While most of the mechanisms considered so far are forms of ex ante control, judicial review is the ex post control mechanism par excellence.
In the United States, no one disputes the fact that the courts must examine both the substantive legality requirements applicable to agency decisions (in particular, compliance with the remit) and procedural requirements (primarily, compliance with the provisions of the APA and related legislation). However, this judicial review is not always easy. Remits are often worded in evasive terms, without intelligible criteria and sufficiently clear objectives to decide in court whether they have been exceeded, and an examination of compliance with procedures can easily drift into a judicialisation of agency activity, which itself is a major drawback as regards the efficiency of their work.212 However, it is not possible either for the remit to be worded in such a watertight and exhaustive manner as to constrain excessively the work of the agencies, or for procedures to be so clear and simple that they freeze any scope for initiative in the management of the decision‑making process. The tension between the tightness of the provisions and the flexibility of action is the fundamental problem that the courts ultimately have to solve.
The Supreme Court has resolved this tension realistically by giving agencies a degree of flexibility to interpret their own statutes according to principles inherent in the execution of their remit. In the Chevron judgment, agencies were given a considerable degree of discretion in this respect.213 Although this judgment was criticised as being very lax and although some courts, after Chevron, showed a clear determination to step backwards by interpreting agency statutes literally,214 it is now widely accepted that legislative instruments setting up agencies can provide the basic framework only, and necessarily allow teleological interpretation of their provisions.215 By analogy, agencies can also extensively interpret and apply procedural rules in order to perform their functions.216
Evidence of the need for and usefulness of this wide interpretation is the fact that agencies are very often required to implement choices in the public interest in areas where it is not obvious from a policy point of view which is the best choice.
This kind of consideration, coupled with the need for fast, effective regulation, led some US writers to reject the unacceptable constraints introduced into the regulatory process by the cumbersome checks by President and Congress217 and by the rigid intervention of the courts.218 Proponents of such arguments end up proposing to allow agencies to deviate from the conditions set, when common sense and good policy so dictate.219 We do not endorse these arguments. They are bound to give agencies carte blanche in the regulatory process, removing any legitimacy they have and, if serious errors were made, could end up discrediting the entire system of mechanisms for delegating discretionary power. On the contrary, we think that the solution remains in balancing the substantive and procedural requirements, which must be subject to political and judicial review. I consider procedural requirements to be more easily subjected to judicial review. Reviewing substantive requirements is equivalent to assessing their appropriateness (Does the disputed measure best meet the agency's objectives? Is it more suited to attaining the desired goal? Is there another more effective means of meeting the same objectives in accordance with the remit?). All are unusual questions for a court. In constitutional law, the situation is different, since a ruling must be given on the validity of measures that violate basic rights, making plausible a tough approach (hard-look test) to these basic freedoms which are often mishandled by political majorities.220 In administrative law on the other hand, the protected property, even where it is affected, does not require such an approach, especially since intervention can take several forms and be more or less intense, and since the most appropriate solution is not necessarily obvious from the outset. In such cases, checks on legality can be only minimal, based on the manifest incompatibility of the measure with the objectives and operating rules set for the agency.221 For these reasons, a number of authors conclude that, ultimately, political review of agency activity is a better means of ensuring their accountability.222 One thing is certain: for the judicial review process to be as effective as possible, it must not become commonplace. This would accentuate all the problems inherent in the exercise of judicial review, such that in the long term it might hinder agencies' smooth operation. To avoid such a situation, two lines of action should be followed: first, internalising part of judicial review by introducing quasi‑judicial procedures within the agencies, helping to solve problems before they become disputes; and second, managing the decision‑making process via networks of professional interests. We will consider the contribution of networks to the regulatory process separately.223 As regards keeping judicial procedures to a minimum, existing Community law already contains provisions along these lines. For example, the technical decisions of the Community Plant Variety Office (CPVO) are subject to appeal before a Board of Appeal acting like a court of first instance prior to appeal to the Court of Justice.224 In addition, Articles 44 and 118 of the CPVO and OHIM establishing regulations respectively provide that the Commission shall control (by requiring the alteration or annulment of any unlawful act) the legality of those acts of the President, in respect of which Community law does not provide for any control on legality by another body, and of the acts of the administrative council relating to the budget of the Offices. Member States, any member of the administrative board or simply any person directly and personally involved may refer any such act to the Commission for examination of its legality.
The Commission thus plays a quasi‑judicial role. Its intervention is governed by a formal procedure resembling that of the APA, in particular as regards deadlines. The Commission can conclude that the contested act is unlawful and require its withdrawal. It has important power, making it the guardian of the legality of acts of the Offices. The Commission has to check the same factors as set out in Article 230 of the Treaty (lack of competence, infringement of an essential procedural requirement, infringement of Community law or misuse of powers), which are some of the grounds for actions for annulment before the ECJ. The independence of the Offices remains intact, since the checks are carried out ex post and cannot question the appropriateness of the decisions concerned. This form of control is thus preventive, encouraging the Offices' managers to take care to comply with the substantive and procedural requirements, and prompting them to cooperate closely with the Community executive.
The European Agency for the Evaluation of Medicinal Products (EMEA), on the other hand, does not take autonomous decisions, owing to the fact that the decision‑making process is always subject to a final decision by the Commission via committee procedure, and sees all relevant decisions end up before the European courts.225 So we see that Community law contains the seeds of a system of judicial review equivalent to that which prevails in the United States. This system may develop and improve with the emergence of regulatory agencies at Community level.
This optimism is based on the fact that the ECJ, following its law‑making period, is already starting to conduct judicial review of the administration, as regards not only the contractual and non‑contractual liability of its servants,226 but the requirements of genuine openness of the Community's decision‑making system to society as well, on the basis of ensuring compliance with a number of principles relating to transparency, equal access and giving reasons for decisions.227 We have already seen that a European APA may accelerate these tendencies. We will now see why the creation and direction of networks could be another positive factor in the same direction.
To avoid overloading the ECJ, except for proceedings for a preliminary ruling within the agencies,228 provision could be made for cooperation with the administrative courts in the Member States229 and with a European Constitutional Council, responsible, among other things, for the delicate task of ruling on the extent of agencies' powers and the legality of their founding statutes in the light of the Treaty.230 In the meantime, judicial review of regulatory activity in the EU remains very unsatisfactory. The almost total absence of procedural requirements and the quasi impossible access of the Court by private persons are evidence of this. It is not surprising that as regards, for example, the framework directives on environmental protection, no implementing measure has been contested before the Court of Justice since 1991. In the related field of pesticide regulation (Council Directive 94/43/EC, OJ L 227, 27.7.1994, p.31), only one implementing measure has been cancelled, and it was for having ignored the European Parliament's right to be consulted.231
e) Network coordination232
There is no doubt that the emergence of complex problems highlights the limits of the Commission’s policymaking and executive abilities. This situation underlines the need to seek ways of coordinating the resources and skills of actors at lower levels, both for the generation of information and for the implementation of policies where it has been found that the Commission’s existing tools under the Treaty are inadequate.233 In more normative terms, with the emergence of a new mode of democratic regulation based on proceduralisation of the production and the application of norms234 and on the coordination of collective action, providing collective actors with a structure is a very important factor. This mode of regulation does not substitute the foregoing substantive modes of policymaking, but rather represents an attempt to increase their potential by achieving a better and tidier linkage between the bureaucratic, the expert and the social systems of knowledge.235 It is also true that nongovernmental organizations and civil societies associations in general, substitute the State in areas it is unable or unwilling to act. Under this viewpoint, collective action is an extension of the state activity in areas where its advocacy or representative functions are difficult or undesirable.236 Consequently, public authorities must seek to encourage both reflexivity (by putting in place evaluation and revision mechanisms) and collective participation. The latter principally entails guaranteeing the cooperation of the various (possibly all) stakeholders. It is a very positive, inclusive approach, but, if legitimacy is to be enhanced, stronger and better organized actors must not be given undue advantages. If collective learning is a main condition for modern governance, the role of the public authorities is to organise it. The control aims of government action must be partially re‑oriented from exclusively substantive outcomes to the establishment and support of participative mechanisms. This implies neither a change in the location of ultimate responsibility for decision‑making nor a diminution of the responsibility of the public authorities. On the contrary, decisions are now taken on the basis of processes that are open and inclusive. Under this system, the public authorities have increased responsibility to ensure the adequacy of the procedures by which collective learning and coordinated action can be achieved.
For the Commission, this clearly consists in its ability to operate as a body, which can orchestrate collective action through networks of different actors involved in the regulatory process.
As Notis Lebessis and John Paterson point out, “this is of particular relevance to the broader question of the role of the Commission as an animator of networks of actors. The multitude of administrative levels and of stakeholders involved in European government action raises questions of co-ordination, which will have even greater significance in an enlarged and more diversified Union. The coherence of this action will, therefore, depend increasingly on the quality of the cooperative relations which the Commission forges with these actors and the relationships which it fosters and encourages among them.”237
The United States and the EU are both deliberately and normatively multi-level systems of government. They both basically depend on coordination between multiple public authorities. In both systems, policy outcomes are the product of negotiation and mutual adjustment between different actors involved in the decision‑making process. Consequently, it is not surprising that network structures have become the default mode of institutional form on both sides of the Atlantic.238
The committee procedure alone brings into play an extensive network of experts; every working day an average of 1, 000 officials and experts attend about 20 different Council working groups in Brussels. Each brings together representatives from all 15 Member States plus the Commission to negotiate executive Community measures. About 70 percent of the EU’s regulatory output is actually decided at this level.239 These decision‑makers meet behind closed doors and are answerable to their respective national administrations, which thus also avoid scrutiny by the national parliaments. The operation of these networks is neither transparent nor democratic.240 It is true that the Commission has recently made efforts to extend its networks to include private interests affected by this mass of opaque regulation (e.g. social dialogue, new technologies, environment), but it is still far from providing this process with a reasoned structure.241
Community networks cruelly lack sufficient representativeness and decision‑making capacity. They frequently favour certain powerful groups, neglecting civil society, which remains barely organised, particularly in certain Member States. Furthermore, a compromise based on the lowest common denominator is frequently found by a suspect consensus which fails to make the various approaches known or even deliberately conceals them within a system that tolerates no disagreement, itself considered to be harmful to the process of European integration.242
The Commission does not often have the necessary technical expertise for regulation that is becoming more and more specialised. The gap was filled immediately by the private sector, which sometimes manages, even directly, to have an important influence on Community regulation.243 There are numerous other examples that illustrate the necessity but also the inadequacy of the current network system at Community level.
This is another area in which agencies can play a salutary role. They are particularly suited to operating within a network involving national and Community administrations. Agencies sometimes, are not destined to work in a vacuum, or to replace national decision‑makers; still less can they replace the representatives of civil society. However, they have a natural vocation to stimulate the interaction of all these players, public and private, national, international and European. They can also encourage new important interests by favouring participation in the decision‑making process of emerging players.244 Agencies even develop the exceptional capacity to form national experts into an international network capable of cooperating with the private sector, while maintaining its independence and efficiency. The experience of the positive development of the scientific committees under the EMEA is an example.245 The osmosis between national and Community agencies forms a transnational network of institutions pursuing similar objectives and facing analogous problems, more motivated to defend its professional standards and policy commitments against external influence and to cooperate with other parallel organisations than a national civil service annexed to a central bureaucracy.
Consequently, as G. Majone and M. Everson point out, “there is no reason why the network model, given the right conditions, could not be extended to all areas of economic and social regulation of Community interests and indeed to all administrative activities where mutual trust and reputation are the key to greater effectiveness.”246 It is obvious that the operation of agencies within a network will be all the more reliable and effective, the more representative and legitimate the participants are. However, in the current state of the decision‑making process within the Community, networks appear as an additional guarantee of its legitimacy, even if the conditions for their own legitimacy are not yet fully met.
Lastly, it was noted that monitoring of the procedural requirements coupled with extensive participation by individuals in the regulatory process may raise two issues: the slowing of the process (gridlock, ossification), and the potentially growing influence of private interests on public decisions (interest capture). However, if there is a slowing down, it is largely compensated for by greater public support for the objectives pursued by the measures concerned. Regarding the second issue, it cannot be denied that the current committee system is much more vulnerable to outside influences, and especially major organised interests, while the opening of the system will be of greater benefit to small interest groups, which do not have the resources to finance permanent lobbying structures in Brussels.247
We have attempted in this paper to show that creating European regulatory agencies can increase both the efficiency and the legitimacy of the decision‑making process within the EU. We have also argued, contrary to the prevailing school of thought, that this could be legally possible under the current treaties.248
In doing so, we have drawn on the US model of independent regulatory agencies. We found that, despite fundamental differences between the two systems, US federalism and the emerging European federalism face similar problems. One such parallel problem relates to the efficiency and legitimacy of the regulatory process in an increasingly complex and changing environment. We asserted that where the Americans take a realistic and pragmatic approach, Europeans are always prisoners of a flagrantly dogmatic legalism.
This dogmatic approach is especially visible when it comes to the delegation of regulatory powers involving a real margin of discretion. It is rooted in a rigid conception of institutional balance within the Community based on case law dating back 45 years. It is blocking any development of European decision‑making mechanisms.
Arguing essentially from a legal point of view, supported by arguments from other disciplines, in particular the political sciences and governance theory, we have attempted to re‑situate this case law in its historic context and in the current reality of institutional balance. We were thus able to affirm that the revised and corrected Meroni doctrine presents no obstacle to the creation of such bodies.
We then analysed the range of means available for effective control of agency activity, which sets limits on their independence and increases their accountability. We concluded that this regulatory whole could establish and ensure bodies that not only respected the institutional balance, but were also capable of revitalising it, via a clearer and more visible division of powers, and keeping up with its development, by introducing participation and cooperation, not only between the existing institutions, but also between them and emerging players, such as networks of parties affected by Community regulation.
We were thus able to argue that the involvement of such agencies in a decision‑making process subject to operational rules and tough but justified judicial review means better protection for the rights of European citizens. At the same time, it can raise the quality of public debate on the main European issues.
We also argued that the operation of agencies contributes to better management of the scientific and technical expertise required in modern rulemaking procedures.
Generally speaking, a model of a European regulatory agency based on these principles is not only feasible, but also highly desirable, since it can significantly help to modernise Community governance and to improve governance worldwide.
While I hope they are convincing, legal/political arguments do not of course suffice to take this step. What is required is strong political determination on the part of the Member States and all the European Institutions, giving rise to a new administrative and regulatory culture. This will not be easy since all involved display a curious tendency to believe that they will lose out: the Commission, since it will have to give up some of its decision‑making prerogatives, and the Council, since it will no longer have direct control (via the committee procedure) over the same part of regulatory activity.
The European Parliament will perhaps be the only player to be more open to this possibility, in view of its relative absence from implementing procedures, although all the Institutions would still need to be persuaded not to attempt (in return) to interfere in the day‑to‑day management of these new bodies, thus avoiding the temptation to micro‑manage, which is well known to be detrimental to the smooth operation of agencies. However, I consider this fear, shared by the Community executive and legislative powers, to constitute a further argument in support of the necessity of the operation.
Nonetheless, I cannot be excessively optimistic that these changes will come about rapidly. Since the issue, rightly or wrongly, has constitutional implications, resistance will be strong. Hence the usefulness of putting forward two interim proposals.
Until the logjam is broken (whether or not by an amendment to the Treaty), the Commission could follow one or both of two alternatives: