Op-Ed: “The FO v Ministère public (Sanctions extraterritoriales) case : revisiting the territoriality principle” by Nuno Cunha Rodrigues
Last week, on 9th September 2021, the Court of Justice issued its judgment in the case Ministère public (Sanctions extraterritoriales) (C-906/19), a preliminary ruling concerning the possibility and limits for the imposition by a Member State of sanctions for road transport infringements in other Member States.
The French Court of Cassation submitted two questions to the Court of Justice: (a) whether the obligations on drivers under Regulation 3821/85 apply when vehicles are driven both on regular services covering less than 50km and on longer journeys, and (b) whether the infringing acts at issue could be subject to a prosecution in France even though they were committed in Germany.
Concerning the first question, the Court of Justice confirmed that a single vehicle operating as mixed-use falls entirely within the scope of application of Regulation 3821/85.
The second question concerned the interpretation of Article 19(2) of Regulation 561/2006. It was not the first time that this provision was under the scrutiny of the Court. It had already been considered in the Eurospeed (C‑287/14) and Baumgartner (C‑513/17) judgments. In both cases, the Court of Justice concluded that Article 19(2) of Regulation 561/2006 allowed competent authorities of a Member State to impose a penalty for an infringement of the Regulation, even if it was committed in the territory of another Member State in which the undertaking had its seat.
In Ministère public, the Court assessed the same Article 19(2) but from a different angle. The case concerned a roadside check in France of a coach operated by a transport undertaking having its registered office in Germany. The driver was found to have driven in Germany without the driver’s card inserted in the vehicle’s tachograph. The managing director of the undertaking was subsequently imposed a fine of over 10,000 euros in France, as provided for in the French Transport Code.
Sanctions established by the French Code followed the provision of Article 19(1) of Regulation 561/2006, according to which Member States should lay down rules on penalties applicable to infringements of that Regulation and of Regulation 3821/85 (in the case, the driver had infringed Article 15(7) (a) (ii and iii) of Regulation 3821/85).
Still, Article 19(2) of Regulation 561/2006 (by contrast with Article 19(1) thereof) didn’t clearly mention Regulation 3821/85. The ‘shadow’ or underlying question was whether the French authorities could impose a penalty for the infringement of Regulation 3821/85 detected in French territory (and not committed in it), having in mind that this latter Regulation had no similar provision to Article 19(2) of Regulation 561/2006 but knowing, at the same time, that both Regulations are interdependent.
This explains why Article 19(2) of Regulation 561/2006 had to be revisited by the Court of Justice.
It is noteworthy that this provision is justified by the cross-border nature of road transport activities (recital 19 of Regulation 561/2006 and Baumgartner, paragraph 30) and by the need to assure the functioning of the internal market and the effectiveness of EU law. In other words, Article 19(2) of Regulation 561/2006 allows a Member State which had detected an infringement in its territory (and not outside its territory) to penalise that infringement, irrespective of the place where it was committed (Baumgartner, paragraph 31).
The subtle difference between these two situations – in the first the infringement was detected in the EU Member State territory and in the second it was not – discloses the need for EU rules to establish some degree of connection or link to an EU Member State’s jurisdiction, taking into account the territoriality principle, whenever they provide national authorities powers to impose penalties in cross-border situations. Without this appropriate link, EU rules would be uncertain, leading to their inapplicability in cross-border infringements.
This is more clearly understandable if one recalls the discussion concerning the possible extraterritorial application of EU law to third countries.
Here, the territoriality principle, established in EU law, follows the general principle enshrined in public international law according to which a State cannot take measures in the territory of another State, through the application of national laws, without the latter’s consent.
In some cases, EU law can become applicable to situations that occur outside the EU territory (extraterritorial effects) by seeking some degree of connection or link with the EU territory or through the so-called ‘territorial extension’ technique. By doing so, the EU aims to define market access rules to non-EU companies or to produce what some call a ´Brussels effect´ that reaffirms the EU as a global regulatory power leveraging EU rules that aim to establish a world level playing field. The latter is clear, nowadays, for example in data protection, foreign direct investment (considering the proposed new Regulation to address distortions caused by foreign subsidies in the Single Market), or environmental protection (taking in account the recently approved Carbon Border Adjustment Mechanism (CBAM)). Specific examples of the use of this technique, can be found in the field of EU environmental law (Article 4 of Regulation 995/2010; Article 3(1)(f)(iv) of Directive 2012/19/EU; Article 25-A of Directive 2008/101/EC) (see also the ATA judgment, C-366/10); EU animal protection law (Article 3 of Regulation 1007/2009); EU financial markets law (Article 4(1)(c) of Regulation 648/2012); or the legislation on rating agencies (Article 4(3)(c) of Regulation 1060/2009) and on data protection (Articles 14 and 15 of Regulation 2016/679).
Beyond territorial connections, EU courts have also moved towards an effect-based approach, inter alia, in the context of competition law (Intel, C-413/14, paragraphs 48-53, and ISU, T‑93/18, paragraph 125). This approach aims to minimise the risk of double jurisdiction over the same conduct.
Going back to Article 19(2) of Regulation 561/2006, in our opinion, the appropriate connection or link to an EU Member State’s jurisdiction was accomplished by demanding the infringement to be detected in the territory of the Member State where the penalty is imposed.
In Ministère public the Court of Justice was asked to go deeper into the analysis of Article 19(2) of Regulation 561/2006 and to clarify whether the same rule was applicable to Regulation 3821/85.
For the French Government and the European Commission, relying on contextual and teleological interpretations, those two Regulations formed an inseparable whole. Accordingly, Article 19(2) could be extended to Regulation 3821/85.
However, this interpretation was problematic for a number of reasons.
Firstly, because, in the field of criminal law, offences must be defined clearly and precisely in advance (see Advocate General (AG) Bobek’s Opinion, point 54). In the case at hand, the individual concerned wasn’t, on the basis of the wording of the relevant provision and with the help of the interpretative assistance given by the courts, in a position to know which acts or omissions would make him criminally liable (AG Bobek’s Opinion, point 53).
Secondly, based on the literal interpretation of Article 19(2), a Member State could not impose a penalty in the above mentioned situation as Regulation 3821/85 was not established in Article 19(2) (differently from Article 19(1)).
Thirdly, the above interpretation was the only one suitable in respect of the principles of legality and proportionality of criminal offences and penalties stated in Article 49(1) of the Charter of Fundamental Rights of the EU.
As so, in Ministère public the Court of Justice concluded Article 19(2) of Regulation 561/2006 wasn’t applicable to Regulation 3821/85. Consequently, the French authorities could not have fined the German Director if the infringement was committed in Germany (although the infringement at issue appeared to have been both committed and detected in France, as explained in AG Bobek’s Opinion, point 38).
Put differently, the Court of Justice’s decision would have been a diverse one if Article 19(2) of Regulation 561/2006 had expressly allowed a Member State to impose a penalty for an infringement of Regulation 3821/85. If so, the connection or link would already be present in the Article. In this hypothetical scenario, Article 19(2) should also consider the non bis in idem principle (and demand Member States to inform the European Commission). In this sense see, for example, Article 19(1) of Regulation 561/2006; Article 11(3) of Directive 2017/1371; Article 10 of Directive 2014/57/EU; and AG Bobek’s Opinion, point 52.
Paradoxically, one can say the Ministère public (Sanctions extraterritoriales) case is not about the extraterritorial application of EU law within the EU. Instead, it underscores, once again, the need for EU rules to establish an appropriate link or connection to an EU Member State jurisdiction whenever considering its application by Member States in cross-border situations.
Furthermore, this case clarifies the need to assure that EU rules are consistent with the principles of legal certainty and security (although this is not clearly mentioned in the judgment), namely in the context of criminal law, when exercising EU competences such as the one stated in Article 83(2) of the TFEU and in accordance with the Charter.
Nevertheless, discussions on the applicability of EU law to cross-border situations within the EU and the possible extraterritorial reach of EU law will continue.
Nuno Cunha Rodrigues is Associate Professor at the Faculty of Law of the University of Lisbon; Jean Monnet Chair; Vice-President of the European Institute at the Faculty of Law of the University of Lisbon and a Lawyer. He is the author of Extraterritoriality of EU Economic Law – The Application of EU Economic Law Outside the Territory of the EU, Springer, 2021, forthcoming.