Narine Ghazaryan, Assistant Professor in EU and International Law, Radboud University Nijmegen
Photo credit: Jesper Ahlin Marceta via Wikicommons
Introduction
The recent ruling in Case C-180/20 (the CEPA case) marks a new chapter in the ongoing debate about the Common Foreign and Security Policy (CFSP) and its boundaries. This case saw the Commission challenge the Council’s decision to deviate from a proposed Council Decision concerning the EU-Armenian Comprehensive and Enhanced Partnership Agreement (CEPA). Following the precedent set by the Court of Justice of the European Union (CJEU) in Commission v Council (Agreement with Kazakhstan), the Commission removed Article 37 TEU (governing treaties with non-EU countries regarding CFSP) as a primary legal basis for its revised proposal. However, the Council responded by adopting two separate decisions, with one relying on Article 37 TEU along with relevant procedural provisions.
While splitting decisions authorizing international agreements has occurred previously, the CEPA case stands out. Unlike instances where such a split was necessary for provisional application due to political circumstances, the CEPA case appears to use this tactic to sidestep the Kazakhstan judgment. This case underscores the increasing use of the “center of gravity” test in situations involving CFSP and reinforces the trend of consolidating EU external actions. It also aims to provide clarity on how this test should be applied.
Facts and Legal Background
In November 2017, the Council authorized the signing and partial provisional application of the CEPA through a decision based on Article 37 TEU, Articles 91 and 100(2), Articles 207 and 209 TFEU, and Article 218(5) and (7) alongside the second subparagraph of Article 218(8) TFEU.
Following the CJEU’s decision in the Kazakhstan case, the Commission in July 2019 decided to remove Article 37 TEU from the legal basis for the Council Decision. This Decision pertained to the EU’s position within the CEPA Partnership Council regarding the rules of procedure for the Council, its committees, and subcommittees. The legal basis was to be Article 218(9) TFEU for procedural aspects and Articles 91 and 100(2), alongside Articles 207 and 209 TFEU for substantive aspects.
Subsequently, Coreper chose to split the decision into two. One decision, based on Articles 218(8), 218(9), and 37 TEU, addressed the CEPA’s Title II concerning political dialogue, reform, and foreign and security policy cooperation. The Commission, with support from the Czech Republic, initiated an annulment action under Article 263 TFEU in April 2020. They contested the exclusion of Title II from Decision 2020/245 (the primary decision) and the use of Article 37 TEU as the substantive basis for Decision 2020/246 (the Title II decision). They further objected to adding the second paragraph of Article 218(8) TFEU as a procedural basis for Decision 2020/246. The Commission also argued that the Council’s approach artificially created different “centers of gravity” to manipulate voting rules.
Opinion of Advocate General Pitruzzella
Advocate General (AG) Pitruzzella sought to clarify the “center of gravity” test by dismissing claims of a hierarchy between the “purpose” and “content” of a measure. He asserted that applying the test depends on the specific circumstances of each case and is inherently practical. While acknowledging previous cases like Portugal v Council and the Philippines judgment where the purpose seemed paramount, he highlighted other influential factors. These included the context, diverse purposes, or multiple components of a measure. The AG pointed to the Kazakhstan judgment as a case that significantly clarified existing case law by using the “classic” center of gravity test to differentiate CFSP from TFEU competencies in the context of Article 218 TFEU. Besides the “classic” test, the AG noted the Court’s use of “quantitative” and “qualitative” criteria to analyze the content of international agreements.
In AG Pitruzzella’s view, regardless of the specific test applied, the CFSP aspect within the CEPA framework is not distinct enough to warrant relying on Article 37 TEU. He then used the Philippines judgment as a framework for the case, first examining whether CEPA provisions concerning policies beyond the dominant ones (transport, trade, and development cooperation) fell under the same policy umbrella or went beyond it. Drawing on the CJEU’s broad interpretation of development cooperation, he concluded that the agreement primarily aims to bolster economic and trade cooperation to promote sustainable development. Since development cooperation is multifaceted, it could be linked to Title II, eliminating the need for a separate decision.
The AG then turned to the second step of the Philippines judgment framework to determine whether the CFSP elements of CEPA contained obligations extensive enough to constitute separate objectives. He concluded that the largely declaratory nature of Title II provisions did not necessitate Article 37 TEU as a legal basis. For completeness, the AG considered the approach used in the Kazakhstan judgment (qualitative and quantitative assessment) but stated that it would lead to the same conclusion. Given the answer to the first plea, he deemed it unnecessary to address the second.
Judgment
The Court first addressed the procedural legal basis, particularly the inclusion of the second subparagraph of Article 218(8) and the relationship between Articles 218 and 219 TFEU. Echoing the Kazakhstan judgment, the Court stated that determining the voting procedure within the Council for a position adopted on behalf of the EU under an international agreement hinges on whether the situation falls under the first or second paragraph of Article 218(8), which in turn requires analyzing the substantive legal basis.
Regarding the “center of gravity” test, the Court agreed with the AG, confirming no hierarchy between a measure’s aim and content. Instead, all objective factors pertaining to both the aim and content must be considered to determine the field covered by the decision, including identifying the predominant purpose or component. The CJEU reiterated that using multiple legal bases is only permissible if the measure serves several intertwined purposes or has inseparable components, none being secondary to another. This is not possible if the relevant procedures are incompatible. The key question is whether the areas covered by the agreement requiring qualified majority voting are predominant in terms of the agreement’s overall content or purpose. The three main areas within the agreement are transport, common commercial policy, and development cooperation, grounded in Articles 91, 207, and 209 TFEU.
Concerning the Agreement’s content, the Court examined the provisions in Title II related to political dialogue, domestic reform, and foreign and security policy. It concurred with the AG, noting that these provisions were limited compared to the agreement’s 386 articles, primarily focused on trade and development cooperation. Regarding the nature of Title II obligations, the Court observed that they are programmatic and do not establish specific action plans.
Turning to the Agreement’s aims, Article 1, read in conjunction with the preamble and the majority of the provisions, demonstrates that the CEPA is a framework agreement designed to foster bilateral cooperation in transport, trade, and development cooperation. The Court adopted a broad interpretation of development cooperation, consistent with its pre- and post-Lisbon case law (ECOWAS and Philippines judgments). This interpretation is not contradicted by the CFSP-related objectives outlined in Article 1. Importantly, the Court emphasized that the CFSP objectives listed in Article 1 lack accompanying action plans or concrete terms governing cooperation in this area.
The CJEU rejected France’s argument that the Nagorno-Karabakh conflict should be considered an inherent part of the agreement’s context, thereby prioritizing its security component. The Court argued that the CEPA lacks provisions with specific obligations concerning the Nagorno-Karabakh conflict. Additionally, the contested decisions concerning the CEPA’s institutional framework do not involve any concrete measures between the parties that might be relevant to the conflict.
Ultimately, the Court determined that the CFSP aspects of the CEPA do not constitute an “autonomous” component of the agreement. Consequently, it annulled both decisions, leading to the dismissal of the Commission’s second plea. Upholding established practice, the CJEU maintained the effect of the decisions until the Council rectifies the situation by adopting a new decision compliant with the judgment.
Commentary
The central question is whether this judgment merely follows established legal precedent or provides further clarity to existing case law.
Council’s Attempt to Prevent the ‘Absorption’ of the CFSP?
Despite suggestions that separating the legal basis would safeguard the distinction between CFSP and non-CFSP procedures while preserving the unique status of the CFSP within the EU legal order, the Court rejected this approach in the CEPA judgment. Similar to the Kazakhstan judgment, there was no recourse to Article 40 TEU. This further indicates that the CFSP does not inherently possess a distinct character requiring special protection in every instance where the division of competences involving TEU and TFEU legal bases is contested. Instead, the CEPA judgment reaffirms that the “center of gravity” test applies like any other case concerning competence delimitation.
In this regard, the Council’s inclusion of Article 37 TEU seems like an attempt to circumvent the Kazakhstan judgment by artificially dividing the decision. This resulted in an unusual situation where there’s a joint substantive legal basis for the entire agreement but a separate one for a decision within the Partnership Council on the CEPA’s institutional framework, which applies to the whole agreement. The AG rightly rejected the Council’s argument that the Commission’s lack of objection to including Article 37 TEU as a substantive legal basis when authorizing the signing of the CEPA justifies its approach. This fact alone does not justify such an outcome.
This argument reveals the Council’s underlying concern following the Kazakhstan judgment: if the decision on the CEPA’s institutional framework can omit Article 37 TFEU as a substantive legal basis alongside the relevant procedural provision requiring unanimity, could this imply that Article 37 TEU can also be excluded from the decision approving the agreement itself? This concern is not unfounded considering the CJEU’s statement in the Kazakhstan judgment that the links between the EU-Kazakhstan Partnership Agreement and the CFSP “are not sufficient for it to be held that the legal basis of the decision on the signing of that agreement, on behalf of the EU, and its provisional application had to include Article 37 TEU.”
Consequently, Article 37 TEU appears unnecessary as a legal basis for decisions authorizing the signing of framework agreements primarily focused on trade and development cooperation. Examples of such agreements already exist, such as the Framework Agreement on Comprehensive Partnership and Cooperation with Vietnam. The CFSP provisions within the CEPA could have similarly been deemed insufficient to necessitate a separate legal basis under Article 37 TEU for the decision to approve the agreement. It could even be argued that the Kazakhstan judgment retroactively casts doubt on the inclusion of Article 37 TEU as a substantive legal basis for decisions on signing trade and cooperation agreements. Therefore, it is not surprising that the Council, while justifying its position on CEPA, highlighted the fact that the Commission did not challenge the inclusion of Article 37 TEU as a legal basis for the decision authorizing the agreement. This suggests that the Council’s decision to split the decisions was a reaction to the Kazakhstan judgment, driven by a desire to prevent the “absorption” of the CFSP. This might be in anticipation of further challenges to the very practice of including Article 37 TEU as a substantive legal basis for framework agreements that mainly focus on trade and development cooperation.
What’s Next for the ‘Center of Gravity’ Test?
The CEPA judgment is noteworthy concerning the role of quantitative and qualitative criteria in applying the “center of gravity” test.
The Court’s approach contrasts with that of AG Pitruzzella, who considered the use of “quantitative” and “qualitative” tests as secondary to the “classic” center of gravity test. He clearly favors the two-step test used in the Philippines judgment, dedicating most of his analysis to its application. Only after reaching his conclusion based on the Philippines judgment did he mention that applying the quantitative/qualitative criterion used in the Kazakhstan judgment would lead to the same outcome.
In contrast, the CJEU does not differentiate between the “classic test” and the quantitative and qualitative criteria used in Kazakhstan. However, unlike in Kazakhstan, the CJEU’s findings in CEPA are based on a more comprehensive and systematic analysis of the agreement’s aims and content. The CEPA judgment attempts to integrate the quantitative and qualitative criteria with the approach used in the Philippines judgment. For instance, concerning the agreement’s content, the Court performs a quantitative and qualitative analysis of the relevant provisions, concluding that they should be viewed in light of the agreement’s essential objective rather than as individual clauses. This applies “provided that those clauses do not impose such extensive obligations…that those obligations in fact constitute objectives distinct from those of development cooperation.”
Similarly, regarding the agreement’s aim, the quantitative and qualitative overview of the provisions is connected to the established approaches from the Portugal v Council and Philippines judgments. When examining the objectives, the Court does not try to pinpoint traditional CFSP legal objectives (as suggested by Advocate General Bot in the Mauritius judgment). Instead, it refers to objectives that “may be linked to CFSP.” It ultimately concludes that the CFSP-related elements “cannot be regarded as constituting a distinct component of that agreement but [are], on the contrary, incidental to the principal components” concerning development cooperation. As previously mentioned, the Court broadly interprets development cooperation, aligning with previous cases like ECOWAS. In fact, this broad interpretation should be seen as the “lasting effect” of ECOWAS on EU external relations law.
Moreover, besides the agreement’s content and aims, the judgment considered its context. While the CJEU’s approach to context has been criticized for placing significant weight on it, CEPA shows that it remains a factor under review, particularly when relevant arguments are raised. However, the CJEU is cautious of artificially constructed contexts, as demonstrated by its rejection of France’s attempt to use the Nagorno-Karabakh conflict to establish a security-related context for the agreement.
Conclusion
The CEPA judgment is another development in the ongoing debate about competence delimitation in EU external relations. The Council, always protective of the CFSP, tried to circumvent the Kazakhstan judgment, only to have the Court cast further doubt on using Article 37 TEU as a legal basis for decisions on signing trade and cooperation agreements. Compared to Kazakhstan, the CEPA judgment also offers a more substantial and thorough application of the “center of gravity” test. Based on past experience, the CEPA judgment is unlikely to be the final word on this matter.