CHAPTER 4: The Legal Base |
79. The legal base proposed for the Institute
is Articles 13(2) and 141(3) of the EC Treaty. Article 13(1) allows
the Council of Ministers to take appropriate action to combat,
among other things, sex discrimination. For measures adopted under
Article 13(1), unanimity is required. However, Article 13(2) provides
a derogation from the requirement for unanimity: where the Council
adopts "incentive measures" to support action by Member
States which contributes to the objectives referred to in Article
13(1), qualified majority voting applies. Article 141(3) provides
that the Council shall adopt measures to ensure the application
of the principle of equal opportunities and equal treatment of
men and women in employment matters. These measures shall be adopted
by qualified majority voting.
80. The Government's position is that the legal
base proposed by the Commission is inappropriate. They consider
that Article 13(1) is to be preferred to the combination of Article
13(2) and 141(3). However, they acknowledge that a "substantial
pay element" in the proposal brought Article 141(3)
into play. Because Article 13(1) requires unanimity voting and
Article 141(3) requires qualified majority voting, these two articles
cannot together form a legal base for the proposal. This is because
bases are considered to be "incompatible", (i.e.: each
requires a different voting procedure).
81. In case C-178/03 Commission v Parliament
the European Court of Justice confirmed that the choice of legal
base must be based on objective factors which are amenable to
judicial review, including in particular the aim and content of
the measures. Where the measure pursues a twofold purpose and
one of those is identifiable as the predominant purpose whereas
the other is merely incidental, the act must be based on a single
legal basis, namely that required by the predominant purpose.
However, where the proposal pursues a number of objectives that
are indissociably linked, it should be founded on both legal bases.
In Case C-178/03, the Court held that there was no incompatibility
of legal bases because both prescribed qualified majority voting.
Although there were different procedural requirements under each
article, Parliament's rights were not undermined because the proposal
would be adopted under the co-decision procedure as provided for
by one of the two legal bases. The Court gave no guidance as to
how Member States should proceed where the proposal has dual purpose,
neither of which is incidental, but the legal bases prescribed
different voting procedures.
82. Given that under Article 13(2), qualified
majority voting is required, this article may be combined with
Article 141(3) without giving rise to the difficulties created
by the use of Article 13(1). For Article 13(2) to be appropriate,
the creation of the Institute would have to be "an incentive
measure" to support action by the Member States to combat
sex discrimination. What is meant by "incentive measure"
is unclear. The Government, however, took the view that in the
present case Article 13(2), rather than Article 13(1), is an acceptable
legal base for the Institute.
They intended to lodge a Minute Statement setting out their
position on the legal base.
83. The proposed legal base raises a number of
concerns. The first, mentioned above, is whether or not the creation
of an Institute of this nature can constitute an "incentive
measure", as understood by Article 13(2) of the EC Treaty.
The second is whether it is technically correct to refer to Article 13(2)
without reference also to Article 13(1). A third question relates
to the approach of the Member States to the question of legal
base and the need for consistency. These concerns are dealt with
more fully in the following paragraphs.
84. In seeking an explanation of how the Proposal
could be seen as an "incentive measure", we asked whether
any other agency had been created on the basis of Community powers
to adopt "incentive measures". In this respect, we referred
to the position taken by the Government on the proposal for the
creation of a European Monitoring Centre for Drugs and Drug Addiction.
In that case, the Government stated that "the establishment
of a body does not constitute an incentive measure".
85. The Government explained that a number of
Member States took the view that the role of the Institute would
be to support action taken by the Member States in order to contribute
to the aim of combating discrimination. The Institute's tasks
would include collecting, analysing and disseminating information,
developing methods for improving the comparability of data and
organising conferences and meetings with stakeholders to exchange
information and good practice. These could constitute measures
designed to encourage and facilitate and (in a broad sense) provide
incentives for Member State action in the field of gender equality.
86. The Government referred to a previous matter
in which an "incentive measure" legal base (in this
case, Article 152(4) on public health) was used to adopt Regulation
851/2004 establishing the European Centre for Disease Prevention
and Control. In that case, the Government objected to the legal
base and produced a joint Minute Statement with Germany.
87. In our view, doubts remain whether the creation
of an Institute can properly be based on an article permitting
the adoption of "incentive measures" to support action
taken by Member States to combat discrimination. However, in the
absence of any guidance in the Treaty or from the Court as to
how the term ought to be construed, it is difficult to reach any
conclusive opinion on this matter.
88. We recommend that the Government, together
with the Member States and the Commission, should develop an understanding
of what "incentive measures" means and what kind of
proposals should be adopted on the basis of an "incentive
measures" legal base. Given the current divide in opinion
within the Council, is seems likely that this will not be an easy
89. As explained above, Article 13(1) allows
for measures to be adopted to combat sex discrimination. Article
13(2) is phrased as follows: "By way of derogation from paragraph
1, when the Council adopts Community incentive measures
to support action taken by the Member States in order to contribute
to the achievement of the objectives referred to in [Article 13(1)],
it shall act in accordance with the procedure referred to in Article
251." The procedure in Article 251 is the co-decision procedure
requiring qualified majority voting.
90. On examining Article 13, we were concerned
that the reference to Article 13(2), without including reference
also to Article 13(1), might be technically incorrect. We suggested
to the Government that Article 13(1) was the enabling provision
allowing appropriate action to combat sex discrimination. Article
13(2) merely provided that where this appropriate action took
the form of incentive measures, the voting should be by qualified
majority instead of unanimity.
91. The Government did not agree with this reading
of Article 13. Although they agreed that Article 13(2) was "in
some respects parasitic" on Article 13(1), they concluded
that there was a clear intention in the EC Treaty that Article 13(2)
should be available as a separate and stand-alone legal base.
This, they argued, was evidenced by the fact that it was subject
to a different decision-making and voting procedure. The Government
also referred to Articles 94 and 95(1) where, they claimed, a
similar relationship exists. Article 95 was used widely, without
reference to Article 94(1), as the legal base for internal market
92. Interpretation of the EC Treaty is not straightforward
and is ultimately a matter for the European Court of Justice.
Although we accept that the Government's position is not without
foundation, we remain concerned that it is technically incorrect
to rely on Article 13(2) as a legal base without referring to
93. This view is supported by the fact that Article
13(2) in its terms is a derogation only from the voting requirements
in Article 13(1); in the absence of Article 13(2), incentive measures
would have to be adopted by unanimity voting. The Government drew
a comparison with Articles 94 and 95(1). However the drafting
of Article 95(1), though expressed to be a derogation to Article
94, creates a separate power, as we believe the legislative history
(the Single European Act) will confirm. It provides that "The
adopt measures for the approximation of the
provisions laid down by law
in Member States
There is no similar provision in Article 13(2).
94. It remains unclear why Member States would
not support a legal base of Articles 13 and 141(3) for this proposal.
In substance, this legal base is no different from a legal base
of Article 13(2) and Article 141(3). The same procedure and voting
rule would be prescribed. On a technical level, however, it gets
round our concerns as to whether there is any power in
Article 13(2) to adopt measures. Although we put this question
to the Minister during correspondence,
she did not explain why the Member States have chosen not
to take this route. In our opinion, this would create a technically
sound legal base for the proposal while retaining qualified majority
voting in the Council and avoiding the problem of incompatible
95. In recent months, we have scrutinised several
proposals which seek to create agencies or bodies at a European
level. The proposed legal base is often controversial, and in
some cases the approach taken by the Government appears to be
inconsistent. One example is the case of the European Monitoring
Centre for Drugs and Drug Addiction discussed above. In response
to our question on this apparent divergence of views, the Minister
replied that she did not consider that there was "any significant
difference between the two Departments in the legal approach to
identifying the most appropriate legal base". It appears
that the Government, while objecting outright to the use of a
particular legal base, will nonetheless support the proposal on
its merits and deal with its objections by the lodging of an appropriate
96. As we have previously noted,
it is regrettable that proposals are being adopted on legal bases
which seem to the Government to be inappropriate. While we consider
that the Government's willingness to compromise is laudable where
it considers that there is a compelling need for the proposal
to be adopted, we see a danger that this approach may undermine
the limits of the Community's competence as set out the EC Treaty.
97. We also note the pending judgment in Case
C-217/04 United Kingdom v Parliament and Council regarding
the establishment of the European Network and Information Security
Agency. We hope that this judgment will add clarity to the criteria
governing the selection of a legal base for the creation of an
98. The issue of legal base is central to the
division of competence between the Community and Member States
and we will therefore continue to pay close attention to the appropriateness
of the legal base proposed in the course of our scrutiny of draft
99. We recommend that the Government should,
in principle, adopt a consistent line in dealing with legal bases.
We welcome the Government's clarification of how they intend to
approach legal bases for proposals which create agencies and urge
them to ensure that all Departments are aware of the agreed approach.
39 p 31 Back
Judgment of 10 January 2006 (See Case no C-178/03 Commission
v Parliament and Council) Back
pp 29-30 Back
See Department of Health EM 12143/05 COM (2005) 399 final and
letter dated 4 November 2005 from Lord Grenfell to Minister of
State, Department of Health (See Correspondence with Ministers,
March-December 2005 due to be published April 2006) Back
HL Paper 140, 25th Report, Session 2003-04, pp 150-152 Back
p 32 Back
See Chapter 8 of the Committee's Report on Paediatric Medicines
(20th Report of Session 2005-2006, HL Paper 101) Back