Finnish Constitutional Law Committee adopts ultra vires review of secondary EU law?

Finnish Constitutional Law Committee adopts ultra vires review of secondary EU law?

Constitutional Law Court’s ultra vires review of EU law, but similar actions by other European institutions have mostly stayed under the radar.

A central aspect of modern day constitutionalism is the rule of law principle. One aspect of this entails that constitutions both vest the state with power and limit the use of that power. Constitutional review is a specific mechanism through which this limitation takes place.

Across the still 28 Member States of the European Union, there exists a wide array of mechanisms for constitutional review. Finland has a somewhat peculiar system that combines both abstract ex ante review and concrete ex post review. Under Section 106 of the Constitution of Finland, all courts have the power to set aside a norm of national law that is contrary to the constitution. Under Section 74, abstract ex ante review is carried out by the Constitutional Law Committee (Perustuslakivaliokunta) of the Finnish Parliament. The Committee is composed of Members of Parliament. Before deciding on an issue, it hears constitutional law professors and other experts.

The German Federal Constitutional Court (Bundesverfassungsgericht) has used its wide review powers to much avail with regards to various issues of EU law. EU law scholars are familiar with the development of the Solange doctrine and the highly disputed first ever preliminary reference in the case Gauweiler. While everyone seems to have an opinion on the actions of the German court, these express only one variation of the dynamics between national institutions tasked with constitutional review and the EU polity more generally.

While the German court engages with EU law only after it has come into being, due to its ex ante review powers, the Finnish Committee is also able to review proposals. To simplify somewhat, the Finnish Government has a duty to keep the Parliament informed of EU-related issue. For this purpose, it sends the Parliament reports in which it explains its stance on e.g. a legislative proposal given by the Commission or an initiative made by the European Council. The Committee sometimes issues a statement on these reports, in which it outlines whether the proposal contains anything of significance from the perspective of the Finnish Constitution. In these situations, the Committee effectively reviews the Commission’s proposals on the basis of the Finnish Constitution. This form of review by the Committee already received some attention during the Eurozone crisis. The Committee reviewed various draft versions of the European Stability Mechanism Treaty (ESM). This review apparently affected the content of the final version of the ESM.

Recently the ESM came before the Committee a second time. Last year the Committee reviewed the Commission’s proposal to turn the ESM into a European Monetary Fund (EMF) by enacting a new regulation. The core of the Committee’s review focused on whether enacting the EMF would increase the Union’s competences and whether Article 352 TFEU would be an adequate legal basis for the proposed regulation. Simply put, if the EU were to adopt a regulation without an adequate legal basis for it in the Treaties, this would breach the principle of conferral, and therefore also the sovereignty of Finland.

While the Committee is cognisant of the Foto-Frost doctrine, it acts under the mandate of the Finnish Constitution whilst conducting such reviews. Let me quote the Committee in extenso on this point:

“The EU Treaties do not contain a specific legal basis for the establishment of the EMF. The EMF would be a union institution according to the Commission’s proposal. As a whole, the proposal resembles other regulations that have been used to establish EU agencies. Assessment of the choice of legal basis is not part of the duties bestowed upon the Committee in the Finnish Constitution. Appropriateness of the legal basis is an EU law issue, which will in the last instance be decided by the Court of Justice. On the other hand, assessment of the legal basis is to some degree a precursor for the assessment of the proposed Regulation in light of the Finnish Constitution. If the proposed Regulation has an adequate legal basis, then there is no transfer of competence in the constitutional sense and therefore a restriction on the sovereignty of Finland (see PeVL 28/2013 vp). If in turn the chosen legal basis cannot be deemed adequate, the constitutional assessment of the proposed Regulation will be slightly different.” (Statement PeVL 12/2018, translation by the author)

The EMF proposal was abandoned in the December 2018 European Council. Instead, an amendment to the ESM Treaty is being planned. Thus, the issue might come before the Committee a third time.

There has arisen a political disagreement between the three parties in the Finnish Government on whether the proposed amendments to the ESM breach the budgetary sovereignty of Finland. If the proposed amendments were to be reviewed by the Committee, and if the Committee was to find them in breach of the Constitution, the Finnish Government could not support such an initiative. Such an amendment to the ESM could of course be adopted as a constitutional amendment, but there would not be enough political support to reach the required qualified majority in the Parliament.

With this example, I have tried to briefly show how different forms of review, that take place at different points during the EU’s political process, raise different legitimacy concerns. This is a matter of comparative constitutional law and comparative (political) institutional analysis. For us to fully understand how the EU as polity functions, more attention should be given to such issues.

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