COMMENT: Towards an Independent, Effective, and Expert Mechanism of Conflict Resolution: the Importance of the Boards of Appeal of Agencies in the European Union
* Blog published as part of the 2023 CoI conference ‘Towards just institutional approaches to conflict prevention and resolution’ *
Over the last couple of decades, the European administrative state has grown increasingly complex. The European Union’s size and competences have expanded ever since its creation. This has shown the necessity of creating regulatory agencies. These have been created on a case-by-case basis bringing together independence from political or contingent considerations and expertise for an effective application of EU law.
Within the process of ‘agencification’, as this has been called, an increasing number of agencies have become empowered to take individual binding decisions within highly specialized and technical fields. Examples of such agencies are the European Chemicals Agency (ECHA), the European Union Aviation Safety Agency (EASA), and the European Union Agency for the Cooperation of Energy Regulators (ACER).
The creation of such decision-making agencies has led to an extra layer of conflict resolution in the EU. Prior to bringing any action before the EU courts, these decisions must be appealed at the Board of Appeal (BoA) of the respective agency. These are internal appellate bodies that offer an independent, effective, and expert remedy. While they have been considered quite successful thus far, an air of mystery still surrounds their functioning and organization. This blogpost aims to shed some light on these BoAs and their recent developments: what are they, and, most importantly, why should we care about them? (Spoiler alert: they play a vital role in legitimizing the existence of EU agencies).
Boards of Appeal as an internal control mechanism
The BoAs are part of the internal structures of the decision-making agencies. Their objectives are to protect the rights of private parties, strengthen the agencies’ legitimacy and to ensure the optimal implementation of the existing regulatory framework. While the BoAs all operate in their own respective policy areas and the European legislator has offered little guidance on how they should be shaped, the European Court of Justice recently confirmed that they do share common characteristics: the BoAs should offer an independent, effective, and expert mechanism of conflict resolution. First, the BoAs are internal administrative revision bodies that enjoy a certain degree of independence to make an independent judgment. Even though extent to whether their independence safeguards are sufficient to make a truly independent judgment is still under discussion, they are currently considered, by the EU Courts, as independent enough. Secondly, they are an effective remedy as they form a quick, accessible, specialized, and inexpensive mechanism of rights protection via a quasi-judicial adversarial procedure. Their effectiveness also lies in reducing the workload of the courts by avoiding the referral of technical questions to them. Thirdly, they are composed of both legal and technical experts.
Why are they so important?
In the same judgment, the Court of Justice stated that the creation of the BoAs forms part of an overall approach by the European legislature to provide EU agencies that take decisions on complex and scientific issues with review bodies. These BoAs are, the Court of Justice continues, appropriate means for rights protection as the agencies have a broad discretion in their decision-making and the EU courts can only conduct a limited review over that. In this respect, the BoAs can play a crucial role.
Within this context, it is important to realize that although many agencies have been created in the EU, there is no explicit legal basis for creating them in EU primary law. The powers delegated to these agencies are transferred from the EU institutions, and therefore we should be wary about the effects of delegation on the institutional balance. Judicial review over binding measures is one of the conditions for creating agencies. However, a judicial review does not necessarily equate a substantive review over the agencies’ acts. Technical expertise of the agencies – one of their main features – actually justifies a limited judicial review. The EU courts’ review is merely limited to checking whether taking the contested decision does not exceed the bounds of the powers that have been conferred upon the decision-making authority. Therefore, the judicial mechanisms appear to be inadequate in fully capturing the complexities of the powers exercised by the agencies. A substantial review is necessary, otherwise the technical appraisals by the agencies in their decisions would circumvent any type of controls. This is where the BoAs play their crucial role: they have the resources available to address this review gap.
Recent developments
While these resources are available to the BoAs, until recently they have been cautious in addressing the review gap. In the past, the BoAs of ECHA and ACER have applied the same limited review as the EU Courts. This deferential approach was struck down by the General Court in two landmark cases against ECHA (in BASF and Germany) and by the General Court and the Court of Justice against ACER. In these decisions, the EU Courts held, inter alia, that because of the BoAs’ composition of both legal and technical experts, they should be able to conduct a detailed examination of appeals and carry out assessments of complex technical and economic facts. In short, they should conduct a more intense review than is carried out by the EU Courts. While the EU Courts do not further explain what this detailed examination means, these judgments do emphasize the importance of the BoAs in ensuring the legitimacy of the agencies’ decisions. A limited review by the BoAs would lead to a limited review on a limited review by the General Court in the subsequent procedure, and such a system would, according to the EU Courts, fail to offer the guarantees of effective judicial protection.
Besides the intensification of their review, the BoAs have also encountered another development. In 2019, a filtering mechanism was introduced in the Statute of the Court of Justice of the European Union (Article 58a). Only in exceptional cases will appeals against decisions of the listed BoAs be allowed at the Court of Justice (soon to be expanded to all BoAs). This change is part of a larger reform of the EU judiciary to handle its increasing workload. The rationale behind limiting these appeals that they are already considered by an independent BoA and then by the General Court; these cases are usually dismissed at the Court of Justice. Although the filtering mechanism is not part of an overall strategy regarding the structure and functionality of EU administrative justice, it does strengthen the judicial position of the listed BoAs. The appellant is left with fewer levels of judicial protection as one level is replaced by an, institutionally, administrative bodies. This might even result in these BoAs being considered as court substitutes.
Where does that leave us?
This then leaves the question; what type of procedure do these BoAs offer? Is it an administrative procedure, is it a judicial procedure, or is it somewhere in-between? The overall consensus is that the BoAs offer a quasi-judicial procedure: they offer an administrative remedy and have features of a judicial procedure. This provides some insights into their functioning and organization, but it also leaves us with a lot of questions.
While an intensification of their review is prescribed by the EU Courts, a judicialization of these BoAs can be observed simultaneously. What, then, does it mean for the BoAs to be an independent, effective, and expert mechanism of conflict resolution? What are the standards they should adhere to? An even more existential question that could be raised within this context: we know that these BoAs raise the legitimacy of the agencies’ decisions, but what is the actual underlying aim of this procedure? The answer to this million-dollar question will only further enhance the position that the BoAs fulfill within the current landscape of European administrative justice.
Sofie Oosterhuis, PhD Candidate in European Administrative Law at Utrecht University. She will speak at the 2023 CoI conference ‘Towards just institutional approaches to conflict prevention and resolution’
