Examination of Witnesses (Questions 200
- 219)
WEDNESDAY 5 DECEMBER 2007
Mr Martin Howe QC
Q200 Chairman:
Thank you very much indeed for coming to give evidence and it
may be that there is something you want to say at the beginning.
I think it is the first time you have given evidence. You will
be given a copy of the transcript afterwards, and you might like
to start by indicating what your interest in the area is?
Mr Howe: My interest in the area is I do quite
a lot of Community law as part of my practice at the Bar but I
have a broader, sort of constitutional, political interest in
the subject of the development of the European Treaties and I
have written a number of publications on previous Treaties, particularly
on the Constitutional Treaty most recently. Although I actually
have not published anything yet directly on this Treaty, I have
looked at it, studied it and talked about it at various venues.
Q201 Chairman:
Thank you. I do not think anyone in the Sub-Committee has an interest
to declare, except me perhaps. I declare that I am a member of
the Lord Chancellor's Advisory Committee on Private International
Law, which looks at matters in the freedom, security and justice
area. I do not think that is a very relevant interest, but just
for completeness. Could you help us about the general opt-in in
that area, under the Protocol relating to the United Kingdom and
Ireland, and in doing so perhaps relate it to the different opt-in
provided by the Protocol on the Schengen acquis, and explain
the interrelationship, if you can?
Mr Howe: Perhaps the starting-point really is
the position under the existing Treaty. Sorry, it is slightly
more complex than this, because, of course, there are certain
aspects of what will become the complete area of freedom, security
and justice, which at present are under the Rome Treaty, notably
to do with immigration, border checks, and so on.
Q202 Chairman:
That is going to be an opt-in that at present we do not have?
Mr Howe: No. Our opt-in does apply to that;
the existing Amsterdam Protocol applies to that. What would happen
is that the additional areas which at present are under the framework
of the Treaty on the European Union but are not under the framework
of the Treaty of Rome would come under the umbrella of the Treaty
of Rome. I describe it that way. Of course, they will be renamed,
that will be renamed as the Treaty on the Functioning of the European
Union. Currently, measures in the area, say, of police cooperation,
judicial cooperation, are characterised as being intergovernmental,
as distinct from traditional European Community Directives and
measures, which are characterised as being supra-national. It
is important not to get too hung up on the terminology, but the
differences of substance are that Community legislation, coming
under the existing Treaty of Rome, is part of Community law and,
in accordance with the case law of the Court of Justice, that
law penetrates directly into the laws of Member States. The Court
of Justice has jurisdiction both to interpret it, and therefore,
potentially, in practice, to widen it, and it has a specific enforcement
jurisdiction against Member States when Member States fail to
take action to implement it internally. The general effect of
the Lisbon Treaty, before we come to the United Kingdom's opt-in
or opt-out Protocols, will be to move what are at present intergovernmental
measures—- -
Q203 Chairman:
The third pillar measures; into Title IV, in the first place?
Mr Howe: Yes; into Title IV. In general, the
third pillar measures are characterised in that they require unanimity,
in general, subject to detailed implementation, that they do not,
in general, incorporate the jurisdiction of the European Court
of Justice, and therefore that really they are analogous to international
agreements, in many ways, albeit that they are made in the framework
of the European Union, not in the framework of the European Community.
The main effect will be that the measures in these fields, which
at present we have an ability to take part in via the third pillar
structure, will no longer be an option, and if we want to participate
in them at all we will have to do so by the supra-national mechanism,
in other words, we will have to accept them as being measures
which are part of what would now be Community law.
Q204 Chairman:
Is there any particular problem arising from that, which you want
to identify?
Mr Howe: There is. Of course, the particular
problem is the jurisdiction of the European Court of Justice,
because once you have the jurisdiction of the European Court of
Justice in interpreting a measure its expansive philosophy comes
into play and you lose control, really, over the interpretation
and application of a measure as part of your law. In effect, that
is a loss of control, which we have already in respect of existing
areas of supra-national Community competence. It is a serious
question whether we would want to extend that, if you like, loss
of control into sensitive areas relating to our criminal law and
the criminal justice system. The choice we face is that we would
no longer be able to carry on with the existing system of intergovernmental
agreements, effectively; we would be forced, if we wanted to co-operate
with other European Union States within this area, to do so via
the fully supra-national mechanism.
Q205 Chairman:
There is a gloss, we will come to later, is there not, the five-year
transitional period, which we can take in due course?
Mr Howe: Yes.
Q206 Lord Jay of Ewelme:
Just to probe a little bit the point you were making; and clearly
you are not the only person who is worried about this expansionary
character of the European Court of Justice. I wonder if you could
just give one or two specific examples of ways in which in the
past the Court of Justice has, as it were, expanded jurisdiction
to the detriment of the United Kingdom?
Mr Howe: There is actually a very interesting
and important expansion which is directly relevant to this area
of criminal law, and that is the Commission v Council case
of 2005.
Q207 Chairman:
This is the environmental pollution and then the ship pollution
case?
Mr Howe: Yes. If the Court of Justice is right
in the decision it reached in 2005 then the Treaty of Rome always
contained a power, from its very beginning, to allow the Community
to direct Member States to create criminal offences. I think,
if you had raised that as a possibility at the time of signature
of the Treaty, or indeed even ten years ago, it would have been
dismissed as being something, "Oh, no, no, they can't possibly
go out into criminal law."
Q208 Chairman:
That may be your feeling instinctively. I do not know whether
you can document it after this hearing? It would be interesting
to look back and see what the discussions were on the criminal
law pillar and just see whether there was any precursor of the
environmental pollution and ship pollution cases.
Mr Howe: Yes. That is not the only case in which
the European Court of Justice has advanced the goal-posts, if
you like.
Q209 Baroness O'Cathain:
Can I just ask, Mr Howe, how significant is this? You have told
us, first, about the first case and then you said this is not
the only case. Does this mean that it is creep and that, long
term, all criminal law will actually come under this?
Mr Howe: I do not know about all criminal law.
Q210 Baroness O'Cathain:
But if they are part of it?
Mr Howe: The effect of that case is, although
it was related specifically to environmental law, the logic of
it must apply, in fact, to all areas where the European Community
has an existing competence. So that if, for example, it decides
to provide measures for consumer protection I cannot see why it
could not also impose on Member States a requirement to create
offences for the protection of consumers, and so on, or in the
financial sphere it issues Directives harmonising financial markets.
I cannot see why, in principle, it does not have the power to
create criminal offences to protect the functioning of financial
markets.
Chairman: This is the Commission's attitude,
but it is fair to say, is it not, that in the ship pollution case,
in fact, the European Court was careful to limit what it said
to the environmental context?
Baroness O'Cathain: Yes, but that was before
this, was it not?
Q211 Chairman:
That was a very recent decision.
Mr Howe: I think the general point I was making
about the expansionary nature of decisions of the European Court
of Justice is that the effect of this aspect of the Lisbon Treaty
would be that, although we have the opt-in, which I have described
the effect of, we cannot participate in that area except by virtue
of taking on board the whole shooting-match of measures which
are fully, legally effective as part of the Community legal order,
although it will become the European Union legal order under the
Treaty.
Q212 Chairman:
Perhaps, again, without spending time on this, it is fair to say
though, is it not, that in one respect it is quite possible that
Article 69f, paragraph two, actually rows back and brings the
criminal jurisprudence of the environmental and ship pollution
cases within the opt-in, in future, thereby actually not to this
country's detriment but giving it something that it did not have
before? I appreciate that is arguable, but that is a possibility,
is it not? Some of the evidence given to us has been quite emphatic
that is the effect; other of the evidence has been less certain.
Mr Howe: Yes, I take the point. A possible argument
one would put on 69f(2) is to say that, insofar as it specifically
provides a mechanism for the Union to attach criminal offences
to the effective implementation of a Union policy in an area where
it has an existing policy, the appropriate Treaty base for such
a criminal measure is 69f(2) and not the original Treaty base.
Therefore, the further corollary of that would be then that comes
within (I will continue to call it) the Amsterdam Protocol opt-out,
as extended by the Treaty. However, the problem with the way the
system works is, if you get a political impetus to try to bind
the United Kingdom into some measure which the other States want
to take, the temptation to use an alternative Treaty base will
be there, and the argument will be whether the Commission is entitled
to select the most appropriate Treaty base.
Q213 Lord Burnett:
Would that be challengeable?
Mr Howe: It is challengeable, but, on the other
hand, the Court of Justice, though it does have a legal power
to entertain such a challenge, does not always uphold such challenges.
I think the classic example was the selection of the health and
safety Treaty base for the Working Time Directive, which, had
it gone under the then social provisions of the Treaty, would
perhaps have been a more appropriate selection, but the Court
of Justice upheld the Commission's decision, when it initiated
that legislation, to select the health and safety basis. In fact,
the political reason why the Commission had done that was in order
to bring it in under a QMV power, rather than the power which
required unanimity; so whilst it is possible for the Court to
overrule these sorts of decisions, it tends to rule in accordance
with its broader objectives.
Q214 Chairman:
Would that be another example of the expansive attitude that you
were mentioning?
Mr Howe: I would say so, yes.
Q215 Chairman:
Are there any others you want to give?
Mr Howe: If we come more broadly to the powers
of the Court of Justice, I think in different phases of its existence
it has expanded in different directions. One specific area where
I think in recent years there has been quite a lot of expansion
has been in the field of direct tax harmonisation, where direct
tax harmonisation has been, if you like, blocked at the political
level because it requires unanimity under the Treaty and the British
Government has consistently refused to agree to allow that to
become QMV. We have had a torrent of cases from the Court of Justice
on the compatibility of national tax arrangements with general
Treaty principles, in which the respondent States have been overwhelmingly
unsuccessful. What has been happening in that field is that the
Court, for example, previously allowed a national tax system,
to do things such as allowing tax reliefs only to subsidiaries
based in your own country because that was necessary for the coherence
of the national tax system. Then they have been outlawing those
sorts of practices simply by taking a stricter approach to the
application of the general Treaty rules on non-discrimination,
free movement of capital, and so on; so you have got an example
of change of approach to interpretation.
Chairman: Would the advance corporation tax
case be one example of that?
Q216 Lord Burnett:
Marks and Spencer?
Mr Howe: Yes; Marks and Spencer.
Q217 Chairman:
Is that the main one you were thinking of?
Mr Howe: That, but also there is an earlier
one; the name is Lankhorst-Hohorst.
Q218 Lord Wright of Richmond:
Are you saying that this situation has actually changed as a result
of the Reform Treaty?
Mr Howe: No; that is not an aspect which has
changed as a result of the Reform Treaty. I think the way I was
going, or at least being led by the questions, was towards the
more general point about the tendencies of the European Court
of Justice.
Q219 Lord Bowness:
You talked about the Commission's choice of legal base and the
Court of Justice upholding that, whether because of their expansive
tendencies or not. Can you just help me; would it have been possible,
however, for the Council to have challenged the choice of legal
base before it was actually proceeded with?
Mr Howe: The Council has power to amend Commission
proposals. I am just trying to think whether there is any example
of an amendment by the Council which has altered the legal base
of a Commission proposal.
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