Case C-505/09 P

European Commission

v

Republic of Estonia

‛Appeal — Environment — Directive 2003/87/EC — Greenhouse gas emission allowance trading scheme — National allocation plan for emission allowances for the Republic of Estonia for the period 2008 to 2012 — Respective competences of the Commission and the Member States — Article 9(1) and (3) and Article 11(2) of Directive 2003/87 — Equal treatment — Principle of sound administration’

Summary of the Judgment

It is clear from Article 11(2) of Directive 2003/87 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/EC that the Member State alone has the power, first, to draw up the national allocation plan whereby it proposes to achieve the aims of that directive concerning greenhouse gas emissions, and which it notifies to the Commission, and, second, to take final decisions fixing the total quantity of allowances that it will allocate for each five-year period and the distribution of that quantity amongst economic operators. On the other hand, it is unequivocally clear from Article 9(3) of that directive that the Commission’s role is limited to verifying the conformity of the national allocation plan of the Member State with the criteria set out in Annex III to the directive and the provisions of Article 10 thereof. It is entitled to check that conformity and to reject the national allocation plan on the grounds of incompatibility with those criteria and those provisions, by reasoned decision. If its plan is rejected by the Commission, the Member State may not take a decision under Article 11(2) of that directive unless the amendments it proposes have been accepted by the Commission. While it is true that there may be great differences in the types of obligations that directives impose on the Member States and therefore in the results which they must achieve and while it is also common ground that provisions of a directive that concern only the relations between the Member States and the Commission may not call for transposing measures, it cannot be denied that Articles 9 and 11 of Directive 2003/87 govern the respective roles of the Commission and the Member States in the context of the procedure for adoption of the national allocation plans, that is to say, the division of powers between them. Those provisions make it possible to determine whether the Member States enjoy any freedom of action when drawing up their plan and, as the case may be, the extent of that leeway. Likewise, it cannot be denied that Directive 2003/87 does not lay down a specific method for the drawing up of a national allocation plan or for the fixing of the total quantity of greenhouse gas emission allowances to be granted. Indeed, on the contrary, Annex III, point 1, of that directive expressly provides that the Member States must lay down the total quantity of allowances to be allocated taking into account, inter alia, national energy policy and the national climate change programme. Thus, the Member States have a certain freedom of action in choosing the measures they consider most appropriate to achieve, in the specific context of the national energy market, the objective laid down by that directive. With regard to the fact that, in accordance with Article 9 of Directive 2003/87, the national allocation plans are assessed by the Commission ex ante, such a power of review differs, clearly, in many respects from the review ex post provided for under Article 226 EC. That fact cannot, however, mean that the review ex ante must go beyond a review of legality. (see paras 49, 51-54)

The necessity of observing the principle of equal treatment cannot, however, alter the division of powers between the Member States and the Commission, as laid down in a Union provision such as Article 9(3) of Directive 2003/97 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/EC, which confers on the Commission the power only to verify the legality of the national allocation plan, permitting it to reject a plan that is not in conformity with the criteria set out in Annex III to Directive 2003/87 or the provisions of Article 10 thereof. With regard to the extent of that review, the Member States remain free to use the data and methods of assessment of their choice, so long as those do not lead to results not in conformity with those criteria or those provisions. In exercising its power of review under Article 9(3) of that directive, the Commission must respect the freedom of action enjoyed by the Member States. Thus, it may not reject a national allocation plan solely on the ground that the data contained in it are not in conformity with the data favoured by that institution. Any differences as regards the data and the evaluation methods applied by the Member States are an expression of their freedom of action, which the Commission must respect in the context of its review of conformity. In that context, the Commission may sufficiently ensure equal treatment between the Member States by examining the plan submitted by each of them with the same degree of diligence. It is open to the Commission to choose a common point of comparison for the plans drawn up by each of those States. To that end, the Commission may, inter alia, draw up its own economic and ecological model based on the data chosen by it and use that model as a point of comparison in order to verify whether the national allocation plans are compatible with the criteria laid down in Annex III to Directive 2003/87 and the provisions of Article 10 thereof. (see paras 65, 66, 68, 69)