Article 267 TFEU and the existential crisis of national Supreme Courts

The preliminary reference procedure is a never-ending source of surprises and interpretative challenges. After almost sixty years of case-law, article 267 TFEU is still the subject of debates that seem crucial for the functioning of the procedure. One would suppose that such debates had been resolved decades ago by the Court of Justice, but cases like PFE prove quite the contrary.

In PFE, the Court is being confronted with a delicate issue, none other than determining what is a Supreme Court. This rather existential query is being posed in the context of a dispute before a chamber of the Italian State Council (the supreme administrative court). Under Italian Law, when a chamber of the State Council disagrees with a case-law rendered by the plenary of the State Council, it must refer the case to the plenary. The rule is quite clear and it makes perfect sense, for it intends to preserve the authority of plenary decisions and thus avoid the legal uncertainty that may be created by contradictory decisions of a Supreme Court.

In PFE, the Consiglio di Giustizia amministrativa per la Regione siciliana, a chamber of the State Council, considered that a case-law of the plenary was not compliant with the Court of Justice’s judgment in the case of Fastweb (C-100/12), a public procurement case. It is not completely clear whether the plenary’s case-law is in breach of the said judgment of the Luxembourg court, but the point is that the chamber has doubts. In such circumstances, the chamber made a reference to the Court of Justice with mainly two questions: one on the substance and another on the “existential” issue: what is a Supreme Court, the overall institution, or each of the chambers entrusted with jurisdiction to resolve a case?

There are practical consequences deriving from this “existential” question: if the “court or tribunal” pursuant to article 267 TFEU is the Supreme Court as an institution, then it does not really matter who is in charge of deciding the case, whether it may be a chamber or the plenary, and therefore national law can lawfully deprive a chamber of its jurisdiction in favor of the plenary. However, if the Supreme Court is to be considered its chambers, then the answer is quite different: the chamber would not need to refer the case to the plenary if it is completely certain that the plenary’s case-law is not consistent with EU Law. The chamber would thus be able to resolve the case on its own authority, thus ignoring its obligation to refer it to the plenary.

The “existential” question is so delicate, that the Court has decided to reopen the oral procedure and hear the case a second time around. On 15 October 2015, Advocate General Wathelet published its second Opinion on the case, but this time before the Grand Chamber. The point that deserves the attention of the Grand Chamber is the “existential” question, as it is explained in the Order of 16 July 2015.

The Opinions of AG Wathelet are two excellent pieces of writing, clear, concise and very common-sensical: he defends what he calls the “functional” interpretation of article 267 TFEU, according to which it is the organ entrusted with the function the one to be considered a “court or tribunal” pursuant to article 267 TFEU. Therefore, he invites the Court to declare that the chamber of the State Council has the authority to set aside the case-law of the plenary formation, but also to make a preliminary reference to the Court of Justice in order to clear its doubts. This conclusion would be the result, according to the Advocate General, of the Court’s past case-law, mostly Parfums Christian Dior, Lyckeskog, Kücükdeveci, Cartesio and Melki, among others.

I fully agree.

The case-law of the Court quite inevitably leads to the conclusion proposed by the Advocate General, and a decision of the Court in different terms would entail a change of course in the case-law. If the Court has gone as far as admitting that Supreme Courts must set aside the case-law of a Constitutional Court in breach of EU Law, it would thus be obvious that the chamber of a Supreme Court is entitled to set aside the case-law of its plenary formation.

However, by doing so the Court is entering a new terrain. In its past case-law, the Court has “interfered” in the way in which different national courts interact within their division of tasks. Cartesio conditions the relation between a first instance court and its appellate court. Krizan puts pressure in the relation between a Supreme Court and a Constitutional Court. Melki is even more complex, inasmuch it concerns three different jurisdictions (instance courts, supreme courts and the Conseil constitutionnel).

However, in PFE the challenge is intrusive in a different way, because it goes into the very heart of a Supreme Court, into its internal arrangements and into the way in which it exercises its jurisdiction. The PFE case would lead the Court into the delicate area of internal organization of a Supreme Court, a subject that might raise more than one concern on the part of national Supreme Courts. After all, nobody intrudes in the way in which the Court of Justice arranges its work, so why should the Court of Justice tell Supreme Courts how to arrange theirs? It is therefore no surprise that the Court of Justice has decided to reopen the oral procedure and send the case to its Grand Chamber, which is, paradoxically, exactly what the State Council’s chamber should have done under Italian law in the main proceedings: refer the case to its plenary. But it did not.

The PFE case also shows how important Supreme Courts have become in the past years for the Court of Justice, and how the latter is struggling to reinforce the role of the former as guarantors of EU Law. In Ferreira da Silva, commented in a previous post, the Court of Justice declared for the very first time a breach of article 267 TFEU by a Supreme Court for not referring a case to Luxembourg. In PFE the Court of Justice will decide on how a Supreme Court must organize its chambers and their relation with its plenary. In a recent line of Spanish references on consumer protection, the Court will have to deal with the powers of Supreme Courts to limit the temporal effects of their judgments when they apply EU Law. The Court of Justice is thus re-fleshing and re-considering the strategic role of a judicial counterpart that has proved to be as important, or maybe even more important, than domestic constitutional courts: the Supreme Courts of the Member States.

The Court of Justice will have to move with care, for there is a lot at stake for the European judicial system. Supreme Courts are at the very apex of each national judiciary, but at the same time, precisely because of their position, their compliance with EU Law is so crucial. A fine balance between the need to respect the autonomy of Supreme Courts and the supervision of their strategic role will have to be found. A considerable challenge for the Grand Chamber and its newly elected president, whose talent for balance is well-known.