if we survive this recession, everyone knows exactly what's what. Once financial markets know exactly to what extent they can count on a bailout, they will presumably start to respond correctly to the budget deficits of various Member States. Once they do that, we will have the quod licet Iovi rule that legally isn't possible. Financially vulnerable states get punished by the markets for running deficits, and large healthy states do not.

None of this takes away from the point about solidarity, of course. There is no question that the Member States of the Eurozone will never be able to achieve a level of correlation to make fiscal transfers unnecessary, especially given the continuing low levels of cross-border migration. We can only hope that such transfers can be achieved through less politically sensitive means than today. Likewise, various countries are going to have to think about their self-discipline with regard to competitiveness. A constant loss of competitiveness relative to Germany is simply not sustainable. Of course, Europe shouldn't let its labour market policies be dictated by the most Calvinist common denominator either. Instead, a target level of real wage growth should be established that is achievable for all. Solidarity and competitiveness, however, are topics for another day.

Thursday, December 06, 2012

This Week in Luxembourg

In the same week that the Commission handed down its largest ever cartel fine (yet to be published), the Court (Judge Ilešič) upheld the General Court’s judgement in AstraZeneca v. Commission, which had set a somewhat lower fine on the applicants than originally decided by the Commission, but had upheld the bulk of the Commission’s work. The underlying problem concerns “abuse [of] the patents system and the procedures for marketing pharmaceutical products in order to prevent or delay the arrival of competing generic medicinal products on the market and to impede parallel trade.” AstraZeneca v. Commission Cf. Chillin' Competition Blog and The Antitrust Hotch Potch

In the other competition case, Commission v. Verhuizingen Coppens, the Commission managed a partial win. In the General Court, the Commission’s decision had been annulled, on the grounds that the Commission had not discharged its burden of proof in establishing that the applicant’s issuing of “cover quotes” was knowingly anticompetitive and part of a cartel. The Court (Judge Jarašiūnas) now held that that was too harsh. Cartel involvement was proven, and so the Court restored part of the fine. (€ 35.000 instead of € 104.000)

Dittrich et al. v. Germany is another small step for equal rights for gays, although it is nowhere mentioned in the judgement. The case concerns alleged discrimination between civil servants who are married and civil servants who are part of a civil partnership. The Court (Judge Šváby) replied that Directive 2000/78 applies if the assistance in question is to be paid by the state in its capacity of public employer (as opposed to in its capacity as sovereign). Not very surprising, but good to know.

Confronted with another Ruiz Zambrano case, the Court (Judge Ó Caoimh)’s ambivalence is plainly visible. On the one hand, they would like to follow AG Bot (NLDEFR) and once again distinguish this case from the original precedent. However, the fact pattern here is too close to the fact pattern in Ruiz Zambrano to make that plausible. So they split the difference and leave it to the national court to decide whether, in each case, the child’s “genuine enjoyment” is at risk. O, S and L v. Maahanmuuttovirasto

In Sagor, the Court (Judge Ilešič) puts some Italian immigration law along the yardstick of Directive 2008/115 on “common standards and procedures in Member States for returning illegally staying third-country nationals”. A criminal fine for which an expulsion order may be substituted is OK, but house arrest even after physical transportation back to the home country becomes possible is not.

AG Cruz Villalón declined to endorse the methodology established by Hungary and Ukraine for local border traffic, whereby a Ukrainian citizen could be denied entry into the Schengen area on the grounds that his cumulative period of stay would exceed a legal maximum. The AG argued that this approach was only consistent with Regulation 1931/2006 if fraud or abuse were shown. Szabolcs-Szatmár-Bereg Megyei Rendőrkapitányság Záhony Határrendészeti Kirendeltsége v. Shomodi (NL, DE, FR)

Another asset freeze decision was shot down by the General Court. In Qualitest FZE v. Council, the General Court found that the Council had failed to state reasons with sufficient precision, and that the evidence it had provided in the course of litigation was in any event insufficient to support the asset freeze. If the Council wants to maintain the measure anyway, it has two months to appeal or enact a new decision.

Tuesday, December 04, 2012

Zwarte Piet

Just like the Americans have their War on Christmas, in the Netherlands we have our annual debate about whether Zwarte Piet is racist. What both debates have in common is that it is only one side that is doing all the "debating"; the sane majority needs nothing more than a resounding facepalm in reply.

Normally I would tend to take the same approach, but today it occurred to me that there is a simple, systematic way to think about this question, almost as if it were a legal issue. (Which it isn't, yet. Thank God for small graces.) So I thought I'd lay it out.

In my view, something can be racist by intent or racist by effect. (I know, I spend too much time doing European competition law.) It is intuitively obvious what it means for an act to be motivated by racist intent, whereas a racist effect means that the act has an unreasonable disparate impact on different races. Of course, in practice that disparate impact will often be intended on some level, but it is still useful to distinguish the two cases. (And, speaking of European law, note that in Common Market Law discriminatory intent without a discriminatory effect is not unlawful, although in practice it will be difficult to prove.) I fail to see how something can be inherently racist if it is neither motivated by racism nor has any kind of disparate impact.

This means that we can simply look at them each in turn. The first prong is quite simple. No one that I am aware of is claiming that the tradition of Zwarte Piet persists in order to promote a racist ideology, or otherwise because of racist intent. The tradition is observed by people of all ideologies and ethnicities, including a large majority who cannot plausibly be accused of being racists. Of course, I'm sure there are those who are batshit insane enough to suggest that one can be a racist without knowing it, but I'm not even going to dignify that with a response. (And even if that were true, how could such an unsuspected racist belief be the reason for any conscious choice?)

Note that blackface is an American tradition that has no equivalent in the Netherlands. The Zwarte Piet tradition dates back to around the same time as blackface, the mid-19th century, long before anyone in the Netherlands knew what blackface was or why it is unavoidably connected to a tradition of racism to the point of being per se racist. (By which I mean that anyone using blackface is deemed to know this tradition, and accept and intend the racist connotation of that institution.) Calling Zwarte Piet an example of blackface assumes the conclusion, and is therefore illegitimate as an argument.

That leaves disparate impact. This one is a bit more tricky, because it is unquestionably true that some black people are genuinely shocked and hurt at seeing Zwarte Piet. I'm still ruling it out, though. The problem is that, hurt feelings aside, there is no disparate impact. Again, this is - to my knowledge - undisputed. And the emotional impact that the Zwarte Piet tradition might cause is caused entirely by the (subjective) meaning that the person in question gives to what he or she sees. Specifically, people are hurt because they believe Zwarte Piet is racist. But this simply shows that the argument is circular: Zwarte Piet is racist because some people interpret it as racist. All it takes is for them to pull their heads out of their assess and educate themselves about the tradition and its meaning for people today, and the problem would be solved.

Unfortunately, my compatriots' love for White Liberal Guilt is much to great for them to be able to resist asking the question, so I'm sure this debate will continue year after year for as long as I shall live. Nevertheless, I will continue to treat the question with all the contempt it deserves.

The same goes, by the way, for the recent choice in Amsterdam to take the cross off Sinterklaas's hat, in order to avoid offending the Muslims:

Monday, December 03, 2012

Excessive Pragmatism

I'm still reading the Cohn-Bendit/Verhofstadt book. So far my diagnosis is that, for a book that I fundamentally agree with, there is a lot there that makes me mad. I will blog more about specific annoyances later, time permitting, but I thought I might start by explaining my problems with the book's excessive pragmatism.

Here's the idea: There is no question that the authors, like me, would be arguing for more European integration even if the economy were currently booming. This pamphlet is a classical case of not letting a good crisis go to waste.  This makes the argument seem very insincere. Rather, I would have liked to see them start by making the ideological argument first, switching to pragmatic arguments only in subsequent chapters. (Coincidentally, there's a column by Floor Rusman in NRC.Next today about these two approaches, although unfortunately it is in Dutch.)

It is the ideological argument that is often missing in contemporary debate, at least on the main public stage. To be sure, books are occasionally written, speeches occasionally given, but they are not aimed at the general public. Instead, the target audience for such efforts is the established circle of pre-existing Eurocrats, Europhiles and Eurosceptics. When European federalists turn their attention towards convincing the general public, doing battle with the Eurosceptics for votes in (European) elections and referendums, they invariably turn to pragmatic arguments about costs and benefits. Even the glorious speech by Polish Foreign Minister Radek Sikorski in Oxford in September falls in this category. Just look at the core of his argument: Eight myths about how England would benefit from leaving the EU. They are:
  • Britain’s trade with the EU is less important than its trade with the outside world.
  • The EU forces Britain to adopt laws on human rights which are contrary in spirit to British tradition.
  • UK is bankrupting itself by funding Europe.
  • The UK is drowning in the EU bureaucracy.
  • The UK is drowning in EU legislation and nasty directives coming from Brussels.
  • The European Commission is a hotbed of socialism.
  • Through its invasive Social Chapter, the EU is preventing  hardworking British people from working longer hours than feckless continentals.
  • New proposals for EU pesticides legislation would ban gardeners from using coffee grounds to tackle slugs.
Instead of arguing that each of these myths is irrelevant, and only as a secondary matter incorrect, Mr. Sikorski responded with a barrage of statistics and other facts. The myths are irrelevant, of course, because even if they were true they would be the will of the peoples of Europe, and since the EU is a democratic organisation, these outcomes could be changed if a sufficient majority of the peoples of Europe so decided. So the real question is how different competences should be assigned to different levels of government. Arguing that no competences whatsoever should be assigned to the EU-level is a tenable position, but not an obvious one. The Eurosceptic interlocutor would be welcome to explain how he or she arrived at such an extreme position.

To be sure, this way of framing the issue is highly ideological, for example because it rules out the possibility that it is somehow illegitimate to aggregate the citizens of the Member States into one big group of EU citizens, whose collective will should drive the outcomes of EU-decision making. Personally, I view people only as individuals, not as inherently part of some metaphysical nation or demos, so I have no problem with varying the scale of the relevant citizenry in this way, but someone else may not adhere to that ideological belief. That is fine. That simply means that we can have a conversation. Only when the basic ideological belief system is established should one proceed to the more pragmatic arguments that are designed to appeal to "swing voters".

Consider my other main ideological belief system, liberalism (i.e. what the Americans call libertarianism, although I don't go as far as American libertarians tend to). When arguing with a non-liberal, I like to stress that I consider freedom a bonum in se, something that is good regardless of whether it promotes other good things. Only as a second step do I argue, for example, that economic freedom leads to economic growth, and that a rising tide raises all boats, thus linking liberty with another bonum in se: material prosperity.

In the same way, for all their talk about straight cucumbers and overly profligate Eurocrats, the Nigel Farrages and Daniel Hannans of this world constantly return to the fact that voting is not only an act of individual self-determination, but also an exercise of power over others. They cannot stand the idea that foreigners should have power over Brits, and they don't mind saying so. A lot. Maybe it is because I grew up right next to an utterly random yet inexplicably 1500 year old border, but I don't see the point. Why should I be allowed to exercise power over the people in Limburg, who are only my compatriots because the Netherlands accidentally conquered that county during its War of Independence, but not over my fellow Saxons on the other side of the German border? But, as noted, that is a conversation we can have. (And should have.)

Along these lines, the debate about European Integration takes place on two levels, the ideological and the pragmatical. The former convinces only slowly; dreams are not passed on easily. The latter, on the other hand, convinces quickly but shallowly. Pragmatic arguments appeal to the brain, but not to the heart. Friends won in this way are just as easily lost again. To pretend that the ideological argument does not exist is to concede the debate before it even begins. To hide it from view when appealing to the general public is to give credence to their suspicion that the speaker's true motives are hidden, and that he cannot be trusted. And to claim that ideological thinking about European Integration is somehow illegitimate is just very, very wrong.

Last Week in Luxembourg

It turns out that, under art. 16 of the Statute of the Court, there is such a thing as the Court sitting as a “Full Court”, i.e. with 27 judges instead of the 15 that make up a Grand Chamber. One such case of “exceptional importance” is Pringle v. Ireland, where the Court (Judge Lenaerts) held that we get to keep the simplified amendment of the TFEU in Decision 2011/199 and the ESM. For commentary, cf. Laurens Ankersmit on European Law Blog, Ciara Murphy on European Law Blog, Kenneth Armstrong on Eutopia Law Blog, Maximilian Steinbeis in German on Verfassungsblog, and Marijn van der Sluis on Publiekrecht & Politiek in Dutch.

Speaking of the Grand Chamber, it held (per Judge Rosas) that EPSO is not allowed to carry out an examination for a position that requires a “thorough knowledge of English, French or German” in English, French and German only, because that unfairly discriminates against Italians. As such, the judgement of the General Court is overturned. Italy v. Commission Cf. European Law Blog

AG Trstenjak considered a rather unusual fact pattern for a Regulation 44/2001 case: the Land Berlin paid sums that were too large to a number of people claiming compensation for Third Reich-era forced sales. Does the government’s claim for restitution fall under the Regulation? And to what extent can the Land invoke art. 6(1) of the Regulation in order to sue them all together? And does it matter that some of them live in Israel, i.e. outside the EU? The AG argued that the Regulation applies, and offers some guidance on art. 6(1). Land Berlin v. Sapir et al.

AG Jääskinen also looked at Regulation 44/2001, also with a fun fact pattern: In tort, jurisdiction can be based on the place where the tort was allegedly committed. If the tort consist of different elements committed by different actors in different countries, the courts in each of these countries have jurisdiction. The AG argued that this is still true if the defendant responsible for the element of the country in question is not actually being sued. Melzer v. MF Global UK

AG Kokott discussed the case law on the responsibility of parent companies for infringements of the cartel rules committed by their wholly-owned subsidiaries in Commission v. Stichting Administratiekantoor Portielje. While the Stichting achieved a partial win in the General Court, the AG argued that this was in error.

As I already predicted when I first heard about the case, Bloomberg lost their access to documents case against the ECB concerning certain Bank documents about Greece. Thesing and Bloomberg v. ECB

The General Court upheld the Commission’s cartel decision (FR) in Groupement des cartes bancaires « CB » v. Commission (FR). (There was no fine.)

Finally, the EFTA Court handed down an interesting free movement of goods case in Vín Tríó ehf. v. Iceland. It found no evidence of protectionism, so it held for Iceland. Cf. European Law Blog