On 9 March 2023, the European Court of Justice delivered its long-awaited judgment in the Aquind-case shedding light on the intensity of review conducted by the boards of appeal of European Union agencies. This case concerned the Board of Appeal of the European Agency for the Cooperation of Energy Regulators (ACER) which limited itself to assessing manifest errors of assessment in its decision-making. The Court struck down this limited approach; the ACER Board of Appeal consists of both legal and technical experts and therefore must, in principle, conduct a full review of the agency’s decision. This judgment is significant as it relates to the quality of (quasi-)judicial control of administrative decision-making. This blog post aims to discuss this judgment and its implications for the system of judicial review in the EU.
Boards of appeal: internal review bodies
Boards of appeal have been established in agencies that can take binding individual decisions in complex technical or scientific cases. Examples of such agencies are, amongst others, the European Union Intellectual Property Office (EUIPO), the European Chemicals Agency (ECHA), and, the respective agency in Aquind, ACER. These boards of appeal are the first layer of control prior to any judicial proceedings before the Court of Justice of the European Union.
In this case, Aquind submitted a request for an exemption under Regulation (EC) No 714/2009, on conditions for access to the network for cross-border exchanges in electricity, for a proposed electricity interconnector between the electricity transmission systems in the United Kingdom and France. As the national regulatory authorities in France and the UK could not reach an agreement, this request was forwarded to ACER which refused the exemption. Aquind, subsequently, filed an appeal with ACER’s Board of Appeal. In its appeal decision, the Board of Appeal stated that they are solely limited to checking whether ACER made a manifest error of assessment, given the margin of discretion that should be left to ACER for deciding on complex economic and technical issues. Aquind argued that such a limited review would be contrary to Article 19(5) of Regulation (EC) No 713/2009 which states that the ACER Board of Appeal has the same powers as ACER itself.
The Court of Justice, following the judgment of the General Court (Case T-492/21) and the opinion of Advocate General Campos Sánchez-Bordona of 15 September 2022, agrees with Aquind that a more thorough review can be expected from ACER’s Board of Appeal and must even conduct a full review of the contested decisions. Before delving into the specifics of the Board of Appeal’s intensity of review, the Court of Justice makes some general remarks about the position of boards of appeal within the European administrative landscape. The creation of the boards of appeal forms part of an overall approach by the European legislature to provide EU agencies that take decisions on complex technical and scientific issues with review bodies; these review bodies are an appropriate means for rights protection as the agencies have broad discretion in their decision-making and the EU courts can only conduct a limited review over it. The several boards of appeal also share certain shared features: they are internal administrative revision bodies who have a certain independence, perform quasi-judicial functions through adversarial procedures, and are composed of legal and technical experts. Moreover, they form a quick, accessible, specialized, and inexpensive mechanism for rights protection.
Intensity of review: what can be expected from the boards of appeal?
When defining the intensity of review, the Court of Justice focuses on several aspects. First, ACER’s Board of Appeal is composed of six members and six alternates from among the current or former senior staff of the national regulatory authorities, competition authorities or other national or EU institutions with relevant experience in the energy sector. Therefore, the Court of Justice concludes, these members meet the requirements to conduct a full review of ACER’s decisions. This expertise should, by design, enable the members to conduct a detailed examination of appeals, and thus the EU legislature intended to provide the Board of Appeal with the necessary expertise to carry out assessments of complex technical and economic facts relating to energy. Second, the statement of grounds accompanying the appeal at the Board of Appeal does not have to include legal pleas; the appellants can also bring forward solely technical grounds (pleas of fact). The brevity of the time limit for the ACER BoA to decide on the appeal also cannot be seen as a ground to limit the intensity review; it reflects rather the concern of the legislature to ensure a swift procedure’. All in all, the Board of Appeal had not been created to confine itself to a limited review of complex technical and economic assessments. The Court of Justice further adds that, if the Board of Appeal would only conduct a limited review, this would mean that the General Court would be carrying out a limited review of a decision which was itself the result of a limited review. Such a system would fail to offer the guarantees of effective judicial protection.
How ‘full’ should a ‘full review’ be?
This raises the question of what should be included in a ‘full review’. The Court of Justice does not answer that question. It only states that the board members have the necessary technical knowledge to conduct a ‘detailed examination of appeals’ and ‘carry out assessments of complex technical and economic facts relating to energy’. Within this context, the Court of Justice refers to earlier case law by the General Court on the Board of Appeal of the European Chemicals Agency (ECHA).
In two landmark cases (T-125/17 BASF Grenzach GmbH v ECHA and T-755/17 Federal Republic of Germany v ECHA), the General Court stated that because of the legal and scientific competencies of its members, the ECHA Board of Appeal should conduct a more intense review than is carried out by the EU courts by assessing the highly complex and scientific and technical facts. Instead of assessing manifest errors of assessment, the Board of Appeal must examine whether the arguments brought forward by the applicant demonstrate that the considerations of the ECHA decisions are vitiated in error. At the same time, the General Court holds that the ECHA Board of Appeal is not required to re-examine the scientific assessments as this would not sufficiently consider the objectives of the decision-making procedure in which the Member States play a significant role.
Following the General Court judgments, the ECHA Board of Appeal has already applied this new standard in its decisions. The Board of Appeal has stated that it should rely on the legal and scientific competencies of its members to examine whether the agency has examined carefully and impartially all the relevant facts of the individual case and whether those facts support the conclusions that ECHA drew from them. The grounds and evidence brought forward by the appellant are leading in this examination and should sufficiently substantiate the appellant’s argument that ECHA made an error of assessment. Merely the existence of diverging scientific opinion is, according to the ECHA Board of Appeal, not, in itself, sufficient. Thus far, the ECHA Board of Appeal has not been convinced by the studies brought forward by the appellants (see for example: ECHA BoA A-004-2021, Clanese Production Germany GmbH & Co. KG v ECHA [2022] and ECHA BoA A-009-2021, SCAS Europe S.A./N.V. v ECHA [2023])
While ACER argued in Aquind that its Board of Appeal is fundamentally different from that of ECHA, the Court of Justice stated that because of the similar composition in technical and legal experts, they are very much comparable, and both can carry out assessments of complex scientific, technical, and economic facts. The fact that the ACER Board of Appeal members are not employed full-time, unlike the members of the ECHA Board of Appeal, does not affect the intensity of the review. Although this standard is not referred to as a ‘full review’, the new decisions by the ECHA Board of Appeal may serve as a point of reference for how the ACER Board of Appeal must operate in the future.
Where do we go from here?
The General Court judgments on the ECHA Board of Appeal may, thus, serve as an inspiration to the ACER Board of Appeal. The Court of Justice does not directly confirm the applicability of the ECHA case law to the ACER Board of Appeal. However, the General Court did hold that the ACER Board of Appeal also must examine whether the considerations of the ACER decisions are vitiated in error but does not call that a ‘full review’. Therefore, it remains the question of whether this standard sufficiently meets the possibility to conduct a ‘full review’ or a ‘detailed examination’.
It is important to keep in mind that the Court of Justice, following on from earlier case law by the General Court, classifies the boards of appeal as ‘administrative revision bodies’ that ‘perform quasi-judicial functions through adversarial procedures’. Especially the last part of the classification is essential. The adversarial nature of the appeal proceedings limits the boards of appeal to the grounds brought forward by the parties. The approach taken by the ECHA Board of Appeal does seem to fit that approach.
Nonetheless, the exact aim of the appeal procedure has not been fully clarified yet. This overarching question is especially important since the Aquind-judgment may have far-reaching consequences for the other boards of appeal. As previously stated, the Court of Justice explicitly refers to the comparability of the ECHA Board of appeal to the ACER Board of Appeal. Within that context, the Board of Appeal of the European Union Aviation Safety Agency (EASA) is also explicitly mentioned by both the EU Courts. The Court of Justice has made general comments on the common characteristics of all the boards of appeal in that their composition of both lawyers and technical experts means that ‘they are better able to dispose of appeals against decisions which often have a strong technical component’. This general observation by the Court of Justice implies that the ‘full review’ standard set out in Aquind is applicable to all the other boards of appeal consisting of legal and technical experts as well.
The Court of Justice has shed some light on the shared features between the different boards of appeal and on what the ACER Board of Appeal should or, at least, is allowed to do but has not (yet) explained why we have these procedures in the first place. Are these boards of appeal created to mainly address the complex technical or scientific issues since the EU courts are not able to do that? Are the boards of appeal created as an extension of the agencies to offer them a second chance to fix the contested decision? Are the boards of appeal created to minimize the workload for the EU courts? Or is it a combination of some or all of the above? Clarifying the underlying aim of the boards of appeal may also further clarify the intensity of review that they should conduct in their procedures; these are the questions we should focus on.
