Keywords

Summary



Keywords

1 International agreements - Conclusion - Prior opinion of the Court - Subject-matter - Division of powers between the Community and the Member States

(EC Treaty, Art. 228(6))

2 International agreements - Prior opinion of the Court - Envisaged agreement - Concept

(EC Treaty, Art. 228(6))

3 International agreements - Agreements concluded by the Community - Dependent territories of a Member State which do not belong to the Community - Procedures for participating in agreements - Representation by the Member State concerned - No effect on the division of powers between the Community and the Member States

(EC Treaty, Art. 228)

4 International agreements - Powers of the Community and of the Member States - National provisions concerning the conclusion of treaties - Not relevant

5 International agreements - Powers of the Community and of the Member States - Agreement imposing financial obligations on the Member States - Not relevant

6 Common commercial policy - Conclusion of international agreements - Inclusion of products covered by the EAEC Treaty

(EC Treaty, Arts 113 and 232(2); EAEC Treaty)

7 Common commercial policy - Conclusion of international agreements - Inclusion of products covered by the ECSC Treaty - Limits

(EC Treaty, Arts 113 and 232(1); ECSC Treaty, Art. 71)

8 International agreements - Conclusion by the Community of the Agreement on Agriculture and the Agreement on the Application of Sanitary and Phytosanitary Measures annexed to the Agreement establishing the World Trade Organization - Agreements covered by the common commercial policy - Legal basis

(EC Treaty, Arts 43 and 113)

9 International agreements - Powers of the Community and of the Member States - Conclusion of the Agreement on Technical Barriers to Trade annexed to the Agreement establishing the World Trade Organization - Agreement covered by the common commercial policy

(EC Treaty, Art. 113)

10 Common commercial policy - Concept - Services within the meaning of the General Agreement on Trade in Services (GATS) annexed to the Agreement establishing the World Trade Organization - Excluded apart from cross-border supplies not involving the movement of persons

(EC Treaty, Art. 113)

11 Common commercial policy - Transport - Excluded

(EC Treaty, Art. 113)

12 Acts of the institutions - Choice of legal basis - Criteria - Practice followed by an institution - Not relevant with regard to the Treaty rules

13 Common commercial policy - Concept - Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) annexed to the Agreement establishing the World Trade Organization - Excluded apart from provisions relating to the prohibition of the release into free circulation of counterfeit goods

(EC Treaty, Art. 113)

14 International agreements - Conclusion - Transport - Community competence - Non-exclusive nature of the way in which the matter is covered at present by common internal rules

15 International agreements - Conclusion - Right of establishment and freedom to provide services - Community competence - Non-exclusive nature of the way in which the matter is covered at present by common rules on the treatment of nationals of non-member countries

16 International agreements - Conclusion - Areas open to intervention by the Community under Articles 100a or 235 of the Treaty - Community competence - Exclusive nature - Assessment criteria

(EC Treaty, Arts 100a and 235)

17 International agreements - Conclusion - Protection of intellectual property - Community competence - Non-exclusive nature at the present stage of harmonization of national rules at Community level

18 International agreements - Conclusion - Community competence - Exclusive nature - Assessment criteria - Problems in the implementation of an agreement arising from joint participation by the Community and the Member States - Not relevant

19 International agreements - Agreement falling partly within the competence of the Community and partly within that of the Member States - Need for close cooperation in its negotiation, conclusion and fulfilment

Summary

$$I. The opinion of the Court may be sought, pursuant to Article 228(6) of the Treaty, in particular on questions concerning the division between the Community and the Member States of competence to conclude a given agreement with non-member countries.

II. The Court may be called upon to state its opinion pursuant to Article 228(6) of the Treaty at any time before the Community finally expresses its consent to be bound by the agreement. Unless and until that consent is given, and even after it is signed, the agreement remains an envisaged agreement.

III. The dependent territories for whose international relations certain Member States are responsible, inasmuch as they remain outside the scope of the Treaty, are, as regards the Community, in the same situation as non-member countries. Consequently, it is in their capacity as the States responsible for the international relations of territories dependent on them but not within the scope of Community law, and not as Member States of the Community, that the States responsible for those territories are called upon to participate in any given international agreement. However, the special position of those Member States cannot affect the solution of the problem relating to the demarcation, for the purposes of concluding such an agreement, of spheres of competence within the Community.

IV. Internal rules of law, even of a constitutional nature, cannot alter the division of international powers between the Member States and the Community as laid down by the Treaty.

V. Given that the World Trade Organization is an international organization which will have only an operating budget and not a financial policy instrument, the fact that the Member States will bear some of its expenses cannot of itself justify the participation of the Member States in the conclusion of the agreement.

VI. According to Article 232(2) of the EC Treaty, the provisions of that Treaty cannot derogate from those of the Treaty establishing the European Atomic Energy Community. Since the Euratom Treaty contains no provisions relating to external trade, there is nothing to prevent agreements concluded pursuant to Article 113 of the EC Treaty from extending to international trade in Euratom products.

VII. The ECSC Treaty, which was not intended, according to Article 232(1) of the EC Treaty, to be affected by that latter Treaty, and Article 71 of which provides that the powers of the Member States in matters of commercial policy are to remain unaffected by the application of the ECSC Treaty, can only have been intended to cover agreements with non-member countries relating specifically to ECSC products; it follows that the Community has sole competence pursuant to Article 113 of the EC Treaty to conclude an external agreement of a general nature, that is to say, encompassing all types of goods, even where those goods include ECSC products. Article 71 of the ECSC Treaty cannot render inoperative Article 113 of the EC Treaty and affect the vesting of power in the Community for the negotiation and conclusion of international agreements in the realm of common commercial policy.

VIII. In so far as the Agreement on Agriculture annexed to the Agreement establishing the World Trade Organization is intended to establish, on a worldwide basis, a fair and market-oriented agricultural trading system, and the Agreement on the Application of Sanitary and Phytosanitary Measures, which is also annexed to the aforementioned agreement, is confined to the establishment of a multilateral framework of rules and disciplines to guide the development, adoption and enforcement of sanitary and phytosanitary measures in order to minimize their negative effects on trade, those two agreements can be concluded by the Community on the basis of Article 113 of the Treaty alone, even though the implementation of the commitments entered into under those Agreements will require measures to be adopted on the basis of Article 43 of the Treaty.

IX. The provisions of the Agreement on Technical Barriers to Trade annexed to the Agreement establishing the World Trade Organization are designed merely to ensure that technical regulations and standards and procedures for assessment of conformity with technical regulations and standards do not create unnecessary obstacles to international trade; that agreement must therefore be regarded as falling within the ambit of the common commercial policy and may consequently be concluded by the Community alone, notwithstanding that, as Community law stands at present, the Member States retain certain powers of their own in the matter.

X. Having regard to developments in international trade, as borne out by the Agreement establishing the World Trade Organization (WTO) and its annexes, including the General Agreement on Trade in Services (GATS), which were the subject of a single process of negotiation covering both goods and services, it follows from the open nature of the common commercial policy that trade in services cannot immediately, and as a matter of principle, be excluded from the scope of Article 113 of the Treaty.

As regards cross-frontier supplies not involving any movement of persons, the service is rendered by a supplier established in one country to a consumer residing in another. The supplier does not move to the consumer's country; nor, conversely, does the consumer move to the supplier's country. That situation is, therefore, not unlike trade in goods, which is covered by the common commercial policy within the meaning of the Treaty. There is thus no particular reason why such a supply should not fall within the concept of the common commercial policy.

The same cannot be said of the other three modes of supply of services covered by GATS, namely:

- consumption abroad, which entails the movement of the consumer into the territory of the WTO member country in which the supplier is established;

- commercial presence, that is to say, the presence of a subsidiary or branch in the territory of the WTO member country in which the service is to be rendered;

- the presence of natural persons from a WTO member country, enabling a supplier from one member country to supply services within the territory of any other member country.

As regards natural persons, it is clear from Article 3 of the Treaty, which distinguishes between 'a common commercial policy' in paragraph (b) and 'measures concerning the entry and movement of persons' in paragraph (d), that the treatment of nationals of non-member countries on crossing the external frontiers of Member States cannot be regarded as falling within the common commercial policy. More generally, the existence in the Treaty of specific chapters on the free movement of natural and legal persons shows that those matters do not fall within the common commercial policy.

It follows that the modes of supply of services referred to by GATS as 'consumption abroad', 'commercial presence' and the 'presence of natural persons' are not covered by the common commercial policy.

XI. The particular services comprised in transport are the subject of a specific title of the Treaty, distinct from the title on the common commercial policy; consequently, international agreements in transport matters are not covered by Article 113 of the Treaty, despite the enactment by the Council and the Commission, on the basis of Article 113, of a series of embargoes involving the suspension of transport services. Since the embargoes related primarily to the export and import of products, they could not have been effective if they had not been accompanied by the suspension of transport services.

XII. A mere practice of the Council cannot derogate from the rules laid down in the Treaty and cannot, therefore, create a precedent binding on Community institutions when deciding, prior to the adoption of a measure, the correct legal basis for it.

XIII. In so far as the section of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) relating to the means of enforcement of intellectual property rights contains specific rules as to measures to be applied at border crossing points, it has its counterpart in the provisions of Council Regulation No 3842/86 laying down measures to prohibit the release for free circulation of counterfeit goods. Since measures of that type can be adopted autonomously on the basis of Article 113 of the EC Treaty, international agreements in that field fall within the Community's competence in matters of commercial policy.

As regards the provisions of TRIPs other than those concerning the prohibition of the release into free circulation of counterfeit goods, the connection between intellectual property and trade in goods, whereby intellectual property rights enable those holding them to prevent third parties from carrying out certain acts having effects on such trade, is not enough to bring those rights within the scope of Article 113 of the Treaty.

It is true that, in the field of intellectual property, the Community has internal competence to harmonize national laws pursuant to Articles 100 and 100a and may use Article 235 as the basis for creating new rights superimposed on national rights. However, those measures are subject to voting rules or rules of procedure which are different from those applicable under Article 113. If the Community were to be recognized as having exclusive competence under Article 113 to enter into agreements with non-member countries with a view to protecting intellectual property and, at the same time, achieving harmonization at Community level, the Community institutions would be able to escape the internal constraints in respect of voting procedures and rules to which they are subject when seeking to take action in that sphere, which is not acceptable.

That conclusion is not altered by the fact that the Community institutions have developed a practice whereby, in order to protect the Community's intellectual property interests, they resort to autonomous measures falling within the ambit of commercial policy, namely the opening of procedures under the new commercial policy instrument and the suspension of generalized tariff preferences, or incorporate within trade agreements ancillary provisions relating to such property.

XIV. Even in the field of transport, the Community's exclusive external competence does not automatically flow from its power to lay down rules at internal level. The Member States, whether acting individually or collectively, only lose their right to assume obligations with non-member countries as and when common rules which could be affected by those obligations come into being. Only in so far as common rules have been established at internal level does the external competence of the Community become exclusive. However, not all transport matters are already covered by common rules; consequently, the Member States have not lost all their powers to conclude international agreements in that sphere.

Even supposing that the exercise of those powers entailed any risk of distortion in the flow of services and impairment of the cohesion of the internal market, there is nothing to prevent the institutions from arranging, in the common rules laid down by them, concerted action in relation to non-member countries or from prescribing the approach to be taken by the Member States in their external dealings.

XV. The chapters of the Treaty on the right of establishment and on freedom to provide services do not contain any provision expressly extending the competence of the Community to relationships arising from international law. The sole objective of those chapters is to secure the right of establishment and freedom to provide services for nationals of Member States. They contain no provisions on the problem of the first establishment of nationals of non-member countries and the rules governing their access to self-employed activities. It cannot therefore be inferred from those chapters that the Community has exclusive competence to conclude an agreement with non-member countries to liberalize first establishment and access to service markets, other than those which are the subject of cross-border supplies within the meaning of the General Agreement on Trade in Services (GATS), which are covered by Article 113 of the Treaty.

Nor does the preservation of the coherence of the internal market justify the conclusion of GATS by the Community alone. Attainment of freedom of establishment and freedom to provide services for nationals of the Member States is not inextricably linked to the treatment to be afforded in the Community to nationals of non-member countries or in non-member countries to nationals of Member States of the Community.

Although the only objective expressly mentioned in the chapters of the Treaty on the right of establishment and on freedom to provide services is the attainment of those freedoms for nationals of the Member States of the Community, it does not follow that the Community institutions are prohibited from using the powers conferred on them in that field in order to specify the treatment to be accorded to nationals of non-member countries. Whenever the Community has included in its internal legislative acts provisions relating to the treatment of nationals of non-member countries or expressly conferred on its institutions powers to negotiate with non-member countries, it acquires exclusive external competence in the spheres covered by those acts. The same applies in any event, even in the absence of any express provision, where the Community has achieved complete harmonization of the rules governing access to a self-employed activity.

Since that is not the case in all service sectors, it follows that competence to conclude GATS is shared between the Community and the Member States.

XVI. It is undeniable that, where the harmonizing powers conferred by Article 100a of the Treaty have been exercised, the harmonization measures thus adopted may limit, or even remove, the freedom of the Member States to negotiate with non-member countries. However, an internal power to harmonize which has not been exercised in a specific field cannot confer exclusive external competence in that field on the Community.

The same applies in respect of Article 235 of the Treaty, which, whilst enabling the Community to cope with any insufficiency in the powers conferred on it, expressly or by implication, for the achievement of its objectives, cannot in itself vest exclusive competence in the Community at international level.

XVII. As regards intellectual property, the harmonization achieved within the Community in certain areas covered by the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) is either partial or non-existent. With regard to the measures to be adopted to secure the effective protection of intellectual property rights, the Community is certainly competent to harmonize national rules on those matters pursuant to Article 100 of the Treaty, but the Community institutions have hitherto scarcely exercised their powers in that field.

It follows that the Community and its Member States are jointly competent to conclude TRIPs.

XVIII. Problems which may arise in the implementation of an international agreement as regards the coordination necessary to ensure unity of action where the Community and the Member States participate jointly in that agreement are of no relevance to the question of the division of powers in respect of such participation.

XIX. Where it is apparent that the subject-matter of an international agreement or convention falls in part within the competence of the Community and in part within that of the Member States, the requirement of unity in the international representation of the Community is such that it is essential to ensure close cooperation between the Member States and the Community institutions, both in the process of negotiation and conclusion and in the fulfilment of the commitments entered into.

The duty to cooperate is all the more imperative in the case of agreements such as those annexed to the Agreement establishing the World Trade Organization, which are inextricably interlinked, and in respect of which a dispute settlement system is established involving cross-retaliation measures.