Appendix 6 The Exclusive External Competence
of the Community |
This Note seeks to provide some clarification of
the basic legal framework.
(a) Legal Personality
1. The Community has legal personality by virtue
of Article 281 of the Treaty and capacity, within its field of
competence, to enter into obligations binding in international
law. The Community is party to a wide variety of international
agreements. It is also a member of a number of international organisations.
However, the Treaties do not expressly confer legal personality
on the European Union and consequently, it is argued, the Union
has no power to contract obligations binding in international
law or to belong to international organisations.
(b) Sources of Community competence
2. The Community's competence to conclude international
agreements arises from two sources.
(i) Express provisions in the Treaty. For example,
Article 133 enables the Community to enter into tariff and trade
agreements within the scope of the Common Commercial Policy. Other
examples can be found in Article 111 (monetary and foreign exchange
agreements), Article 155 (TENs), Article 174 (Environment) and
Article 181 (Development co-operation);
(ii) The jurisprudence of the European Court of Justice.
The Court has held that external competence may flow from other
provisions of the Treaty and measures adopted within the framework
of those provisions. Thus the existence of "internal rules"
(sometimes referred to as the AETR doctrine) or of unexercised
Treaty powers to adopt such rules confers external competence
to the Community.
(c) Competence - the legal implications
3. The Community's ability to conduct external
relations is restricted, as a matter of law, to those areas where
it has competence. On the other hand, where and to the extent
that the Community has competence, Member States' freedom of action
is limited. They may not enter into agreements between themselves
or with third States on the same subject matter. This is a consequence
of the supremacy/primacy of Community law - Member States cannot
prejudice the operation of Community law by entering into external
4. Where the transfer of competence is partial,
because the Treaty expressly preserves Member States' competence
(e.g. Article 174 (4)) or the internal rules, as is the case in
relation to civil aviation do not occupy the whole field, then
the Community and the Member States share competence. Both will
be parties to the international agreement, which is commonly referred
to as a "mixed agreement". Internal and external competence
are therefore directly related.
5. The precise extent of Community competence
in relation to a particular subject or agreement is frequently
a matter of concern and debate between the Commission and the
Member States. (The external competence implications of a proposal
may therefore influence Member States' decisions on the adoption
or extension of internal rules).
(d) Transport Policy
6. It is clear that the Community has competence
in relation to external trade matters. Articles 131-134 enable
the Community to conduct a common commercial policy with third
States. The policy has facilitated the establishment of a customs
union between the Member States and is based on uniform principles
with regard to such matters as tariff rates, the conclusion of
tariff and trade agreements with third States, import and export
policy. It has been long recognised that the common commercial
policy is an area where the Community has exclusive competence.
But the precise scope of the common commercial policy has been
hotly debated. In particular, does it include services and, in
particular, transport. The matter came before the Court of Justice
prior to the conclusion of the Uruguay round and the Court state
the law in its Opinion 1/94.
7. In a lengthy, detailed and somewhat complex
ruling the Court held that the common commercial policy covered
some, but not all, modes of supplying services. The Court also
held that international agreements in the field of transport were
excluded from the scope of the common commercial policy: transport
was the subject of a separate and specific title of the Treaty.
But the Court went on to reaffirm its jurisprudence on the sources
of Community competence (see para (b) above) and found, after
a detailed examination of the acquis, that the Community had,
by virtue of relevant existing "internal rules", (limited)
competence in relation to transport.
8. Where the line presently lies between the
Community's exclusive external competence and Member States' competence
to conclude international agreements depends primarily on the
identification of "internal rules" (ie the three liberalisation
packages and other existing regulations in or affecting the sector).
As the witnesses explained, any negotiation of matters within
Member States' competence (eg traffic routes) may not in practice
be separated from matters the Community's exclusive external competence
Dr Christopher Kerse
Second Counsel to the Chairman of Committees and
Legal Adviser to the Select Committee on the European Union, House
21 January 2003