Opinion of the Advocate General — ECLI:EU:C:2014:2394
Date: 2014-11-20

summary on the debate in the Council of 5 March 2013. 17 – The United Kingdom challenges no other pay related provision of the CRD IV Directive than Article 94(1)(g) and Article 94(2). While Article 94(1)(g)(iii) is covered by the Form of Order sought, it is not discussed in detail in the action. 18 – See also the Liikanen Report of the High-level Expert Group on reforming the structure of the EU banking sector, Brussels, 2 October 2012, paragraph 4.2.5. 19 – The United Kingdom refers here to Jennings, R., and Watts, A., (eds) Oppenheim’s International Law, 9th ed, Longman, Harlow, vol 1 ‘Peace’, at p.456, which in my opinion, however, does not support any contention to the effect that the legislative jurisdiction of States would be limited to conduct occurring on their own territory. On the contrary, in footnote 2 on that page, the authors refer to the Lotus judgment of the Permanent Court of International Justice where it was stated that international law generally left states ‘a wide measure of discretion’ in the application of their laws, limited in certain cases by prohibitive rules. 20 – Judgment in Air Transport Association of America and Others, C‑366/10, EU:C:2011:864, paragraph 110. 21 – See also Article 3(36) of the CRD IV Directive, which states that ‘competent authority’ means ‘competent authority as defined in point (40) of Article 4(1) of Regulation (EU) No 575/2013’. 22 – See Judgment in Imperial Chemical Industries v Commission, 48/69, EU:C:1972:70, and Judgment in Ahlström Osakeyhtiö and Others v Commission, C-89/85, C-104/85, C-114/85, C‑116/85, C-117/85 and C-125/85 to C‑129/85, EU:C:1988:447. 23 – Judgment of the Permanent Court of International Justice (PCIJ) of 7 September 1927 in Lotus (France v. Turkey), PCIJ Publications 1927, Series A, No 10, p. 25. 24 – Opinion in Ahlström Osakeyhtiö and Others v Commission, 89/85, 104/85, 114/85, 116/85, 117/85 and 125/85 to 129/85, EU:C:1988:258, points 27 to 30. 25 – According to the doctrine this core of the PCIJ’s dictum in Lotus is still valid. See, for example, the Case Concerning the Arrest Warrant of 11 April 2000 (Dem. Rep. Congo v Belgium), Judgment, I.C.J. Reports 2002, p.3, Separate Opinion of President Guillaume, paragraphs 13 to 16; Legality of the Threat of Nuclear Weapons (Advisory Opinion) I.C.J. Reports 1996, p. 226, Declaration of President Bedajaoui, paragraphs 13 to 15. For a discussion see Juillard, P., L’application extraterritoriale de la loi économique in L’application extraterritoriale du droit economique, Bazex, M. et al (eds) (1986) and Koziel, T., ‘Extraterritorial Application of EU Environmental Law-Implications of the ECJ’s Judgment in Air Transport Association of America’, The Columbia Journal of European Law 19(2012) F1; Pazartis, P., ‘Judicial Activism and Judicial Self-Restraint: the PCIJ’s Lotus Case’ in Legacies of the Permanent Court of International Justice, Tams, C.J., and Fitzmaurice M., Martinus Nijhoff, Leiden, 2013, p. 319. 26 – There is apparent consensus amongst many writers that contemporary international law would have departed from the presumption established in the Lotus case concerning the States’ freedom to decide on the applicability of their legislation with the boundaries of compulsory international law rules and would require a ‘sufficient’ link or nexus before extraterritorial behaviour of non-nationals and a State before the latter could exercise its jurisdiction to prescribe. For an influential contribution see Mann, F. A., The Doctrine of Jurisdiction in International Law, Recueil des Cours 1964:1, vol.111. 27 – On universal jurisdiction see O’Keefe, R., ‘Universal Jurisdiction Clarifying the Basic Concept’, Journal of International Criminal Justice 2 (2004) p. 735. 28 – Island of Palmas Case (or Miangas), United States v Netherlands, award of 4 April 1928 (II RIAA 829). 29 – Anglo-Norwegian Fisheries Case (UK v. Norway), Judgment, I.C.J. Reports 1951, p. 116. 30 – Nottebohm Case. (Liechtenstein v. Guatemala), Judgment, I.C.J. Reports 1955, p. 4. 31 – Case Concerning the Arrest Warrant of 11 April 2000 (Democratic Republic of Congo v. Belgium), Judgment, I.C.J Report 2002, p. 1. 32 – Opinion in Ahlström Osakeyhtiö and Others v Commission, EU:C:1988:258, paragraph 24. 33 – OJ 1995 L 281, p. 31. 34 – Judgment in C-92/09 and C‑93/09, EU:C:2010:662. 35 – OJ 2001 L 8, p.1. 36 – Judgment in Volker und Markus Schecke and Eifert, EU:C:2010:662, paragraph 86. 37 – Judgment in NS, C-411/10 and C‑493/10, EU:C:2011:865. 38 – Judgment in Meroni v High Authority, 10/56, EU:C:1958:8. 39 – OJ 2010 L 331 p. 12. 40 – Judgment in Commission v Parliament and Council, C‑427/12, EU:C:2014:170, paragraph 38. 41 – Judgment in Meroni v High Authority, EU:C:1958:8 at pp. 171 to 172. 42 – Judgment in Commission v Parliament and Council, C‑427/12, EU:C:2014:170, paragraph 38. 43 – See the discussion of this topic in my Opinion in United Kingdom v Council and Parliament, C‑270/12, EU:C:2013:562. 44 – Judgment in Racke, 98/78, EU:C:1979:14 paragraph 20, and Judgment in Netherlands v Council, C‑110/97, EU:C:2001:620, paragraph 151. 45 – Judgment in Pokrzeptowicz-Meyer, C‑162/00, EU:C:2002:57, paragraph 52 . See also Judgment in Saldanha and MTS, C‑122/96, EU:C:1997:458, paragraph 14, and Judgment in Elektrownia Pątnów II, C‑441/08, EU:C:2009:698, paragraph 32. See also Judgment in Gemeinde Altrip and Others, C‑72/12, EU:C:2013:712 where it was held at paragraph 22 that it ‘should be borne in mind that, in principle, a new rule of law applies from the entry into force of the act introducing it. While it does not apply to legal situations that have arisen and become definitive under the old law, it does apply to their future effects, and to new legal situations too…. It is otherwise – subject to the principle of the non-retroactivity of legal acts – only if the new rule is accompanied by special provisions which specifically lay down its conditions of temporal application.’ Citing, the Judgment in Monsanto Technology, C-428/08, EU:C:2010:402, paragraph 66 and the Judgment in Stichting Natuur en Milieu and Others, C-266/09, EU:C:2010:779, paragraph 32. 46 – See Judgment in Kone and Others v Commission, C‑510/11 P, EU:C:2013:696, paragraph 76 and the case-law cited. 47 – Judgment in Accrington Beef and Others, C‑241/95, EU:C:1996:496, paragraph 33. 48 – Ibid., paragraph 36. 49 – See, in this sense, Judgment in Greece v Commission, C‑86/03, EU:C:2005:769, paragraph 71. This has classically occurred when the EU has failed to take measures to accommodate goods in transit affected by immediate changes to EU customs law. See Judgment in Sofrimport v Commission, C‑152/88, EU:C:1990:259. 50 – Judgment of the Court of Human Rights of 22 September 1994 (§42, Series A no. 296-A). 51 – Judgment of the Court of Human Rights (no. 26449/95, §54, 9 November 1999). 52 – Judgment in Teleos and Others, C‑409/04, EU:C:2007:548. 53 – Judgment in Test Claimants in the Franked Investment Income Group Litigation, C‑362/12, EU:C:2013:834, paragraph 44. 54 – The provision refers to, for example, senior management, risk takers, staff engaged in control functions and any employee receiving total remuneration that takes them into the same remuneration bracket as senior management and risk takers whose professional activities have a material impact on their risk profile. See also Annex I to the CRD III Directive, discussed below at paragraph 84. 55 – Judgment in Racke, EU:C:1979:14 paragraph 20 and judgment in Netherlands v Council, EU:C:2001:620, paragraph 151. 56 – See COM (2010) 0284 final, section 5.7., entitled ‘Remuneration’. 57 – See, inter alia, recital 71 on the proposed Regulation in COM(2011) 0452 final, as well as recital 49, and Articles 74, 88-91 of the proposed Directive in COM (2011) 0453 final. 58 – See the Report at A7-0170/2012. 59 – Article 5(1) and (4) TEU. 60 – Article 5(1) and (3) TEU. 61 – The written observations of the United Kingdom make a passing reference to the compatibility of the disclosure requirements with the principle of subsidiarity. However, given that the written observations do not develop this arm of the United Kingdom’s challenge any further, I will confine my analysis of the disclosure obligations to their compatibility with the principle of proportionality. 62 – OJ 2003 C 321, p. 1. 63 – The United Kingdom relies on the judgment in Luxembourg v Parliament and Council, C‑176/09, EU:C:2011:290 in this respect. 64 – Judgment in Eurotunnel andOthers, C‑408/95, EU:C:1997:532, paragraphs 37 to 39, and the judgment in Commission v Council, 355/87, EU:C:1989:220, paragraphs 42 to 44. 65 – Judgment in Afton Chemical, C‑343/09, EU:C:2010:419, paragraphs 30 and 57. 66 – Ibid., paragraph 33. 67 – Ibid., paragraph 34. 68 – See, in this sense, ibid., paragraphs 35 to 41. 69 – Judgment in Vodafone and Others, C‑58/08, EU:C:2010:321, paragraph 52; judgment in Commission v Council, C‑117/10, EU:C:2013:786, paragraph 113. 70 – Judgment in Spain v Council, C‑310/04, EU:C:2006:521, paragraphs 121 to 123. 71 – See judgment in Digital Rights Ireland, C-293/12 and C‑594/12, EU:C:2014:238, paragraph 47 and the case-law cited. 72 – See judgment in United Kingdom v Council, C‑84/94, EU:C:1996:431, paragraph 58, and judgment in British American Tobacco (Investments) and Imperial Tobacco, C‑491/01, EU:C:2002:741, paragraph 123. 73 – I will return to the United Kingdom’s concerns pertaining to Article 114(2) TFEU in my analysis to follow of the first plea. 74 – This aggregated information is not analogous to the detailed information on pay of named individuals and its compatibility with EU data protection law, considered by the Court in the judgment in Österreichischer Rundfunk and Others (C-465/00, C-138/01 and C‑139/01, EU:C:2003:294) and the judgment in Satakunnan Markkinapörssi and Satamedia (C‑73/07, EU:C:2008:727). 75 – Judgment in Germany v Parliament and Council, C‑233/94, EU:C:1997:231, paragraphs 13 and 15. 76– According to Articles 33 and 34 of the CRD IV Directive, authorised financial institutions may carry out their activities within the territories of other Member States on the basis of their authorisation in the home Member State. 77 – Judgment in Del Cerro Alonso, C‑307/05, EU:C:2007:509, paragraphs 40 and 46; judgment in Impact, C‑268/06, EU:C:2008:223, paragraph 123; and judgment in Bruno and Pettini, C-395/08, and C‑396/08, EU:C:2010:329, paragraph 36. 78 – Judgment in Del Cerro Alonso , EU:C:2007:3, paragraph 39, and judgment in Impact, EU:C:2008:2, paragraph 122. 79 – Judgment in Bruno and Pettini, EU:C:2010:329, paragraph 39. See also the judgment in Impact, EU:C:2008:223, point 129. 80 – Judgment in Lock, C‑539/12, EU:C:2014:351, paragraphs 29 to 33, and case law cited. 81 – Judgment in Del Cerro Alonso, EU:C:2007:509, paragraph 46. 82 – Judgment in Impact, EU:C:2008:223, paragraph 124. 83 – Judgment in Bruno and Pettini, EU:C:2010:28, paragraphs 36 and 37; judgment in Del Cerro Alonso, EU:C:2007:509, paragraph 40, 44 to 46; judgment in Impact, EU:C:2008:223, paragraphs 123 to 124 and 130, and the Opinion of Advocate General Kokott in Impact, EU:C:2008:2, paragraph 173. 84 – Opinion of Advocate General Kokott in Impact, EU:C:2008:2, point 174. 85 – Opinion of Advocate General Kokott in Impact, EU:C:2008:2, point 173. 86 – This outcome is not altered by the alleged factual consequences of the introduction of a fixed ratio consisting of increased fixed components of pay or decreased total remunerations for the material risk takers. 87– See footnote 76 above. 88 – Examples of such EU measures are those relating to anti-discrimination, posted workers and working time. Regarding the Court’s case-law, see, for example, judgment in Del Cerro Alonso, EU:C:2007:509, where the Court held at paragraph 41 that the ‘pay’ exception ‘cannot, however, be extended to any question involving any sort of link with pay; otherwise some of the areas referred to in Article 137(1) EC would be deprived of much of their substance’, and the judgment in Impact, EU:C:2008:223, where the Court held at paragraph 125 that ‘[i]t cannot, however, be extended to any question involving any sort of link with pay; otherwise some of the areas referred to in Article 137(1) EC would be deprived of much of their substance’, citing, inter alia, the judgment in Del Cerro Alonso EU:C:2007:509, paragraph 41.