European Scrutiny Committee Contents


7 EU-Iraq relations

(a)

(32176)

16152/10


(b)

(32177)

16179/10


(c)

(32638)


Council Decision on the signing and provisional application of certain provisions of the Partnership and Cooperation Agreement between the European Union and its Member States, and the Republic of Iraq


Council Decision on the conclusion of a Partnership and Cooperation Agreement between the European Union and its Member States, of the one part, and the Republic of Iraq, of the other part

Draft Council Decision on the signing and provisional application of certain provisions of the Partnership and Cooperation Agreement between the European Union and its Member States, and the Republic of Iraq

Legal baseArticles 79 (3), 91, 100, 192 (1), 194 (4), 207, 209 and Article 218 (5) TFEU; QMV
Documents originated16 November 2010
Deposited in Parliament16 November 2010
DepartmentForeign and Commonwealth Office
Basis of considerationExplanatory Memorandum of 4 April 2011 and Supplementary Explanatory Memorandum of 14 June 2012
Previous Committee ReportNone
Discussion in CouncilDecember 2011
Committee's assessmentLegally and politically important
Committee's decision(a) and (c) cleared;

(b) Not cleared; further information requested

Background

7.1 In March 2006 the Council authorised the Commission to negotiate a Trade and Cooperation Agreement with Iraq. Negotiations were launched in November 2006 and the final agreed text concluded in November 2009 in Brussels. The text was then amended in light of the Lisbon Treaty. In February 2009 in Baghdad, both Iraq and the EU agreed to amend the status of the draft Agreement, from a "Trade and Cooperation Agreement" to a "Partnership and Cooperation Agreement" (PCA).

7.2 In his Explanatory Memorandum of 4 April 2011, the Minister for Europe (Mr David Lidington) explains that this occurred because Iraq would otherwise have been required to pass a significant amount of local legislation to satisfy the World Trade Organisation element of the Agreement, causing significant delays and possibly ending the negotiations prior to completion.

7.3 The Minister stated that the PCA, which is concluded for 10 years (renewable):

—  has the objective of building a solid basis for strengthening ties between Iraq and the EU;

—  in particular, will provide a legal framework for both the EU Member States and Iraq covering issues such as regular political dialogue, including annual Ministerial meetings, trade relations, and development assistance;

—  also provides for regulatory cooperation in the fields of energy, transport, investment, human rights, education, science and technology, justice, migration and asylum;

—  also addresses the following subject matters: countering proliferation of weapons of mass destruction, combating terrorism, small arms and light weapons, and the International Criminal Court;

—  aims to enhance dialogue between the EU and Iraq on bilateral, regional and global issues, improving the trade and investment arrangements, developing cooperation in the above sectors, supporting Iraq's own reform, development efforts and facilitating its integration into the wider international economy.

7.4 The Minister described the PCA as also having "the added benefit of bringing together the EU Member States to discuss Iraq in a positive light", Iraq having "historically been a divisive topic amongst Member States since the 2003 invasion."

7.5 The Minister also declared that "the UK has protected all of its red lines within the text of the PCA, including on migration and international law."

Legal and procedural issues

7.6 The Minister noted that:

"the legal bases cited in the Proposals for Council Decisions deposited in November 2010 were: Articles 207 and 209 in conjunction with 218(5) TFEU for the signing, on behalf of the EU, and provisional application of certain provisions; and Articles 207 and 209 in conjunction with 218 (6)(a) for the conclusion. Subsequently there was a change to the agreed legal bases for the signing and to provisional application. The revised Council Decision is attached".

7.7 The Minister continued as follows:

"Provisional application now applies to Article 2 and Titles II, III and V of the PCA in accordance with Article 117 of the PCA only insofar as it concerns matters falling within the Union's competence. The legal bases have been updated to follow the model for the PCA with the Philippines.[42] It cites specific legal bases where the provisions of the PCA are entered into by the EU and impose specific obligations. The legal bases are therefore now Articles 91, 100, 79 (3), 192 (1), 194, 207 and 209 in conjunction with Article 218 (5) TFEU. In light of the specific obligation placed on the EU to agree, on request, to negotiate an EU-Iraq readmissions agreement, we agree with the citation of a specific JHA legal base under Article 79 (3). With regard to the provisions of the PCA falling under Title V of the Treaty on the Functioning of the European Union, it is the UK's position that Protocol No.21 on the Position of the United Kingdom and Ireland in respect of the area of Freedom, Security and Justice annexed to the Treaty on European Union and the Treaty on the Functioning of the European Union means that the UK opt-in applies to this Council Decision.

"The legal bases for the proposed Council Decision on the conclusion of the PCA will be updated accordingly but a final redraft has not yet been produced at working level."

The Government's view

7.8 The Minister continued as follows:

"Closer EU engagement on Iraq is in the UK's interest, both for reasons of burden sharing and because it will help to deliver UK objectives, including on trade, and development and human rights. This PCA will mark the first contractual relationship between the EU and Iraq, and is the centre piece for closer EU engagement with Iraq — a key aim of UK policy in the country.

"The Iraqi Council of Representatives has not yet ratified the PCA. After negotiations concluded in November 2009, the PCA was prepared to be presented as a final document. With the Iraqi national election occurring on 7 March 2010, this did not leave enough parliamentary days in Iraq to complete the process. The severe delay in forming a government has meant the Council of Representatives will have a backlog of legislation to deal with, most notably their 2011 Budget and national Hydrocarbons law. On 21 December 2010 Prime Minister al-Maliki finally secured parliamentary approval for a new cabinet. It is worth noting that there is a, relatively low, risk that the new Iraqi government may want to re-open and re-negotiate the text, thus delaying signing the PCA and any subsequent benefits for EU trade and cooperation with Iraq."

7.9 The Minister then made the following further observations:

"On 7 March 2010, Iraqis turned out in their millions to vote in national elections for the Council of Representatives and take the future of their country into their own hands. In doing so in the face of tragic losses on polling day, Iraq demonstrated its commitment to democracy over violence and terrorism.

"On 10 November 2010, after much delay, it was announced that negotiations between the main Parties had concluded with an agreement that a government would be formed with the incumbent Prime Minister Maliki continuing in this position. In addition, incumbent President Talabani also continues in his position whilst Usama al Nujaifi has taken the role of Speaker in the new Council of Representatives (CoR).

"On 25 November 2010, President Talabani officially invited Prime Minister Maliki to form a government. On 21 December 2010 Prime Minister Maliki finally secured parliamentary approval for a new cabinet. The new government is inclusive of all the main ethno-sectarian blocks and reflects the outcome of peaceful negotiations between the parties. The United Kingdom has supported this process through discussions with the main political leaders, in which we encouraged each to make the compromises necessary to reach a positive outcome. The Council of Representatives has now resumed the parliamentary process. With a significant backlog of legislative issues to deal with because of the delay in government formation, the first reading of the PCA could still be some way off.

"While Iraq continues to make some progress in rejecting sectarianism, tensions between the communities remain, centred on issues such as power and revenue sharing. We continue to urge all the main political leaders to work together in a spirit of compromise in the interests of all of Iraq, or risk damaging the still recent gains in security and political progress. The EU can significantly contribute to the development and prosperity of Iraq, and this PCA allows Iraq and Member States a firm footing to begin this process."

7.10 With regard to the Legal Issues, the Minister stated:

"Where articles in the PCA fall within the JHA area, Protocol 21 to the TFEU provides that in cases where such obligations are being entered into by the EU the UK has a choice as to whether or not to opt-in and therefore to participate in those measures as part of the EU. If the UK chooses not to opt-in to such provisions and an agreement is mixed (i.e. it is between a third country (in this case Iraq) and the EU and its Member States) it is open to the UK to sign up to these elements of the PCA in its own right. This position is made clear in the preamble to the PCA noting the UK, Ireland and Denmark's participation and by a recital to the Council Decision."

7.11 The Minister then described the timetable as "currently uncertain", and continued thus:

"Extended discussions on provisional application and legal bases meant that, although draft proposals for Council Decisions were deposited in November 2010, the Council is not yet in a position to sign the PCA. Ireland still has a reserve, and we will maintain a reserve until scrutiny and an EAC write-round are complete."

The Minister's letters of 28 February and 4 April 2011

7.12 In his first letter, the Minister wrote to say that, although these proposals were deposited in November 2010, there was difficulty reaching agreement between Member States on draft texts for the Council Decisions:

"This was due to a lack of clarity on the provisional application of some elements of the agreement by the Commission, and extended discussion on the appropriate legal bases for the Agreement at working group level in Brussels. I delayed sending the EM for UK parliamentary scrutiny on the basis that it would need to be amended following the outcome of the discussions in Brussels."

"The discussion on the appropriate legal bases has continued into February 2011. The FCO has been coordinating input from relevant departments to ensure the bases meet UK legal requirements. FCO officials have kept the Scrutiny Committee clerks fully informed.

"The discussions in Brussels are drawing to a close. However, I am also aware of the concerns that the Scrutiny Committees have raised recently in regard to PCAs. Some of these concerns are relevant to the Iraq PCA, particularly in regard to Title V of the TFEU (JHA).

"FCO officials are giving careful consideration to the legal base issue. In view of these factors I think that it would be sensible to wait until we have reached a decision on the way forward before submitting the EM for the Iraq PCA. We have registered a scrutiny reserve in Brussels in the interim."

7.13 In his subsequent letter of 4 April, the Minister:

—   recalled his earlier letter about unresolved issues with respect to the application of the JHA opt-in and the citation of legal bases in agreements between the EU and its Member States, and third countries;

—  referred to the Committee consequently holding a number of similar agreements under scrutiny;

—  also referred to our concerns in the context of the Philippines PCA Council Decision and to the process of interdepartmental consultation prior to his appearance before the Committee on 27 April 2011 to discuss that PCA;

—  said that, having written earlier to explain the delays in submitting an Explanatory Memorandum on the Iraq PCA, and to inform the Committee of his intention to wait until he had completed consideration of the legal bases issue before submitting it;

—   also said that he had sent his Explanatory Memorandum to the Committee, at its request, "on the understanding that we are not in a position to comment in detail on some of these issues at this stage."

7.14 The Minister closed his letter thus:

"For this reason we have not provided a definitive list of the articles that can be considered pursuant to Title V at this stage. I will write to your Committee again once we have more clarity on the issue. I will also submit a revised Explanatory Memorandum following the evidence session on 27 April."

The Minister for Europe's evidence

7.15 The Minister gave evidence to us on 27 April 2011. In our Report[43] on his evidence, we drew the following conclusions on opting into provisions of international agreements:

  • that there were several difficulties with the Government's approach to when the opt-in Protocol applies. Of greatest concern to the Committee was that a unilateral subjective assessment of the content and legal effect of a provision of a multilateral agreement would lead to legal uncertainty, if not litigation. We thought the Minister's legal adviser was right when he said the Government agreed that the better practice was for a Title V legal base to be cited in an international agreement because "it achieves the greatest level of legal certainty, because in those circumstances it is clear on the face of the legislation that there is a JHA content in the provision and the opt-in is engaged."[44] These, we suggested, were all the reasons why a legal base must, rather than may, be cited;
  • a further difficulty was the consequence of the Government's approach for Denmark and Ireland. A unilateral assessment by the UK that a provision in an international agreement is made pursuant to Title V would mean that Ireland would have to opt into the provision in order to be bound by it, and Denmark would be excluded. Given such consequences, it was hardly probable that the legal base need not identify the applicable Treaty Article in Title V;
  • it transpired that Ireland and the Commission take a different view to the UK of whether a legal base in Title V should be cited. In the case of Ireland, this would lead to the unfortunate situation of the only other beneficiary State to the opt-in Protocol taking the contrary view of when the opt-in applies. In the case of the Commission, we thought there was also a risk that it might bring an action in the ECJ should the UK assert that it can opt out of a binding provision in an international agreement without the need for a Title V legal base;
  • a Regulation or Directive would always cite a Title V legal base if the opt-in was considered to be engaged. The Government's approach to EU international agreements therefore had the consequence of placing them in a category sui generis, for which the Committee failed to find any justification in the EU Treaties; and
  • in addition, the Government's approach could set an unhelpful precedent in a multilateral system of law based on transparency, consistency and predictability: other EU Member States may wish to take a similar approach to Treaty obligations they would prefer not to be bound by.

7.16 In all, it seemed to us that the Government was in a minority of one in arguing that its interpretation of Title V was correct: were this not the case other Member States (particularly Ireland and Denmark) and the EU institutions could be expected to agree to the citation of a Title V legal base. We thought this approach was based more on wishful thinking than reasonable legal interpretation. More importantly, however, there was a risk that it might lead to the consequences listed above. We therefore asked the Government to reconsider its policy on the application of Title V to EU international agreements.[45]

The Minister's letter of 10 November 2011

7.17 A further letter of 10 November 2011[46] clarified the Government's position, indicating that the UK's Title V opt-in applied to any provision in an international agreement which created obligations in the JHA field.  Whilst the Government would press, in such cases, for a Title V legal base to be cited, a failure to do so would not, in its view, affect the application of its Title V opt-in.

The Minister's Supplementary Explanatory Memorandum of 14 June 2012

7.18 The Minister for Europe recalls his earlier Explanatory Memorandum and his letter of 10 November 2011, and says that the PCA was signed by the EU and its Member States, and Iraq, on 11 May 2012. He then says:

"Whilst the stage of scrutiny has already passed and the PCA signed, this Supplementary Explanatory Memorandum is being sent retrospectively to provide clarity on details around the JHA opt-in that the government was unable to provide in the original EM submitted in April 2011."

7.19 The Minister also says:

"Where articles in the PCA fall within the JHA area, Protocol 21 to the Treaty on the Functioning of the European Union ("TFEU") provides that in cases where such obligations are being entered into by the EU the UK has a choice as to whether or not to opt-in and therefore to participate in those measures as part of the EU. If the UK chooses not to opt-in to such provisions and an agreement is mixed (i.e. it is between a third country (in this case Iraq) and the EU and its Member States) it is open to the UK to sign up to these elements of the PCA in its own right. This position is made clear in the preamble to the PCA noting the UK, Ireland and Denmark's participation and by a recital to the Council Decision.

"The legal bases cited in the Proposals for Council Decisions deposited in November 2010 were: Articles 207 and 209 in conjunction with 218(5) TFEU for the signing, on behalf of the EU, and provisional application of certain provisions; and Articles 207 and 209 in conjunction with 218 (6)(a) for the conclusion of the PCA. Subsequently there was a change to the agreed legal bases for the signing and provisional application of the PCA. The revised Council Decision is attached.

"Provisional application now applies to Article 2 and Titles II, III and V of the PCA in accordance with Article 117 of the PCA only insofar as it concerns matters falling within the EU's competence. The legal bases have been updated to follow the model for the PCA with the Philippines. It cites specific legal bases where the provisions of the PCA are entered into by the EU and impose specific obligations. The legal bases are therefore now Articles 91, 100, 79 (3), 192 (1), 194, 207 and 209 in conjunction with Article 218 (5) TFEU. In light of the specific obligation placed on the EU to agree, on request, to negotiate an EU-Iraq readmissions agreement, we agree with the citation of a specific JHA legal base under Article 79 (3). With regard to the provisions of the PCA falling under Title V of the Treaty on the Functioning of the European Union, it is the UK's position that Protocol No.21 on the Position of the United Kingdom and Ireland in respect of the area of Freedom, Security and Justice annexed to the Treaty on European Union and the Treaty on the Functioning of the European Union means that the UK opt-in applies to this Council Decision.

"It is the UK's position that Articles 25 (Mode IV arrangements), 103 (judicial cooperation), and 105(5) (cooperation on migration and asylum, including reference to a future readmissions agreement) fall under Part 3, Title V TFEU.

"The legal bases for the proposed Council Decision on the conclusion of the PCA will be updated accordingly."

Conclusion

7.20 We note that the revised draft Council Decision on signature of the PCA — document (c) — includes as one of its legal bases Article 79(3) TFEU, which authorises the EU to conclude readmission agreements with third countries. However, the other provisions of the PCA highlighted by the Minister as falling under Part 3, Title V TFEU, do not cite a corresponding Title V legal base.

7.21 Title IV of the PCA, which bears the title "Justice, Freedom and Security", includes cooperation on: the rule of law; civil and criminal judicial cooperation; personal data protection; migration and asylum; combating organised crime and corruption; combating money laundering and terrorist financing; and combating illicit drugs. All of these provisions would appear to fall within the scope of different forms of cooperation covered by Part 3, Title V TFEU.

7.22 We assume, therefore, that the Minister has chosen to highlight only those provisions which, in his view, create specific obligations for the EU (as distinct from Member States) and therefore justify the citation of a Title V legal base.

7.23 As the Minister is aware, for reasons of legal certainty and transparency, we have consistently taken the view that the citation of a Title V legal base is essential to engage the UK's Title V opt-in. We have argued that a unilateral subjective assessment of the content and legal effect of provisions of a multilateral agreement will inevitably lead to legal uncertainty, if not litigation.

7.24 We note that the PCA with Iraq has already been signed, prompting a scrutiny override. We therefore now clear documents (a) and (c) from scrutiny.

7.25 We note also that the legal bases for the draft Council Decision on conclusion of the PCA with Iraq are to be updated to include one Title V legal base — Article 79(3) TFEU on readmission agreements. We accordingly ask the Minister to deposit the revised draft Council Decision on conclusion for scrutiny, and to ensure that his accompanying Explanatory Memorandum:

—  identifies the provisions of the PCA which, in his view, create specific obligations for the EU and justify the citation of a Title V legal base;

—  sets out the relevant legal bases in Part 3, Title V TFEU which the Government believes should be cited; and

—  if they are not cited, explains what further action the UK intends to take to protect its Title V opt-in.

7.26 We should add that we expect the Ashton and Lidington undertakings on enhanced Parliamentary scrutiny of opt-ins to be respected where a draft legislative proposal does not contain a Title V legal base but the Government asserts that the opt-in applies.

7.27 Until then we will continue to retain document (b) — the Council Decision on the conclusion of the PCA — under scrutiny.

7.28 Looking further ahead, we expect similar information to that set out in paragraph 7.25 above to be provided in Explanatory Memoranda on future draft Council Decisions authorising the signature and conclusion of similar mixed competence agreements between the EU, its Member States and third countries.


42   See (31949) 13615/10 and (32472) - : HC 428-xxvii (2010-12), chapter 3 (24 May 2011). Back

43   HC 955-I (2010-11). Back

44   HC 955-II (2010-11) Q 40. Back

45   The Government's response was published on 23 November 2011, as HC 1670. Back

46   Reproduced at the Annex to this chapter of our Report. Back


 
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Prepared 13 December 2012