TARNPolicyBrief

TARNPolicyBrief2019no.1–PolicyrecommendationsforreformingEUagencygovernance

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Agencif ication of EU Executive Governance

FindingsoftheTARNJeanMonnetNetworkandimplicationsforthereformofEUgovernance

AUTHORSGiacintodellaCananea,BocconiUniversityDeirdreCurtin,EUIMerijnChamon,GhentUniversityMortenEgeberg,ARENAOsloMichelleEverson,BirkbeckCollegeJustinFrosini,BocconiUniversityHerwigHofmann,UniversityofLuxembourg

ChristianJoerges,HertieSchoolofGovernanceMarkoMilenkovic,SAISEuropeJohannesPollak,InstituteforAdv.StudiesViennaJarleTrondal,ARENAOsloEstherVersluis,MaastrichtUniversityEllenVos,MaastrichtUniversityBrunodeWitte,MaastrichtUniversity

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Executive Summary

TODAYEUagenciesareubiquitousandindispensablegovernancemechanisms.Sitting‘in-between’theMemberStatesandUnioninstitutions,agenciesstillhavenoclearlegalbasiswithintheFoundingTreaties.However,theyderiveasignificantdegreeoflegitimacyfromeffectivelyservingnationalandEuropeanpolicy-makingandregulatorycommunities.Thisoutput-legitimacyshouldofcoursealsobecomplemented with sufficient throughput-legitimacy, whereby the latter depends on how EUagenciesproduceoutput.

THREE KEY CHALLENGES nonetheless have to be faced by both EU agencies and the politicalinstitutions. In a way, agencies have been a victim of their own success. Indeed, the institutionsperceive themas useful instruments to address deficits in policy implementation or as answers topolicy crises, resulting in a ‘mushrooming’ of agencies in absence of a clear framework for theirestablishment and operation. However, a well thought out framework would allow a moreconsidereddefinitionof themandatesof theEUagenciesand the (accountability, budgetary, etc.)requirementsimposedonthem.Todaytherefore:

1. agencies are fighting to maintain their legitimating efficiency within more stringentbudgetaryrequirements;

2. agenciesstruggletobalanceEuropeanandinternationalchallenges;3. agencies are trying to satisfy, an often burdensome and counterproductive, accountability

regime.

THREEOPTIONS toaddress these challengeshavebeen identifiedbyTARNduring thenetworkingand discoursing with its stakeholders. Short-term reforms in three key areas appear possible andnecessary:

1. Budgetary control: Agencies should be subject to a performance based budgetary review,whichfocusesmoreclearlyonoutputratherthanprocess.

2. Co-ordinationofbothinternal(European)andexternal(international)activities:ratherthanendorsingtheCommonApproachonEUagencies,whichforeseesthepossibilityofmergingexisting agencies, TARN discussions point to synergies and efficiency gains that might beunlockedthroughgreaterco-ordinationofagencyactivities,especiallyatinternationallevel.

3. Reviewing accountability mechanisms: agencies currently suffer an acute accountabilityoverloadwhich impactsupontheirefficiency.TARNdiscussions indicate thataccountabilitymechanisms have become a pro forma process which in some cases detracts from thepurpose of accountability in legitimising agency operation. TARN urges a redefinition ofapplicableaccountabilitymechanismsthatreflectacommonunderstandingontheagencies’roleandpurposeintheEUadministrationandwhicharebasedonprinciplesoftransparency,grantingeffectivemeansofreviewandensurebotheffectivedischargeofdutiesaswellasprotectionofindividualrights.

THEPURPOSEofthisbriefistoidentifyareaswhereimmediate(orshort-term)actionispossibletorationalise but also enhance EU agencification. The brief nonetheless fully recognizes that thelegitimacyofEUagenciesandagencificationalsohastobeaddressedatamorefundamentallevel.ThisaspectisexploredinaseparateStatement.

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EU Agencies: what are they and why have they become ubiquitous? EuropeanUnion(EU)agenciesareexecutivebodiessetupbytheEUlegislaturetocontributetotheimplementation of EU policies, helping the EU institutions proper to concentrate on core policy-making tasks.1 They are situated ‘in between’ theMember States and the core EUadministration(the Commission), which explains their attractiveness to the Member States.2 In addition, beingphysically placed in variousMember States, they are presented as a tool for bringing EU bodiescloser to citizens, also providing for a fairer geographical distribution of the EU governancestructure.EUagencieshavetheirownseparatelegalpersonalityandadegreeofadministrativeandfinancialautonomyandworkat‘arms’lengthfromtheEUinstitutions.3

ThefirstEUagenciesdatebacktothe1970sbut,sincetheEUFoundingTreaties lacka legalbasisexplicitly allowing the establishment of EU agencies,4 continually adding to constitutional debatesover their position and role in the EU system of governance. The legislaturewas at first timid inestablishingandempoweringthesesubsidiarybodies.Over time, thishaschanged:as thebodyofEUregulationhasbecomeincreasinglydense,sohastheneedforgreateradministrativeintegrationand cooperation for which EU agencies are excellent and in some areas (e.g. financial services,energy,foodsafety,medicines,railways,aviationsafety,etc.)alsoindispensablevehicles.Dependingontheirprecisemandate,agenciesmaycontributetotheimplementationofEUlawbyprovidingtheEUinstitutionsandMemberStateswithsciencebasedinformation,bygivingoperationalsupporttotheMemberStates,bybringingtogethernationalauthoritiesinEuropeannetworksorbyregulatingsectors of the internalmarket themselves.Over time, the EU institutionshave grown increasinglyaccustomed to the EU agency instrument, also because it is a very visible response to policyproblemsorcrises.5

EU Agencies: A Victim of their Own Success? Asaresult,governancewithintheEUtodaywouldbeimpossiblewithouttheaidofEUagencies.TheEUdecentralisedagenciesnownumbermorethan30,working inallareasofEUpolicy-making. Inmany of these areas, they have become indispensable both to ensure a proper, effective andefficient application of the EU acquis and to allow a further development of the acquis that isexpertise-based.

However,theproliferationofEUagencies,whichsomerefertoasa‘mushrooming’,6hasalsodrawnattentiontotheEUagencies.ThesuccessoftheagencyinstrumenttherebystandsincontrasttotheEU institutions’ lack of attention for a consistent approach in the agencification of the EUadministration. Furthermore, because of their relative autonomy, agencies have always been anobject of concern. Effortsmade by the EU institutions to ensure that the agencies, despite theirautonomy, remain legitimate through the application of a comprehensive series of accountabilitymechanismshavecreatedtheirownproblems:simplyaddingonaccountabilityrequirementsfortheagenciestocomplywithinanill-thoughtoutwaydoesnotleadtomoregenuineaccountabilitybutonly to accountability overload and diverts agencies’ (limited) resources from the tasks forwhichthey were actually established. Combined with the current horizontal EU cost-saving exercise,7agencies’resourcesavailableforthefulfilmentoftheiractualcoremandateareunderpressure.

Theprimaryproblemremainsoneofensuring the legitimacyofagencyoperationwithin theEUwithout,atthesametime,underminingtheoperationalefficiencyofEUagencies.

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Figure1.ThisfigureisbasedonthefiguresinMerijnChamon,op.cit.,p.46,complementedbytheCourtofAuditors'reportsontheannualaccountsoftheEUagenciesforthemorerecentyears.

Heterogeneity in EU agencif ication The agency debate has long been characterised by concern about the heterogeneity of agencies.Createdonanadhocbasis, ifandwhereregulatoryorpolicy-makingdemandsarose,EUagenciesarediverse intheirstructures,functionsandmandates.8Whilestructures,functionsandmandatesshould depend on policy needs, which may vary from one policy areas to the next, the currentdegreeofheterogeneitydoesnotreflectgenuinedifferences inpolicyneeds.Thisexacerbatestheproblemofaccountabilityand legitimacy.Differentstructuresnotonlymake itharder toestablishoneunitarymechanismofaccountability,suchasanEUAdministrativeProceduresRegulation,9butatthesametimeshowtheneedofamorehorizontalapproach.10Clustering(seebelow)certainofthe agencies’ services and functions should be considered as a first possible step in tackling theheterogeneityoverload.

Inmorerecenttimes,effortshavebeenmadetorationalisethefunctioningofEUagencies.11ThishasbeendonenotjustbytheEUinstitutionsbutalsobytheagenciesthemselves.Agencieshavesetupan informalnetworkof EUagencies to voice their common interests. To thisend theagencieshavedefinedthreepriorities(thesocalled‘DublinAgenda’),oneofwhichisthe‘sharingofservicesandcapabilities’.12Oneexampleofthisisthe‘HouseofAgencies’bringingtogetheralltheagencies’liaisonofficersstationedinBrussels.13Theclusteringsuggestedabovecouldtaketheformofsharingcertain agency services and functions, at least within related policy areas.14 This could be a firstfeasible step inalleviatingproblemsnotonlyofefficiencybutalsoof accountability, transparencyandindependence.15

The TARN Network: Dialogue Sessions TARNisanacademicnetworksetup in2015tofosterandsustainresearchonagencygovernancewithin the EU. The network’s main academic component is complemented and enriched by itsdiscussions with EU agencies and EU institutions. Stakeholders collaborating within the networkinclude the EU agencies and the EU agencies network, the European Commission, the EuropeanParliament, the European Ombudsman. TARN’s approach is to systematically engage with thesestakeholdersandtoinvitethemtoitsacademicworkshopsandconferences.

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So far, TARN has also organised three dedicated dialogue sessions, held in Brussels, aimedspecifically at the stakeholders and designed to discuss the particular issues that mark currentagencyoperations.

Figure2.TARNdialogueeventsparticipants

ThroughitsdialoguewithinstitutionalandagencyactorsandsubsequentlydisseminatingtheresultsofthesesessionsviatheTARNwebsite,TARNhasidentifiedthreeuniqueareasofcurrentconcernwhichformthebasisforthepolicyrecommendationsmadetotheEUagencycommunity:

1. Policyconsistencyandbudgetarycontrol–definingagencies’tasks2. Co-ordinationandlegitimacyofagencies’(external)action–theinternationaldimension3. Strains on agencies due to multiple and sometimes overlapping accountability

mechanisms

A core insight resulting from the research and dialogue within the network is one that thelegitimacyandaccountabilityofagencies is inextricable linkedwith theirefficiency,orability toperformthetasksassignedtothem.

Policy consistency and budgetary control: Defining EU agencies’ tasks TheEU institutionsrenewedfocusona ‘performance-based’approachtothepursuitofEUpolicy-making and regulatory action16 also translates in their approach to EU agencification17 and isprimarilydrivenbyefficiencyand legitimacy concerns.Howcan theEuropeanpublicbe given thebestresultswiththebestpossibleuseofresources?Inaddition,asdiscussionwithinTARNDialoguesessionshasrevealed,18aperformance-basedapproachmayalsobeharnessedinordertoaugmenttheaccountabilityofEUagencies, inparticularwhenappliedtothebudgetaryaccountabilityofEUagencies.

WhereEUagencyactorsfeelthatgoodperformance,orcompletionoftheirmandate, isaprimaryindicatoroftheir functionalaccountability, ‘performance-based’budgetingbypolicyareamightbearguedtoproduceitsownaddedvalueforagencyaccountability.19

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Currently, budgetary sign-off for an agency, by the European Parliament and by the Court ofAuditors, isthecentralmechanismwithinthepluralaccountabilityschemeappliedtoEUagencies.Parliamentary review of agency budgets ensures transparency of agency action to the Europeancitizenandenhancesthe‘constitutionallegitimacy’ofagencystructureswithintheEU.

The (budgetary) accountability, and hence legitimacy, of EU agencies could nevertheless besignificantlyincreasedthroughfurtherreform.Twosuggestionsmaybemadehere:

Movingawayfromthecurrentbudgetaryscheme

First,wesuggestmovingawayfromthecurrentbudgetaryscheme,wherebyagencybudgetsare treatedwithin the EU budget as a package. It should be fully transformed to treat thebudgetsofEUagenciesaspartofthepolicyareatowhichtheybelong.ThisisalreadypartiallyforeseenwithintheexistingarchitectureoftheEUbudget:thebudgetsofindividualagenciesare locatedwithin theheadingof themultiannual financial framework inwhich their policyareafalls.20 Implyingapolicy-basedapproachtobudgetallocation,asimilarapproachtotheallocation of agency budgets would allow for a greater measure of accountability review,basedonthesuccess(orlackthereof)withwhichagencieshavefulfilledtheirmandates.Suchapolicy-basedapproachwouldalsofacilitategreaterco-ordinationbetweentheactivitiesofagenciesworkinginthesameorsimilarpolicyagencies.

Movingtowardsperformance-basedaccountability

Secondly, holding agencies to account based on their performance in realizing policyobjectivesrequiresaprecisedefinitionofkeyperformance indicatorswhichought toreflectthe agency’s generalmandate as defined in its establishing act. Agencies’mandates shouldthereforebedefinedintermsofpolicyoutputratherthanprocess.21Onemajorobstaclehereis that the EU legislature, for legal and political reasons, has defined the powers andresponsibilities of EU agencies in a circumspect way, shying away from granting them fullregulatory powers. This means that policy output is typically the result of compositeprocedures22 involving several actors (EU agencies, the Commission, national authorities).Whilesuchproceduresmayaptlyreflecttheprincipleofsubsidiarity,theyalsomakeitmoredifficult to linkspecificoutput toaspecificactor,making itmoredifficult tohold theactorsinvolvedtoaccount.

The International Dimension: Legitimacy and enhanced co-ordination TheinternationaldimensionofEUagencyactionisunderexploredwithinacademicliterature.TARNhas sought to strengthencurrentand future research in thisarea.23 Thepreliminary conclusionofthiseffortsofaristhatagencies’externalactionandinternationalco-operation,forexampleinthefield of international risk management, is a crucial development.24 Furthermore, having in mind‘reflection phase’ the EU is going through andwide ‘enlargement fatigue’ amongmember states,decentralisedagenciesmightbecomeevenmoreimportantfactor incooperationandruletransferto(potential)candidatecountriesandthosestatescoveredbyEUNeighbourhoodpolicies.

TheTARNdialogueeventshaverevealedthefollowingtwoareasinwhichimmediateimprovementsmightbemade,inordertooptimisetheinternationalactivitiesofEUagencies:

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Mandatesandscopeforaction

While the TARN Dialogue sessions have revealed that the current legal bases for theinternationalcooperationactivitiesofEUagencies(i.e.thegeneralexternalactionprovisionsfound in the EU Treaties and the specific provisions in the founding acts of the agencies25)work reasonably well in practice, great legal uncertainty remains. A clarification and anoptimisation of legal instruments used by agencies in the external action should thus beconsidered.Whilst some participants in the dialogues have expressed that, in some cases,currently available legal instruments are inadequate and do not provide agencies withsufficient scope for initiativeandaction to fulfil theirmandate,26othervoices in thedebatefocus more on the question of legality and accountability of agency action. Researchconducted inthecontextofTARNshowsthataspecificallyproblematicmatteraretherulesandprinciplesonexchangeofinformationbetweenEUagenciesandthirdcountryauthoritiesorinternationalorganizations.

Enhanced co-operation amongst DGs and agencies and co-ordination withinternationalagencies/standards

The TARN Dialogue sessions also revealed significant scope for improvement in the co-ordinationoftheinternationalactivitiesofagencies.

• Currently,CommissionDGstakedifferentapproachestothe internationalactivitiesofEUagencies.27Amoreconsistentapproachwould,bycontrast,createafirmbasisforco-ordinatedagencyaction.

• Aboveall,whereaneedisalsoregisteredforagreaterdegreeofconcertedactionbyagencies working together in a similar filed (i.e. Europol and Eurojust), consistentapproaches across the field of international action would facilitate clear andeffectiveimplementationofEUaction.

• Similarly, effectiveness and accountability could also be enhanced by a clearerdivision of roles between the Commission and agencies, whereby, policy-makingtasksareentrustedtotheCommission(ExternalActionService)andmoretechnicalrule-making tasks could be apportioned to agencies, especially in thoseexternal/internationalprocesseswhere technicalandpoliticaldimensionsmightbeclearlyseparated.

Figure3.Wordcloudofpaperspresentedatthe2017TARNLuxembourgconferenceonEUagencies’externalrelations.

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Agencies under strain: the accountability overload A recurring theme within TARN Dialoguesessions has been the ‘problem’ of agencyaccountability.28 Accountability has alwaysformed a key part of the legitimacy schemeforagencies:agenciesmayactautonomouslyonly to the degree that they remain‘accountable’ to all of their principals orstakeholders.29 Over the 30 odd years ofoperationofEUagencies,adenseschemeofaccountabilityhasbeendevelopedinordertocallEUagenciestoaccount.

However, with the growth in tasks andfunctions of EU agencies, their continuingheterogeneity and the increased burdens ofdata management, ‘accountability’ is morelike an impositionuponagencies rather thananessentialmechanism,ensuringinstitutionalandpublictrustintheiractivities.

Theaccountabilityoverloadmustberegardedas an urgent problem to be addressed withdueregardto:

• The functions, structures and size ofindividualagencies;

• A coherent approach in the rules andprinciples that apply to EU agencies, forinstanceincludingahorizontalapproachtothepreventionofconflictsofinterest;

• Theinterplaybetweentheprecisedefinitionofanagency’smandateandtowhichextent(andforwhat)anagencycanbeheldtoaccount;

• Theexactpurposesofindividualaccountabilitymechanisms(controlvslegitimacy);• Theneedtoensurethatagenciesareabletoperformthetasksentrustedtothem,andnotbe

overwhelmedbyproformaaccountabilityprocedures;• Theneed to craft newaccountabilitymechanisms,whichproperly reflect the full rangeof EU

agencyactivity,includingtheirgrowingtaskofassistingmemberstatesinregulationandpolicymakingatnationallevel(ensuringthereisnoaccountabilitydeficitor‘underload’);

• Recent evolutions in public administration practice, including measures of reputational riskmanagement, to ensure continuity of public trust in the process of public policy-making andregulation.

‘Aquestion to ask is how accountablewewantagencies tobe,as this seemingly influences thekind ofaccountability thatwewant. In practicewe see how agencies are often burdened withrules to ensure “accountability” and anautomaticreflextomalpracticesormisconductiscomeupwithevenmorerules“toensurethatitneverhappensagain”.However,EUagenciesdonotneedmorerules;theyneedcoherenceintherules that already exist, as these are often inconflict.We should consider in this regard thataccountabilityshouldnotbeequatedwithtermssuch as compliance, transparency, andstreamlining. These are instruments of control,not of accountability. In fact, these instrumentscan even work to the detriment ofaccountability.Accountability shouldbe tailoredtothespecifictasksthattheagenciesfulfilsandtherisksthatareassociatedwiththattask.Onesizedoesnotfitallinlightofthevastdifferencesthat exist between EU agencies. Therefore, weshouldbetter specifyandclassifywhat it is thatweareactually talkingaboutwhen referring tothis widely differing class of publicorganizations.’

DialogueSession,Brussels,21September2017

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Implications for agency governance and policy recommendations Drawing thenecessary implications fromthe findingson the threekeyareasof concern identifiedabove,thefollowingpolicyrecommendationscanbemade:

Budgetarycontrol

The reform of the budgetary procedure in line with activity based budgeting should besteppedupwithaspecialfocusonevaluatingtheagencies’activitiesinlightofpolicyoutput.This will require the definition of agency-tailored key performance indicators that do notexclusivelyorpredominantlyfocusonprocessasispresentlythecase,butratheronoutput.Ultimately this should elicit a reflection among and between stakeholders on a possiblesimplification of the often complex composite procedures currently in force. ThissimplificationoughttobeinlinewiththeprincipleofsubsidiaritybutmightresultingrantingEUagenciesgreaterpowers.Thispossibilityought tobecontemplatedwhenand ifa soundbutleanandcoherentsystemofaccountabilitymechanismsisputinplace(seebelow).

Co-ordinationof(external)activities

While the Common Approach on EU agencies foresees the possibility of merging existingagencies,sucharadicalapproachdoesnotseemnecessarytounlockpossiblesynergiesandefficiencygains.Thepossibilitiesoffurthercoordinationofactivities(bothadministrativeandintermsofpolicy)shouldbeexplored.ThisalsoappliesfortheEUagencies’externalrelationswhichareoftenancillary,butnecessary,complementstotheagencies’coreinternalmandate.WhiletheCommonApproachaimstomakesurethatEUagenciesarenotseentorepresenttheEU,acoordinationofagencies’externalrelations(withtheCommissionandbetweentheagencies)isstillvital.Finally,inthoselimitedcaseswhenexternalrepresentationoftheEUbythe agencies is needed for practical reasons, it shouldbe regulated in amanner that is notoverburdening for theoperationof theagenciesbutallows foracontrolby institutionsandmemberstates.

Reviewingaccountabilitymechanisms

Themyriadofaccountabilitymechanismscurrently imposedonEUagencies isnot informedby a fully considered idea of where EU agencies fit in the EU’s institutional architecture.Instead, layer upon layer of accountability mechanism have been imposed, in some casesfrustrating the efficient functioning of the EU agencies. It therefore seems essential toredefinetheapplicableaccountabilitymechanisms.Whichmechanismsarenecessaryoughttobe informed by a common understanding on the agencies’ role and purpose in the EUadministration. This question was left open by the Common Approach. The EU institutionsshouldthusgobacktothedrawingboard,reflectingonthis fundamental issueanddrawingthenecessaryconclusionsfortheaccountabilityframeworkforEUagencies.IdeallytheresultofthisthoughtexerciseshouldbereflectedinareinforcedandupgradedCommonApproachonDecentralisedAgencies.

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1See the JointStatementof theEuropeanParliament,CouncilandCommissionaccompanying theCommonApproachonEUDecentralisedAgencies.2 Michelle Everson, Cosimo Monda & Ellen Vos, European Agencies in between Institutions and MemberStates,in:Everson,Monda&Vos,EuropeanAgenciesinbetweenInstitutionsandMemberStates,AlphenaandenRijn,KluwerLawInternational,2014,pp.3-7.3Theautonomyor independenceofEUdecentralisedagencieshasbecomearesearchfield in itsownright,see Martijn Groenleer, The autonomy of European Union agencies: a comparative study of institutionaldevelopment, Delft, Eburon, 2009, 432 p;MariaMartens, Voice or Loyalty? The Evolution of the EuropeanEnvironment Agency (EEA), (2010) 48 JCMS 4, 881-901; Arndt Wonka & Berthold Rittberger, Credibility,complexityanduncertainty:explainingtheinstitutionalindependenceof29EUagencies,(2010)33WEP4,pp.730-752; Ellen Vos, EU agencies and independence, in Ritleng (ed.), Independence and legitimacy in theinstitutionalsystemoftheEuropeanUnion,Oxford,OUP,2016,pp.206-227.4 The only exceptions here are the European Defence Agency, Europol, Eurojust and the European PublicProsecutor.SeeArticles45TEUand85,86and88TFEU.5Forinstance,theEuropeanFoodSafetyAuthoritywasestablishedin2001followingtheBSEanddioxinfoodscares; theEuropeanMaritimeSafetyAgencywassetup in2002 followingtheErikaandPrestigeaccidents;theEuropeanSupervisoryAuthoritieswerefoundedin2010followingthefinancialcrisis;etc.6MichelleEverson&EllenVos,Europeanagencies:whatabouttheinstitutionalbalance,in:AdamLazowski&StevenBlockmans,ResearchHandbookonEUInstitutionalLaw,Cheltenham,EdwardElgar,p.140.7SeeEuropeanCommission,Programmingofhumanandfinancialresourcesfordecentralisedagencies2014-2020,COM(2013)519final.8 See i.a. Merijn Chamon, EU Agencies: Legal and Political Limits to the Transformation of the EUAdministration,Oxford,OUP,2016,pp.15-45.9SeetheParliament’sproposalforsuchaRegulationannexedtoEuropeanParliamentresolutionof9June2016foranopen,efficientandindependentEuropeanUnionadministration.10 Arguing for the proceduralisation of (agencies’) decision-making, see Herwig Hofmann, ‘Agencies in theEuropeanRegulatoryUnion’,TARNWorkingPapers,5/2016;EdoardoChiti, 'EuropeanAgencies'Rulemaking:Powers,ProceduresandAssessment',(2013)19EuropeanLawJournal1,pp.93-110.11SeetheCommonApproachonEUdecentralisedagenciesadoptedin2012bytheEuropeanParliament,CouncilandtheCommission.12EUAgenciesNetwork,EUAgencies–workingforyou,EUPublicationOffice,2016,p.5.13 See the 2017-2018 Work Programme of the Network of EU Agencies, EFSA, p. 5; 2018-2019 WorkProgrammeoftheNetworkofEUAgencies,FrontexandECDC,p.4.14Ibid.,seealsotheCommonApproachonEUDecentralizedAgencies,para.5.SeealsotheConclusionsfromthe second TARN Dialogue Event, available at: http://tarn.maastrichtuniversity.nl/wp-content/uploads/2016/12/TARN-Dialogue-Final-Conclusions.pdf.15Ibid.16SeetheInterinstitutionalAgreementbetweentheEuropeanParliament,theCounciloftheEuropeanUnionandtheEuropeanCommissiononBetterLaw-Making,OJ2016L123/1,para.20.17SeetheCommonApproachonEUDecentralisedAgencies,paras15&31.18SeethethirdTARNDialoguesession,11-13April2018.19Ibid.20 See the Conclusions from the second TARN Dialogue Event, available at:http://tarn.maastrichtuniversity.nl/wp-content/uploads/2016/12/TARN-Dialogue-Final-Conclusions.pdf.21SeeFlorentinBlancandGiuseppaOttimofiore,'Theinterplayofmandatesandaccountabilityinenforcementwithin theEU', inM.ScholtenandM.Luchtman(eds.),LawEnforcementbyEUAuthorities: Implications forPoliticalandJudicialAccountability,Cheltenham,EdwardElgar,2017,pp.272-304.22Onthecompositeadministrationandproceduress,seeOswaldJansenandBettinaSchöndorf-Haubold(eds.),TheEuropeancompositeadministration,Cambridge, Intersentia,2011;HerwigC.H.Hofmann, ‘CompositeDecisionMakingProceduresinEUAdministrativeLaw’,in:HCHHofmann,ATürk(eds.)LegalchallengesinEUAdministrativeLaw, Cheltenham, Elgar, 2009 pp. 136-167; Edoardo Chiti, 'Les agences et l'administration directe dans l'Unioneuropéenne', inAubyandDutheildelaRochère(eds.),Droitadministratifeuropéen,Bruxelles,Bruylant,2007,pp.275-277.

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23Thisnotablybyorganizingaconferencedevotedto theexternal relationsofEUagencies (andagency likebodies)inJune2017inLuxembourg.Aneditedvolumeonthetopicisalsoinpreparation.24Thereisawideexternalpractice,closelylinkedandnecessitatedbythefunctionsandtasksoftheagencies.Among the areas of activity, which were discussed during the session was risk assessment for setting ofpolicies;especiallyasinsomepolicyfieldswhereriskisimminentandthereisoftenneedofurgentaction.Itisimperative tocooperatewith internationalactors, toavoidcatastrophic resultsof thedivergent language intheimplementationofpolicybyEUandnon-EUnationalandinternationalbodies(aswiththeZikaoutbreak).As standardsandapproaches inassessmentof riskare related to scientificevidence,workingarrangementsareoftenthebasisforcommonlygeneratedscientificevidenceand/ortheapproachofinterpretation.SeetheConclusionsfromthebreakoutsessionbyGroup3duringtheTARNDialogueSessionof29June2016,availableat:http://tarn.maastrichtuniversity.nl/wp-content/uploads/2016/12/TARN-Dialogue-Conclusions-g3.pdf.25Ibid.26SeethethirdTARNDialoguesession,11-13April2018.27ThisisveryclearfromtheDGsdifferentapproachestotheworkingarrangementsontheagencies’externalrelations,concludedbetweentheDGsandtheagencies.28Seei.a.IlariaGraceffaandMaiaIgnatenko,Reportonthe11-13AprilTARNWorkshopandDialogueSessioninBrussels,availableat:https://eutarn.blogactiv.eu/2018/04/29/report-11-13-april-tarn-workshop-and-dialogue-session-in-brussels/.29Justliketheaspectofagencyautonomy,thatofagencyaccountabilityhasbecomeafieldofresearchonitsown, see i.a.MadalinaBusuioc, Europeanagencies and their boards: promises andpitfalls of accountabilitybeyonddesign, (2012)19 JEPP5,pp.719-736;MadalinaBusuioc,EuropeanAgencies - LawandPracticesofAccountability, Oxford: OUP, 2013, 326 p; Michael Buess, Accountable and Under Control? ExplainingGovernments'SelectionofManagementBoardRepresentatives,(2015)53JCMS3,pp.493-508;NuriaFont&IxchelPérezDurán,TheEuropeanParliamentoversightofEUagencies throughwrittenquestions, (2016)23JEPP9,pp.1349-1366;MiroslavaScholten,ThepoliticalaccountabilityofEUandUS independentregulatoryagencies, Brill, Leiden, 2014, 493 p.; Christopher Lord, The European Parliament and the legitimation ofagencification, (2011)18 JEPP6, 909-925; Julia Jansson,Building resilience,demolishingaccountability? Therole of Europol in counter-terrorism, (2016) 28 Policing and Society 4, 432-447; Michael Buess, ‘EuropeanUnionAgencies’VerticalRelationshipswiththeMemberStates:DomesticSourcesofAccountability’,(2014)34JournalofEuropeanIntegration5,509-524.

TARN Statement

ONEUAGENCIESREFORM

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5April2019

TARN STATEMENT ON EU AGENCIES REFORM

Authors

GiacintodellaCananea,BocconiUniversityDeirdreCurtin,EuropeanUniversityInstituteMerijnChamon,GhentUniversityMichelleEverson,BirkbeckCollegeJustinFrosini,BocconiUniversityHerwigHofmann,UniversityofLuxembourg

ChristianJoerges,HertieSchoolofGovernanceMarkoMilenkovic,SAISEuropeJohannesPollak,InstituteforAdv.StudiesViennaJarleTrondal,ARENAOsloEstherVersluis,MaastrichtUniversityEllenVos,MaastrichtUniversityBrunodeWitte,MaastrichtUniversity

TheTARNacademicresearchnetworkstudiesEUagenciesinawaythatisrelevantforpolicymakersandactorswithin theEU institutionalenvironment.Over thepast threeyears, thenetwork has engaged in widespread consultation with stakeholders and has prepared aseries of policy recommendations which may be implemented within the currentinstitutionalenvironment. Inaddition,theTARNnetworkhassetouttofinda longer-termconstitutionalperspectiveupontheappropriateplaceandframingofEUagencieswithintheTreatiesandtheoperationoftheEUinstitutionalsystem.

Thisisapressingissue,sincetheEUadministrationhassofarbeen‘agencified’inabsenceofsoundanchoringoftheEUagenciesintheEUTreatiesleadingtolargeheterogeneityofEUagencies, and numerous accountability concerns resulting in ‘overloaded’ and sometimesconfusingsetofcontrolmechanisms.

Above all,where agencies have emerged as a formof EU ‘civil service’with a useful andappropriate role in the development and even implementation of European policies andprogrammes, apressingneedhasarisen to clarify thenatureof agencymandates, and tosecuretheagency-instrumentwithintheTreaties.Ifagenciesaretoretaintheirlegitimacyasimpartial bodies of expertise, they must first be supplied with clear and comprehensivemandates,evenwherethosemandatesdetailapoliticalprogramme.

TARN Statement

ONEUAGENCIESREFORM

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Bythesametoken,however,agenciesmustbegiventheirownsourceofformallegitimacythroughtheirrecognitioninandregulationbytheEuropeantreaties.

In particular, five key recommendations may be made. Unlike the TARN policyrecommendations, they are not necessarily feasible to implement in the short-term. Inconstitutionaltermshowevertheysuggestthemselvesasnecessary.

Legalbasis

1. At least in a number of language versions, i.a. the English one, the Lisbon Treaty hasformally recognisedagencificationof theEUexecutiveby introducingEUagencies intotheTreaties.AgenciesaresoputonparwiththeEUinstitutionsinavarietyofprovisionsin the Treaties, inter alia related to internal security, complaints on instances ofmaladministrationsubmittedtotheOmbudsman,audits,fraudandcitizenship.Agenciesare moreover required to hold an open, efficient and independent administration(Article 298 TFEU).Moreover, the Treaty has formalised jurisdiction of the Court overagency acts in Article 263 TFEU. In thismanner, the Courtmay review the legality ofagencyacts‘intendedtoproducelegaleffectsvis-à-visthirdparties’andtheirfailuretoact,whileitmayalsointerpretthelegalityofagencyactsinpreliminaryrulings.Yet, theabsenceof EUagenciesnotably in the systemofArticles290-291TFEU raisesconcernsinrelationtothenatureoftheEUexecutiveandthepossibleconflictingrolesof the Commission and agencies aswell as accountability andmeasures of control onagencies.This‘constitutionalneglect’showsthecurrentunclearpositionofagenciesasactors that can adopt binding executive acts, while conformity with the principle ofconferral of powers is being raised. The recognition by the Court (in ESMA – Case C-270/12) of the possibility that agencies can be delegated binding decision-makingpowers can only be a temporary solution and Treaty change is needed to clarify andconsolidate the institutional realities. This need is intensified in view of the trend tograntagenciesincreasinglymorediscretionarypowers.

A legal basis should thus be inscribed in the Treaties, preferably in Part 6, Title I –InstitutionalProvisionsoftheTreatyontheFunctioningoftheEuropeanUnion,soastoprovide an enabling clause to create and empower EU agencies. Similarly to Article291(3) TFEU it could also contain a legal basis for the adoption of a new frameworkinstrument. Itwould have to refer back toArticles 290-291 TFEUand explain the rolethatEUagenciescanplay.ConverselyArticles290-291TFEUshouldbechangedsoastoreflectandexplaintherolethatEUagenciescanplay.

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NeedforanoverallvisionlaiddowninaRegulation

2. The 2012 Common Approach should be updated and be made binding. In the JointStatementaccompanyingtheCommonApproach,theEUinstitutionsthemselvesnotedthattheproliferationofagencies‘hasnotbeenaccompaniedbyanoverallvisionoftheirroleandplaceintheUnion.’However,theCommonApproachalsofailstoaddressthatquestion.TheEU institutions shouldaddress thisquestion. Solving thequestionof the'role and place of agencies in the Union', will allow them to solve the question howagenciesrelatetotheCommission,Parliament,CouncilandMemberStateswhichinturnwillallowthe institutions todefineaclearandsimplifiedaccountability framework foragencies.

Ideally, the new Common Approach would be an act of infra-constitutional nature(similartotheComitologyandTransparencyRegulations)andshouldfirstreflecttheEU'sfundamental constitutional principles which are now neglected in the CommonApproach and in institutional practice: conferral, subsidiarity, proportionality andinstitutional balance. For this however a legal basis in the Treaties would be needed(similar to Article 291(3) TFEU), requiring the institutions to adopt such a frameworkinstrument in the formof aRegulationpursuant to theordinary legislativeprocedure.Sinceit isunclearwhethertheinstitutionscouldrelyonArticle352TFEU(whichinanycase also prescribes unanimity in the Council) and a revision of the Treaties does notseem realistic presently, a second best alternativewould be to upgrade the CommonApproach to a binding inter-institutional agreement under Article 295 TFEU, aspreviouslytriedin2005.

ControlandAccountability

3. TheproliferationofEUagenciesintheEUinstitutionallandscapealsorequiresarethinkof control mechanisms on agencies and underlines the need for a set of generalprinciples that govern EU agencies. The current Common Approach tries to adopt asomewhatbroadervisiononEUagenciesthanthefragmentedapproachfollowedbefore2012inordertoimprovetheexistingsituation,specificallythecoherence,effectiveness,accountability and transparency of these agencies.Whilst the Common Approach hascertainlyhelpedtostructureandrethinkEUagenciesintheEU’sinstitutionallandscape,analysis of the founding regulations adopted after the adoption of the CommonApproach reveals that the Common Approach currently is not always followed inpractice.ThisagainunderlinesthattheCommonApproachshouldberevisited.

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Asstated,thisshouldideallybedonethroughaRegulationoralternativelybymeansofaninterinstitutionalagreement.Thisagreementshouldspecificallyaim:– todefineagencies– tosetupacoherentmodelofparliamentaryscrutiny– toformulaterulesonindependencefrombothcommercialandpoliticalinterests;

takingintoaccountthediversityofagencies– to(re)structureaccountabilitymechanismssoastoavoidoverloadandtakeinto

accountthatagenciesoperateattimesalsoonbehalfofMemberStatessoastoformulateaccountabilityaccordingly

– tounderline the importanceof stakeholder involvement,but leave flexibilityasregardsthemeansofinvolvementdependingonthenatureandmandateoftheagencies and the relevant policy areas while providing for appropriatemechanismsof independence fromcommercial andpolitical interests as statedabove

– toputfullyself-financedagencies,asEUpublicbodies,underbudgetarycontroland to consider whether (part of) their gain should (not) flow back to the EUbudget.

Heterogeinity

4. ItistimetoaddresstheissueofheterogeneityofEUagenciesinamannerthatwillgenuinelyassistthemtocontinueperforming importantmissions intheEUsystem.Whilestructures,functionsandmandatesshoulddependonpolicyneeds,whichmayvaryfromonepolicyareastoanother,thecurrentdegreeofheterogeneitydoesnotreflect genuine differences in policy needs. This exacerbates the problem ofaccountability and legitimacy. Different structures not only make it harder toestablish one unitary mechanism of accountability, such as an EU AdministrativeProcedures Regulation, but at the same time show the need of amore horizontalapproach, e.g. prescribing uniform but lean accountability mechanisms for allagencies. Clustering certain of the agencies’ services and functions should beconsideredasafirstpossiblestepintacklingtheheterogeneityoverload,butfurtherdebatesandactionsareneeded.

Dialogue

5. Itisnecessarytoholdregulardialoguesessionsbetweenrepresentativesofagencies,Commission, Parliament, Council, Member States, stakeholders and academics todiscusstopicsofconcernandresearchfindingsinaChathamhousesetting.