Markus Frischhut, Jean Monnet Professor (EU law, ethics and values) at Management Center Innsbruck, Austria and Adjunct professor at ‘Alma Mater Studiorum - Università di Bologna’, Italy

Art credit: William Hogarth, An Election: the Polling

ECJ President Koen Lenaerts accurately pointed out in a paper about “mutual (yet not blind) trust” that “trust is built over years, destroyed in seconds, and takes forever to repair.” Many people feel disconnected from the European Union (EU) both geographically and emotionally. Furthermore, trust in the EU has been damaged by numerous scandals. These scandals have impacted various EU institutions, including the European Commission (e.g., Dalligate, Barrosogate, and Oettigate) and, more recently, the European Parliament (e.g., Qatargate). Since the 1990s, there has been a growing emphasis on ethics and morality within the EU. In 2020, a European Parliament-commissioned study proposed an “Independent Ethics Body” (IEB). This suggestion resulted from an analysis of the existing ethics, integrity, and transparency regulations within EU institutions. The European Commission presented a proposal in June 2023 to establish the “Interinstitutional Body for Ethical Standards” (IBES), an interinstitutional ethics body. The outcome of the negotiations between the EU institutions, which is anticipated to be formally signed in mid-May 2024, is now public. As a result, EU institutions now have an ethics body rather than an independent ethics body, which would advise the European Commission on current policy issues with ethical ramifications, as is the case with the “European Group on Ethics in Science and New Technologies” (EGE).

Current proposal

Ethics rules must first be defined and then enforced. France (“Haute Autorité pour la transparence de la vie publique” [HATVP]), Ireland (Bill for a Public Sector Standards Commissioner), and Canada (Conflict of Interest and Ethics Commissioner [CIEC]) were all included in a legal comparison for the 2020 IEB study. When it comes to enforcement, the French HATVP and the Canadian CIEC stand out as examples of best practices. However, even among EU institutions, there are various approaches. Analyzing the IBES’s enforcement capabilities is simple: there are none. According to Article 6(3) of the Inter-Institutional Agreement (IIA) on the IBES (IBES-IIA), it “shall not be competent as regards the application of a Party’s internal rules to individual cases”. This is a significant issue because rules that are written down but not adequately applied (“walk the talk”) can actually harm public trust. In addition, the European Parliament itself has acknowledged that a self-regulatory strategy has serious flaws.

Another issue is determining who is covered. The institutions of the European Union mentioned in Article 13(1) TEU, the two ancillary bodies mentioned in paragraph 4. (the Economic and Social Committee and the Committee of the Regions), as well as a few others, were the main subjects of the 2020 study (Ombuds[wo]man, European Data Protection Supervisor [EDPS] and the Euro Group, together with the Euro-Summit). The European Central Bank (ECB) stands out among these EU organizations for its more ambitious strategy. With the exception of the European Council (EUCO) and only in part the Council of the EU, the new IBES covers all EU (ancillary) institutions specified in Article 13 TEU. Partially, as solely the High Representative is covered. As a result, neither the ministers nor the “representatives at ministerial level of the Member State holding the Presidency of the Council,” as the Commission had proposed, are covered.

Similarly, the established substantive rules may be more or less ambitious. In addition, substantive ethical rules can be established in advance, and an EU ethics body can be given the responsibility of clarifying and enforcing them, along with raising awareness, providing training, etc. However, the IBES’s main responsibility is to act as a forum for the aforementioned parties to “develop common minimum standards for the conduct of the members of the Parties” (Article 13 TEU less EUCO; partially the Council) (Article 6(2) lit. a). This is expected to occur within the first six months (see Article 8(5)).

Contrary to what some have suggested, the staff of these Parties is not included; only the members specified in Article 2. (e.g. members of the European Parliament, or of the European Commission). Similar difficulties to those encountered when harmonizing national law through EU directives may arise because the goal is to harmonize existing standards. As a result, the strategy used is comparable to the “minimum harmonization” used in EU directives (e.g. Case C-509/07, Scarpelli), where Member States are not required to, but may set stricter requirements. Therefore, in our situation, each Party to the IBES-IIA may “impos[e] higher ethical requirements on its members, in particular in consideration of a specific risk associated with the mandate and tasks of the Party to this Agreement or of its members” (recital 10). At the same time, a Party that already has higher standards shall not be required to lower them (recital 11).

Similar to the EU’s motto (“united in diversity”), “full account should be taken of the characteristics and specific status of each Party to this Agreement and its members” when applying the IBES-IIA (recital 9). This makes sense because common standards are obviously preferred, but differences are allowed when they are objectively necessary due to differing legal environments or standards, especially if they are stipulated in EU primary law. For instance, the ECJ a few years ago established standards for avoiding “any conflict of interest” (Case C-130/19, Court of Auditors v Pinxten) from the requirement that members of the Court of Auditors “be completely independent in the performance of their duties” (Article 285 TFEU). Conflicts of interest should be covered for all Parties (see also below), but the rules might need to be more specific or stringent for some.

Due to “the independence of the judiciary” (recital 9), the CJEU participates only as an observer among the Parties. The IBES will be assisted by five independent experts, in addition to the Parties, who will attend all meetings as observers and “on any ethical question related to the mandate of the Body” advise the IBES members (Article 5(1)). This task primarily relates to developing “common minimum standards for the conduct of the members of the Parties” (Article 6(2) lit. a). The other tasks include updating these standards, exchanging ideas, “abstract interpretation,” and encouraging collaboration, to name a few.

Conflicts of interest must be avoided by both the Body’s members (Article 13) and the independent experts (Article 5(3)). It is interesting to note that the common minimum standards do not specifically mention conflicts of interest (Article 8(2)). Declarations of both financial and non-financial interests will be covered by the minimum standards (lit. a). They will cover outside employment (lit. b), accepting gifts (lit. c) and awards (lit. d), as well as regulations governing activities after leaving office, while in office (lit. e). Finally, in accordance with the IIA on the required transparency register, the IBES will establish minimum standards regarding “conditionality and complementary transparency measures” (lit. f), i.e. “the principle whereby registration in the register is a necessary precondition for interest representatives to be able to carry out certain covered activities” (Article 2 lit. h leg. cit.).

Returning to the independent experts, external experts are marginalized at the beginning of this crucial initial phase because in the first year after the IBES is established, the “independent experts shall be appointed for a full mandate from amongst the current or former members of the existing internal bodies responsible for ethical questions of the Parties” (Article 22(1)). They are only permitted to issue a “confidential and non-binding written opinion” when consulted (Article 7(3)), and they only “provide an anonymised and aggregated annual account” (Article 7(4)). Therefore, there is no “naming and shaming”.

Legal competence

Could the EU have chosen a more ambitious strategy? The response is affirmative. The Meroni case-law (starting with Cases C-9/56 and C-10/56) and the institutional balance are two arguments frequently used against more stringent regulations. The ECJ first stated that “the powers conferred on an institution include the right to delegate, in compliance with the requirements of the Treaty, a certain number of powers which fall under those powers, subject to conditions to be determined by the institution” (Case Tralli v ECB, C-301/02 P, para 41). Consequently, delegation is an option. It’s also important to remember that Meroni involved the High Authority (now the European Commission) delegating authority to private companies, whereas in this case, delegation would involve an EU organization in charge of ethical matters. Other requirements from this case-law (obligation to state reason; nemo plus iuris transferre potest quam ipse habet; no unlimited discretion; etc.) must be taken into account, but they do not present any obstacles.

The ECJ also discussed the “separation of powers,” but in the context of national situations. Similar to how Montesquieu developed this idea to stop the abuse of authority. Similar to this, the “institutional balance” is frequently used as justification against an ethics body. The Court has stated that the institutional balance “requires that each of the institutions must exercise its powers with due regard for the powers of the other institutions” (Case C-409/13, Council v Commission, para 64). An ethics body that complements and elaborates on EU primary law could be seen as an argument in favor of such a body in terms of institutional balance.

The EU’s fundamental principles (Article 2 TEU), along with legal and ethical precepts, should form the foundation for ethical standards. The aforementioned relationship between primary law (e.g., Article 285 TFEU) and the ethical idea of avoiding conflicts of interest is a good illustration. This might be a successful fusion of legal and ethical standards. As is common knowledge, the ECJ exercises judicial restraint when considering ethical issues (e.g. Case C-506/06, Mayr, para 38). In addition, the CJEU’s authority under Article 19(1) TEU (“ensure that in the interpretation and application of the Treaties the law is observed”) shall not be impaired.

Article 295 TFEU (IIA) is the best legal foundation for an IIA between the European Parliament, the Council, and the Commission in terms of legal bases. The other parties would need to rely on the aforementioned Meroni-doctrine and their “procedural autonomy.” However, Article 295 TFEU cannot impose legal obligations on third parties (e.g., if one wanted to include lobbyists). Article 298 TFEU (sound administration) can only be applied to the executive branch of government, not the other branches. Finally, while Article 352 TFEU (gap-filling clause) is a possibility, it is extremely difficult (unanimity in the Council), and the ‘implied powers’ doctrine is too ambiguous.

In conclusion, does this IBES-IIA result in a more “Ethical Union”? It undoubtedly fits with the progressive strategy of European integration in general. Under Article 2(2) of the Staff Regulations, one might have also attempted to include staff. At the very least, the IBES-IIA calls for the exchange of effective strategies for putting staff regulations into practice (recital 17). Similar to this, more enforcement authority might have been granted. Some may view this result as an illustration of “failing forward,” but it’s likely that the goal was to present a result before the upcoming EU elections (June 2024) and that the compromise was the cost of getting so many (eight) EU institutions and advisory bodies on board. Only the Parliament and the Commission initially supported the transparency register; the Council didn’t join until May 2021. As a result, this new ethics body can be viewed as a significant advancement, though more work can and should be done.

Barnard & Peers: chapter 8 (especially also delegation of powers, pp. 217-218) and chapter 9