Opinion of the Advocate General — ECLI:EU:C:2021:20
Date: 2021-01-14
Language of the case: German
Subject matter: Energy;Right of establishment;Approximation of laws;Freedom to provide services
Procedure: Action for failure to fulfil obligations - successful
Origin: Germany

summary form, the legal and factual particulars on which those complaints are based (judgment of 16 July 2015, Commission v Bulgaria, C‑145/14, not published, EU:C:2015:502, paragraph 28 and the case-law cited). 100 By its fourth complaint, the Commission complains that the Federal Republic of Germany has failed to transpose correctly Article 37(1)(a) and (6)(a) and (b) of Directive 2009/72 and Article 41(1)(a) and (6)(a) and (b) of Directive 2009/73, in so far as the first sentence of Paragraph 24 of the EnWG confers on the Federal Government powers which, according to those provisions, should lie exclusively with the NRA. 101 As the Advocate General observed in point 100 of his Opinion, both the attribution to a body other than the NRA of power to intervene in areas falling within the competence of the NRA and the imposition upon the NRA of provisions adopted by other bodies delineating in detail the exercise of competences reserved to it are liable to limit the NRA’s ability to adopt decisions falling within its sphere of competence independently and without any external influence. 102 It follows that the fourth complaint concerns questions which are closely linked, in so far as the conferral on an entity other than the NRA of powers reserved to the NRA is, according to the Commission, capable of constituting an infringement of the independence of that authority, since, in accordance with Article 35 of Directive 2009/72 and Article 39 of Directive 2009/73, those powers must be exercised autonomously. Therefore, the arguments put forward by the Commission concerning the independence of NRAs cannot be regarded as a new complaint, different from that raised initially, or as an amendment to the initial complaint. Therefore, those arguments are admissible. – Substance 103 Article 37(1) of Directive 2009/72 and Article 41(1) of Directive 2009/73 confer on NRAs various powers, including, in particular, in point (a) of each of those provisions, the power to fix or approve, in accordance with transparent criteria, transmission and distribution tariffs, or their methodologies. 104 In addition, Article 37(6)(a) and (b) of Directive 2009/72 and Article 41(6)(a) and (b) of Directive 2009/73 confer on NRAs, in particular, the power to fix or approve at least the methodologies used to calculate or establish the terms and conditions for connection and access to national networks, including the applicable tariffs, as well as the conditions for the provision of balancing services. 105 The expression ‘at least’ in the wording of those provisions, read in the light of recital 36 of Directive 2009/72 and recital 32 of Directive 2009/73, indicates that the determination of the methodologies for calculating or establishing the terms and conditions for connection and access to national networks, including the applicable tariffs, forms part of the powers directly reserved to NRAs by those directives. 106 In that regard, the Court has already held, when interpreting Article 23(2) of Directive 2003/54, which contained provisions similar to those referred to in paragraph 104 above, that the allocation to an authority other than the NRA of the power to determine important elements in the setting of tariffs, such as the profit margin, did not comply with those provisions, in so far as that allocation reduced the scope of the powers conferred on the NRA by that directive (see, by analogy, judgment of 29 October 2009, Commission v Belgium, C‑474/08, not published, EU:C:2009:681, paragraphs 29 and 30). 107 Furthermore, Article 35(4)(a) and (5)(a) of Directive 2009/72 and Article 39(4)(a) and (5)(a) of Directive 2009/73 specify that NRAs shall exercise their powers independently of any public entity or political body. 108 With regard to the concept of ‘independence’, which is not defined by either Directive 2009/72 or Directive 2009/73, the Court has already held that, as regards public bodies, the term refers in its usual meaning to a status that ensures that the body in question is able to act completely freely in relation to those bodies in respect of which its independence is to be ensured, shielded from any instructions or external influence (see, to that effect, judgment of 11 June 2020, Prezident Slovenskej republiky, C‑378/19, EU:C:2020:462, paragraphs 32 and 33). 109 The Court has stated that independence in decision-making implies that, within the sphere of the regulatory duties and powers referred to in Article 37 of Directive 2009/72, NRAs take their own decisions autonomously and solely in the public interest, so as to ensure compliance with the objectives pursued by that directive, without being subject to external instructions from other public or private entities (judgment of 11 June 2020, Prezident Slovenskej republiky, C‑378/19, EU:C:2020:462, paragraph 54). 110 It is true that, under Article 35(4)(b)(ii) of Directive 2009/72 and Article 39(4)(b)(ii) of Directive 2009/73, the requirement for independence referred to therein is without prejudice to general guidelines laid down by the government. However, it is clear from the wording of those provisions that such general guidelines do not concern the tasks or regulatory powers referred to, respectively, in Article 37 of Directive 2009/72 and Article 41 of Directive 2009/73. 111 It should be noted in that context that those directives also seek, in accordance with recital 33 of Directive 2009/72 and recital 29 of Directive 2009/73, to strengthen the independence of NRAs as compared to the regime provided for under the previous rules. 112 As the Advocate General observed in point 112 of his Opinion, the complete independence of NRAs from economic actors and public entities, be they administrative bodies or political bodies (and in the latter case, be they the holders of executive power or of legislative power) is instrumental in ensuring that the decisions taken by the NRAs are truly impartial and non-discriminatory, while the possibility of undertakings and economic interests connected with the government, the majority or political power being treated more favourably is excluded. Furthermore, the strict separation of NRAs from political power enables them to coordinate their actions on a long-term basis, which is necessary to meet the objectives of Directives 2009/72 and 2009/73. 113 It follows that an interpretation of Article 37(1)(a) and (6)(a) and (b) of Directive 2009/72 and of Article 41(1)(a) and (6)(a) and (b) of Directive 2009/73 as meaning that it is possible for a national government to fix or approve the methodologies for calculating rates for access to the network and the balancing services to be used by NRAs would counteract the objectives pursued by those directives. 114 In the present case, the first sentence of Paragraph 24 of the EnWG confers on the Federal Government, with the consent of the Bundesrat, the power not only to lay down the conditions for access to the network, including the provision of balancing services, and to establish the methodologies used for determining such conditions and the methodologies for fixing the tariffs for network access, but also the power to decide in which cases and under which framework the NRA may define those conditions or methodologies or approve them at the request of the system operator, and in which specific cases of network use and under which conditions the NRA may, in individual cases, authorise or withhold authorisation for individual tariffs for network access. 115 The first sentence of Paragraph 24 of the EnWG thus confers directly on the Federal Government certain powers reserved exclusively to the NRA, as well as the power to authorise the NRA to exercise those powers, contrary to the provisions of Article 37(1)(a) and (6)(a) and (b) of Directive 2009/72 and Article 41(1)(a) and (6)(a) and (b) of Directive 2009/73. 116 As the Advocate General pointed out in point 106 of his Opinion, the independence conferred on the NRA by Directives 2009/72 and 2009/73 in the context of the tasks and powers conferred on it, exclusively, by Article 37 of the former and Article 41 of the latter, cannot be limited by acts such as, in the present case, regulations adopted by the Federal Government, with the consent of the Bundesrat, under Paragraph 24 of the EnWG. 117 That assessment cannot be invalidated by any of the arguments put forward by the Federal Republic of Germany. 118 First, as regards the principle of the Member States’ procedural autonomy, it follows from Article 288 TFEU that the Member States are required, when transposing a directive, to ensure that it is fully effective, whilst retaining a broad discretion as to the choice of ways and means of ensuring that the directive is implemented. That freedom of choice does not affect the obligation imposed on all Member States to which the directive is addressed to adopt all the measures necessary to ensure that the directive concerned is fully effective in accordance with the objective which it seeks to attain (judgment of 19 October 2016, Ormaetxea Garai and Lorenzo Almendros, C‑424/15, EU:C:2016:780, paragraph 29 and the case-law cited). 119 It follows that while the Member States enjoy autonomy as regards the organisation and the structuring of their NRAs, that autonomy must nevertheless be exercised in accordance with the objectives and obligations laid down in Directives 2009/72 and 2009/73 (see, to that effect, judgment of 11 June 2020, Prezident Slovenskej republiky, C‑378/19, EU:C:2020:462, paragraph 38 and the case-law cited), which seeks to ensure that, in the exercise of the powers reserved to NRAs, those authorities take their own decisions autonomously. 120 Secondly, as regards the alleged lack of precision of the substantive provisions of the relevant directives regarding the definition of methodologies for network access and fixing of tariffs, it is apparent from Article 37(1) of Directive 2009/72 and Article 41(1) of Directive 2009/73 that transmission and distribution tariffs or calculation methodologies must be fixed in accordance with transparent criteria. In accordance with paragraph 6(a) of those two articles, those tariffs and calculation methodologies, and the conditions for connection and access to national networks, must be fixed in accordance with the need for the necessary investments to be made in the networks to ensure their viability. It is also apparent from paragraph 10 of those provisions that such tariffs and calculation methodologies must be proportionate and applied in a non-discriminatory manner. 121 In addition, as regards the provision of balancing services, Article 37(6)(b) of Directive 2009/72 and Article 41(6)(b) of Directive 2009/73 establish that those services must be performed in the most economic manner possible, must provide appropriate incentives for network users to balance their energy input and off-takes, and must be provided in a fair and non-discriminatory manner and based on objective criteria. Finally, in accordance with paragraph 8 of those articles, in fixing or approving the tariffs or methodologies and the balancing services, NRAs must ensure that transmission and distribution system operators are granted appropriate incentives, in the short and long term, to increase efficiencies, foster market integration and security of supply and support the related research activities. 122 The criteria laid down in Directives 2009/72 and 2009/73 are specified in other legislative measures, namely Regulation (EC) No 714/2009 of the European Parliament and of the Council of 13 July 2009 on conditions for access to the network for cross-border exchanges in electricity and repealing Regulation (EC) No 1228/2003 (OJ 2009 L 211, p. 15) and Regulation (EC) No 715/2009 of the European Parliament and of the Council of 13 July 2009 on conditions for access to the natural gas transmission networks and repealing Regulation (EC) No 1775/2005 (OJ 2009 L 211, p. 36), which are applicable to cross-border exchanges (see, to that effect, judgment of 3 December 2020, Commission v Belgium (Electricity and natural gas markets), C‑767/19, EU:C:2020:984, paragraph 112). Those regulations are supplemented by various network codes established by means of Commission regulations. 123 In the light of an equally detailed legislative framework at EU level, from which it is apparent, as the Advocate General observed in point 118 of his Opinion, that tariffs and calculation methods for domestic and cross-border exchanges must be fixed on the basis of uniform criteria, the Federal Republic of Germany’s argument that, for the purposes of transposing Directives 2009/72 and 2009/73, it is necessary to draw up national criteria for the calculation of tariffs, cannot therefore succeed. 124 Thirdly, as regards the argument that the legislation adopted under Paragraph 24 of the EnWG is a legislative proposal, which is necessary in order to ensure democratic legitimacy, it must be recalled that Article 10(1) TEU provides that the functioning of the Union is to be founded on the principle of representative democracy, which gives concrete form to the value of democracy referred to in Article 2 TEU (judgment of 19 December 2019, Junqueras Vies, C‑502/19, EU:C:2019:1115, paragraph 63 and the case-law cited). 125 That principle is fully reflected in the legislative procedure in which Directives 2009/72 and 2009/73 were adopted. As one of the principles common to the Member States, it must be taken into consideration when interpreting those directives and, in particular, the specific provisions at issue (see, by analogy, judgment of 9 March 2010, Commission v Germany, C‑518/07, EU:C:2010:125, paragraph 41). 126 The Court has already held that the principle of democracy does not preclude the existence of public authorities outside the classic hierarchical administration and more or less independent of the government, which often exercise regulatory functions or carry out tasks which must be free from political influence, whilst still being required to comply with the law subject to the review of the competent courts. Conferring on NRAs a status independent of the general administration does not in itself deprive those authorities of their democratic legitimacy, in so far as they are not shielded from all parliamentary influence (see, to that effect, judgment of 9 March 2010, Commission v Germany, C‑518/07, EU:C:2010:125, paragraphs 42, 43 and 46). 127 However, Directives 2009/72 and 2009/73 do not preclude the appointment of directors of NRAs by parliament or government (see, to that effect, judgment of 11 June 2020, Prezident Slovenskej republiky, C‑378/19, EU:C:2020:462, paragraphs 36 to 39). Nor do they preclude, as is apparent from recital 34 of Directive 2009/72 and recital 30 of Directive 2009/73, those authorities being subject to parliamentary scrutiny in accordance with the constitutional law of the Member States. 128 Furthermore, Article 37(17) of Directive 2009/72 and Article 41(17) of Directive 2009/73 require Member States to establish appropriate mechanisms at the national level under which a party affected by a decision of an NRA can bring proceedings before a body independent of the parties involved and of any government. Such a requirement is a corollary of the principle of effective judicial protection, which is a general principle of European Union law and one which is enshrined in Article 47 of the Charter (judgment of 16 July 2020, Commission v Hungary (Charges for access to electricity and natural gas transmission networks), C‑771/18, EU:C:2020:584, paragraph 61 and the case-law cited). 129 In those circumstances, the Federal Republic of Germany cannot rely on the principle of democracy, which is guaranteed throughout the European Union, to attribute to an authority other than an NRA powers for which the NRA has exclusive responsibility by virtue of Article 37(1)(a) and (6)(a) and (b) of Directive 2009/72 and Article 41(1)(a) and (6)(a) and (b) of Directive 2009/73. 130 Furthermore, even though the regulations adopted by the Federal Government under Paragraph 24 of the EnWG are ‘substantive laws’, it should be noted, as the Advocate General observed in point 124 of his Opinion, that the powers attributed exclusively to NRAs by Directives 2009/72 and 2009/73, and their independence, must be ensured in relation to any political body, and so not only the government, but also in relation to the national legislature, which can and must establish such powers in legislative acts but cannot, however, take powers away from NRAs and attribute them to other public bodies. 131 Fourthly, as regards the argument based on the judgment of 13 June 1958, Meroni v High Authority (9/56, EU:C:1958:7), without it being necessary to rule on whether that case-law is applicable in a case such as the present one, which relates to national authorities designated by Member States pursuant to a directive, it must be noted, as the Advocate General observed in point 134 of his Opinion, that the interpretation of Article 37 of Directive 2009/72 and Article 41 of Directive 2009/73 found in paragraphs 105 and 113 above is, in any event, in line with that case-law. According to that case-law, it is not permissible to delegate to administrative bodies a margin of discretion which may, according to the use which is made of it, make it possible to take political decisions in the true sense, by substituting the choices of the delegator by those of the delegatee, and thus bring about an ‘actual transfer of responsibility’. However, a delegation of clearly defined executive powers, the exercise of which can, therefore, be subject to strict review in the light of objective criteria determined by the delegating authority, is permitted (see, to that effect, judgment of 22 January 2014, United Kingdom v Parliament and Council, C‑270/12, EU:C:2014:18, paragraphs 41, 42 and 54). 132 The powers reserved to NRAs are executive powers that are based on the technical and specialist assessment of factual realities. Moreover, as is apparent from paragraphs 120 to 123 above, in the exercise of those powers, NRAs are subject to principles and rules established by an equally detailed legislative framework at EU level, which limit their discretion and prevent them from making political choices. 133 In the light of the foregoing considerations, the Commission’s fourth complaint in support of its action must be upheld and it must be held that, by failing to transpose correctly Article 37(1)(a) and (6)(a) and (b) of Directive 2009/72 and Article 41(1)(a) and (6)(a) and (b) of Directive 2009/73, the Federal Republic of Germany has failed to fulfil its obligations under those directives. Costs 134 Under Article 138(1) of the Rules of Procedure of the Court of Justice, the unsuccessful party must be ordered to pay the costs if they have been applied for in the other party’s pleadings. 135 Since the Commission has applied for costs and the Federal Republic of Germany has been unsuccessful, the latter must be ordered to pay the costs. 136 In accordance with Article 140(1) of those rules, under which Member States which have intervened in the proceedings are to bear their own costs, the Kingdom of Sweden must be ordered to bear its own costs. On those grounds, the Court (Fourth Chamber): 1. Declares that, by failing to transpose correctly: – Article 2(21) of Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC, and Article 2(20) of Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC, – Article 19(3) and (8) of Directives 2009/72 and 2009/73, – Article 19(5) of Directives 2009/72 and 2009/73, – Article 37(1)(a) and (6)(a) and (b) of Directive 2009/72 and Article 41(1)(a) and (6)(a) and (b) of Directive 2009/73, the Federal Republic of Germany has failed to fulfil its obligations under those directives; 2. Orders the Federal Republic of Germany to pay the costs; 3. Orders the Kingdom of Sweden to bear its own costs. [Signatures] * Language of the case: German.