FOR EDUCATIONAL USE ONLYE.L. Rev. 2005, 30(1), 42-67

European Law Review

2005

Article

THE PROBLEM OF KOMPETENZ-KOMPETENZ: A CONFLICT BETWEEN RIGHT AND RIGHT IN WHICHTHERE IS NO PRAETOR

Gunnar Beck.

Copyright (c) Sweet & Maxwell Limited and Contributors

Case: Brunner v European Union Treaty (2 BvR 2134/92 & 2159/92) [1994] 1 C.M.L.R. 57 (BverfG (Ger)) (Germany)

Legislation: Treaty establishing a Constitution for Europe (Draft) Art.I-6, Art.I-11Basic Law (Germany) Art.23, Art.24Treaty on European Union (Maastricht) 1992

Subject: EUROPEAN UNION. Other related subjects: Administrative law. Constitutional lawKeywords: Competence; Constitutional law; EC law; European Court of Justice; Judicial review;

National courtsAbstract: Considers how the clause on the primacy of EU law in the draft Treaty Establishing a Constitution for Europe affects the jurisdiction of the national courts to determine the extent of EU legislative competence and thereby affects the constitutional law of the Member States, in view of the German Federal Constitutional Court in Brunner v European Union Treaty (2 BvR 2134/92 & 2159/92). Highlights the court's arguments for a national constitutional jurisdiction of last resort on the grounds of: (1) democratic legitimacy and Parliamentary assent; (2) the European Parliament's lack of full democratic accountability; (3) the protection of fundamental rights; and (4) the principles of legal certainty and limited individual authorisation. Discusses the potential impact of the draft Constitution on each of the four arguments advanced and what may be required to resolve the conflict between the two systems in favour of the EC.

*42 The problem of Kompetenz-Kompetenz concerns the question of which court decides the boundaries of the EU's legislative competence: the ECJ with a view to the uniform application of Community law, or national constitutional courts with reference to the overriding requirements of national constitutional law and to the terms of national accession to the EU ratified by national parliaments. The issue has been brought to the fore again by the proposed incorporation into the Constitutional Treaty for the EU of the so-called primacy clause, and as part of the wider debate about the legal and political implications of the proposed constitutional settlement. The underlying structure of the relationship between EU and national law has been most comprehensively and authoritatively analysed from the perspective of national constitutional law in the Maastricht judgment of the German Federal Constitutional Court. The Court's reasoning is here analysed in terms of four inter-related

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sub-strata which underpin the Court's case for a "national constitutional jurisdiction of the last resort": the need for national parliamentary assent; the absence of a European demos; the protection of fundamental constitutional rights; and the principle of legal certainty. The author concludes that the provisions of the Constitutional Treaty in no way affect the underlying structure of the relation between national and EU law and that, in its four key strands of argumentation, the reasoning of the German Federal Constitutional Court remains relevant and applicable, without significant qualification or modification, to the constitutional structure envisaged by the Constitutional Treaty.

While the ultimate fate of the draft EU Constitutional Treaty remains undecided, the controversy surrounding it has brought to the fore again the question of the supremacy of Union law and in particular the issue of how it may be affected by Art.I-6 (formerly Art.I-10 of the Convention text) of the draft Constitutional Treaty. Article I-6 provides as follows:

"The Constitution, and law adopted by the Union's Institutions in exercising competences conferred on it, shall have primacy over the law of the Member States."

*43 Ever since the provision appeared in the first draft of the Constitutional Treaty submitted to the Convention it has been argued that Art.I-6 merely restates well-established case law of the European Court of Justice ("ECJ") going back to its decisions in Costa, [FN1] the Internationale Handelsgesellschaft [FN2] and the Simmenthal [FN3] cases. Those cases established the supremacy of Community over national law generally including national constitutional law, and did so on the grounds that primacy of Community Law is a sine qua non which is necessary to ensure the uniform application of Community law throughout the Member States and without which a legal order of its kind could not function. Article I-6 does no more than codify the principle. The final version of the Constitutional Treaty endorsed by the Intergovernmental Conference concluded under the Irish Presidency in June 2004 emphatically reiterated this position with a Declaration which states that "[t]he Conference notes that the provisions of Art. I-6 reflect existing Court of Justice case law."

At the same time, however, Art.I-6 does introduce at least one new term or concept, that of the EU Constitution. The reference to the Constitution has raised concerns that Art.I-6 might have the effect of making the doctrine of supremacy part of the constitutional structure of each Member State. This in turn, critics of the Constitutional Treaty continue to argue, might have the effect of resolving the question of Kompetenz-Kompetenz (i.e. that of whether it is the national Constitutional courts or the European Court of Justice which ultimately determines the relationship between national constitutional provisions and EU law) definitively in favour of the European Court. [FN4] This would allow the European Union itself de facto to extend its own competences in the absence of a formal internal constitutional amendment procedure allowing the EU institutions to do so formally by their own decisions and without the need for national ratification by each Member State.

The argument about Kompetenz-Kompetenz is part of a wider concern and debate that the Constitutional Treaty would expand, expressly and/or impliedly, the existing range of the EU's competences. If the ECJ acquired the Kompetenz-Kompetenz this would give the EU, through its Court, the power to adjudicate all competence disputes between Member States and the EU, without any check by national constitutional courts. This paper will argue that, in legal terms, this fear is unfounded and that the importance of the question of Kompetenz-Kompetenz can easily be overstated, when, in reality, its practical *44 significance is circumscribed, first, by the degree to which the basic constitutional allocation of powers cannot reasonably be called into doubt, secondly, by a basic plausibility requirement which obtains in relation to all judicial interpretation of legal texts, and, finally, by the pragmatic considerations any court must acknowledge if it wishes to avoid conflict with the political authorities.

Critics of the proposed codification of the principle of the supremacy of EU law point to the similarities between the proposed primacy clause for the EU and the US supremacy clause as an ominous warning against inadvertently strengthening the remit of the judicial review power of the ECJ. Indeed, at first sight the parallels between the two documents are undeniable. Both clauses assert the primacy of the Constitution and of all laws made under its authority over all laws of the (Member) States. Article VI of the US Constitution goes on to state that Federal supremacy applies even in relation to the constitutional law of the states of the Union. The Constitutional Treaty, by contrast, does not do so expressly--an omission, however, whose significance should not be over-emphasised. For in the Internationale Handelsgesellschaft case the ECJ established more than three decades ago that the doctrine of supremacy afforded no exception and that the need for legal certainty and uniform application of EC law meant that EC law trumped national law including the constitutional law of Member States.

At the same time, it must be said, Art.I-6 does not establish a general principle of the primacy of EU law over all national law; its scope of application is limited by Art.I-11 which provides as follows:

"1. The limits of Union competences are governed by the principle of conferral ... .2. Under the principle of conferral, the Union shall act within the limits of the

competences conferred upon it by the Member States in the Constitution to attain the objectives set out in the Constitution. Competences not conferred upon the Union in the Constitution remain with the Member States."

Article I-11(2) echoes the Tenth Amendment to the US Constitution which states that "[t]he powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people." Where the Union and (Member) States have concurrent powers, the principle of primacy of Union law confines the legislative power of the (Member) States to subject matters not (yet) covered by Union or Federal law. To the extent to which both the Union and the states have legislated, both constitutional systems thus ensure that Union or Federal law displaces the state law which is invalid to the extent to which it conflicts with Union law. In the EU Art.I-12(2) of the Constitutional Treaty expressly applies the principle of primacy to concurrent powers. The US Constitution does not contain an equivalent clause, nor does it formally categorise powers as exclusive and shared powers, but the same result is achieved by the doctrine of pre-emption. According to this doctrine the states of the Federation are free to legislate only for as long as there is no Federal law covering the same subject matter. Once a Federal statute has occupied that field, it displaces state law and state courts are bound to give effect to federal law when it is applicable and to disregard state law when there is a conflict. Accordingly, a state statute is void to the extent to which it conflicts with Federal law understood to include not only the *45 Constitution, Federal statutes and treaties but also their interpretation by the US Supreme Court. [FN5]

In the US judicial activism in strengthening Federal at the expense of state power has been most significant in areas where the Constitution grants both the Federal and the state governments the power to legislate without clearly delimiting their respective spheres of competence. Perhaps the two most notable examples are the expansive reading given by the US Supreme Court to the Federal government's fiscal powers and of its power to regulate commerce which played a crucial role in undermining state power in both areas. In the case of the European Union, most of the powers conferred on it fall into the category of shared competences--that field of state-Union relations where the US example suggests the scope of judicial activism is greatest. This would acquire particular significance if the reference to the Constitution, the only way in which the proposed primacy clause in the Constitutional Treaty goes beyond the existing case law, would indeed enhance the ECJ's role and self-

understanding as the ultimate guardian of the Constitution. It may encourage the Court to seek to emulate the US Supreme Court and, by imaginative reference to the objectives and values enshrined in the Constitution, to adopt an expansive reading of the Union's concurrent competences and impliedly establish new competences for the Union on the basis that they must have been intended to be exercised at EU level as they are necessary to the effective exercise of those tasks more expressly assigned to the Union by the Constitution.

In the author's view, however, there are at least three main considerations which cast doubt on some of the more extravagant claims about the extent of constitutional change likely to result from adoption of the Constitutional Treaty in general and from inclusion in the text of the contentious primacy clause. These are: first, the fact that notwithstanding its misnomer the Constitutional Treaty remains a treaty; secondly, the practical significance of the problem of Kompetenz-Kompetenz which is far more limited than often supposed; and, thirdly, there is nothing in the provisions of the Constitutional Treaty which in any way changes the underlying structure of the relationship between EU law and the legal systems of Member States so as to affect the position of the constitutional courts in the Member States--a position which has been most comprehensively analysed and stated by the Bundesverfassungsgericht (i.e. the German Federal Constitutional Court) in its famous Maastricht judgment. The final claim will form the main focus of this discussion, whilst claims one and two will be discussed much more briefly and with exclusive reference to the competence question. It will be suggested that the exercise of the EU's competences remains constrained in fundamental ways which, notwithstanding textual parallels between the US and EU Constitutions, can be juxtaposed against the very different arrangements under the United States Constitution. On the question of the Kompetenz-Kompetenz it will be concluded that the key elements characterising the reasoning of the Bundesverfassungsgericht in the Maastricht judgment are applicable, *46 with hardly any qualification or modification, to the constitutional structure envisaged by the Constitutional Treaty.

Constitution or Treaty?

In its most basic sense the new reference to the Constitution in the Constitutional Treaty is misleading. The draft Constitutional Treaty was drawn up by the Convention to replace and consolidate the present EC and EU Treaties, and, while it may have become fashionable to refer to it as the EU Constitution, it remains the case that the Constitutional Treaty does not have the basic features characteristic of a Constitution but, in common with the present and previous EC and EU Treaties, takes the form of an international treaty. Like the present EC and EU Treaties, it requires ratification by the Member States in accordance with their national constitutional requirements. There is no provision in any constitution of the Member States explicitly providing for the adoption of a Constitution of the European Union. Indeed, the adoption of a constitutional system directly by the European peoples or their representatives would require substantial changes of national constitutions or would even be excluded. [FN6]

The difference between a treaty and a constitution remains vital notwithstanding increasingly customary and rather loose reference to the so-called process of the constitutionalisation of the European Union. For the two concepts imply a radically different answer to the fundamental question "of who has the right to determine the basic legal order of the Union: the Member States, by reaching agreement amongst themselves, or the EU, by determining its own institutional and legal framework by dint of a decision of its own competent institutions." [FN7] Strictly speaking, even the term Constitutional Treaty is a misnomer. The term suggests that, by an agreement enshrined in a treaty, the Member States empower the EU henceforth to determine and develop further its own constitutional structure.

This is not the case. The Constitutional Treaty, unlike for example the US Constitution and indeed unlike virtually any national constitution, does not provide for an internal revision mechanism which would allow for the amendment of constitutional provisions on the basis of decisions taken by the institutions of the European Union. Rather, like the existing EU/EC Treaties and any other international treaty, it is capable of amendment only by a further treaty between the Member States. [FN8]

Even if the Constitutional Treaty is finally adopted, the EU will not thereby acquire that defining feature of statehood which would enable it, by dint of a prescribed constitutional procedure authorising its institutions, to grant itself new powers and thereby to amend its *47 own basic legal framework. Any powers the EU would have under the Constitutional Treaty, it would continue to exercise by conferral and the supremacy of EU law would extend only so far as and no further than the limits of the powers that have been conferred. Article I-11 of the Constitutional Treaty for the first time codifies the limitation on the principle of primacy by reference to that of conferral: subject to the primacy enjoyed by directly effective Constitutional provisions itself. EU law, according to the new provision, trumps national law only where and to the extent to which the Constitution (or at present the Treaties) confers legislative powers on the Union. To the extent to which it does not confer competence, Member States retain legislative autonomy subject, of course, to other treaty obligations they may incur as sovereign actors independent of their membership of the EU.

The Constitutional Treaty also for the first time lists and categorises the Union's competences. The two most important areas where the EU either has the exclusive legislative power or the power to harmonise and/or replace national legislation are listed in Arts I-13 and I-14 respectively. For the most part, these reproduce and do not extend the Union's existing competences under the present treaties. In some areas, however, it has been suggested, the Constitutional Treaty extends the Union's powers. This applies arguably to the Union's exclusive competences to conclude certain types of international agreements and to establish competition rules; in both respects the wording of Art.I-13 does not merely codify but arguably broadens the precise remit of the Union's powers under the existing ECJ caselaw.

Regarding the Union's shared competences Art.I-14 provides a list of policies where, within the confines of the precise definitions of the legislative powers conferred in the EC Treaty, Union legislation displaces national legislation whenever the Union exercises its legislative competences and where the Union may also act to harmonise national legislation to the extent to which it does not seek to replace it. The areas covered are familiar areas of Union competence subject to two principal exceptions. First, energy policy becomes a Union competence within the scope of the detailed measures authorised in Pt III of the Treaty; so far the Community had to use Art.308 EC Treaty ("EC") to adopt measures in this area. Secondly, Justice and Home Affairs measures currently governed by the more onerous requirements of the Second Pillar of the EU Treaty, become a shared competence under the title of Freedom, security and justice. While the scope for Union measures in this area may actually be more restricted under the Constitutional Treaty than under the existing treaties, the proposed treaty introduces qualified majority voting ("QMV") across a range of measures where so far unanimity is required. In short, the Constitutional Treaty largely confines itself to consolidating and categorising the Union's well-established competences; where, by contrast, it does extend those powers, the extension is limited in scope and, except in the cases enumerated, confined to an extension of the application of QMV into areas presently still subject to unanimity.

Under the present treaties the traditional areas of state sovereignty, with the exception of monetary policy and certain areas of internal security policy either fall outside the remit of Union competence or remain firmly ring-fenced within the inter-governmental pillars. This national prerogative in foreign affairs survives under the Constitutional Treaty except for

certain subordinate or operational decisions in the field of foreign policy envisaged by Art.III-300 where, however, the proposed operation of QMV would only come into play *48 on condition of prior unanimous approval of the overarching policy objectives by all Member States. Similarly, the Union's revenue powers remain as constrained as they are under the present treaties, with the exception of the proposed introduction of QMV to allow for the appropriation of limited emergency funds for circumscribed objectives approval of which requires unanimity (Art.III-313).

How far the EU still remains from acquiring significant competences in most of those areas traditionally regarded as the defining features of statehood, can perhaps be best illustrated by comparing the proposed constraints on the EU's powers with the equivalent provisions of the US Constitution covering the same subject matter. Article I(8) of the US Constitution gives the Federal Union control over defence, foreign policy, fiscal and monetary policy as well as important aspects of judicial policy and internal security. Some of those powers, however, notably most fiscal powers, are granted to the Union concurrently with the states. Furthermore the Union is granted the power "[t]o borrow money on the credit of the United States", the power to regulate foreign and inter-state commerce and the power to declare war. Finally, Art.I(8) contains an enabling clause empowering the Union "to make all Law which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States." In so far as the supremacy of Union law is confined by both the US and the EU Constitutions to those powers conferred on the Union institutions by the two Constitutions respectively, even the most superficial comparison of the basic allocation of powers between the different layers of government in the two texts suggests how much broader the scope for the application of the supremacy principle is in the US, and how constrained by the principle of conferral it remains under the EU Constitutional Treaty.

The US example, however, is instructive in another respect. Notwithstanding the broadranging powers granted to the Union by the Constitution, Federal power remained for a long time constitutionally constrained in at least two respects. First, the grant of fiscal authority to Congress in Art.I(8) did not transfer this power from the states which was well established when the Constitution was drafted in 1787. Taxation became one of those concurrent powers exercised broadly by both layers of government except for those limited circumstances in which Art.I(9) denies the states duty-levying powers. Amongst the most important constraints on the federal government was the prohibition of Art.I(9) cl.4 not to lay any direct taxes except "in Proportion to the Census or Enumeration herein before directed to be taken." Ultimately the constraints on the Federal government's power to impose income taxes were removed in 1913 when Congress overrode previous Supreme Court decisions and passed the Sixteenth Amendment which granted Congress the power to lay income taxes without the conditions of Art.I(9). The Fourteenth Amendment, by removing the restrictions on income tax, magnified the federal taxing power and ushered in hundreds of federal grant powers.

Secondly, as originally drafted and confirmed by the Supreme Court in 1833 [FN9] the Bill of Rights only restrained the federal government, not the states. A fundamental change in federal-state relations in this respect only occurred as a result of the Civil War and the passage of the Fourteenth Amendment in 1868. The Amendment, known as the "Due Process Clause", prohibited the states from making or enforcing any law "which shall *49 abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws." The Due Process Clause subsequently became the vehicle for a succession of decisions whereby the Supreme Court extended almost every provision of the Bill of Rights to bind the states. Without the Fourteenth and

Sixteenth Amendments the subsequent redress in the federal-state balance of power in the areas of fiscal policy and civil rights with its manifold ramifications in other policy areas would not have been conceivable.

Both cases suggest that the basic allocation of powers contained in sufficiently clear and precise constitutional provisions sets the basic parameters which will constrain subsequent judicial interpretation of the constitutional text by a constitutional court, and that in such cases formal amendment of those provisions represents, in principle and, unless a constitutional court is prepared flagrantly to disregard the wording of the provisions, also in practice, the only effective way of bringing about far- reaching constitutional change. In the case of the EU, foreign, defence and budgetary policy are obvious areas of policy-making where no creeping transfer of competences through implicit judicial constitutional change has occurred, either because the ECJ has not been given jurisdiction, or because the wording of the relevant provision has left no doubt as the narrow confines of Union power. In other areas, by contrast, notably the internal market competence of the Union which, in a very broad sense, could be seen as mirroring functionally the Commerce Clause of Art.I(8) of the US Constitution, the grant of an inherently vague power likely to expand in the context of an increasingly integrated economy, provided the basis for extensive judicial concentration of legislative power at the centre, which generally found its limits only in clear constitutional provisions to the contrary. The Constitutional Treaty in no substantive way extends the Union's powers over taxation, foreign and defence policy.

The example of the US together with the EU's admittedly more short-lived experience so far suggests that, in view of the proposed exclusion of ECJ jurisdiction over the CFSP [FN10] and the clear and carefully worded provisions on taxation and budgetary policy, there is little scope for the expansion of Union competence in these areas except by formal amendment. Unlike the US Constitution, however, which provides Congress with the power to amend the Constitution according to the internal revision procedure in Art.V which requires the assent of two thirds of both Houses of Congress and of three quarters of the states, the Constitutional Treaty, like all its predecessor treaties, can only be amended on the basis of unanimity.

The limits of Kompetenz-Kompetenz

Realistically, the issue of Kompetenz-Kompetenz does not arise in relation to all competences conferred on the Union or shared between the EU and its Members. It is irrelevant to the extent to which the constitutional text is unequivocal in allocating powers to either the EU or Member States. Conversely, it becomes relevant in proportion to the imprecision of language and/or the extent of conceptual ambiguity. In other words, problems of who is to decide on the limits of the EU's conferred competences may arise *50 in all those areas where the competences in question may be reasonably or credibly disputed. Such disputes may arise either where an area of competence is not clearly defined, where the concepts to which it refers are vague or ambiguous, or where two partially overlapping powers are not both allocated either to the Union or, alternatively, left with the Member States including those cases where certain measures may fall within one area of competence but may also be reasonably regarded as necessary to the effective exercise of other powers which have been allocated to another layer of government. The question of Kompetenz-Kompetenz thus will only acquire practical significance in those grey areas of the limits of the EU's powers where based on different interpretations of the wording or arguable objectives of Treaty provisions or as a result of overlapping competences the ECJ and national constitutional courts may take a different view. The more uncontentious the

demarcation of policy areas between the two, the less scope there is for Kompetenz-Kompetenz problems to arise.

From this two things follow. First, even if the Kompetenz-Kompetenz issue were to be resolved in favour of the ECJ, the resultant scope for judicial extension of EU power would be significantly constrained in scope in that, under the existing treaty arrangement no less than under the Constitutional Treaty, there are certain policy areas which remain inter-governmental and thus remain firmly within the control of Member States as opposed to those that form part of the exclusive competence of the Union. To the extent to which legally binding measures in these areas are subject to judicial review or open to challenge on the grounds that they are unconstitutional, there would be no uncertainty in these areas as to which court--the ECJ or national constitutional courts--would be competent to adjudicate any dispute that may arise over who decides on who is to legislate on what. Examples of undisputed ECJ jurisdiction are disputes relating to the so-called four freedoms and differential treatment of EU citizens on the grounds of nationality--cases where the language of the Treaties leaves no doubt that these are Union matters. By contrast, taxation is an area where except for the narrowly circumscribed provisions regarding the Community's budget and related matters, the Treaty does not confer any competences on the Union. Accordingly, to the extent to which fiscal measures are open to review, the prerogative of national courts to rule on the constitutionality or otherwise on the legality of such measures has not generally been challenged by the ECJ except where such measures involved discriminatory treatment or internal market issues. In practice, therefore, whenever the Treaties have been clear in either conferring or denying certain powers to the Union, the competence of either the ECJ or the national courts has not been contested.

It is rarely acknowledged that, in effect, an analogous situation exists in relation to the relationship between Parliament and judicial power in this country or other Member States. Once an Act of Parliament has been enacted, the courts have sole power over its interpretation but they are constrained by the words used in the Act, which, in direct proportion to their clarity and incontestability, set the parameters limiting judicial discretion. Where the language in the statute is clear, the courts will not generally adopt a construction that does violence unto the language used in the Act so that the legislature would find it needful to legislate again to overrule the case law. A very simple example of the limits to judicial discretion, where the exercise of such discretion would do obvious and incontestable violence to the language of the statute, would be if a court decided to construe a power indicated by the use of the modal verb may, as a duty which is commonly *51 introduced by the modal must. Beyond the scope of such incontestable cases, the rules and conventions of statutory interpretation further restrain judicial discretion [FN11] but conventions governing the ordinary use of language also continue to operate as important constraints on the legislative power of judges. A judge may have discretion to include a flying boat within a statutory rule as to ships or vessels; he has no discretion to include a motorcar within such a rule. [FN12]

In other Member States with a written constitution the respective constitutional courts have the sole right to review legislation with regard to its conformity with the constitution. Nevertheless, were a constitutional court to adopt an unconventionally expansive reading of the national constitution and to start striking down politically contentious measures of social and economic policy, the likely open conflict with the legislature would result either in a crisis of political legitimacy or a constitutional amendment. The position of constitutional courts as the sole interpreters of national constitutions thus depends on judicial self-restraint just as the exercise of judicial discretion generally depends on the judicial acceptance of limits to that power. [FN13] Viewed in this light the problematic associated with and often misrepresented as particular to the issue of Kompetenz-Kompetenz appears to a large

measure as little more than an instance of the problem of judicial discretion in general. For common to both the general and the particular is the link between the practical significance of the power and the reasonableness of its exercise.

The practical relevance of the Kompetenz-Kompetenz issue goes no further than the extent delimited by the plausibility of the claim to exercise that competence by either the ECJ or the national court with regard to the issue at hand. [FN14] Were the ECJ to construe the Treaty in such a way as to claim the right to review the foreign or economic policies of Member States or details of national tax systems and thereby try to overrule the national prerogative in these areas, the resultant political crisis at EU level would, analogously to a domestic crisis provoked by the perception of a national constitutional court overstepping the fine line of judicial power, necessitate a political resolution of the conflict between national governments and the Court where legal arguments about the Court's Kompetenz-Kompetenz would matter little in the face of political will. [FN15] In brief, therefore, even if the Constitutional Treaty were to resolve the question of Kompetenz-Kompetenz, then the effective exercise of that power itself would imply and depend on recognition of *52 the need for judicial self-restraint ensuring that the Court's judgments do not overstep, at any given time, the mark of the politically acceptable. [FN16]

Finally, in the absence of an internal constitution revision mechanism for which neither the existing treaties nor the proposed Constitutional Treaty make provision and the introduction of which would itself require a further drastic amendment of the Constitutional Treaty, the Member States collectively (wherever QMV applies) or individually (where unanimity is required) retain control over the determination of those parameters within which alone Kompetenz-Kompetenz problems may reasonably arise. Due to the ineliminable impreciseness and uncertainty of the language in which the allocation of competences, like all legal commands, sometimes has to be expressed for political or legal reasons, there will always be a blurred zone at the points of intersection between the powers of the Member States and the Union. How deep the inroads, however, which any resultant dispute over who has legislative authority in this judicial no-man's-land may make into the traditional legislative autonomy of Member States only secondarily and to a limited extent depends on which court decides; first and foremost the scope of its effects is pre-determined by the political decisions of national governments and the degree to which they are willing to surrender the right to abandon the principle of conferral as the basis for the Union's competences and grant the EU the right to re-define its own powers in accordance with its own decision-making procedures. It is the basic allocation of powers in the constitutional text which determines the radius of EU law, and it is only at the edges where the language of the text does not speak for itself but needs to be interpreted by the courts, that the issue of Kompetenz-Kompetenz is at all relevant.

The position of the Bundesverfassungsgericht and the Maastricht judgment

Together with the extra-judicial writings of some of its judges, the judgments of the German Constitutional Court provide what is perhaps the most comprehensive analysis of the issue of Kompetenz-Kompetenz in the relationship between national and EC law. The Court developed its analysis in two stages. During the first the Court focussed on Art.24 of the German Basic Law or Grundgesetz ("GG") which allows for the transfer of legislative power to an international organisation, and on the question of whether that power extends to the transfer to an organisation outside the German constitutional structure such as the European Community, of a power to contravene certain basic principles protected under the Constitution itself. The Court set out its thinking in two important judgments known as Solange I and Solange II. In Solange I the Court resoundingly rejected the existence of a

power capable of contravening the German constitution and ruled that in the hypothetical case of a conflict between Community law and the guarantee of fundamental rights under the German Constitution, those rights prevailed over any conflicting norm of EC law. The power under Art.24 GG therefore had an implied qualification that nullified any power by the competent institutions of the Federal government to transfer sovereign rights wherever such a transfer could affect the constitutional guarantee of fundamental rights under the Basic Law.

*53 The Court later moderated its stance in the light of the ECJ's development of a doctrine of protection for fundamental rights. In Solange II it ruled that, in view of this development and for as long as the Community generally ensured an effective protection of fundamental rights as against the sovereign powers of its institutions and that protection was regarded as substantially similar to the protection of fundamental rights required unconditionally by the German Constitution, the Court would no longer exercise its jurisdiction to decide on the application of secondary Community legislation. The Court, however, neither said that it no longer had such jurisdiction nor did it rule out that it might not resume exercising its jurisdiction should the conditions for its suspension no longer be in place. Solange II therefore did not affect the substance of the Court's judgment in Solange I, namely, that the power of the Federal government to transfer sovereign rights extends only so far and no further than is compatible with the protection of fundamental constitutional rights and with safeguarding the basic structure of the German Constitution.

After re-unification the German Basic Law was amended and Art.23 GG now expressly authorises the Federal government to transfer sovereign powers to the European Union. Article 23 GG states that the existence of the power assumes a level of protection by the European Union of fundamental rights, which is substantially similar to the protection of those rights under the German constitution. The new Art.23 GG effectively codifies the Constitutional Court's Solange decisions. When ratification of the Maastricht Treaty was challenged before the Constitutional Court, the Court ruled not just that the ratification was compatible with the Constitution but used the opportunity to adapt its earlier decision in the light of the amended Constitution and embedded its earlier human rights focus in a more comprehensive analysis of the relationship between EU law and German constitutional law. In its long and politically charged judgment the Constitutional Court made clear that Germany's acceptance of the supremacy of Community law was conditional on parliamentary assent and asserted its jurisdiction to review Community law to ensure, first, that it remains within the scope of the powers conferred on the Community and, secondly, does not transgress the fundamental rights guaranteed under the German Constitution.

It must be noted at this stage the Maastricht judgment nowhere carefully distinguishes between the need for parliamentary ratification under the German Basic Law and the corresponding but not identical constitutional requirements, which obtain in other Member States. Parliamentary assent is the most common form of ratification. Some Constitutions, like the Irish, however, require a referendum, whilst in other Member States a referendum is optional and its outcome may then either be consultative or binding. Moreover, a referendum resulting in an approval of a proposed treaty change does not necessarily or even generally dispense with the need for further parliamentary approval. In one form of another, therefore, the need for parliamentary approval is generally either the basis or part of the national ratification process throughout the EU, and even where it is not strictly required, the constitutional need for express democratic legitimation of proposed treaty changes remains even if it assumes the form of a plebiscite. In substance if not in form, therefore, the analysis by the Federal Constitutional Court of the relationship between national and EU law is just as relevant to other Member States, for the determinants of that relationship--the mixture of the need for democratic legitimation expressed in the majoritarian principle, be it directly or indirectly through parliament, *54 which is restrained by the rights-based anti-majoritarian

component of Member States' constitutions--are the same in all the Member States and are expressive of their basic liberal-democratic political order. The Court's complex analysis of the relationship between national and EU law proceeds along four more or less distinct lines of argument.

Democratic legitimacy and parliamentary assent

The German Basic Law defines the Federal Republic as a parliamentary democracy in which the exercise of popular sovereignty is generally restricted to parliamentary elections. Article 38 guarantees every German citizen the individual right to participate in the election of the Bundestag and "thereby to co-operate in the legitimation of state power by the people at federal level and to have an influence over its exercise." [FN17] No provision is made for referendums except in certain narrowly circumscribed cases involving boundary modifications of the Länder. In other cases, however, legislation is democratically legitimated not directly--through plebiscites--but indirectly by parliamentary approval, subject, of course, to the overriding status of the constitution and, at least in principle, to the direct applicability of the general principles of public international law. The need for parliamentary ratification extends to all cases where the Constitution grants powers to the Federal government to cede law-making powers to international organisations generally (Art.24 GG) and to the European Union in particular (Art.23 GG).

If therefore, the Constitutional Court states in the conclusions of the judgement, a confederation of democratic states like the European Union exercises sovereign rights, it does not derive its democratic legitimacy from a single European demos nor even directly from the constituent peoples. Instead the democratic basis for its exercise of these rights resides in the treaty concluded by the Member States which becomes valid in the Member States only once it has been ratified in accordance with their national constitutional requirements. The European Union depends on those transmission mechanisms prescribed by national constitutions for the translation of popular sovereignty into democratically legitimated legal action. In the case of Germany, and most other Member States, that mechanism guaranteeing democratic legitimacy consists in parliamentary ratification. [FN18] "Because the German elector essentially exercises his right to participate in the democratic legitimation of the institutions and agencies entrusted with sovereign powers by means of the elections for the German Bundestag, the Bundestag must also decide on German membership of the European Union and its continuation and development." [FN19] In the words of one of the authors of the Maastricht judgment writing extra-judicially, national laws authorising the transfer of sovereign rights to the European Union and requiring the approval of national parliaments thus "serve as a bridge which carries the *55 European law created outside Germany into Germany." [FN20] If this bridge were to break down, the transfer of these rights to and their exercise by the EU would lack democratic legitimacy and any legislation adopted by the EU would no longer apply in Germany. [FN21]

In short, democratic legitimacy is conferred on the European Union indirectly through the ratification of its enabling treaties by the German Parliament, which is itself legitimated through periodic elections and subject to the overriding framework of the Constitution. The validity and application of EU law in Germany thus depends on the instruction of parliamentary assent. In the words of the Constitutional Court: "[T]he common authority of [the European Union] is derived from the Member States and can only have binding effects within the German sovereign sphere by virtue of the German instruction that its law be applied." [FN22] Germany thus remains "one of the 'Masters of the Treaties [Herren der Verträge]'." [FN23] The Court acknowledges a certain supporting function for the directly elected European Parliament for the provision of democratic legitimacy, whilst leaving no

doubt that in the absence of far-reaching cultural, political and social changes within the states of the EU national parliaments will remain the main source of democratic legitimation. The Court's argument limiting the democratic legitimating role of the European Parliament within the structures of the EU draws attention to the pre-legal preconditions of the concept of legitimacy and is therefore best discussed in its own right.

The absence of a European demos

As a result of the introduction of direct elections together with the gradual extension of its legislative powers, the European Parliament, the Court acknowledges in the Maastricht judgment, has acquired an ancillary legitimating function "as the source of a supplementary democratic support for the policies of the European Union." [FN24] The Court goes on to state that:

"[w]ith the establishment of Union citizenship by the Maastricht Treaty, a legal bond is formed between the nationals of the individual Member States which is intended to be lasting and which, although it does not have a tightness comparable to the common nationality of a single state, provides a legally binding expression of the degree of de facto community already in existence ... .

The influence flowing from the citizens of the Union can eventually become a part of the democratic legitimation of the European institutions to the extent that the conditions necessary for this purpose are fulfilled on the part of the peoples of the European Union." [FN25]

The Court here points to a rich conception of political legitimacy which goes beyond "a merely formal principle of accountability" and which depends "on the presence of certain *56 pre-legal conditions" which are crucial to the process of peaceful democratic articulation and resolution of political conflict between "opposing social forces, interests and ideas." [FN26] Two indispensable conditions singled out by the Court are, first, the possibility of direct communication through a common language between the organs of government exercising sovereign powers and the people as the electorate legitimating the exercise of those powers, and, secondly, the existence at EU level of political parties, associations, and common press and broadcasting organs as the mass communication media "for imparting the objectives of the Community institutions and the effects of their decisions to the individual nations." [FN27] These conditions are vital parts of the wider social basis that would be necessary for the gradual emergence of a recognisable European public opinion and of an EU-wide public discourse by which the political process at EU level has to be fed before it can be regarded as fully democratic. [FN28] So far that discourse only exists at the level of political, academic and economic elites. To the extent, however, to which the social basis for EU-wide political debate and discourse widens, the Court concedes, the European Parliament may over time acquire greater democratic legitimation and thereby itself provide greater legitimacy for the policies and legislation of the European Community. This does not mean, however, the Court warns, that the legitimating role and importance of national parliaments will decline within the foreseeable future:

"What is decisive is that the democratic bases of the European Union are built-up in step with integration, and that as integration proceeds a thriving democracy is also maintained in the Member States. An excess weight of functions and powers within the responsibility of the European federation of states would effectively weaken democracy at national level, so that the parliaments of the Member States could no longer adequately provide the legitimation for the sovereign power exercised by the Union.

If the peoples of the individual states provide democratic legitimation through the agency of their national parliaments (as at present) limits are then set by virtue of the democratic

principle to the extension of the European Communities' functions and powers. Each of the peoples of the individual states is the starting point for a state power relating to that people. The states need sufficiently important spheres of activity of their own in which the people of each can develop and articulate itself in a process of political will-formation which it legitimates and controls, in order thus to give legal expression to what binds the people together (to a greater or lesser degree of homogeneity) spiritually, socially and politically.

From all that it follows that functions and powers of substantial importance must remain for the German Bundestag." [FN29]

In summary, the emergence of a European demos, the Court states, is a normative and constitutional precondition which must be met before the European Parliament can assume more than its present supporting legitimating function, and it is a process which itself depends on a number of fundamental changes in the cultural, social and political *57 fabric of the Member States making up the Union. For the time being these pre-legal sources of identification of the people with a large political entity still firmly locate the focus of popular allegiance in the individual states making up the Union. For this reason, national parliaments must retain ultimate control over the integration process. For in the absence of national parliamentary control that process would lack democratic legitimation which at EU level cannot be provided by the European Parliament for as long as it is elected by a number of national electorates rather than one demos defined in terms of lesser or greater cultural and social homogeneity.

In essence, the Constitutional Court links the question of democratic legitimation with that of identity. It acknowledges that national identity is a composite that is subject to determination by underlying cultural and social determinants which include shared cultural experiences, shared values and generally though not necessarily a distinct linguistic identity. [FN30] At the same time these determinants are, at least in principle, open to evolution. In principle, therefore, if the electorates currently constituting culturally and socially distinct entities finding political expression in separate Member States, converged to such extent--socially, culturally, politically as well as linguistically in the sense that English became established as a universal second language which could be used as the official language throughout the Union in a fashion akin, for example, to its present status in India and which is understood by the vast majority of the electorate--that they would come to regard themselves as sufficiently homogeneous, then this would call into question the rationale for the mediation of popular will through national institutions. Together with institutional reforms of the EU, designed further to strengthen the accountability of the executive organs of the Union to the European Parliament, this development would justify a greater legitimating role for the European Parliament. For the time being, however, the persistence of a strong sense of national identity in Member States requires political and legal expression, and this implies that national parliaments (except in countries where there is a constitutional requirement for a referendum) must retain a "reserve" control function over the extent and depth of the process of European integration. For without this control the process runs the risk of being divorced from its legitimating basis, namely, popular accountability and consent.

Fundamental rights

The Court's third argument, in which it asserts the inviolability of the fundamental rights guaranteed under the German Constitution and its own role as the ultimate arbiter guaranteeing their observance by supra-national institutions no less than by the domestic organs of government, is in many respects the most familiar, as it draws to a considerable measure on the earlier Solange judgments. Hence a short summary will suffice. The Federal Constitutional Court starts with the premise of the inviolability and inalterability of the

fundamental rights as enumerated for the most part in Title I (Arts 1 to 20 GG) of the Basic Law. Their inalterability means they are equally protected against the possibility of dilution or limitation by either the formal process of constitutional amendment on the basis of the required enhanced parliamentary majority or the acts of a supranational body *58 like the European Union purporting to exercise those functions transferred by parliamentary accession to its founding treaties. The inviolability of these rights under the German constitution means that their observance is an implied condition accompanying any transfer of sovereign functions or powers to such bodies by the organs of the German federal government, and "[t]he Federal Constitutional Court by its jurisdiction guarantees that an effective protection of basic rights for the inhabitants of Germany will also generally be maintained as against the sovereign powers of the Communities and will be accorded the same respect as the protection of basic rights required unconditionally by the Constitution, and in particular the Court provides a general safeguard of the essential content of the basic rights. The Court thus guarantees this essential content as against the sovereign powers of the Community as well." [FN31]

The Court's position in the Maastricht judgment amounts to a concise and systematic restatement of the position as reached in the Solange I judgment, which the Court then proceeds to qualify in the light of its subsequent modification of its views in Solange II. Accordingly, the Court states that it would not generally independently exercise its right to review EU secondary legislation with a view to its conformity with the basic principles and rights afforded by the German Constitution. Rather, "the Court exercises a jurisdiction on the applicability of secondary Community legislation in Germany in a "relationship of co-operation" with the European Court, under which that Court guarantees protection of basic rights in any particular case for the whole area of the European Communities, and the Constitutional Court can therefore restrict itself to a general guarantee of the constitutional standards that cannot be dispensed with." [FN32] The Court here emphasises that responsibility for the judicial development of European law must be entrusted to the ECJ which, through its caselaw, has developed a sufficiently broad-based protection of the general principles and rights embedded in the constitutional traditions of Member States. Whilst this means that, as a general rule, the Constitutional Court will not rule on the validity of EU legislative acts, this does not in any way abridge the jurisdiction of national constitutional courts to determine the ultimate borderline between developing and altering European law. Whilst the Federal Constitutional Court may be generally content to let the ECJ get on with the business of developing the body of EU law, it categorically asserts its own Kompetenz-Kompetenz to determine the borders of the EU's competence. To transfer such Kompetenz-Kompetenz would create at least the theoretical possibility of subjecting the Member States to a self- propelling automatism de-coupled from the two sources from which European law ultimately derives its legal authority: the overarching moral and legal principles enshrined in national constitutions combined with the democratic legitimacy bestowed by parliamentary assent.

Legal certainty and the principle of limited authorisation

The Court's final argument addresses the complaint that "the European Community will be able, because of its widely set objectives, to develop into a political union having unspecified sovereign right without a renewed parliamentary instruction for its laws to apply." [FN33] The Court rejects this complaint together with the other challenges; its argument *59 is premised again on the need for popular legitimacy and expressly builds on the two first arguments. European law only has binding effect within the German state by virtue of parliamentary accession to the Treaties on which the Union is founded.

Parliamentary assent, however, the Court states, must be both revocable and predictable in its consequences in accordance with the principle of legal certainty. For while the transfer of sovereign functions and powers "for an unlimited period" and "with the intention of long-term membership" is compatible with the concept of national sovereignty, Germany would lose "the quality of a sovereign state in its own right" if it did not preserve the right "ultimately to revoke that adherence [to the Union Treaty] by a contrary act." [FN34] The Court here impliedly returns to its earlier argument that the exercise of sovereign power depends on popular legitimation and that, in the absence of a European demos, that sovereignty resides in the Member States which cannot divest themselves of it permanently.

It is for the same reason that the transfer of sovereign rights to the Union must be predictable or certain in its extent for if it were not and determination of the scope of the powers transferred were left for the Union rather than Member States to determine, this would, in effect, leave the transferred powers undefined from the perspective of the Member States and could no longer be meaningfully understood as having been authorised by national parliaments. Assent is meaningful only if its object is sufficiently certain. Applying these considerations to Germany's membership of the EU the Court concludes that "[t]he Union Treaty satisfies the requirements of certainty because it lays down the future course of implementation, that is to say, the possible uses to be made of the sovereign powers granted, in a manner which is sufficiently predictable: that establishes that the Act of Accession adheres to the requirements of parliamentary responsibility." [FN35]

In concreto the requirements of legal certainty find expression in the Union Treaty in "the principle of limited individual empowerment ... which does not give the Union a power to determine its powers ... the possibilities for conferring further duties and powers on the European Union and the European Community are restricted by sufficiently precise rules." [FN36] Above all the principle of limited individual authorisation prevents the Union from inferring concrete powers from its widely worded tasks and objectives as set out in particular in the treaty preamble. The German Constitutional Court thus expressly denies the transfer of sovereign rights from the Member States to the Union could ever extend to granting the Union Kompetenz-Kompetenz, namely, the autochthonous power to grant itself new competences and enabling it to give itself the financial and other means to fulfil its objects, including the Kompetenz-Kompetenz of the ECJ to determine the scope of the Treaty without regard to the constitutional requirements which obtain in Member States. [FN37] If contrary to the principle of limited individual authorisation the "European institutions were to interpret, and act under, Art.F(3) TEU in a sense contrary to the content of this Treaty provisions as accepted by the German Act of Accession, such action would not be covered by the Act and would therefore not be legally binding within the German Member State. The organs of the German state would have to refuse to supply the personnel to *60 implement any legal instruments based on such a treatment of Art. F(3)." [FN38] If a conferred power cannot be adequately defined or if its definition were left solely to the discretion of the ECJ, its transfer would be unconstitutional and it could be declared non-binding by the domestic courts. [FN39]

In short, the Court's argument can be summarised as follows: The requirement for legal certainty implies the principle of limited individual authorisation as the overarching norm governing the transfer of sovereign right from the Member States to the European Union: The competence of Member States is the rule, that of the Union is the exception. [FN40] From this it follows that the Union cannot be granted the sole right to define its own competences. Nor does the ECJ have the sole right to interpret the scope of the Treaties for such a right would imply the power to determine whether the exercise by the Union of a power disputed by the Members was based on a valid interpretation of the Treaties or, in effect, amounted to an amendment of the Treaty. Granting the ECJ Kompetenz-Kompetenz in these questions

would erode the distinction between Treaty interpretation and Treaty amendment. From this it follows that the Federal Constitutional Court must remain the ultimate arbiter over who decides whether the acts of the European institutions fall within the scope of the sovereign rights transferred to them or exceed those limits.

Summary

The judgment of the Constitutional Court is multilayered and combines formal legal reasoning with due regard to the non-legal foundations of political allegiance and legitimacy. The unifying principle central to the four strands of argument outlined above is the principle of conferral. Through the act of conferral of sovereign rights and powers by parliamentary assent to the founding treaties of the European Union the Union acquires the democratic legitimacy it would otherwise lack. At the same time the principle limits the powers of the European Union by reference to the overriding requirements imposed by the liberal-democratic basic order guaranteed by the German constitution: the need for democratic legitimation (argument one), as an expression of the "spiritual, social and political" homogeneity of a people as the necessary irrational source of political allegiance (argument two) and subject to the constitutional guarantee of fundamental rights (argument three) and of the basic principle of legal certainty and predictability as one of the constituents of the rule of law (argument four).

The principle of conferral safeguards the democratic-majoritarian foundation of the Constitution through the need for parliamentary assent as a precondition for every additional step in the process towards European integration, and it protects the Constitution's liberal basis with its twin demands for the protection of fundamental rights and of the rule of law by reserving to the Constitutional Court the jurisdiction to strike down any unconstitutional legislation irrespective of whether it has been adopted by the organs of the European Union or by the German parliament. It follows that the scope and application of European Union law in Germany, and the other Member States, is ultimately contingent *61 on parliamentary assent and compliance with national constitutional requirements. It is this conditionality enshrined in the principle of conferral which secures the position of the Member States as the "Masters of the Treaty" and ensures that by accession to the European Union its Member States do not submit to a self-propelling automatism of irreversible integration. [FN41]

The Maastricht judgment in the light of the Constitutional Treaty

Since the Maastricht judgment there have been more specific challenges to the primacy of EU law and to related ECJ rulings before the German courts. In the most important of those, the lengthy litigation which arose over the Community's banana import regime, the Constitutional Court reaffirmed its familiar position in Solange II that constitutional complaints attacking Community secondary legislation would be admissible only if they argued successfully that the general level of protection afforded at EU level, including the ECJ case law since Solange II, fell below the German level of protection. [FN42] Neither the adoption of the Treaty of Amsterdam nor that of the Nice Treaty caused the Court to revise its views, and the Maastricht Judgement remains the Constitutional Court's considered and authoritative statement on the fundamental principles determining the relationship between EU and national law.

The draft Constitutional Treaty, of course, envisages more far-reaching changes than either the Amsterdam or Nice Treaties, notably in the area of institutional reform and the definition and extension of QMV. The proposed changes, however, if accepted, would all be accomplished by way of treaty amendment and do not affect the issue of the Union's

Kompetenz-Kompetenz in the sense of the ability of its own competent institutions to revise the treaty without the need for assent by each Member State and in particular the question of which court is competent to determine the scope of the Union's powers. It has already been shown that the practical significance of who has judicial Kompetenz-Kompetenz can easily be exaggerated as the judicial power of interpretation varies broadly in proportion to the ambiguity of the text or concepts concerned and ultimately cannot be exercised without judicial self-restraint if conflict and a struggle for recognition with the political authorities is to be avoided. At present both the ECJ and the German Constitutional Court claim the Kompetenz-Kompetenz of defining the boundaries between treaty amendment and treaty interpretation. This impasse cannot be resolved in favour of the ECJ simply by codifying the ECJ's existing position in the form of the proposed primacy clause but only if the German Constitutional Court will give way and abandon its own claim. In the Maastricht judgment the Constitutional Court described the relationship between the two courts as one of co-operation in which the two judicial systems were discharging complementary though partially overlapping functions. The extent to which that relationship may be affected by adoption of the Constitutional Treaty, and to which the existing system of mutual forbearance would be resolved in favour of either court system, is best assessed by reference to the four main arguments of the Maastricht decision as identified above.

*62 The argument from democratic legitimacy

The principle of democratic legitimacy, together with the non-majoritarian liberal principle permeating the German constitution, is the central concept underlying the Court's analysis of the relationship between national and EU law. The European Union is not legitimised by a single European people but rather by the peoples of the states which together form the EU. It follows from the fact that the European Union has its democratic basis in its Member States and relies on the assent of national parliaments for its legitimation, that its powers are strictly limited by the terms of the parliamentary authorisation in treaty form. Parliamentary assent thus has a dual effect. On the one hand, it legitimates the exercise of sovereign powers by the European Union. On the other hand, it ensures Member States retain control over the process of integration in that they determine the scope of the powers transferred, in that every additional step towards closer union requires a treaty amendment which is conditional upon a further separate act of national parliamentary approval, and, finally, in that any transfer of any power remains legally reversible. These conditions find expression in the EC Treaty through the principle of conferral which is enshrined in Art.5 which provides that "[t]he Community shall act within the limits of the powers conferred upon it by this Treaty and of the objectives assigned to it therein." Articles 1, 3 and 5 of the Treaty on European Union ("TEU") cross-refer to the EC Treaty and ensure that the conditions attached to the exercise of Community also apply as minimum requirements to the other policies of the Union, supplemented by any specific additional safeguards and constraints.

It is a further condition attached to the transfer of powers to the European Union that parliaments grant the ECJ the exclusive power of interpreting the treaty, while reserving the task of amending the treaty for the Member States. At least in principle the distinction between interpretation and amendment is recognised in the present Treaties: Art.220 EC limits the ECJ's jurisdiction to the interpretation and application of the Treaties, whilst Art.48 TEU lays down the procedure for future amendments of the Treaties and expressly reserves to each Member State the right to veto any change to the existing treaties. Both the principle of conferral and the distinction between interpretation and amendment of the Treaties are central to the Constitutional Court's argument that the European Union does not have the

power to define its existing powers or to give itself new competences as and when the need arises. If the Constitutional Treaty can be shown to preserve both notions it is difficult to see how it could to any significant degree affect the underlying relationship between national and EU law.

The principle of conferral is expressly recognised by Art.I-11(1) which states that "[t]he limits of Union competences are governed by the principle of conferral." Article I-11(2) explains further that "[u]nder the principle of conferral, the Union shall act within the limits of the competences conferred upon it by the Member States in the Constitution to attain the objectives set out in the Constitution. Competences not conferred upon the Union in the Constitution remain with the Member States." Articles I-1 and I-3(5) also affirm the act of conferral as the source and limiting condition of the Union's competences. The Constitutional Treaty also preserves the strict separation between the mechanisms for interpreting and for amending the treaty. Article I-29(1) reproduces the content of present Art.220 EC without any substantive changes and limits the function of the Court of Justice to ensuring "respect for the law in the interpretation and application *63 of the Constitution." Compared to the current procedure for amending the existing treaties, the revision procedure envisaged under the Constitutional Treaty is more nuanced in that, while affirming the general principle of ratification by all Member States in Art.IV-443 which reproduces Art.48 TEU, it introduces a simplified revision procedure in Art.IV-444 which provides for a lighter revision procedure for the transition to qualified majority voting and co-decision in areas where the Union already has competence but can only adopt legislation on the basis of unanimity. Article IV-444 does not, however, thereby provide a basis for extending the Union's competences, and it provides no basis for circumventing the principle of parliamentary ratification through the backdoor.

In summary, the Constitutional Treaty expressly preserves the principle of conferral as the legal fount of all Union competences and it is as explicit as the treaties currently in force in its denial to the Union of any autochthonous capacity for determining its own powers as the treaties currently in force. The principle of conferral recognises that parliaments and governments of Member States retain full control over any future revision of the Constitutional Treaty involving the creation of new Union competences. The assent of national parliaments remains the bridge which any future treaty creating new competences, will have to cross.

The argument from the absence of a European demos

Like the first argument of the Maastricht judgment, the second argument employed by the Federal Constitutional Court will retain its relevance whether the Constitutional Treaty is ratified or not. Part I of the Constitutional Treaty introduces a new Title VI which emphasises the principle of representative democracy through the European Parliament, and extends the co-decision procedure to a range of Union competences. The Constitutional Treaty does not, however, provide for any mechanism enabling the directly elected representative body to extend or even re-define the Union's competences, which, it has been shown, remains the prerogative of the Member States. Thus, while the reference to the "High Contracting Parties" mentioned in both the EU and EC Treaty as the sole authors of the Union has been replaced by the new formula speaking both of "the will of the citizens and States of Europe" in Art.I-1 of the Constitutional Treaty, the added reference to "the will of the citizens" is purely rhetorical as the High Contracting Parties currently so called remain the Masters of the Constitutional Treaty and its future amendments. The European Union remains a confederation of states, which is legitimised by the mediated wills of the peoples of its constituent states and not by a single European people. The Constitutional Treaty recognises

this fact in that the European Parliament continues to have neither budgetary nor sole legislative powers, even though the Constitutional Treaty strengthens the legislative role of the European Parliament by extending co-decision.

However, in continuing to deny the European Parliament the exclusive or predominant legislative role parliaments characteristically have in established parliamentary democracies, the Constitutional Treaty gives expression to the fact that the European Parliament continues to be elected by national electorates rather than one European electorate. Indeed, arguably the most significant way in which the text seeks to strengthen the democratic basis of the Union does not concern the European Parliament at all, but aims to do so through the proposed re-definition of qualified majority voting in the Council, designed to *64 ensure a more meaningful relation between the population size of a member and its influence in the Council of Ministers. [FN43] This attempt to strenghten the majority principle at the level of the Council rather than by increasing its accountability to the European Parliament reinforces the view that the Constitutional Treaty does not question the central contention by the Federal Constitutional Court that democratic legitimacy continues to be mediated through national parliaments and that, under the present cultural, social and political conditions the European Parliament cannot have more than a supporting legitimating function. Furthermore, as much of the reasoning of the Constitutional Court in this regard far exceeds purely legal arguments and is concerned with the long-term pre-legal constraints on European integration, it is difficult to see how its reservations could be overcome in the absence of far-reaching cultural and social changes on the way to the formation of a common European political identity and of a recognisable EU-wide public opinion. Institutional and legal change may contribute to such changes but they cannot engineer them. In any event, the Constitutional Treaty does not propose a great constitutional leap forward in trying to create a direct democratic basis for the European Union.

The argument from fundamental freedoms

The Court's argument emphasising the need for protection of fundamental rights under the German constitution can be contrasted with the other arguments in several important ways. First, the arguments revolving around the notions of democratic legitimacy and parliamentary assent are contingent on the cultural and social status quo and the prevailing political culture, and the Court acknowledges at least in principle the gradual evolution of a European people which could gradually evolve into a second independent democratic basis for the law-making institutions of the European Union. The Court's concern for fundamental rights, by contrast, invokes a standard of protection, which, at least within the framework of the existing German constitution, is absolute and immutable. Secondly, even though the concept of democratic legitimacy is not linked to a fixed locus, the Court made clear that it would not lightly and not for a long time lift its constitutional proviso linking the transfer of further powers with the need for parliamentary legitimation. By contrast, the Court's approach to the protection of fundamental rights has, over less than three decades, changed considerably in response to the rapid development by the ECJ of a case-based framework of rights-protection which persuaded the Constitutional Court to suspend its monitoring function in favour of one of operational reliance on effective human rights enforcement by the ECJ. Thirdly, whereas the provisions of the Constitutional Treaty do not obviously or not necessarily affect the Court's reasoning in most aspects of the Maastricht decision, the incorporation of the Charter of Fundamental Rights into the new proposed EU constitutional structure as envisaged under the Constitutional Treaty would amount, at least in theory, to the opening of a new chapter in the Community's approach to the protection of human rights. It is less clear, however, how, if at all, the EU's new emphasis on human rights may affect the

position of the German Constitutional Court which first took heed of the ECJ's development of a general policy of the judicial protection of fundamental rights in the Solange II decision and, in the same *65 case, recognised that the general level of protection of fundamental rights at EU level no longer required it to exercise its jurisdiction over the applicability of secondary Community legislation. The Maastricht judgment expressly affirmed this decision.

The Charter of Fundamental Rights and Freedom could perhaps best be described as a "distillation of the rights contained in the various European and international agreements and national constitutions on which the ECJ had for some years already been drawing." [FN44] In most cases Member States are already bound to observe these rights by virtue of identical or similarly worded articles in the ECHR or other international human rights documents. The ECJ has frequently emphasised the role of these documents as the common source of reference for the general principles and fundamental rights contained in EU law. In addition, following the amendments of the Treaty of Amsterdam, Art.6 of the Treaty on European Union expressly recognises "respect for human rights and fundamental freedoms" as one of the basic principles of the Union. The EC and EU Treaties, however, do not at present provide a comprehensive catalogue of such rights and freedoms, nor does the caselaw of the ECJ, which cannot be exhaustive and which notwithstanding its growing coverage remains essentially exemplary.

The Charter would complement the existing patchwork of rights protection in the following ways: first, it would for the first time provide the EU with a list of individual rights and freedoms that would, at least in form, resemble a bill of rights. Secondly, whilst many of the Charter rights reproduce rights contained in the ECHR and other international legal instruments some do not, such as the prohibition on eugenic practices and human reproductive cloning. Thirdly, the Charter, by making the rights it contains directly applicable to the EU institutions and all legislation adopted in pursuance of their decisions, would make human rights guarantees more explicit and provide a clear basis for their justiciability even if such justiciability does not extend to national legislation outside the Union's competence. The Charter reinforces and to some extent extends the protection of human rights at EU level; this does not mean, however, that it would be likely to do so to the complete and conclusive satisfaction of the German Constitutional Court for at least two reasons.

First, the Charter recognises many of the rights guaranteed by the German Constitution, either almost verbatim or at least in substance and through the replication of similar articles in the ECHR. This does not, however, apply to all of the Arts 1 to 20 of the Grundgesetz a significant number of which-- either in full or in part--do not appear in the Charter although for the most part these rights concern policy areas where so far the EU has little or no competence. It follows that those rights which the German Constitutional Court has defined as part of the inviolable and unalterable part of the German Constitution are not in all cases and in some cases only partially reproduced in the EU Charter. Secondly, although the Constitutional Treaty authorises accession by the EU to the ECHR, the ECJ will not be formally bound by the jurisprudence of the European Court of Human Rights even after accession. If the Strasbourg Court found an EU legislative act to be in breach of the Convention, the EU, once it has become a signatory, would be under a treaty obligation to rectify the violation, but, analogously to the position of the national courts of other Contracting Parties, this does not mean that the ECJ is directly bound by the case law of the ECtHR. In the absence of a clear hierarchy of authority between the *66 jurisprudence of the ECJ, the German Constitutional Court and the European Court of Human Rights in matters involving rights guaranteed by identical or similar articles under the Charter, the Basic Law and the ECHR, there is therefore no mutually recognised way of resolving potentially conflicting views and decisions, although in practice all the courts will no doubt be at pains to prevent the emergence of conflicting authorities.

At present the German Constitutional Court follows a policy of operational reliance on the ECJ for the protection of fundamental rights in relation to all EU secondary legislation subject to the rebuttable presumption that the standard of protection under EU law is compatible with that under the German Constitution. Incorporation of the Charter into the EU constitutional framework would undoubtedly strengthen this presumption. It does not, however, provide a compelling argument for the extinction of the "last resort" jurisdiction of the German constitutional court in matters involving rights under the German Basic Law. At least doctrinally, the Constitutional Court would only have to abandon its "last resort" jurisdiction if both the rights guaranteed as part of the inviolable part of the Basic Law were either fully and expressly reproduced in the EU constitutional structure or, alternatively, indisputably outwith the scope of the EU legislation and hence of ECJ jurisdiction, and, in addition, there existed a clear hierarchy between the jurisprudence of the three courts involved, the ECJ, the European Court of Human Rights and the German Constitutional Court. At present neither condition obtains, and this would remain the same even if the Constitutional Treaty and the Charter were to be adopted. It follows that the Constitutional Court's third rights-based proviso has not, at least theoretically, lost its significance.

The argument from legal certainty

The Court's final argument is interwoven with the preceding three, and its continued relevance can be deduced from the previous discussion. In brief, in the absence of a European demos the EU lacks its own independent basis of democratic legitimacy. It consequently depends on the approval of national parliaments as the transmission mechanism for the democratic legitimation of the transfer of sovereign powers to the Union institutions. The Constitutional Treaty continues to recognise the principle of conferral as the sole fount of the Union's powers, which is the corollary of the continuing need for parliamentary assent. The very concept of assent implies certainty or at least the possibility of certainty of its object and thus excludes the possibility of grounding an autochthonous capacity in the EU's institutions to determine and expand its own powers. The notion of assent therefore logically implies that of "limited individual authorisation."

It follows that it must be the national constitutional courts who, when called upon, have the right to determine the limits of the transferred powers; granting the ECJ that right would erode the principle of conferral and be tantamount to laying the foundations of a self-propelling capacity on the Union's part to define and re-define its own powers. It also follows that for as long as there is a requirement of parliamentary assent, there is also a requirement of legal certainty, and since that certainty must exist from the perspective of the transferor of the powers in question and not from its transferee or beneficiary, it must *67 be the national constitutional courts and not the ECJ who are the ultimate arbiters over the limits of the Union's competences.

Conclusion

The Kompetenz-Kompetenz problem will persist in its present form for as long as the EU derives its powers by conferral from Member States which themselves remain bound by their national constitutions and, for that reason, subject to review by their national constitutional courts. The Constitutional Treaty does not change the relationship between the EU and its Member States in the first respect; nor does it affect the internal constitutional structure of Member States. If a dispute arises between the EU and one or more of its Member States as to the existence of a Union competence, then the EU and national court systems will each decide the matter in accordance with the logic internal to each judicial system. The ECJ will

decide on the basis of its interpretation of the treaties and with a view to ensuring the uniform application of Union law. The national constitutional courts will decide with sole reference to the requirements of national constitutional law. Each legal system has its own hierarchy of norms, and, although both systems have influenced each other and partially overlap, each ultimately retains its own rule of recognition. If they come into conflict, their relation can only be one of right against right, a conflict in which there can be no praetor. [FN45]

This conflict cannot be resolved until one of the two legal systems gives way and adopts the rule of recognition of the other as its own. And it will be resolved in favour of the European Union only if the EU develops into a true federation with a unified legal system where Union law trumps state law and is enforced by a clearly structured judicial hierarchy with the ECJ at the apex and national constitutional courts relegated to a position analogous to that of the supreme courts of the US states. It has been shown that the Constitutional Treaty does not represent a decisive step in that direction. Indeed, in affirming both the principle of conferral as the basic rule for the allocation of competences within the EU as well as the fundamental distinction between treaty amendment and treaty interpretation, the text fails to provide a clear answer to the most basic question of all: Where is the European Union heading? [FN46] The issue of Kompetenz-Kompetenz is part of the resultant catalogue of unanswered questions.

FN The author practices EU law as a member of the Legal Services Offices at the House of Commons and is a part-time lecturer in the Department of Law at the London School of Economics. The views expressed here are those of the author alone.FN1. Flaminio Costa v ENEL, Case 6/64 [1964] E.C.R. 585.FN2. Internationale Handelsgesellschaft mbH v Einfuhr- und Vorratsstelle für Getreide und Futtermittel, Case 11/70 [1970] E.C.R. 1125.FN3. Amministrazione delle Finanze dello Stato v Simmenthal SpA, Case 106/77 [1978] E.C.R. 629.FN4. Eileen Denza points out that the primacy clause "makes acceptance of primacy not merely a doctrine derived by implication by the European Court of Justice from the nature of the original Treaty establishing the European Economic Community but an express obligation deriving from the new Constitution. This would strengthen the assertions which have been made by the European Court and might well make national constitutional courts less inclined to assert even an exceptional right to confine it or to test it against fundamental national constitutional norms." (Eileen Denza, Memorandum to the EU Committee (Sub-Committee E), in House of Lords EU Committee, Sixth Report of Session 2003-04: The Future Role of the European Court of Justice, HL Paper 47, p.70. Leonard Besselink shares Denza's misgivings about the proposed primacy clause which "if read within the frame of reference indicated would thus render national constitutions for all intents and purposes subject to EU law of whatever nature, and in effect subordinates the entirety of the state's constitution. (Leonard Besselink, Memorandum to the EU Committee (Sub-Committee E), in House of Lords, cited above, p.66)FN5. For a frequently cited example of the classic formulation of the doctrine by the US Supreme Court see Edgar v Mite Corp 457 US 624, 631.The most obvious cases of conflict between Federal law with State law are those where the two sets of provisions openly contradict each other; conflict, however, may also arise if the state law stands as an obstacle to the accomplishment of the purposes of the Federal statute. The extent to which State law is pre-empted in those cases ultimately depends on the federal purpose (for a discussion of the relevant factors see the analysis of the issue in Crosby v National Foreign Trade Council). Uncertainty also arises from the related need to define the field occupied by Federal law for it is only within this identified field that the purpose of the Federal legislation invalidates state

law.FN6. The adoption of EU Constitution or constitutional system is understood here to refer, amongst other features, to the capacity of the Union to effect future constitutional changes through amendments that do not requires the process of ratification under national constitution, e.g. through decisions taken by the institutions of the EU themselves. Examples of constitutions excluding such a transfer of self-expanding powers to the European Union include those of Italy, Luxembourg or Germany. For a more detailed discussion, see J. Dutheil de la Rochère and Ingolf Pernice, "European Union Law and National Constitutions--General Report", in Fide, EU Law and National Constitutions (2002), pp.10-11.FN7. Dieter Grimm, Die großte eRfindung unserer zEit--aLs weltweit anerkanntes Vorbild braucht Europa keine eigene Verfassung, Frankfurter Allgemeine Zeitung, 16 June 2003, p.35.FN8. For interesting comments on the limited legal significance and possible symbolic importance of the adoption of the term "Constitution" by the Convention, see J.Kokott and A. Rueth, "The European Convention and its Draft Treaty establishing a Constitution for Europe: Appropriate answers to the Laeken questions?" (2003) 40 C.M.L.R. 1319-21.FN9. In the case of Barron v Baltimore 32 U.S. (7 Pet.) 243.FN10. Common Foreign and Security Policy.FN11. On statutory interpretation in the common law and especially on the fidelity to plain meaning and the various lines of authority adopting or more or less restrictive approach to the range of exceptional circumstances where legislative purpose may override literal meaning, see J.W. Harris, Legal Philosophies, London 1980, pp.140-145. Harris emphasises the judicial controversy, which for a long time surrounded even the suggestion that plain meaning should give way to regard for consequence and legislative purpose if the application of the former led to outrageous results or manifest absurdities in terms of presumed legislative intention.FN12. Glanville Williams, "Language and the Law" (1945) 61 L.Q.R. 303.FN13. For a good concise discussion of the relation between judicial discretion and judicial restraint, see Dennis Lloyd, The Idea of Law (London, 1964), pp.270-273 and 282-3.FN14. For a differently focussed but related argument, emphasising the limits of the duty of loyal co-operation and indeed of the application of EU law, see Kirchhof, Die Wahrnehmung von Hoheitsgewalt ... , p.I3.FN15. On the absence of legal means of resolving the underlying tension between the ECJ and the supreme courts of Member States, see, e.g. Anthony Arnull, Memorandum to the EU Committee (Sub-Committee E), in: House of Lords EU Committee Sixth Report of Session 2003-04: The Future Role of the European Court of Justice, HL Paper 47, p.56; and Leonard Besselink, Memorandum to the EU Committee (Sub-Committee E), in House of Lords, cited above, pp.66-7.FN16. Karen Alter emphasises the need for harmony between constitutional development and "the deeper political process." Courts may be "counter-majoritarian institutions" but if faced with a "genuine political movement" both national court and the ECJ will be reluctant not to let "public will" prevail over constitutional provisions significantly out of step with political developments. (Karen Alter, Memorandum to the EU Committee (Sub-Committee E), in House of Lords, cited above, p.55)FN17. Brunner v European Union Treaty (Cases 2134/92 and 2159/92), Bundesverfassungsgericht, Judgment of October 12, 1993, B.I.(a), [1994] 1 C.M.L.R. 57.FN18. The Court's discussion of the link between democratic legitimacy of the EU and parliamentary ratification at national level is found in paras C.I.1- C.I.2 of the Maastricht judgment. The central argument occurs in para.C.I.2. (a).FN19. Brunner, para.C.I.3. See also ibid., para.C.I.2.(b.1): "If the Union carries out sovereign

tasks and exercise sovereign powers" then, the Court concludes, "it is first and foremost that national peoples of the Member States who, through their national parliaments, have to provide the democratic legitimation for its so doing."FN20. Paul Kirchhof, The functions of the ECJ and of the courts in the member states, address to the European Policy Forum at the Frankfurter Institut on May 12, 1995, para.3.FN21. P. Kirchhof, "Die Wahrnehmung von Hoheitsgewalt durch Mitgliedstaaten und Gemeinschaftsorgane", Humboldt Forum Recht 1997 Beitrag 2, www.humboldt-forum-recht.de, p.I1.FN22. Brunner, para.C.II.1.(a).FN23. Brunner, para.C.II.1.(a).FN24. Brunner, para.C.I.2.(b.1).FN25. Brunner, para.C.I.2.(b.1).FN26. Brunner, para..C.I.2.(b.1).FN27. Brunner, para..C.I.2.(b.1).FN28. Dieter Grimm, "Die großte eRfindung unserer zEit--aLs weltweit anerkanntes Vorbild braucht Europa keine eigene Verfassung", Frankfurter Allgemeine Zeitung, June 16, 2003, p.35.FN29. Brunner, para.C.I.2.(b.2).FN30. For a more detailed exposition of the cultural dimension of the Maastricht judgment, see Kirchhof, Die Wahrnehmung ... , Introduction.FN31. Brunner, para.B.2.(b).FN32. Brunner, para.B.2.(b).FN33. Brunner, para.C.II.2.FN34. Brunner, para.C.II.1.(a).FN35. Brunner, para.C.II.2.FN36. Brunner, para.C.II.2.FN37. For a more detailed discussion of the principle of limited individual authorisation, see Kirchhof, Die Wahrnehmung ... , p.II 3.FN38. Brunner, para.C.II.2(b).FN39. P. Kirchhof, "The functions of the ECJ and of the courts in the member states", section 3.FN40. P. Kirchhof, "Die Gewaltenbalance zwischen staatlichen und europaeischen Organen", Vortrag im Rahmen des Forum Constitutionis Europae der Humboldt-Universitaet Berlin, para.33 at www.rewi.hu-berlin.de/WHI.FN41. P. Kirchhof, Die Wahrnehmung von Hoheitsgewalt durch Mitgliedstaaten und Gemeinschaftsorgane, Humboldt Forum Recht 1997, Beitrag 2, p.I3.FN42. For a more detailed discussion, see Paul Craig and Grainne de Búrca, EU Law: Text, Cases and Materials (3rd ed., Oxford, 2003).FN43. See H.J. Papier, "Wohin steuert die Europaeische Union? Darauf vermisse ich eine Antwort", in Frankfurter Allgemeine Zeitung, June 8, 2004, p.5.FN44. Craig and de Burca, cited above, p.359.FN45. I read G.W.F. Hegel's Philosophy of Right 15 years ago and thought that the evocative turn of phrase in this sentence was one of the many powerful images contained in his work. Upon rereading Hegel's work, however, I discovered that, rather like the statue of Glaucon ravaged by time, the precise words I recalled bore little resemblance to the original. This obviates the need for a precise acknowledgment.FN46. H.J. Papier, "Wohin steuert die Europaeische Union? Darauf vermisse ich eine Antwort", in Frankfurter Allgemeine Zeitung, June 8, 2004, p.5.EURLR 2005, 30(1), 42-67

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