Under the aegis of the SSM, which comprises the ECB and 19 national central banks (NCAs), the ECB carries out banking supervision vis-à-vis euro area banks. To this end, the EU watchdog has been entrusted with various direct law enforcement powers. Yet, for executing its tasks, it still depends to a significant extent on the expertise and powers of the NCAs. For instance, a large part of banks’ (punitive) sanctioning is still being dealt with by the NCAs, upon the ECB’s request. In our recent study ‘EU administrative investigations and the use of their results as evidence in national punitive proceedings’, which was part of the report Admissibility of OLAF Final Reports as Evidence in Criminal Proceedings, we have pointed out the challenges that stem from the fact that certain ECB investigations and their concomitant results can be used as evidence for punitive sanctioning at the national level; in the absence of EU rules providing for clear guidance on the admissibility of EU gathered materials in national proceedings, numerous questions can be raised concerning the protection of defense rights in a composite law enforcement setting. We have identified three types of challenges: how to protect defense rights at the interface of i) different legal orders, ii) non-punitive and punitive law enforcement, iii) administrative and criminal law enforcement. We concluded that the introduction of EU rules facilitating the interoperability of SSM materials as evidence in national proceedings should be put high on the agenda.
Much is being said, lately, regarding the effectiveness of EU policies, often arguing that their implementation is too poor or uneven throughout the Union. Enforcing EU laws is crucial for their successful implementation; however, how should enforcement be organised? At which level, by what type of institutions and what implications does the choice for a particular institutional strategy have in terms of legitimacy, organization of controls and operation of enforcement? The European Commission itself is committed to making EU laws more effective and improving overall compliance with them. What is most relevant is the ongoing changes in the governance of EU law enforcement, according to which direct enforcement powers, long been regarded an exclusive competence of the EU Member States, are increasingly being uplifted at the supranational level, both by providing EU actors with direct powers and through unprecedented shared powers with the lower administrative levels.
This contribution discusses the legal complications of the digital revolution on competition law, including a call for action to the European Union to adapt the existing legal framework in order to catch data-driven conduct and ensure effective enforcement. The rise of the digital economy demands (European) policymakers and enforcers to look at ways in which privacy and competition can strengthen each other to address today’s key challenges. In relation to the incorporation of privacy or data protection principles into a substantive competition analysis, the Court of Justice of the European Union (henceforth: CJEU) and the Commission have been very restrictive. However, this contribution argues that this vision is no longer without debate and susceptible to change.
Michiel Luchtman & Miroslava Scholten
With this blog post, the editors of the blog would like to announce the creation of the Jean Monnet Network on EU law Enforcement (EULEN). We would like to sketch briefly the relevance of this topic, thematic scope, structure and plans for activities of the network.
This blog post is a follow up to the preliminary outcomes of the international conference “European Union Law Enforcement: The Evolution of Sanctioning Powers”, organised by the Law Department of the University of Turin on 28 and 29 March 2019. The post is also intended to provide an overview of the main contents of the forthcoming publication of the proceedings of the conference (Eds Stefano Montaldo, Francesco Costamagna and Alberto Miglio, European Union Law Enforcement: The Evolution of Sanctioning Powers, Routledge – book series Routledge Research in EU Law – early 2020). Building on the conference, the book presents the state of the art of EU sanctioning powers and discusses paths converging towards its centralisation – at various degrees of intensity depending on the area of EU competence involved – in the hands of European institutions and bodies.
In my first blog post for this blog page, I signaled a rapid proliferation of EU enforcement authorities (EEAs). These EEAs are an example of a growing administration of shared tasks – regulatory and enforcement – in the EU. The establishment of these complex, multi-level governance structures and decision-making procedures is necessary to address “wicked problems” (think, for instance, about the need to protect environment), which require cooperation of and involvement of various stakeholders. Establishing these complex structures and procedures requires in turn sophisticated systems of controls over public power to safeguard the rule of law. How to build such a system? My main argument is that it is through a framework in which a number of elements need to be connected. These elements include:
- relevant concepts of control (accountability, protection of fundamental rights, etc);
- types of controls (political, judicial, etc) that these concepts may represent;
- analytical prisms that they may create (institutional, decision-driven and rights-driven); and
- systems of controls belonging to different jurisdictions/legal orders in the EU (EU-national and national-national).
The lion’s share of antitrust agencies’ actions is the enforcement of policies that ensure compliance and deter market players to engage in anticompetitive practices. However, credibility of competition authorities is hindered when agencies fail to enforce policies successfully. A source of ‘failed’ enforcement policies is found in judicial appeal cases against regulatory decisions, which can delay for years the effective implementation of a sanction or can even rule out the enforcement decision of an agency. Why do regulatory agencies fail to comply with legal standards in the process of enforcing the law? Answering this question can lead us to look up into different places, such as courtrooms, texts of legislation or the market structures of the economic sectors under supervision. Nevertheless, what if we look straight into the core decision-making structure of competition agencies?
For many years, the incorrect application of the Single Market rules has been a concern for the EU. In that respect, the European Commission has expressed its ambition, in compliance and enforcement matters, to be “bigger and more ambitious on big things, and smaller and more modest on small things”. Given its limited resources, it makes sense for the Commission to focus on the “big things”. But then someone else has to take care of the “small things” because, added together, they constitute a serious impediment to the functioning of the Single Market.
How, and by whom, these small things shall be taken care of is the topic of our newly published discussion paper “Reforming compliance management in the Single Market”. In this paper, the National Board of Trade Sweden discusses, after looking at possible alternatives, a decentralisation reform that would consist in setting up national enforcement bodies in each Member State. Their mandate would be to investigate local infringements of EU law and, eventually, to bring actions before the national courts.
Ensuring effective judicial protection appears to be a challenge in the case of the increasingly integrated administrative procedures. The judicial powers are generally more strictly divided between the EU and the national level, while composite procedures may require a more integrated judicial control. Is the Court of Justice of the EU (CJEU) moving into this direction in the recent case of Berlusconi by confirming its exclusive competence to review non-binding national preparatory measures that are part of an EU decision-making process? The ruling clarifies the CJEU’s jurisdiction and avoids a strict separation of the EU and the national level, but it remains to be seen if it serves as an actual next step towards integrated judicial protection. Just how the CJEU can review the national part of the procedure is still unclear, as are the types of preparatory measures to be covered. It seems to nevertheless be a welcome step towards clarifying judicial protection in the case of composite procedures.
Based on ‘Criminal Liability of Managers in Europe. Punishing Excessive Risk’, (2019) Hart Publishing
“In retrospect, many firms … took on too much risk and did not have sufficient resources to manage those risks effectively in a rapidly changing environment.” (Written Submission of Morgan Stanley to the Financial Crisis Inquiry Commission, John J Mack, Chairman, January 2010)
Every managerial decision is risky, at least to some extent. Conducting business is impossible without venturing into new territories and even the most ordinary daily choices could turn out to be failures. Excessive risk, however, can be very detrimental as was starkly illustrated by the most recent financial crisis. By criminalising managers’ excessive risk-taking criminal law enters a sphere at the core of business activity. But it also provides for criminal punishment for courses of conduct that can be extremely harmful.