Boards of appeal of EU agencies at a crossroads

in Law

The Boards of Appeal established for the decision-making agencies perform a function that lies between exercising administrative review, at the one end, and offering judicial review, at the other. It is still unclear in which direction they will ultimately move, and more research in this fast-developing area of EU administrative law is needed.

One of the most significant institutional developments in EU law over the past decades has been the agencification of the EU administration. Both quantitatively and qualitatively, EU agencies are becoming increasingly important in the EU administration: EU agencies employ ever more personnel, dispose of ever-increasing budgets, and exercise increasingly significant powers.

EU Boards of Appeal – unexplored nature and functioning
For one important subset of EU agencies, the EU legislature follows a remarkably consistent approach in a decision-making practice that is otherwise characterized by ad hoccery. For those agencies that are mandated to adopt binding decisions, the legislature will establish internal administrative review bodies within those agencies. These bodies, typically called Boards of Appeal, are composed of legal and technical experts; they need to be seized by the non-privileged parties in the sense of Article 263 TFEU before appeals can be lodged before the General Court. Aside from this basic common denominator, however, the functioning of the Boards of Appeal differs from one Board to the next.

The existence and functioning of the Boards of Appeal in European agencies – such as the European Supervisory Authorities (ESAs), the European Aviation Safety Agency, the European Chemicals Agency, the European Agency for Cooperation between Energy Regulators, the European Railway Agency, the European Intellectual Property Office (EUIPO), and the Community Plant Variety Office (CPVO) – raises a host of questions both at a fundamental level and from a practical perspective. Academics have only recently started to explore these questions, as earlier work on the Boards of Appeal largely limited itself to describing the (organisational) features of these review bodies.. In the upcoming edited volume Boards of Appeal of EU Agencies – Towards Judicialization of Administrative Review? to be published by Oxford University Press (of which I am an editor), precisely these more fundamental questions concerning Boards of Appeal are tackled in a comprehensive way for the very first time.

The very first edited volume on EU Boards of Appeal
The first part of the edited volume presents case studies of all the existing Boards of Appeal. The editors asked the respective authors to assess the nature and independence of their Board of Appeal, and to analyse the corpus of decisions adopted by their Board. The second part presents a series of horizontal chapters where our authors analyse transversal issues. Among the issues addressed are: what is the typical party that actually seizes the Boards of Appeal, and which arguments are typically invoked before these hybrid bodies?; where do we have to position the EU Boards of Appeal from a comparative perspective?; does the independence of a Board of Appeal meet the threshold of judicial independence?; how do we have to conceptualize the mechanism of the Board of Appeal in light of Article 47 of the Charter of Fundamental Rights? Lastly, given that the Boards of Appeal are (partially) composed of experts that are more at ease with issues of a highly complex technical or scientific nature, do they help us achieve epistemic certainty?

A moving target
All our authors arrived at significant substantive findings, a great feat given that they had to analyse a fast-moving target. The fast-moving nature of the Boards can be linked to four different developments. First, seeing as most Boards of Appeal have been established only recently, they are still in the process of defining their own approach, identity, and understanding of their role in the EU’s system of legal protection. Second, the primary EU legislature has recently altered the constitutional framework in which the Boards of Appeal operate: for the decisions of some Boards of Appeal, there will only be one appeal available before the EU Courts since, pursuant to the new Article 58a of the Statute of the CJEU, the Court of Justice will have to allow appeals against those decisions of the General Court in which it ruled on a decision of a Board of Appeal. It needs little explaining that this new provision may fundamentally alter the role and function which Boards of Appeal exercise in the EU’s integrated system of legal protection.

A third development contributing to the fast-moving nature of the topic of Boards of Appeal is that, apart from the established jurisprudence on the Boards of Appeal of the EUIPO and CPVO, the General Court has only recently been seized with cases (Germany v. ECHA; BASF v. ECHA; Aquind v. ACER; etc.) in which Board of Appeal decisions are challenged and which raise the fundamental and practical questions referred to above. Fourthly, also the secondary EU legislature has not been idle: each time the mandate of a decision-making agency is reconsidered, this potentially has repercussions for the Board of Appeal of that agency. A case in point here is the 2019 review of the mandates of the ESAs, to which this blogpost will return in a last part.

Boards of Appeal at a crossroads
Despite these four forces pulling in often different directions, our authors arrived at meaningful and elucidating findings. Still, in almost all chapters, there was also a sense that the ‘jury is still out’ on the future of the Boards of Appeal, and that the latter therefore find themselves at a crossroads. The choice here is not binary. There are an indefinite number of equilibrium positions at which the Boards of Appeal may arrive which lie between the two extremes of providing a purely administrative review and a genuinely judicial review. Evidently, where the Boards of Appeal end up is not fully or even primarily in their hands: the legal framework in which they operate is defined by the primary and secondary legislatures and by the Court of Justice. As noted above, this is perfectly illustrated by the 2019 revision of the ESA regulations.

The 2019 revision of the ESAs regulations – a missed opportunity to beef up the Joint Board of Appeal?
This revision was the first major revision of the ESA regulations. The original regulations dated from 2010, i.e. pre-Short-selling times, and therefore from before the Court of Justice had confirmed the legality of granting EU agencies the power to adopt normative acts. At the time of the Short-selling ruling, some surmised that if the Court would grant the UK’s action, this would result in greater reliance on soft law; and, conversely, if the Court were to dismiss the UK’s action, the EU legislature could do away with the contrived way of formally giving EU agencies soft law powers – which de facto may be very much binding – just to elude constitutional objections based on Meroni.

As follows from post-Short-selling legislative developments, however, it is clear that said prediction did not come true. The EU legislature did not exploit the potential which Short-selling created to grant increasingly significant hard law powers to EU agencies, and has instead continued its preference to grant EU agencies with soft law powers. For instance, the 2019 revision of the ESAs regulations formally expanded the soft law measures which the ESAs may adopt by providing for no action letters (Article 9c), opinions (Article 16a), and Q&As (Article 16b). These new (or codified) forms of soft law not only raise the typical challenges of soft law, but also pose a specific challenge to the Joint Board of Appeal (JBoA) of the ESAs. Private parties may well have good reason to want to challenge some of this soft law. However, the EU legislature has defined the competence of the JBoA similarly to the Courts’ jurisdiction in Article 263 TFEU, thus barring the JBoA from hearing appeals against formally non-binding measures.

This does not detract from the fact that some of the soft law may have very real consequences for private parties, and that there should be some mechanism in place through which such soft law may be scrutinized, as evidenced by two recent preliminary rulings of the Court of Justice. In its 2017 proposal, the Commission therefore foresaw that the Stakeholder Group of the ESA concerned could send a reasoned opinion to the Commission challenging the legality of guidelines or recommendations adopted pursuant to Article 16. If it agreed with the Stakeholder Group, the Commission would then be able to force the ESA concerned to withdraw the soft law concerned. The proposed review mechanism did not make it to the final regulation; neither did the Parliament’s suggestion in the trilogues to allow the JBoA to review guidelines and recommendations.

Instead, a new Article 60a has been inserted in the ESAs regulations, allowing any natural or legal person to send a ‘reasoned advice to the Commission if that person is of the opinion that the Authority has exceeded its competence, including by failing to respect the principle of proportionality referred to in Article 1(5), when acting under Articles 16 and 16b, and that is of direct and individual concern to that person.’ This provision is rightly enigmatic, as it is unclear how soft law could ever be of direct concern to a natural or legal person (as noted by AG Bobek in paras 92-93 of his Opinion in the FBF case) and assuming direct concern is understood as in the Courts’ case law and the JBoA’s corpus of decisions. It must further be noted that Article 60a does not provide for a remedy, unlike the Commission’s original proposal.

Had the Parliament’s suggestion been followed, the potential of the JBoA would have been further realized. It might have increased the workload at the JBoA, which is still rather meager some ten years after its establishment. At the same time, enlarging its jurisdiction in this way would have moved the Board of Appeal mechanism away from the ideal type of judicial review. Now the JBoA continues to largely mimic a miniature court, even though it is not listed in Article 58a of the Statute of the CJEU and even though the JBoA has emphasized that its review should not be confused with that of the Courts. What all this means for the future (development) of the JBoA (and the Boards of Appeal in general) remains to be seen.

A future research agenda
Squaring the circle by coming back to our forthcoming edited volume, it is open questions like these that are identified by the editors in the volume’s concluding chapter, where the main findings of the different chapters are synthesized and a research agenda for the future is defined. I am sure the edited volume will be of great interest to the readers of REALaw, and I hope it will inspire further research – to be published on this blog and in the journal – on the fascinating topic of the Boards of Appeal of EU agencies.

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