Abstract
The proposal for Regulation 2017/1939 establishing the European Public Prosecutor’s Office (The EPPO Regulation) was criticized for completely excluding the Court of Justice of the European Union (CJEU) from judicial review of decisions on forum of prosecution by the EPPO, an EU body. The system of judicial review under the EPPO Regulation has improved significantly relative to its initial proposal, by enabling national courts to refer preliminary questions to the CJEU. Despite this, several issues remain. This article examines whether the limitations imposed by the EPPO Regulation on the use of the action for annulment procedure laid down in Article 263 TFEU comply with EU primary law. More specifically, whether it complies with effective judicial protection as protected under Article 47 CFR, and the legal basis for the EPPO’s system of judicial review, Article 86(3) TFEU. We argue that the preliminary reference procedure is not effective enough in remedying the limited access to the action for annulment procedure to reliably safeguard the defendants’ right to effective judicial protection. To the extent that the current system for judicial review under the EPPO Regulation is at odds with the Article 47 CFR, the EU legislator did not have the competence to enact it under Article 86(3) TFEU. This article proposes that in order to circumvent the unlawful restrictions imposed by the EPPO Regulation, defendants could and should make use of the action for annulment procedure to contest the EPPO’s choice of forum.
Introduction
After decades of intense negotiations, those keen on optimizing criminal law enforcement on the European Union (‘EU’) level finally had their cake. With the entry into operations of the European Public Prosecutor’s Office (‘EPPO’) on 1 June 2021, there now exists an EU body with criminal investigative and prosecuting powers which specifically aims to combat crimes against the EU’s financial interests. 1 The EPPO is competent to prosecute crimes against the financial interests of the EU (‘PIF offences’) as defined in the PIF Directive (Directive (EU) 2017/1371), 2 participation in a criminal organization (as defined in Framework Decision 2008/841/JHA) that is focused on committing PIF offences, 3 and other offenses that are ‘inextricably linked’ to PIF offences (excluding participation in criminal organizations focused on PIF offences). 4 The prosecution of offences that are ‘inextricably linked’ to PIF offences is subject to the limitations imposed by Article 25(3) of the EPPO Regulation (‘EPPO Regulation’), such as the principle of preponderance, and further criteria. 5 In practice, this means that, for example, the embezzlement of EU funds through the use of false and inaccurate documents and statements will now be prosecuted more effectively. This is a big step forward, especially in contexts of financial crimes that contain a cross-border dimension. 6
The EPPO is a highly innovative prosecution body. Being a creature of the EU’s composite legal order, the EPPO finds itself regulated by both EU law (most importantly the EPPO Regulation) and national law. 7 The EPPO therefore operates on both the national and EU level. 8 At times, it is unclear when and where the EPPO should be understood to operate on a national level or on the EU level. However, when the EPPO decides to go ahead and prosecute a case, it does so before national courts and primarily on the basis of national criminal law. 9 This confronts the EPPO with an unusual decision in the context of criminal law proceedings: the decision on the jurisdiction in which the prosecution will take place, i.e. the ‘forum choice’.
The EPPO’s forum choice is highly impactful on the defendant and therefore requires adequate opportunities for judicial review. Because the prosecution takes place before national courts and primarily based on national law, the decision on forum choice has an impact on the rules of procedure and of evidence, and to a certain extent even on the level and type of criminal sanctions. More practically, it also determines the venue of the court proceedings and the language of the proceedings, and might (in case of conviction) impact the conditions under which the sanction is executed. In the absence of full harmonization, there are still persistent differences between the Member States. For example, in Finland, the maximum penalty for money laundering is two years of imprisonment, whereas in Italy, this constitutes the minimum penalty threshold. 10 Moreover, prison conditions are seen to – in some cases – differ widely between Member States. 11 This demonstrates that the choice of forum by the EPPO may considerably impact the position of the defendant, and that it therefore is vital that the defendant is able to adequately contest a decision that fails to comply with the applicable standards.
Although the EPPO’s decision on forum choice is taken at the EU level and should thus in principle be open to contestation via Article 263 TFEU’s action for annulment procedure, 12 access to that procedure is currently restricted under the EPPO Regulation. In accordance with the EPPO Regulation, judicial review is to take place before national courts, which may only refer preliminary questions to the Court of Justice of the European Union (‘CJEU’) concerning the interpretation of EU law, or when they have doubts about the validity of EPPO’s procedural acts vis-à-vis EU law. 13
Against this background, we ask whether the limitations imposed by the EPPO Regulation on the use of the action for annulment procedure laid down in Article 263 TFEU comply with EU primary law, in particular effective judicial protection as protected under Article 47 of the Charter of Fundamental Rights of the European Union (‘CFR’), and Article 86(3) TFEU, which awards the legislator discretion in determining the rules governing the judicial review of the EPPO’s measures. 14 We find that in the scramble to get the EPPO up and running, the concerns expressed about the constitutionality of this system of judicial review have not been addressed with adequate justification by the EPPO Regulation. While we recognize that the EPPO Regulation has significantly improved relative to its original proposal, the system for the judicial review of the EPPO’s decision on forum choice is, as it stands, in violation of EU primary law. It fails to safeguard the right to effective judicial protection guaranteed by Article 47 CFR, 15 and we argue, further, that as a consequence its legal basis in Article 86(3) TFEU does not confer the EU legislator the necessary competence to enact this derogation from EU primary law. 16 We propose that in order to protect defendants’ fundamental right to effective judicial protection, defendants could and should therefore be able to make use of the action for annulment procedure provided by Article 263 TFEU instead of the procedure prescribed by the EPPO Regulation. 17
The next section – section 2 – describes the framework regulating the decision on the choice of forum of prosecution under Article 26(4) of the EPPO Regulation, and its effects on the defendant. Section 3 sets out the system of judicial review of the decision on forum choice under Article 42 of the EPPO Regulation, and how it affects the defendant. Section 4 assesses whether EPPO Regulation’s system for judicial review for the decision on forum choice sufficiently safeguards the defendant’s right to effective judicial protection under Article 47 CFR. Based on section 4, section 5 examines whether Article 86(3) TFEU confers the adequate legislative competence to enact the EPPO Regulation’s system of judicial review for the decision on forum choice. The final section – section 6 – explores under what circumstances the defendant could use Article 263 TFEU to annul the EPPO’s decision on forum choice, and how its use would affect the proceedings.
The choice of forum and its consequences for the defendant
The choice of forum of prosecution is regulated by Article 36(3) of the EPPO Regulation, which in turn refers to the criteria for determining the forum of investigation laid down in Article 26(4) and (5). 18 This section focuses on three components of the choice of forum of prosecution: the actors that make the decision, the criteria for the decision, and the moment of the decision. Moreover, it elaborates on why the choice of forum is of crucial importance for the position of the defendant during legal proceedings, and briefly touches upon similarities with the debate around the principle of mutual trust in mutual recognition instruments.
The actors that make the choice of forum
Within the EPPO, there are several actors involved in making the forum choice. The most prominent actors are the European Delegated Prosecutors (‘EDPs’) at the national level, and the Permanent Chambers at the EU level. 19
The EDPs are described as the ‘true cornerstone of the EPPO’. 20 Their workplace is at Member States’ public prosecutor’s offices, and their power resembles that of national public prosecutors. 21 The EDPs are responsible for initiating and conducting the investigation. 22 When the EDPs have completed the investigation, they must submit a report to the supervising European Prosecutor (a member of the Permanent Chamber) containing a summary of the case, and a draft decision on how, and if applicable where, to proceed with the case. 23
The proposal for the EPPO Regulation originally assigned the choice of forum of prosecution to the European Public Prosecutor (‘EPP’) in consultation with the EDPs submitting the case. 24 It proposed a strong chain of command between the EPP and the EDPs, in order to prevent a tedious decision-making process. 25 Yet, this hierarchical and centralized structure was met with resistance by Member States: they argued that such a structure illustrated a lack of trust towards the capacity and willingness of national authorities to combat fraud. 26 This resistance resulted in, amongst others, the introduction of the Permanent Chambers in 2014. 27
The Permanent Chambers are collegial organs composed of two European Prosecutors (not EDPs) and a chair. The Regulation restricts the appointment of European Prosecutors to one per Member State, and they are assigned to the Permanent Chambers as a ‘permanent member’. 28 The Permanent Chambers are chaired by the European Chief Prosecutor, 29 a Deputy European Chief Prosecutor, or a European Prosecutor. The Permanent Chambers operate on an EU level.
The task of the Permanent Chambers is to direct and supervise the investigations and prosecutions conducted by the EDPs and to ensure the coordination of cross-border cases between the Member States. Under the EPPO Regulation, the case report drafted by the EDP handling the case will be forwarded by the supervising European Prosecutor to the Permanent Chamber. According to Article 36(3), the Permanent Chamber must then in principle decide to prosecute the case in the Member State of the EDP. However, the Permanent Chamber can decide to prosecute in a different Member State if this decision is in accordance with the criteria set out in article 26(4) and 26(5). 30 The Permanent Chamber will then have the final say in deciding on how and, crucially, where to proceed with the case. 31 The power to decide on the choice of forum therefore is situated on the EU level.
Some potential risks are introduced by this institutional structure. Because the members that make up the Permanent Chambers come from different Member States, it is not always evident that they will possess the necessary expertise and information to decide on the appropriate forum in a particular case. 32 As the ‘Case Management System’ of the EPPO will randomly allocate the cases to the Permanent Chambers, 33 it is possible that, for example, European Prosecutors from the Netherlands and Luxembourg together with the Deputy European Prosecutor from Finland are to decide on an individual case, but lack crucial knowledge of the national criminal systems from which they are choosing. 34 Moreover, it might be possible that they may favor a forum that they are familiar with, even though the defendant might not be. 35
The criteria that govern the choice of forum
Article 26(4) of the EPPO Regulation lists the criteria that must be considered when determining the choice of forum. The general rule is that: ‘A case shall […] be initiated and handled by a European Delegated Prosecutor from the Member State
Article 26(4) provides that a deviation from the general rule by the EDP or Permanent Chambers is permitted when ‘duly justified’. 39 The EPPO Regulation provides criteria for how to justify a deviation, and to determine what the outcome of the deviation should be. It is not so clear, however, when and why to depart from the general rule. These questions matter, because the general rule appears to offer more interpretative discretion than the exception does.
Article 26(4) of the EPPO Regulation provides the following criteria to determine the forum when deviating from the general rule: ‘(a) the place of the suspect’s or accused person’s habitual residence; (b) the nationality of the suspect or accused person; (c) the place where the financial damage has occurred’. 40 The proposal for the EPPO Regulation left it to the discretion of the EPPO to assess the criteria at hand and balance them, in order to give maximum flexibility to the EPPO when determining – in its view – the most appropriate forum. 41 This absence of priority rules was met with criticism by the European Parliament, which found that the proposal granted the EPPO excessive discretion. The European Parliament argued, for example, that a hierarchy of the criteria had to be created to ensure foreseeability. 42 Furthermore, the Council of the European Union criticized the discretion granted to the EPPO for potentially promoting ‘forum shopping’. 43 This criticism was taken into account by the Council when drafting Article 26(4) of the EPPO Regulation. 44 Under the EPPO Regulation, the criteria for deviating from the general rule are now listed in order of priority, while granting interpretative leeway only in exceptional cases. 45
Despite the provision of a relatively strict mechanism to be used in exceptional cases, it remains unclear under the EPPO Regulation when a case is considered to be exceptional. It is relatively clear how a deviation from the general rule is to be justified, but it is ill-defined when it is necessary to deviate from the rather open-textured general rule. It must therefore be questioned whether the risk of forum shopping, as mentioned by the Council in 2013, is indeed truly discouraged. 46
The consequences of the choice of forum for the defendant
From a defendant’s perspective, the rules under the EPPO Regulation have reduced the risk of an arbitrary choice of forum compared to its proposal. However, several potential issues regarding the legal position of the defendant remain.
Several authors have raised concerns that the decision on the choice of forum might in particular affect the principle of legality and the right to a fair trial. 47 Panzavolta and Luchtman argue that the principle of legality requires defendants to have the ability to foresee which courts will preside over their case and consequently what will be the applicable law. 48 However, in transnational cases, the defendant might not always be able to predict before which courts the trial will be held on the basis of Article 26(4). As a result, the defendant might not be able to prepare for their case: for instance, they might not know which procedural rules apply or where to find a lawyer. 49
Furthermore, Wasmeier and Panzavolta reason that the choice of forum could affect the defendant’s right to a fair trial, especially with regard to equality of arms. 50 For example, the equality of arms requires that the prosecutor cannot select the forum at the expense of the defense. 51 In accordance with Article 26(4), the Permanent Chambers have the ability to choose from a multitude of jurisdictions. Nevertheless, the vagueness of the criteria laid down therein produces a margin of discretion that might enable the Permanent Chambers to select a jurisdiction to the detriment of the defendant. 52
Additionally, the right to a fair trial requires that defendants have adequate time and facilities for the preparation of their defense. 53 If the Permanent Chambers decides to reallocate the case to an EDP in another Member State in accordance with Article 26(5) of the Regulation, this might result in defendants not having adequate time or facilities to prepare their defense. Such a change in jurisdiction hence entails that defendants must hire a new lawyer, possibly a new translator, and change their defense strategy. 54
The forum choice and the principle of mutual trust
The concerns related to the prosecutorial discretion that allows for ‘forum shopping’ to the detriment of the defendant resemble those found in debates about the use of mutual recognition instruments. In cases where a suspect could be prosecuted in multiple jurisdictions for the same offence, the framework for mutual recognition in criminal matters appears to allow the possibility for public prosecutors to intentionally select a jurisdiction in a way that would affect the defendants’ punishment or complicate their defense. 55 The CJEU has addressed this, stating that by the principle of mutual trust, it is assumed that every Member State of the framework guarantees a minimum level of fairness and protection of fundamental rights and freedoms. Consequently, a decision to prosecute a case in a jurisdiction that is less favorable to the defendant does not infringe upon the defendant’s rights. 56
One might wonder whether a similar argument could apply to the EPPO’s decision on forum choice. Such an assumption of adequacy of all legal systems clearly trivializes the need for effective judicial protection against wrong forum choices. But this does not appear to be the case. In addition to the right to a fair trial and related defense rights under EU law, we see that the EPPO Regulation creates a new right for the defendant in cases prosecuted by the EPPO: the right to be tried in the correct jurisdiction. The correct jurisdiction being where the focus of their criminal activity is (was), where the bulk of the offences has been committed, or when its duly justified, the jurisdiction of their habitual residence, nationality, or within which the main financial damage occurred. It is precisely this right that is infringed upon by a wrongful decision of forum choice by the EPPO and that requires effective judicial protection. Mutual trust does not bring the assumption that the defendant’s right to be tried in a correct jurisdiction is safeguarded. The EU legislator has through the EPPO Regulation rather nuanced the principle of mutual trust in the cases taken up by the EPPO in the sense that although each Member State is trusted to treat the defendant fairly, a genuine link between jurisdiction in which the trial is held and the offence (or the suspect, if duly justified) is required. 57
Judicial review of the decision on forum choice under the EPPO Regulation
The previous section described the rules that govern the decision on forum choice and underlined the importance of being able to judicially review that decision. This section will outline the system of judicial review contained in the EPPO Regulation, with reference to its unusual historical development.
On which level does the EPPO operate?
In principle, the CJEU has jurisdiction to review the acts of any EU Institutions, bodies, offices, or agencies. Judicial review is an important instrument to provide protection for individuals and prevent those exercising public functions from abusing their powers. In 1986, the CJEU explained in Les Verts that ‘the Treaty established a complete system of legal remedies and procedures designed to permit the CJEU to review the legality of measures adopted by the institutions’. 58 The definition of ‘institutions’ was then broadened in 2009 by the TFEU to include all EU bodies, offices, or agencies. 59
However, the case is not necessarily that straight-forward for the EPPO. The EPPO is regulated by both national and EU law and operates on both the national and the EU level. Procedural acts of the EPPO might be adopted on the national level and produced at least partly based on national law. For example, a decision to obtain a certain set of evidence might take place without coordination on the EU level and be partly based on national law. Consequently, it might be more practical (and logical) to leave the review of the decision to national courts. In the same vein, acts that are adopted on the EU level and based on EU law should be subject to review before the CJEU.
It might not always be possible to clearly distinguish at which level and based on which rules an act by the EPPO was in fact adopted, which might make it difficult to determine which court is best placed to review the decision. The previous section has demonstrated that for the decision on forum choice, at least some decision-making power exists on the EU level in most cases. Especially decisions taken by the Permanent Chambers appear to be ‘European in nature’. 60 However, that does not necessarily mean that there is no involvement at all from national levels. National rules and concepts might – in the absence of total harmonization – still have influenced the decision. When the Permanent Chambers decide on the forum of prosecution, they apply Article 26(4) to the information contained in the case file. The EPPO Regulation determines how the information in the case file should be used to select the appropriate forum, but it does not determine what information should be available to make this decision. Therefore, decisions on what is entered into a case file, and that will hence subsequently be used to determine the choice of forum for the proceedings, are likely to take place on a national level and on the basis of national law. While in this scenario it might not be difficult to pin-point what the actual decision on forum choice is and whether it can be classified as ‘national’ or ‘European’, that might not always be the case. Especially when that decision is made without the active involvement of a Permanent Chamber. 61 In that case, it is difficult to determine which court would be best placed to review the decision. It seems that the drafters of the EU treaties have anticipated these difficulties by including Article 86(3) TFEU. Article 86(3) TFEU awards the competence to derogate from the standard system of judicial review under the EU treaties and to establish alternative rules ‘to the judicial review of procedural measures taken by [the EPPO] in the performance of its functions’. 62
Judicial review and the proposal for the EPPO Regulation
The rules in the proposal for the EPPO Regulation constituted a clear derogation from the standard system of judicial review under the EU treaties. 63 In the proposal, the Commission introduced the ‘legal fiction’ that the decision on the choice of forum should be considered as a national decision for the purposes of judicial review. 64 The Commission justified this with the argument that procedural acts adopted by the EPPO will in most cases be carried out by the national law enforcement authorities. 65 The recitals in the proposal further specified that this therefore excludes the direct competence of the CJEU under Article 263 TFEU, and that national courts are not allowed to refer questions on the validity or interpretation of procedural measures under Article 267 TFEU. 66
The proposal generated a large amount of concerns, which can roughly be grouped into three categories. The first group of concerns relates to how excluding judicial review before the CJEU constitutes a disproportionate limitation to the right to an effective judicial remedy as recognized under Article 47(1) CFR. As a result, it was argued that it did not provide effective safeguards against arbitrary decisions. 67 The second group of concerns relates to the Commission’s unusually broad interpretation of Article 86(3) TFEU. More specifically, that Article 86(3) can be relied on to completely exclude the access to the action for annulment procedure and to severely restrict the access to the preliminary reference procedure. 68 Third, it was feared that in the absence of supranational oversight, differences in judicial review between Member States could incentivize forum shopping. 69
This criticism reached the EU legislator. In February 2014, the Council reached a common understanding that decisions ‘of a “European nature” by definition’, such as on forum choice, should be subject to judicial review by the CJEU. 70 Moreover, the European Parliament asked in its Resolution of 12 March 2014 to redraft Article 36 of the proposal to ‘avoid the circumvention of the Treaty provisions on the jurisdiction of the Union’s courts and a disproportionate limitation to the right to an effective judicial remedy under Article 47(1) of the Charter of Fundamental Rights’. 71 Later, in its Resolution of 27 April 2015, the European Parliament stated more explicitly that ‘the decisions taken by the Chambers, such as the choice of jurisdiction for prosecution, the dismissal or reallocation of a case or a transaction, should be subject to judicial review before the Union courts’. 72 An additional report prepared for the European Parliament in November 2016 echoed this position, and further advised against derogating (too much) from the Treaty system. 73
Judicial review under the EPPO Regulation
Notwithstanding the aforementioned concerns, the EPPO Regulation’s system of judicial review of the decision on forum choice still derogates from the standard system of judicial review under the EU treaties. However, access to the CJEU has increased compared to what was granted in the proposal.
The first paragraph of Article 42 provides the same rule as the proposal: procedural acts (or the omissions thereof) are subject to review before the competent national courts. Read in conjunction with recital 89, it completely excludes access to the annulment procedure of Article 263 TFEU for non-privileged applicants. 74 Additional exceptions are listed in paragraph eight of Article 42. 75 In short, the provision (still) severely restricts defendants’ access to the annulment procedure. 76 National courts review the decision on forum choice for the purpose of establishing jurisdiction, and do so on the basis of EU law (including the EPPO Regulation) and national law to the extent that a matter is not dealt with in the Regulation. 77
Different from the proposal, however, is the second paragraph of Article 42. The second paragraph of Article 42 provides that national courts can request a preliminary ruling concerning the interpretation or the validity of the EPPO Regulation, or the validity of its application by the EPPO. 78 In the latter case, a question of validity must be raised directly based on EU law (including the EPPO Regulation). It is elaborated in recital 88 of the EPPO Regulation that where national courts review the legality of procedural acts of the EPPO, the national courts are to review the acts based on EU law, including the EPPO Regulation. Alternatively, the acts can be reviewed based on national law if matters have not been covered by the EPPO Regulation. Whereas the proposal explicitly excluded access to the preliminary reference procedure, the regulation provides that national courts can and sometimes should refer preliminary questions to the CJEU in proceedings that challenge the EPPO’s decision on choice of forum. 79 It is specified that national courts should always refer preliminary rulings to the CJEU when they have doubts of the validity of the EPPO procedural acts in light of EU law. 80 This is in line with the case of Foto-Frost, establishing that only the CJEU can declare EU acts invalid. Naturally, this includes the EPPO’s decision on forum of prosecution by it being a decision from an EU body. 81 Furthermore, it also confirms that ‘requests for preliminary rulings, like actions for annulment, constitute means for reviewing the legality of acts of Community institutions’. 82
It remains, however, unclear what then should be the ambit of the review carried out by the national courts. If it is assumed that national courts base their review on the EPPO Regulation, it does not seem that the national court will be able to do more than review the application of the EPPO Regulation’s criteria to establish whether the domestic court has jurisdiction under national law to take on the prosecution. As the national courts are not competent to declare measures invalid, the competence of the national court is limited to assessing whether the claims raised by the defendant gives rise to enough doubt about the validity of the measure to refer a request for a preliminary ruling from the CJEU. 83 In all cases where there is a doubt of the validity of the forum choice, there is therefore a need for the CJEU to complete the judicial review. At the same time, the CJEU is only allowed to clarify the interpretation of the rules laid down in Article 26(4) or the correctness of the EPPO’s application of these rules. Since the CJEU cannot decide what the correct forum is or should be, it is unclear how expansive its review of the validity of the decision would be. 84
We see that much of the criticism raised against the proposal of the EPPO Regulation still holds, and that it remains curious why the judicial review of the EU decision on forum choice has been awarded to the national courts in the first place. In defense of placing the judicial review with the national courts, the Commission has brought forward arguments related to limiting the potential increase of workload of the CJEU. 85 However, as noted by Mitsilegas and Giuffrida, the existing legal framework provides for potential solutions to this problem, like for instance the possibility of establishing specialized courts attached to the General Court. 86
The system of judicial review and the right to effective judicial protection
In accordance with Article 47 CFR, individuals have the right to an effective remedy before a competent court against acts of EU bodies that the individuals believe are contrary to their rights and freedoms. 87 In the EU legal order, the judicial review of the legality and compliance with EU law is ensured by the CJEU and by the courts of the Member States through the composite system of judicial review. 88 The review of the legality of EU acts is ensured by the CJEU through the procedures under Articles 263, 267 and 277 TFEU. 89 In cases where an individual does not satisfy the requirements for standing directly before the CJEU, the Member States have a duty to establish a system of legal remedies and procedures in accordance with the right to effective judicial protection under Article 47 CFR. 90 Although this composite system of judicial protection is generally considered by the CJEU to be consistent with Article 47 CFR, 91 there are no guarantees that effective judicial protection against acts of bodies such as the EPPO will be safeguarded in all cases and for all individuals having an interest in the case. 92
This section will assess whether the system of judicial review under the EPPO Regulation sufficiently safeguards the defendant’s right to effective judicial protection as protected under Article 47 CFR. More specifically, this section will assess whether the system of judicial review can be considered an effective remedy in both law and practice.
The right to effective judicial protection
Neither Article 47 CFR nor its equivalent provisions under the European Convention on Human Rights (‘ECHR’) set out specific requirements to what constitutes an effective remedy. 93 In fact, the type of remedy that is required varies depending on the case at hand. 94 Both the European Court of Human Rights (‘ECtHR’) and the CJEU have, however, elaborated on the possible elements of an effective remedy.
One element is that a remedy must be capable of directly remedying the impugned situation. 95 A remedy will therefore only be regarded effective if it is capable of preventing a potential violation from either occurring or continuing. 96 Furthermore, a remedy must be sufficient and accessible, and fulfil the standard of promptness so that the procedures are held within reasonable time. 97 Moreover, the remedy must be effective in both law and practice. 98 In the context of this article, this means that the system for judicial review should provide for an effective review of the EPPO’s decision on forum of prosecution, and that the trial is held in a jurisdiction that aligns with Article 26(4) of the EPPO Regulation.
The preliminary reference procedure as an effective remedy for reviewing the EPPO’s decisions on forum of prosecution
The EPPO decision on forum can only be declared invalid by first going through the national courts and the preliminary reference procedure (see section 3.3). The preliminary reference procedure is not available to individuals as a matter of right. It is ultimately up to the national courts to make the decision of whether to refer a question to the CJEU. 99 This means that defendants are dependent on the willingness of national courts to reach the CJEU. That raises several concerns related to Article 47 CFR, particularly if the individual has recourse to an effective remedy in all cases.
It may be argued that a lack of direct recourse to the CJEU is not necessarily a problem for the effective review of the decision on forum by the EPPO – at least not in theory. Since it is the CJEU that decides upon the invalidity of an EU act, all national courts have the obligation to request a preliminary ruling to the CJEU in cases where they believe a decision on forum by the EPPO might be invalid. 100 In theory, this will mean that all questions related to doubts of validity will reach the CJEU eventually. Moreover, if the national courts encounter difficulties in interpreting and applying the EPPO Regulation or other relevant EU law when conducting their review, national courts can ask the CJEU for a clarification through the preliminary reference procedure. 101 In this way, the CJEU will be involved in the judicial review of the decision where it is necessary.
Despite of this, it is not unlikely that several issues might nevertheless arise in practice. It is worth noting that the national courts are in essence assessing an EU body’s application of a set of operating criteria under EU law. This role has traditionally been left to the CJEU. It might therefore not be unlikely that the various national courts approach the judicial review differently, nor might it be impossible that the national courts incorrectly interpret or apply the relevant EU law in their review. Although the national courts have the opportunity (and on some occasions an obligation) to refer questions of interpretation to the CJEU, research has demonstrated that there are significant divergences in the extent to which national courts in different Member States in fact make use of the opportunity to refer questions to the CJEU. 102 Even national courts of last instance may to some degree enjoy de facto discretion with regard to referring a question for a preliminary ruling. 103 Furthermore, the national courts may wrongly assess the question of validity of the decision of forum choice, and conclude that it is in fact valid. 104 In such a case, there is no obligation upon the national court to refer the matter to the CJEU. 105 Consequently, appeal becomes restricted to national avenues, which may again confirm the initial judgment. For the defendant in such a case, all judicial remedies of the review system of the EPPO Regulation are exhausted at this point, without ever having access to review the EU decision on forum choice at an EU level. 106 As a result, the defendant’s access to a review by the CJEU can largely depend on the national court conducting the initial review. At this early stage of EPPO operations, it is not yet possible to empirically assess whether the current review system is in fact ‘effective in practice’ in correcting or remedying invalid forum choice. However, it is still difficult to reconcile the requirement of effectiveness of the available remedies ‘in law’ with the potential power national courts have to prevent a review by the CJEU – in that that this also prevents a ‘competent’ judge from reviewing the validity of a decision on forum.
Moreover, even if national courts do refer the question of validity of the decision of forum choice to the CJEU, another limitation to effective judicial protection persists. In the preliminary reference procedure, the national courts are the ones that formulate the question for preliminary ruling and that have the main role in the procedure before the CJEU. Individuals, in this case the defendant, can only submit written observations and short oral submissions. 107 As a result, they must rely on the national court to accurately represent their concerns. In contrast, direct actions like the action for annulment would allow for a full exchange of pleadings and the full participation of the EPPO. 108 This erects yet another barrier for the defendant to access a competent court for substantive review of a forum choice decision by the EPPO.
Another important implication of this system for defendants we need to consider is how the procedures using the route of preliminary reference procedure likely involve more delays and extra costs compared to the action for annulment. Depending on the length of procedure, and the costs associated with it, this might impact the accessibility of the remedy.
By leaving the preliminary reference procedure as the ultimate review of the invalidity of an EPPO decision on the forum of prosecution, the discretion left to the national courts and the divergences between the practices of Member States’ courts in referring preliminary questions pose a risk for the defendant’s capacity to obtain an effective remedy in practice. Therefore, it cannot be concluded that the system of judicial review under the EPPO Regulation fully complies with the need for the remedy to be effective both in law and practice, as required under Article 47 CFR.
The legislator’s competence to preclude actions for annulment
The previous section demonstrated that the system of judicial review under the EPPO Regulation has shortcomings in ensuring a sufficient level of effective judicial protection. If the system of judicial review is at odds with effective judicial protection, this raises the question whether the EU legislator had the competence to enact such a derogation from the treaty system on judicial review in the first place. In this section we argue that Article 86(3) TFEU does not in fact confer the legislative competence to preclude individuals’ access to the action for annulment procedure altogether.
Article 86(3) TFEU provides the legal basis to enact special rules for the judicial review of EPPO’s procedural decisions and awards the competence to enact a derogation from the treaty system of judicial review. More specifically, it is stated in Article 86(3) TFEU that: ‘The [EPPO Regulation] shall determine […] the rules applicable to the judicial review of procedural measures taken by it in the performance of its function’. 109 Article 86(3) TFEU must be read in conjunction with the following section of Article 263 TFEU: ‘Acts setting up bodies, offices and agencies of the Union may lay down specific conditions and arrangements concerning actions brought by natural or legal persons against acts of these bodies, offices or agencies intended to produce legal effects in relation to them.’ 110
The extent of the competence conferred by Article 86(3) TFEU
It is unclear whether Article 86(3) TFEU can serve as the legal basis for a system that excludes actions for annulment by non-privileged applicants altogether. This question was explicitly addressed by the Council’s Legal Service’s in its 2014 report on the proposal for the EPPO Regulation. 111 The Council’s Legal Service found that although the text of Article 86(3) TFEU makes no ‘express reference to the possibility of derogating from the rules on the jurisdiction of the Court’, 112 the TFEU must be understood to permit the legislator to exclude access to the action for annulment procedure for decisions that the EPPO takes at the decentralized level, i.e. decisions that it takes after referral to the national trial court. 113 Regarding decisions made by the EPPO before referral to the competent national court, the Council’s Legal Service argues that for procedural acts that predominantly or exclusively implement EU law (for example decisions on forum), a system of judicial review before a national court without recourse to the CJEU may not guarantee effective judicial protection. 114 In fact, the Council’s Legal Service argues that this may adversely affect the autonomy of the EU legal order, which cannot be the purpose of Article 86(3) TFEU. 115 The Council’s Legal Service went even further where it concluded that a general exclusion of actions for the annulment of EPPO decisions is not permitted under the EU treaties. 116 More specifically, it argued that the EU legislator is not competent to enact a system that deprives the CJEU from the jurisdiction ‘to hear actions for the annulment of procedural measures adopted by the EPPO which exclusively or predominantly implement Union law and for which a judicial review before a national court would not guarantee effective judicial protection or would adversely affect the autonomy of the Union's legal order’. 117 Several authors echo the finding of the Council’s Legal Service, and argue that it is indeed difficult to see in the wording of Article 86(3) TFEU an adequate legal basis to set aside the treaty system for judicial review. 118
Clearly, the forum choice happens before referral to the competent national court and is based predominantly on EU law. 119 The previous section showed that the system of judicial review under the EPPO Regulation might not reliably safeguard the defendant’s right to effective judicial protection. For that reason, it appears that the EU legislator did not have the competence to enact the current system, in which review of a European decision occurs almost exclusively through national avenues. 120
Back to primary law: the action for annulment procedure
This article has so far established that the system of judicial review under the EPPO Regulation conflicts with primary law in two respects: (1) it fails to provide effective judicial protection of the defendant’s rights, and thereby, (2) it exceeds the legislative competence to design a judicial review system based on Article 86(3) TFEU. Following the doctrine of primacy of EU primary law, these findings could invalidate the EPPO Regulation’s deviation from the annulment procedure (Article 263 TFEU) for the judicial review of the EPPO’s decisions on forum choice. 121 In other words, a defendant could challenge the EPPO’s choice of forum before the CJEU based on the standard rules provided by the EU treaties. Whether or not that means that they would in fact have standing before the CJEU depends on the admissibility criteria of the procedure under Article 263 TFEU. This final section sets out these criteria, and concludes that under some circumstances, they could be satisfied by a defendant seeking to challenge the EPPO’s decision on the choice of forum. Lastly, the section briefly touches upon the effects of a potential annulment for the defendant.
Admissibility criteria
The general legal basis for actions of annulment of acts adopted by EU bodies can be found in Article 263 TFEU. 122
‘Direct and individual concern’
As the EPPO chooses a forum on a case-by-case basis, this decision is evidently of specific individual concern to the defendant. 123 The ‘directness’ requirement has been construed in the case law as the condition ‘that (a) the contested measure must directly affect the legal situation of the individual and that (b) it must leave no discretion to the addressees of the measure, who are entrusted with the task of implementing it’. 124 Condition (a) coincides with the ‘legal effects’ criterion set out below. In assessing (b), it is crucial to realize that the addressee of EPPO’s forum decision is the EPPO itself. The rationale behind the second criterion is that in cases in which the addressee of a contested act enjoys the discretion to correct any faults in its implementation but fails to do so, it is desirable to challenge these implementing measures instead. 125 In the case of the EPPO’s decision on forum, there is no such distinct implementing act. Therefore, (if disregarding any discretion of the EPPO to revisit its decision at a later stage) the choice of forum is to be understood as being of direct concern to the defendant.
‘Legal effects’
Ever since IBM/Commission, the CJEU has interpreted the admissibility condition that the contested act is intended to produce legal effects as selecting ‘any measure the legal effects of which are
The ‘
It is more difficult to satisfy the second sub criterion of ‘
A different argument can be construed on the basis of Rendo. 129 In this case, the CJEU established that there exists a distinct change in a defendant’s legal position when they cannot effectively exercise their procedural rights. 130 Ingelram argues that the same holds in cases where fundamental rights are infringed. 131 As discussed in section 2.3, one may imagine a choice of forum that adversely affects the defendant to such an extent that their procedural rights are effectively curtailed, or even their fundamental rights are impinged upon. By this argument, in severe cases when the forum decision itself severely disadvantages the defendant, the requirement of a ‘distinct change in the legal position’ is met and the defendant can bring an action for annulment before the CJEU. In contrast, when the actual impact of the forum decision on the defendant or the trial is relatively minor, the admissibility requirement of a ‘distinct change in the legal position’ will not be met, and the defendant will have to make do with the judicial review system of the EPPO Regulation.
Effects of annulment for the defendant
When an action for annulment is admitted and well-founded, the CJEU declares the contested decision void. An annulment retroactively creates the legal effects of the situation in which the contested measure had never existed (ex tunc), 132 and vis-à-vis everyone (erga omnes). 133 For the trial, this means that the proceedings in the jurisdiction that was selected by the annulled decision become void as well. 134 At this point, the EPPO may make a new decision and again select a forum for prosecution. Like the preliminary reference procedure, the action for annulment procedure provides the CJEU with limited power to guide the forum choice. The jurisdiction of the CJEU is confined to reviewing the legality of the contested measure, meaning it may not issue directions, orders, or instructions to EU institutions, bodies, offices, or agencies. 135 The administrative discretion to decide on the forum is borne solely by the EPPO.
Nevertheless, in light of the right to effective judicial protection, the action for annulment procedure does still offer a substantial improvement compared to the current review system under the EPPO Regulation. Whereas the EPPO Regulation allows for the possibility that national courts can incorrectly assess the doubts for validity and/or refrains to refer preliminary questions (see section 4.2), the action for annulment procedure is directly open to the defendant (in so far the admissibility criteria are satisfied). The action for annulment procedure provides an effective avenue for judicial review on an EU level when the defendants’ rights need to be protected. Furthermore, in the action for annulment procedure the defendant is a party to the procedure and partakes in a full exchange of pleadings before the Court. 136 In contrast, under the system of judicial review set out in the EPPO Regulation the defendant is largely dependent on national courts to voice their concerns before the CJEU.
Conclusions
This article has assessed whether the limitations imposed by the EPPO Regulation on the use of the action for annulment procedure laid down in Article 263 TFEU comply with EU primary law, in particular Article 47 CFR and Article 86(3) TFEU. Section 2 concluded that the decision on forum of prosecution under the EPPO Regulation is made primarily at the EU level, and that the forum choice can significantly impair the position of the defendant. The EPPO Regulation assigns the judicial review of the decision on forum choice to the national courts, and thereby deviates from the standard treaty system of judicial review. More specifically, it deviates from the standard treaty system by restricting the access to the CJEU through the action for annulment procedure laid down in Article 263 TFEU. As such, national courts are the primary actors conducting the judicial review and the role of the CJEU in the review is kept to a minimum. By leaving the preliminary reference procedure as the ultimate review of the invalidity of an EPPO decision on forum of prosecution, the system of judicial review under the EPPO Regulation appears to be inconsistent with the right to effective judicial protection safeguarded by Article 47 CFR. Particularly, the discretion left to the national courts and the divergences between the practices of Member States’ in referring preliminary questions pose a risk for the defendant to obtain an effective remedy in practice.
To the extent that the current system for judicial review under the EPPO Regulation is at odds with Article 47 CFR, the EU legislator did not have the competence to enact it. Depending on the circumstances of the case, an action for annulment may therefore be admissible before the CJEU. When the CJEU annuls a decision on a choice of forum, it returns the matter to the EPPO, which in turn must make a new forum decision.
To conclude, the system of judicial review of the EPPO’s decision on forum under the EPPO Regulation has improved significantly relative to its proposal by enabling national courts to refer preliminary questions to the CJEU. We have argued, however, that by limiting access to the action for annulment procedure, the EPPO Regulation does not only still fail to live up to the criticism lodged at its proposal stage, but that it is also incompatible with EU primary law. The system for judicial review of EPPO’s decision on forum remain subject to contestation – now and in the future.
Footnotes
Acknowledgements
This article was written as part of the LL.M program ‘Legal Research’ at Utrecht University. The authors would like to thank Prof. John Vervaele and Dr. Brianne McGonigle Leyh for their excellent supervision and feedback.
Declaration of conflicting interests
The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author(s) received no financial support for the research, authorship, and/or publication of this article.
