Partial annulment of a Community act is possible only if the elements whose annulment is sought may be severed from the remainder of the act. That requirement of severability is not met where partial annulment of a measure would have the effect of changing its substance.

A rigorous application of those principles is essential to ensure compliance with the principle of subsidiarity enshrined in the second paragraph of Article 5 EC, a principle which binds the Community institutions in the exercise of their legislative functions. According to that principle, in areas which do not fall within its exclusive competence the Community is to take action only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the Member States and can therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community. Accordingly, in a field such as that of the environment, which is governed by Articles 174 EC to 176 EC, where the Community and the Member States share competence, the Community, that is to say the Commission, has the burden of proving to what extent the powers of the Member State and, therefore, its freedom of action, are limited.

Where transposition or implementation of an environmental directive is at issue, if the directive in question does not prescribe the form and methods for achieving a particular result, the freedom of action of the Member States as to the choice of the appropriate forms and methods for achieving that result remains, in principle, complete. Where there is no Community rule prescribing clearly and precisely the form and methods that must be employed by the Member State, the Commission has the burden, when exercising its supervisory power, pursuant in particular to Articles 211 EC and 226 EC, of proving to the required legal standard that the instruments used by the Member State in that respect are contrary to Community law.

It is clear from Article 9(1) and (3) of Directive 2003/87, establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Directive 96/61, and from Article 11(2) thereof that the Member State alone has the power, first, to draw up the national allocation plan (NAP) whereby it proposes to achieve the aims of the directive concerning greenhouse gas emissions, which it notifies to the Commission, and, secondly, to take final decisions fixing the total quantity of allowances which it will allocate for each five-year period and the distribution of that quantity amongst economic operators. In the exercise of those powers, the Member State thus has a certain room for manoeuvre in choosing the measures which it considers the most appropriate to attain, in the specific context of the national energy market, the result prescribed by the directive.

On the other hand, the Commission has power to review the NAP, under Article 9(3) of Directive 2003/87. Thus the Commission is authorised to verify the conformity of the NAP notified by the Member State with the criteria set out in Annex III and the provisions of Article 10 of that directive and to reject that plan on the grounds of incompatibility with those criteria and those provisions, by reasoned decision. Article 9(3) of the directive also shows that, where the NAP is rejected, the Member State may not take a decision under Article 11(2) unless the amendments proposed by the Member State following the refusal have been accepted by the Commission.

In the exercise of its power to review the NAP, the Commission has a discretion in so far as that review causes it to make its own complex economic and ecological assessments having regard to the general objective of reducing greenhouse gases by means of an economically efficient and effective system of trading allowances. It follows that, in its review of legality in this regard, the Community judicature conducts a full review as to whether the Commission applied properly the relevant rules of law. On the other hand, the Court of First Instance cannot take the place of the Commission on issues where the latter must carry out complex economic and ecological assessments in this context. In this respect, the Court is obliged to confine itself to verifying that the measure in question is not vitiated by a manifest error or a misuse of powers, that the competent authority did not clearly exceed the bounds of its discretion and that the procedural guarantees, which are of particularly fundamental importance in this context, have been fully observed.

In the context of its assessments as to whether the NAPs of various Member States are compatible with the criteria of Annex III to the directive, it is permissible for the Commission to choose a common point of comparison. It may, in particular, draw up and use its own economic and ecological model and has a discretion in that regard, with the result that use of such a common point of reference in a decision rejecting a NAP is open to challenge only on the ground that it is vitiated by an obvious error of assessment.

However, by specifying a specific quantity of allowances, any exceeding of which is regarded as incompatible with the criteria laid down by Directive 2003/87, and by rejecting the national plan of a Member State in so far as the total quantity of allowances proposed therein exceeds that threshold, the Commission exceeds the limits of its power of review under Article 9(1) and (3) and Article 11(2) of that directive. By imposing, in the operative part of a decision rejecting a NAP, a specific limit, calculated on the basis of its own economic model and its own choice of data, for the total quantity of allowances which a Member State has the right to fix, the Commission effectively substitutes itself for the Member State for the purposes of fixing that total quantity. Such a provision is liable to oblige the Member State to modify its NAP so that the total quantity of allowances corresponds exactly to the limit indicated by the Commission in the rejection decision. In such a case, the Member State is required to fix a total quantity equal to or less than the limit indicated by the Commission, failing which it will find it impossible to adopt a decision in accordance with the said Article 11(2).

Such a rejection decision renders Article 11(2) devoid of purpose, inasmuch as that provision provides that it is for the Member State, and not the Commission, to decide the total quantity of allowances which it will allocate.

(see paras 53-55, 60, 63-65)