10 Subsidiarity "yellow card":
the European Public Prosecutor's Office
| (35613)
17176/13
COM(13) 851
| Commission Communication on the review of the proposal for a Regulation on the establishment of the European Public Prosecutor's Office with regard to the principle of subsidiarity in accordance with Protocol No. 2
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| Legal base | —
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| Department | Home Office
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| Basis of consideration | Commission's letter of 14 March 2014
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| Previous Committee Report | HC 83-xxviii (2013-14), chapter 8 (22 January 2014)
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| Discussion in Council | Not applicable
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| Committee's assessment | Legally and politically important
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| Committee's decision | Cleared
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Background and previous scrutiny
10.1 An account of the Commission's Communication
and its background was set out in our Thirty-first Report.[58]
In brief, the Communication set out the Commission's response
to the subsidiarity "yellow card" and Reasoned Opinions
raised by national parliaments in respect of the draft Regulation
on the establishment of a European Public Prosecutor's Office
(EPPO)[59] and its decision
to maintain the proposal. The Commission said that its response
only addressed those grounds advanced by national parliaments
which it considered to fall within the scope of the subsidiarity
protocol and principle. It undertook to write, in due course,
individual responses to national parliaments on arguments which
it considered to be outside scope.
10.2 In our Report, we also set out the view of the
then Minister for Security at the Home Office (James Brokenshire).
He said that the Government was disappointed with the Commission's
hasty review and its outright rejection of the multiple concerns
raised by national parliaments on aspects which "directly
underpin" the subsidiarity principle and democratic legitimacy.
In addition to providing a critique of the Commission's individual
arguments in the Communication, the Minister said that should
individual responses to national parliaments from the Commission
prove unsatisfactory, the Government would support further calls
from national parliaments for the Commission to take serious account
of the concerns raised in relation the proposal.
10.3 We also provided our own assessment of the Commission's
Communication in that Report. In summary, we considered that:
· the precipitate nature of the Commission's
response suggested that it had treated the exercise as a formality
rather than a conscientious review and had not considered the
other options of amending or withdrawing the proposal. In dismissing
all of the arguments advanced by national parliaments, its response
lacked credibility and seemed driven by the expediency of needing
to maintain the proposal;
· the Commission had not properly exercised
the "margin of discretion" identified by Court of Justice
case law which would require it to reconsider the compliance of
the proposal with subsidiarity with an open mind;
· the Commission was wrong to interpret
the scope of the subsidiarity control mechanism narrowly, therefore
considering outside scope arguments advanced by the House of Commons
(and other national parliaments) which were intrinsic to national
parliaments' review of the merits of EU action in terms of them
providing "EU-added value";
· it was unfortunate, despite prior opportunities
to address the question of scope in the context of other Reasoned
Opinions, that the Commission was only doing so now when faced
with significant opposition to the proposal and at a point in
the process when national parliaments were no longer empowered
to challenge a draft legislative act;
· the Commission was wrong to say that it
did not have to consider specifically the sufficiency of Member
State action " at regional or local level", particularly
in the context of the EPPO proposal which affects criminal justice
dispensed through diverse systems and processes at the regional
level of Member States; and
· the Commission was also wrong to assert
that the existence of a legal base in the Treaties for the establishment
of an EPPO meant that it could not per se breach the subsidiarity
principle as, considering the wording of Article 5(1) TEU, it
is the "use of Union competences" that is governed by
the subsidiarity principle, not their mere existence; and
· that the EPPO proposal as maintained lacked
democratic legitimacy given the disregard for national parliament
concerns.
10.4 We recommended in our Report that the Communication
be considered as part of the debate on relations between the Commission
and national parliaments. That debate took place in European Committee
on 30 January 2014.[60]
We also asked the Government to keep us informed of:
i) whether the Commission honours the undertaking
it gave in the Communication (and which is already required by
Article 7(1) of Protocol (No2) to the Treaties) to take the concerns
of national parliaments into account during the negotiations of
the EPPO proposal; and
ii) any developments indicating that the proposal
was moving to the "enhanced co-operation" procedure.
The debate on 30 January 2014 on relations between
the Commission and national parliaments
10.5 The question of the Commission's response to
the "yellow card" raised on the EPPO proposal was addressed
twice by the Minister for Europe (Mr David Lidington) during the
debate on the relations between the European Commission and national
parliaments. The Minister's first comment was:
"On the last point, I raised the Commission's
disappointing response to the recent yellow card on the European
public prosecutor's office, during the 17 December General Affairs
Council. My concerns were shared openly by a number of other member
states, which spoke in support.
"The Commission's response was, at best,
unsatisfactory, and at worst, disrespectful of the views of the
Parliaments of no fewer than 11 member states. After only four
weeks' consideration, the Commission announced that its proposal
on the EPPO would remain unchanged. Its response took a narrow
view of subsidiarity, introduced no new evidence to justify the
proposal and failed to engage with the thoroughness and detail
that rightly should be expected with the genuine concerns that
so many national Chambers had expressed. That makes the case for
strengthening the yellow card mechanism more urgent."[61]
10.6 At a later point in the debate, the Minister
commented further:
"We have continued to raise that matter
with the Commission. I raised it directly with the Commission
when I was in Brussels last week. One thing we find frustrating
about that decision is that there has not yet been what I would
consider to be an adequate, detailed explanation from the Commission
as to why it believed that the criticisms made by 11 national
parliamentary chambers were inappropriate or misjudged.
"Whether or not one agrees with the Commission's
position, one might have more respect for that position if the
Commission was prepared to express its argument in detail. I will
have further conversations with Commissioners over the next few
weeks, and I intend to pursue the matter."[62]
The Commission's letter of 14 March 2014
10.7 The Vice-President of the Commission, Maroš
Šefèoviè, says that the purpose of his letter
is to address arguments submitted by the House of Commons in its
Reasoned Opinion "which do not relate to the principle of
subsidiarity" and so fall outside of the subsidiarity control
mechanism and the Communication. He then presents the Commission's
response to those individual arguments, with the aspiration that
they will address the concerns of the House of Commons and can
form part of continuing political dialogue.
RISK OF VIOLATION OF FUNDAMENTAL RIGHTS
10.8 The House of Commons argued that the proposed
mandatory model of prosecution (as opposed to the domestic national
model) could lead to violation of suspects' rights, that a prioritised,
target-driven system of prosecution for crimes affecting the financial
interests of the Union may lead to inequality before the law and
that victims of other crimes would be adversely affected by the
consequent diversion of national resources.
10.9 The Commission says in response that:
· Article 11(1) of the EPPO proposal states
that the EPPO shall ensure that its activities respect the rights
set out in the EU Charter of Fundamental Rights;
· it disagrees that the choice of prosecution
model affects procedural rights, because mandatory prosecution
is in line with Treaty obligations of Member States and the Union
to effectively combat crimes affecting the financial interests
of the Union and would not mandate prosecutions in all circumstances,
for example, in the case of minor offences or where "in the
interests of the proper administration of justice" and "under
certain conditions governed by the proposal" the EPPO offers
a suspect a conditional dismissal. The EPPO would also have "a
certain leeway to form a decision on bringing a case before a
competent court or not" and that "it was not evident"
that a discretionary model would be more favourable to suspects'
rights; and
· it rejects the idea that the prioritised
investigation and prosecution of crimes affecting the Union's
financial interest could lead to inequality before the law because
given "the distinct areas of competence, the proposal does
not prejudice the efficiency and the effectiveness" of the
investigation and prosecution of other crimes, nor the risk of
conviction. "Similar considerations" apply to the view
that prioritisation could affect victims of other crimes.
RULE OF LAW UNDERMINED BY LACK OF DETAIL ON JUDICIAL
REVIEW
10.10 In response to the House's argument that the
proposal's compliance with the Rule of Law was undermined by the
lack of detail on arrangements for judicial review, the Commission
says that since Article 86 TFEU provides that the EPPO shall act
as a prosecutor in the competent courts of the Member States,
the proposal treats it as a national authority for the purposes
of Judicial Review so that "all challengeable acts of investigation
and prosecution" of the EPPO would be reviewed by the national
courts. Additionally, preliminary references to the Court of Justice
would still be possible pursuant to Article 267 TFEU. Combined,
these two judicial processes "would ensure a comprehensive
level of judicial scrutiny and hence ensure compliance with the
law".
DISADVANTAGES BOTH FOR PARTICIPATING AND NON-PARTICIPATING
MEMBER STATES
10.11 The House of Commons argued that participating
Member States would lose the prerogative to prioritise prosecution
activities within their criminal justice systems; non-participating
Member States would be prejudiced by the reduction in the competences
of Eurojust and OLAF.
10.12 The Commission rejects this argument because:
· Member States are obliged by the Treaties
to "make available the necessary resources and means to effectively
protect the Unions' financial interests" and that this would
be "without prejudice" to the Member States' prerogative
to prioritise prosecution in other areas of criminal activity;
· there would be no disadvantage resulting
from reduced competence and staffing at OLAF because although
it would no longer carry out administrative investigations as
regards Union fraud with respect of participating countries, it
would remain competent for the remaining Member States;
· due care would be taken to ensure that
Eurojust remains "sufficiently staffed to successfully continue
its tasks which go beyond" fighting crimes against the EU
budget; and
· overall, it considers the proposal would
cause "no adverse impact on either Eurojust or OLAF".
PARTIAL PARTICIPATION WILL NOT ACHIEVE UNION-WIDE
ENFORCEMENT
10.13 The House of Commons argued that an incomplete
single legal area across the Union resulting from the non-participation
of some Member States in the proposal, would not achieve an equivalent
level of enforcement throughout the Union. The Commission responds
that:
· because Article 86 TFEU provides for adoption
by enhanced co-operation in the absence of unanimity, partial
participation of Member States per se is not a valid argument
against the establishment of the EPPO; and
· it is the Commission's aim that as many
Member States as possible participate in the proposal and that
any participation represents an improvement to the current fragmentation
caused by 28 different legal regimes and that the reference to
"single legal area" is to be understood in terms of
those Member States who participate in the proposal.
Our assessment
10.14 As we stated in our last Report, we stand by
our view that the arguments addressed by this Commission letter
are not outside the scope of the subsidiarity control mechanism
as they are intrinsic to national Parliaments' review of the merits
of EU action in terms of them providing "EU-added value"
(the second limb of the subsidiarity test in Article 5(3) of the
Treaty on the European Union ("TEU")).
10.15 Nor are we convinced by the Commission's arguments
that the EPPO proposal and its mandatory prosecution model will
not pose a risk to suspects' fundamental rights. We do not see
how a mandatory model which starts with the presumption that a
prosecution must be taken if there is sufficient evidence in support
and is only moderated by a vague degree of discretion described
as "a certain leeway" can be equated with a discretionary
model. In such a model as exists in England and Wales, the evidential
test (sufficiency of evidence test) is just one stage in the Full
Code Test for Crown Prosecutors,[63]
with the wide discretion allowed within the second stage, the
Public Interest test, amounting to more than "a certain leeway".
Also, the House of Commons' reference to suspects' rights has
been too narrowly interpreted by the Commission as being tantamount
to "procedural rights" whereas it was meant in a broader
sense to include other fundamental rights, for instance, the need
to protect a suspect's fundamental right to liberty or right to
a private or family life. Such a right could be engaged, for example,
if they were to be subject to disproportionate enforcement action
by the State resulting from mandatory prosecution where their
individual level of culpability in a fraudulent enterprise was
minimal.
10.16 We also reject the unrealistic assumption that
the Commission makes in relation to impact on other areas of prosecutorial
activity and priorities, that Member States can, particularly
in terms of economic adversity, simply ring-fence and prioritise
investigative and prosecutorial resources for one type of criminal
activity, without that having any impact on residual resources
available for the investigation and prosecution of other crimes.
10.17 We do not see how repeating assertions made
previously about the EPPO being subject to both Judicial Review
and Article 267 TFEU proceedings, answers the House of Commons'
concern about lack of detail concerning Judicial Review
arrangements.
10.18 There remains a real risk of non-participating
States being disadvantaged by reduced resources at OLAF because
the inability of OLAF to investigate crimes in other countries
will undermine the existing levels of co-operation between Member
States on this type of criminal activity. It also remains to be
seen, whether it is possible to separate so cleanly, staffing
requirements for fighting EU budget fraud crimes from others.
There will undoubtedly be some loss in cross-cutting expertise
in the investigation of different types of crimes across the EU.
10.19 Finally, whatever the degree of participation
in the EPPO proposal, it is patently misleading to describe this
as a "single legal area" with connotations of the participation
of all Member States entailed, for example, by the "single
market". In any event, in terms of strict subsidiarity arguments,
it equally does not follow from the existence of a Treaty base
which permits partial participation, that a proposal which relies
on that legal base cannot be challenged in terms of the "EU-added"
value requirement of the principle. This would particularly be
the case if the level of fragmentation between participating and
non-participating states was such that it negated any purported
benefit of internal coherence of the "legal area" of
participating states.
Conclusion
10.20 We take this opportunity to restate our
disappointment with the Commission's approach to the "yellow
card" raised by national parliaments on the proposed Regulation
on the establishment of a European Public Prosecutor's Office
(the EPPO proposal).[64]
As with our Report on the Communication, we will send a copy of
this Report to the Commission, with a covering letter, drawing
its attention to our further concerns.
10.21 Although we now clear the current document,
we continue to keep the EPPO proposal under scrutiny. We therefore
ask that the Government responds, when appropriate, to our outstanding
requests for information on this document (set out in the conclusions
of our Thirty-first Report), in the course of our ongoing scrutiny
of the EPPO proposal.
58 See headnote. Back
59
(35217) 12558/13: Draft Regulation on the establishment of the
European Public Prosecutor's Office. Back
60
Stg Co Deb, European Standing Committee B, 30 January 2014,
cols. 3-18. Back
61
See footnote 61, col. 5-6. Back
62
See footnote 61, col. 9. Back
63
https://www.cps.gov.uk/publications/code_for_crown_prosecutors/codetest.html. Back
64
See footnote 60. Back
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