Opinion procedure 2/15

96.The Court clarified the European Union’s exclusive competence over the common commercial policy long before the entry into force of Article 3(1)(e) TFEU, which now expressly confirms the European Union’s exclusive competence over that policy. Thus, in its very first Opinion delivered on the basis of (what is now) Article 218(11) TFEU, the Court held that exclusive competence over the common commercial policy was justified because permitting the Member States to exercise concurrent powers in that area ‘would amount to recognising that, in relations with third countries, Member States may adopt positions which differ from those which the [European Union] intends to adopt, and would thereby distort the institutional framework, call into question mutual trust within the [European Union] and prevent the latter from fulfilling its task in the defence of the common interest’.(46) That reasoning is consistent with the construction of the customs union set up by the Treaty of Rome. Internally, that union consists of an absolute prohibition on customs duties on imports and exports and charges having equivalent effect between the Member States.(47) At the same time, the Treaties entrust the European Union and its institutions with the task of defending the European Union’s commercial interests externally. Enabling the Member States to conduct their own commercial policies with the outside world (and indeed to pursue their own interests in that context) in parallel with the actions of the European Union would clearly risk jeopardising that essential function.

97.The Commission in the present proceedings invites the Court to revisit its past case-law concerning the scope of the common commercial policy. How far has the scope of that policy expanded as a result of changes introduced by Treaty of Lisbon (in particular, as regards commercial aspects of intellectual property, foreign direct investment, trade in services, the exception relating to the field of transport in Article 207(5) TFEU and the limits resulting from Article 207(6) TFEU)?

98.Certain Member States have suggested that, following the Court’s Opinion1/94, it is no longer appropriate to regard the common commercial policy as ‘dynamic’.

99.I am not convinced that it is particularly useful to debate whether or not the common commercial policy is ‘dynamic’. What matters is that Article 207(1) TFEU should be interpreted in a manner that both respects the wording of that provision and guarantees that the European Union is able to conduct an effective common commercial policy in an international commercial environment that is permanently evolving.

100.I agree with the view expressed by Advocate General Wahl in the context of Opinion procedure 3/15 that, since trade practices, patterns and trends evolve over time, the subject matter of international trade can neither be determined in the abstract nor identified in a static and rigid manner.(48) However, what is to be regarded as ‘trade policy’ or ‘investment policy’ in international relations and what constitutes the common commercial policy, as a matter of EU law, is not necessarily the same.

101.The Court has also emphasised the need to guarantee the effectiveness of the European Union’s common commercial policy. In Opinion1/78, the Court explained that it would no longer be possible to carry on any worthwhile common commercial policy if the European Union were not in a position also to avail itself of means of action going beyond instruments intended to have an effect only on the traditional aspects of external trade. A ‘commercial policy’ understood in that sense would be destined to become nugatory in the course of time,(49) and thus gradually preclude the European Union from fulfilling its role as a global trade partner, both through bilateral relations with non-member countries and through multilateral action.(50) The common commercial policy is therefore not limited to measures which pursue commercial objectives. It may encompass measures which pursue objectives that are not purely commercial such as development,(51) foreign and security policy,(52) or the protection of the environment or of human health,(53)provided always that those measures have also direct and immediate effects on trade. The interaction between the common commercial policy and the (other) principles and objectives of the European Union’s external action is expressly recognised in the final sentence of Article 207(1) TFEU.

102.However, that does not mean that there are no limits to the scope of the common commercial policy. Nor is the fact that a matter is addressed in a trade (and investment) agreement sufficient for that matter to fall within the common commercial policy. Agreements or provisions which other actors in international law may frame as part of trade or commercial policy do not necessarily fall within the definition of ‘common commercial policy’ in the Treaties. In defining that policy, the Court is limited by the wording of Articles 206 and 207 TFEU.

103.What matters for the purposes of Article 207 TFEU is that the European Union’s (internal or external) action should specifically relate to international trade, meaning trade with non-member countries (not trade in the internal market),(54) in that it is essentially intended to promote, facilitate or govern trade and has direct and immediate effects on trade.(55) Thus, the mere fact that an act of the European Union is liable to have implications for international trade is not enough for it to fall within the common commercial policy.

104.In distinguishing between (international) commitments falling under the common commercial policy and those whose primary objective is to improve the functioning of the internal market, it is important to determine whether or not the purpose of the agreement is essentially to extend beyond the territory of the European Union the approximation of the laws of the Member States that has already been ‘largely achieved’ by EU secondary legislation relating to trade in the internal market.(56) If that is the case, that agreement may be presumed to seek to promote international trade and its conclusion therefore falls within the common commercial policy. Conversely, where that ‘internal’ approximation is precisely the object of the agreement, the predominant purpose of the agreement is to improve the functioning of the internal market and it therefore falls outside the common commercial policy, even if it has effects on international trade.(57)

105.A number of parties are concerned, either in general or in the context of a specific chapter of the EUSFTA, that the Commission’s wide interpretation of the scope of the common commercial policy following the entry into force of the Treaty of Lisbon undermines Article 207(6) TFEU.

106.In my opinion, Article 207(6) TFEU concerns only the exercise of the competences which the European Union derives from Article 207(1) TFEU. It presupposes that that competence has been established. Thus, it cannot alter the European Union’s exclusive external competence under Article 207(1) TFEU. Article 207(6) TFEU imposes two limits, even if the second appears to be an application of the first.

107.First, the exercise of the competence over the common commercial policy cannot affect the delimitation of competences between the European Union and the Member States. In my view, that first limitation constitutes an expression of the principle of conferral laid down in Article 2(1) and (2) TFEU and further elaborated in Declaration No18 in relation to the delimitation of competences.(58) In other words, the exercise of the European Union’s exclusive competence over the common commercial policy may not alter or otherwise affect the Treaty provisions on the allocation of competences in other areas falling outside the scope of that competence (such as, for example, trade in the internal market). I am fortified in that interpretation by Article 207(2) TFEU, which provides for a legal basis to adopt ‘… the measures defining the framework for implementing the common commercial policy’ rather than stating that the European Union has exclusive competence over all measures that may have to be adopted in order to perform obligations resulting from an agreement concluded by the European Union in the exercise of its exclusive competence over the common commercial policy.

108.Thus, for example, the exercise by the European Union of its exclusive competence under Article 207(1) TFEU as regards the entire TRIPS Agreement(59) does not mean that it is competent to regulate each and every matter covered by that agreement in the internal market. Nor can such exercise modify the allocation of external competences between the Member States and the European Union as regards intellectual property rights in general.

109.Conversely, I do not read the first limitation to mean that the exercise of the European Union’s competence over the common commercial policy depends on whether the European Union enjoys internal competence on some other basis or has exercised that competence.(60) In particular, insisting on parallelism between the external aspect of the common commercial policy and the internal aspect of other EU policies finds no support in other parts of Article 207 TFEU. Thus, Article 207(4) TFEU expressly confirms that the common commercial policy may include trade in cultural and audiovisual services and trade in social, education and health services. However, the European Union’s internal competences in the area of public health are limited, as they merely complement the actions of the Member States.(61) Moreover, EU action must respect the responsibilities of the Member States for defining their health policy and for organising and delivering health services and medical care.(62)

110.The second limitation imposed by Article 207(6) TFEU is that the exercise of competences under the common commercial policy cannot lead to harmonisation of legislative or regulatory provisions of the Member States in so far as the Treaties exclude such harmonisation. As Article 207(4) TFEU expressly confirms, that limitation does not mean that the common commercial policy cannot cover trade in matters with respect to which other Treaty provisions preclude harmonisation (such as, for example, in matters of social policy, education, public health or culture).(63) Rather, it means that, through the exercise of its competences under Article 207 TFEU, the European Union cannot act so as circumvent the prohibition of harmonisation under the Treaties. That limitation is thus a particular application of the first limitation.

111.The present procedure for an Opinion also requires the Court to interpret Article 207(5) TFEU, especially in relation to the commitments regarding transport in Chapter Eight of the EUSFTA (‘Services, Establishment and Electronic Commerce’).(64) According to that provision, the negotiation and conclusion of international agreements in the field of transport are subject to Title VI of Part Three of the TFEU, that is to say, the Treaty provisions on the European Union’s transport policy. Such agreements therefore fall outside the scope of the common commercial policy.

112.That exception is not new. The Treaties have always kept transport policy outside the common commercial policy. In fact, it was that exception which led the Court to establish, in its judgment in ERTA, the principle of implied exclusive external competences, as opposed to the express exclusive competence over the common commercial policy.(65)

113.Although the judgment in ERTA was concerned with an agreement establishing safety rules, the Court in Opinion1/94 saw no reason to draw a different conclusion in relation to commercial agreements that also deal with transport, such as the GATS.(66) It confirmed ‘the idea underlying ?the judgment in ERTA? that international agreements in transport matters are not covered by ?the common commercial policy?’.(67) The position remained unchanged under the Treaty of Nice(68) and the Treaty of Lisbon.(69) As regards international trade in transport services, the Treaties therefore seek to ‘maintain … a fundamental parallelism between internal competence whereby [EU] rules are unilaterally adopted and external competence which operates through the conclusion of international agreements, each competence remaining … anchored in the title of the Treaty specifically relating to the common transport policy’.(70)

114.For that reason, the application of Article 207(5) TFEU is not limited to international agreements exclusively or predominantly relating to trade in transport services. As the Court held in Opinion1/08, to conclude otherwise would mean that provisions of an international agreement having strictly the same object would fall in some cases within transport policy and in some cases within commercial policy depending solely on whether the parties to the agreement decided to deal only with trade in transport services or whether they agreed to deal at the same time with that trade and with trade in some other type of services or in services as a whole.(71)

115.Notwithstanding the broad scope of Article 207(5) TFEU, it seems to me that the expression ‘international agreements in the field of transport’ should not mean that every agreement applicable to transport (that is to say, in essence, the service of carrying goods or persons by one or more means of transport from one point to another) must be excluded from the common commercial policy. The fact that measures of general application may, in practice, also be applied to transport does not necessarily trigger the exception in Article 207(5) TFEU. Rather an international agreement ‘in the field of transport’ is an agreement that contains provisions specifically concerning transport. That explains why, in Opinion1/08, the Court focused on the sector-specific commitments (and the horizontal commitments that applied in addition to those commitments) to conclude that the conditions for applying the exception in Article 207(5) TFEU were satisfied.

116.The present proceedings show that there remains uncertainty as to the scope of Article 207(5) TFEU. The issues concerning commitments relating to trade in transport services include that of whether the exception in Article 207(5) TFEU covers establishment (as defined in the EUSFTA) even if Title VI of Part Three of the TFEU does not govern it and whether services ‘auxiliary’ to transport services fall within the exception. I shall address those issues in my analysis of Chapter Eight of the EUSFTA.(72)