Luxembourg, 19/07/2005 (Agence Europe) - The European Court of Justice has ruled in a Commission versus France case considered to be of historic interest, in which it imposes a “double penalty” on a Member State - once for non-compliance and again for persistent non-compliance with European law. Some observers say the ruling opens up a new era when it comes to Member State respect of obligations. The fisheries sector concerned is an important one, they say, but the ruling will have a considerable impact on many other sectors also, especially in the environmental field - nitrate pollution, uncontrolled dumping, protection of fauna and flora, etc. - when, in defiance of a first ruling against them, Member States continue not to take action to remedy the situation, to the detriment of private and public interests.
In its ruling of 12 July (see EUROPE 8989), the Court considers that, since 11 June 1991, the date when it was first found guilty, France has still not taken the necessary measures to control the size of fish sold and to punish fishermen guilty of catching juvenile fish. It has therefore imposed a lump sum payment of EUR 20,000,000 on France as well as a penalty payment of EUR 57 million. For the very first time, the Court of Justice has imposed a fine on a Member State and, also for the first time, a fine plus a penalty payment. Leendert Geelhoed will go down in judiciary annals as the advocate general who suggested the Court should give a “cumulative” interpretation of Article 228 of the EC Treaty. If the Court of Justice recognises that a Member State has not complied with a Court ruling, then it may impose the payment of a lump sum or a fine on that State. Leenert Geelhoed, however, preferred to read a lump sum payment and a penalty payment. The idea found favour with the Court so that a second hearing of the parties was convened with a view to discussion on the question of how Article 228 of the EC Treaty should be interpreted.
During this hearing, only Denmark, the Netherlands, Finland, the United Kingdom and the Commission agreed that a recalcitrant Member State should have a penalty imposed on it for past as well as future acts. On the other hand, thirteen Member States (including France, Germany, the Czech Republic, Greece, Hungary, Portugal, Italy and Ireland) felt that Article 228 was not a “punitive” provision in nature but should “induce” the defaulting Member State to comply, and that the two penalties were incompatible with each other.
The Court came down on the side of the “double penalty” as, it believes, one cannot rule out having simultaneous recourse to the two kinds of sanctions. It went on to explain that the “imposition of a lump sum is based more on assessment of the effects on public and private interests” while the imposition of a penalty payment seems particularly suited to inducing a Member State to put an end to a breach of obligations. Another criticism formulated by certain Member States is that the Court lacked the political legitimacy necessary to impose a fine, when the European Commission had made no proposal along these lines.
The Court's response was that: once the Commission has decided to initiate proceedings against a Member State, its role ends there. It then up to the Court, by way of its jurisdictional authority, to decide what kind of penalty should be imposed on the defaulting Member State. The Court also dismisses the argument that, in departing from or going beyond the Commission's suggestions, the Court infringes a general principle of procedural law. The procedure provided for in Article 228 is, the Court states, a special judicial procedure, peculiar to Community law, which cannot be equated with a civil procedure.
Finally, it should be noted that the advocate general had suggested a lump sum payment of EUR 115,000,000 that the Court reduced to 20,000,000 (no doubt because this was the first time that a State was condemned to pay a “double penalty”.
Experts believe the question the Commission will probably have to face in the future is that of knowing whether it is more in its own interests to propose a fine itself or whether, for a question of political timeliness, it is preferable to leave the Court to decide on the kind of penalty and the amount to be paid.
This is the third time that the Court has imposed a penalty payment on a Member State (after Greece and Spain) at the request of the Commission. The six-monthly payment corresponds to a daily amount requested by the Commission multiplied by six for the six months, i.e. over 57 million to be paid on 12 January 2006 if the Commission considers France has not complied with what is expected of it. The Court states that France was to be given time to take the administrative measures and to make the necessary adjustments, as it is not possible for the necessary adjustments to be instantaneous or their impact to be perceived immediately.
These six months are essential for France which should, in this lapse of time, improve the visibility of its controls and acquire the judiciary arsenal to punish fishermen who catch juveniles, experts say. The Commission must also avoid shouting victory too soon and set in place a system for controlling evidence provided by France to ensure that it is able to give its decision during the evening of 11 January on whether the fine is due or not. The other difficulty, they say, will be for the Commission to strike a balance between what they can demand of France - subject to an obligation to achieve good results and the fact that, for practical reasons, the Commission cannot demand a zero infringement rate of any Member State.