EU Committee: Court of Justice of the European Union

Lord Rowlands Excerpts

Monday 17th October 2011 Lords Chamber

[Lord Rowlands]

My Lords, I too am grateful to our chairman and to the staff of our committee for helping us to prepare this report. Like a rather large number of Members of this House, I am something of a veteran of European treaties and the institutional changes that have flowed from them: Maastricht, Amsterdam, Nice and Lisbon—I have been through them all. I have sat through and taken part in some of the debates we have had.

If we retrospectively reflected on the experience of treaty change and institutional change, I have a sneaking suspicion that we would find a rather high proportion of either unintended consequences of those changes or that at least the assessment of what impact these changes would make has often been wrong or ill conceived. My noble and learned friend Lord Boyd made a reference to one such glaring example to which we draw attention in our report, in paragraph 52, on the European Chemicals Agency. This was established on an assumption that there would be only 250,000 licences granted. As my noble friend has said, the figure is now likely to be 2 million. As the president of the General Court said in evidence, a proportion of them will be challenged so it is inevitable that the workload of the General Court will increase. Here is a perfect example of the way in which treaty change was made or institutions were established without any effective impact assessment.

This strengthens our case for being, if not pessimistic, realistic about the changes the Lisbon treaty will have on the work of the Court of Justice. The Lisbon treaty created a fundamental change in the architecture, destroying the whole of that third pillar and bringing within the jurisdiction of the Court of Justice the areas of freedom, security and justice. What will flow from that is a very significant increase in the workload of the European Court of Justice. It was flagged up first by our European Union Committee in 2007-08 in what I thought was the most thorough and wonderful scrutiny of the impact of the Lisbon treaty. On page 127, the European Union Committee flagged up that there would be problems with the workload of the Court of Justice as a result of this change and the inclusion of this extra jurisdiction.

We have followed that up and have confirmed those concerns in our report. In paragraphs 42 and 43, we spell out that it is not simply a matter of more cases but that they will be in areas likely to generate much more difficult and important forms of litigation, and that for the first time the Court will be dealing with individuals in custody, and therefore will need speedy justice, a fast-track approach. Indeed, that is presumably partly why in the Lisbon treaty there is a fast-track procedure to deal with it. If one reads further on what this fast-track procedure is, the assumption was that 10 or fewer cases a year would be fast-tracked. Now we suspect that with the changes that have occurred to the jurisdiction there will be a lot more fast-tracked cases. There will be two consequences of that. First, it could displace other, less urgent cases to be dealt with over a longer and longer time. Secondly, in the annexe to our report, on page 67, it says that if there were an increase in fast-track cases,

“the number of cases that the Court could handle … would decrease sharply”—

because of the nature of fast-tracking, there is going to be a very significant potential displacement of other cases. I do not think we are being alarmist in saying to the House and to Ministers that this is going to create a much greater problem than is being recognised at the moment.

When I joined our chairman and two others in going to Luxembourg, I was rather surprised by how rather sanguine many of the Court administrators were about the impact these changes are going to have on the work of the Court of Justice. Sadly, not only did I find them sanguine in Luxembourg, I now find that Ministers here are sanguine. The letter from Mr Lidington says that he is not convinced that the Court is facing an imminent crisis. I do not know what imminent means, but certainly within the next two or three years we are going to see a very significant increase and significant pressure. It is not unjustifiable to present it as a potential crisis, with which Ministers do not appear to be fully engaged.

I hope tonight when the noble and learned Lord replies that we will at least have something more than the replies we have had so far to our reports, and of course to the other suggestions that have been made by the Court itself since our report came out. Reading Ministers’ responses so far, it appears that they are very good at telling us what they do not want to do but not at telling us how they are going to handle the crisis. I think they are in a state of semi-denial that there is a crisis on the horizon and I hope tonight to be enlightened not only on the proposals they have but to be reassured that in fact they appreciate and understand the potential seriousness that the courts face.

--- Later in debate ---

[Lord Wallace of Tankerness]

My Lords, first, I join the noble Lords, Lord Liddle and Lord Anderson—the three of us not being members of the committee—in congratulating my noble friend Lord Bowness and the members of his committee on this important work which they have undertaken. I think the first call for evidence was in the summer of 2010 and that the report was published just one week after the president of the Court published his proposals. The fact that it was timely shows the foresight of the committee in identifying what is undoubtedly a very important issue.

I believe that the report’s conclusions and recommendations have been a valuable contribution to the current debate. We have heard those conclusions and recommendations echoed in the contributions this evening, which I will seek to address. It is important that we take this opportunity to discuss these matters. The noble Lord, Lord Anderson, asked what the Government believe in. They believe very much in the effective and uniform interpretation, application and enforcement of European Union law across the Union, which was a point well made by my noble friend Lord Bowness in his opening remarks.

We believe that the Court of Justice has a vital role to play in ensuring that member states and European Union institutions act in accordance with the treaties. It is therefore essential to the functioning of the single market that it ensures that there is a level playing field for United Kingdom businesses operating in other member states, and vital in upholding the rights under European Union law of British citizens living and working in other member states. That point was well made by my noble friend Lord Dykes, who emphasised that the Court has that important role in safeguarding the rights of people who are not only United Kingdom citizens but citizens of the European Union.

Accordingly, the Government share your Lordships’ views that the Court of Justice of the European Union is in need of reform in order to work through its sizeable backlog of cases and to reduce the time taken to process cases in the future. I can confirm that since the publication of the committee’s report, officials have been engaged in discussions with their counterparts in the European Union about reform of the Court, following on a set of six recommendations made by the president of the Court to the Council. Discussion has continued between officials and at ministerial level on a bilateral basis and within the Council. The noble and learned Lord, Lord Boyd of Duncansby, asked about that. I can confirm that there have been meetings. In July, the Minister for Europe raised the issue at the General Affairs Council. As I have indicated, discussions continue at a working level, most recently on Friday of last week. The Government are engaging constructively in these meetings with an open mind. We certainly see merits in a number of the recommendations, to which I will deal with in more detail.

I am sure your Lordships’ House will forgive me for not divulging the details of working group discussions, which by their very nature are confidential, but I can indicate in the broadest terms that officials of the United Kingdom Government have been focusing on negotiating changes to the Court’s structure and its rules of procedure, which would enhance the quality of the Court’s judgments and reduce the turnaround time of cases while emphasising—it is important to emphasise this and to remind ourselves of the need for—cost efficiency. In the current economic climate, it is vital to ensure value for money for our taxpayers, and the proposals that the Court makes must be assessed according to financial and budgetary implications. Indeed, I think that even the summary of the conclusions of the committee’s report acknowledged that there were cost implications.

As the debate has made clear, the most significant reform under discussion is the composition of the General Court and specifically the question of how to expand its capacity. I will perhaps deal with that in more detail later. We know that the committee proposed an increase of one-third to 36 members. The president of the Court has tabled a proposal to add to the number of members of the General Court by 12 judges, which is of course one of the key subjects under discussion within the Council. As has been identified, and as I will elaborate, there are other possible options, such as the creation of a specialist trademark court or specialist chambers within the General Court, for managing trademark cases. Officials are considering how each would improve the efficiency of the court, the political and legal implications that they would have and the financial ramifications.

The noble and learned Lord, Lord Boyd of Duncansby, and the noble Lord, Lord Rowlands, asked whether there was an imminent crisis. Although we recognise the huge challenge with regard to the General Court, the report itself, as well as contributors to the debate this evening, recognises that the Court of Justice has done a remarkable job in managing its case load. It was in that context that we did not accept that there is an imminent crisis with regard to Court of Justice—I think the noble Lord, Lord Rowlands, said “potential crisis”. Clearly this is something that we want to focus on to ensure that it continues to build on the advances that it has made.

The report itself recommended that there should be the appointment of extra Advocates-General. It is not clear what evidence this is based on. Significantly, it is not one of the proposals which the Court itself felt was necessary when the president of the Court put forward its proposals. Other measures have come forward from the president of the Court that we would aim to assist: the possibility of the appointment of a vice-president, and the proposal with regard to how grand chamber might be restructured. We are looking at that seriously. We want to ensure that, in doing so, there is continuity, across the courts, of the jurisprudence of the Court. That particular proposal is somewhat complex.

On the issue that was described in your Lordships’ report as the “green light”, we would not necessarily go as far as that but we think it is of considerable importance, when national courts are framing their reference, that they do so concisely. We would certainly encourage them to put forward any proposal and conclusions that they may have reached in framing that reference, so that when the Court of Justice looks at these preliminary references it is very focused on the particular issues.

My noble friend Lord Bowness made some specific points, reminding us that the Council also legislates. Those points were extremely well made. Certainly the Government are seeking to ensure that there is clarity not only for those who subsequently have to interpret the law in the courts but perhaps most importantly for those who have to implement the law in their businesses and daily lives. That is certainly the objective of the negotiations, but I think it is also fair to say that, in a negotiation involving 27 member states, that objective is not always as easy to achieve as one might hope.

A similar answer applies to the question raised by the noble Lord, Lord Rowlands, and my noble friend Lord Bowness about the legislative implications of certain decisions. Perhaps that should not be a counsel of perfection. It ought to be given attention, but again I suspect that that is easier to say, and to make exhortations for, than it is to deliver in the legislation itself.

[Lord Rowlands]

Does the noble and learned Lord accept the fact that, as a result of the change in jurisdiction, there is going to be a very considerable increase in fast-tracking procedures within the Court of Justice and that this will have very considerable consequences for the rest of its workload?

[Lord Wallace of Tankerness]

The noble Lord raised the point about the possibility, post-Lisbon, of fast-tracking and asked whether there was going to be a significant increase. There are issues there which need to be considered. There is not yet any evidence of that coming through, but it is not something to which we are turning a blind eye. According to the Court of Justice’s report on its work in 2010—after the Lisbon Treaty came into force—the use of the urgent preliminary measure in respect of the area of freedom, security and justice was requested in six cases, and granted in five. It is of course relevant to the work of the Court of Justice in its consideration of preliminary references, which is its other main volume of work. It is less relevant in the case of the General Court, which does not do that kind of work. I shall come onto that, as there is agreement across the House that there are quite clearly issues as regards the work of the General Court.

We fully recognise that there are issues that need to be considered in terms of the particular problems which the General Court is facing. Justice delayed is justice denied: it is a phrase which trips off the tongue, but it is one with substance and truth. The position of the General Court is one to which we are giving our attention. The proposal on the table is the one that has come from the President of the Court. It is that there should be an increase in the size of the Court by nine. The House has reasonably asked about our position with regard to the consideration of a specialist trademark court or specialist chambers within the General Court. We see merit in the proposal put forward by the committee of your Lordships’ House of increasing the number and we are considering it against our basic criteria of quality of judgments, their timeliness and cost-effectiveness. That is why we are not ruling it out, but why we also believe that some of the other options ought to be given consideration too.

The noble and learned Lord, Lord Boyd of Duncansby, referred to the letter sent on 4 July by my right honourable friend the Minister for Europe to the noble Lord, Lord Roper. He pointed out that while he recognised the point that judges on a specialist tribunal may not be widely deployable, creating a specialist tribunal would free up judges in the General Court currently working on trademark cases to deal with other types of case. It is important to note that judges currently dealing with trademark cases, which form a substantial part of the General Court’s work, would be freed up for other work. The Commission itself said in its response to the President’s proposals, published at the end of last month, that it has looked at the possibility of specialist chambers within the General Court. It is important that these options are fully explored with regard to what will deliver the best in terms of efficiency, speed and quality of judgment.

However, as I have indicated, we cannot ignore the question of finance. I take the point made by my noble friend Lord Dykes that in the totality of the European Union budget it may appear a small matter, but nevertheless it is the Government’s position that there should be no increase in real terms over the next spending period. We want to examine the costs of the different options. The estimate of the Court itself on an increase of 12 judges is some €13 million. We would want to drill down on that and ask why the cost is more than €1 million per extra judge. We would also wish to look at the fact that the Court has had over the past year an underspend of €5.5 million. It is not unreasonable, in exploring the different options, to bear in mind the costs and to try to ensure that we not only achieve what is best in terms of speed of delivery, but also that there is efficient use of taxpayers’ money—not just that of British taxpayers, but of taxpayers throughout Europe.

As the noble and learned Lord, Lord Boyd, said, we recognise that delay sometimes brings its own costs, and that must be part of the equation, but we feel that considerably more work could be done, not least given the fact that there was a €5.5 million underspend of the Court’s budget last year. Obviously, as the committee itself indicated, it may be possible to find funds by deprioritising other parts of the budget.

I hope I have emphasised the fact that the Government take this issue seriously. We appreciate the constructive proposals that have been put forward. As I have indicated, we are not ruling out the possibility of an increase in judges. At the present time, the proposal on the table is for an extra 12 judges, which has come from the President of the Court. We are giving these matters detailed consideration through working groups and at ministerial level. We are also conscious that the outcome in the end should be to ensure that the Court of Justice, as one of the institutions of the European Union, delivers and serves the wider purposes both of the Union itself and of European citizens. They should be on the receiving end of justice when the call comes for it. I hope that I have reassured your Lordships that we are taking this matter seriously and working diligently to get the right outcome in terms of speed, quality and cost-effectiveness.