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From Hard to Soft: Governance in the EU Internal Market

Published online by Cambridge University Press:  27 October 2017

Abstract

At least three generations of governance methods have been—and are still being—used for the regulation of the internal market: the classic EU method, leading to harmonisation and (more rarely) unification; the ‘new approach’ based on mutual recognition and the use of standards; and ‘new governance’ which does not entail any formal delegation of powers to the EU and operates through self-regulation, the creation of EU agencies and networks, administrative cooperation and other means of open coordination. It is impossible to establish either a hierarchy or a clear chronological order between these methods, while it is also quite difficult to reach a clear conclusion as to their efficiency. What is certain is that all methods of governance are under constant adjustment and that they all feed into one another in order to secure the smooth operation of the internal market. The interaction between these methods is the topic of the present chapter.


Type
Research Article
Copyright
Copyright © Centre for European Legal Studies, Faculty of Law, University of Cambridge 2013

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References

1 See European Commission, ‘Europe 2020 (Communication)’ COM(2010) 2020 final; European Commission, ‘Single Market Act: Twelve Levers to Boost Growth and Strengthen Confidence: “Working Together to Create New Growth” (Communication)’ COM(2011) 206 final; European Commission, ‘Single Market Act II: Together for New Growth’ COM(2012) 573 final. These and supporting official documents are available at: http://ec.europa.eu/internal_market/smact/index_en.htm.

2 This approach, introduced as being ‘new’ back in 1985, can hardly justify its name almost 30 years later, but this is one of the lesser incoherencies in EU governance methods.

3 For an excellent empirical and normative analysis of the way in which the CEUM has operated, see Craig, P, ‘Democracy and Rulemaking within the EC: An Empirical and Normative Assessment’ (2002) 8 European Law Journal 105–30Google Scholar; Dehousse, R, ‘La méthode communautaire a-t-elle encore un avenir?’ in Rey, JJ and Waelbroeck, M (eds), Mélanges en l’honneur à J V Louis (Brussels, Editions de l’Université Libre de Bruxelles, 2003) 95107 Google Scholar; Manin, P, ‘La “méthode communautaire”: changement et permanence’ in Blanquet, M (ed), Mélanges en honneur à Guy Isaac: Cinquante ans de droit communautaire (Toulouse, Presses Universitaires Sciences Sociales Toulouse, 2004) 213–37Google Scholar. More specifically on the way in which the CEUM relates to new modes of governance, see J Zeitlin, ‘Is the Open Method of Coordination an Alternative to the Community Method?’, http://eucenter.wisc.edu/OMC/Papers/JZ_Community_Method.pdf. For an up-to-date critical analysis, see Dehousse, R (ed), The Community Method: Obstinate or Obsolete? (Basingstoke, Palgrave Macmillan, 2011)CrossRefGoogle Scholar.

4 See, eg, the expression used in art 91(a) of the Treaty on the Functioning of the European Union (TFEU) in relation to transport policy.

5 For the evolution in this field, see Hatzopoulos, V, Regulating Services in the EU (Oxford, Oxford University Press, 2012) 231–38CrossRefGoogle Scholar.

6 Case 13/83 European Parliament v Council (Transport Policy) [1985] ECR 1513.

7 For a presentation of the way in which these four objectives have been pursued in the field of road haulage, see Hatzopoulos (n 5) 225–31.

8 Regulation (EU) 1093/2010 of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC [2010] OJ L331/12; Regulation (EU) 1094/2010 of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/79/EC [2010] OJ L331/48; Regulation (EU) 1095/2010 of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC [2010] OJ L331/84.

9 For which see below under ‘Agencies’.

10 For the EMSA: European Parliament and Council Regulation 1406/02/EC of 27 June 2002 establishing a European Maritime Safety Agency [2002] OJ L208/1, amended by Regulation (EC) No 1644/2003/EC of 22 July 2003 [2003] OJ L245/10, European Parliament and Council Regulation (EC) 724/04/EC of 31 March 2004 [2004] OJ L129/1; European Parliament and Council Regulation (EC) 1891/06/EC of 18 December 2006 on multiannual funding for the action of the European Maritime Safety Agency in the field of response to pollution caused by ships and amending Regulation (EC) No 1406/2002 [2006] OJ L394/1; European Parliament and Council Regulation (EU) 100/2013 of 15 January 2013 [2013] OJ L39/30. For the EASA: European Parliament and Council Regulation (EC) 1592/02/EC of 15 July 2002 on common rules in the field of civil aviation and establishing a European Aviation Safety Agency [2002] OJ L240/1, amended several times and replaced by European Parliament and Council Regulation (EC) 216/08/EC of 20 February 2008 on common rules in the field of civil aviation and establishing a European Aviation Safety Agency [2008] OJ L79/1, itself amended by Commission Regulation (EC) 690/2009/EC of 30 July 2009 [2009] OJ L199/6.

11 EMA was set up by Council Regulation (EEC) No 2309/93 of 22 July 1993 laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Agency for the Evaluation of Medicinal Products [1993] OJ L214/1, renamed by European Parliament and Council Regulation (EC) No 726/2004 of 31 March 2004 laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Medicines Agency [2004] OJ L136/1, to the European Medicines Agency.

12 See, eg, the general ‘horizontal’ harmonisation legal basis in art 114 TFEU.

13 European Parliament and Council Directive 2011/83/EU of 25 October 2011 on consumer rights, amending Council Directive 93/13/EEC and Directive 1999/44/EC of the European Parliament and of the Council and repealing Council Directive 85/577/EEC and Directive 97/7/EC of the European Parliament and of the Council [2011] OJ L304/64. For a presentation of this text and the relevant criticisms, see M Faure, ‘Towards a Maximum Harmonization of Consumer Contract Law?’ (2008) Maastricht Journal of Transnational and International Law 433–45; Micklitz, HW and Reich, N, ‘Crónica de Una Muerte Anunciada: The Commission Proposal for a Directive on Consumer Rights’ (2009) 46 CML Rev 471519 Google Scholar; S Whittaker, ‘Unfair Contract Terms and Consumer Guarantees: The Proposal for a Directive on Consumer Rights and the Significance of Full Harmonization’ (2009) European Review of Contract Law 223–47; C Twigg-Flessner and D Metcalfe, ‘The Proposed Consumer Rights Directive: Less Haste, More Thought?’ (2009) European Review of Contract Law 368–91; J Smits, ‘Full Harmonization of Consumer Law? A Critique of the Draft Directive on Consumer Rights’ (2010) European Review of Private Law 5–14; G Low, ‘The (Ir)relevance of Harmonization and Legal Diversity to European Contract Law: A Perspective from Psychology’ (2010) European Review of Private Law 285–305.

14 Hence, in the extremely sensitive area of posted workers, the Court in Case C-319/06 Commission v Luxembourg, Posted Workers II [2008] ECR I-4323 found that the rules of the ‘Posted Workers Directive’ 97/61/EC, although explicitly allowing for more protective measures, in fact amounted to complete harmonisation.

15 For the different kinds of harmonisation, see Slot, PJ, ‘Harmonisation’ (1996) 21 EL Rev 378–97Google Scholar; Vos, E, ‘Differentiation, Harmonisation and Governance’ in de Witte, B, Hanf, D and Vos, E (eds), The Many Faces of Differentiation in EU Law (Antwerp, Intersentia, 2001) 145–79Google Scholar.

16 The ‘horizontal’ harmonisation legal basis, art 114 TFEU, is being completed by art 115 which specifically authorises the European Parliament and the Council to issue directives for the approximation of laws in the internal market.

17 European Parliament and Council Directive 2010/13/EU of 10 March 2010 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual media services (Audiovisual Media Services Directive) [2010] OJ L95/1; European Parliament and Council Directive 1999/93/EC of 13 December 1999 on a Community framework for electronic signatures [2000] OJ L13/12; European Parliament and Council Directive 2000/31/EC of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic commerce’) [2000] OJ L178/1.

18 For an early evaluation of the liberalisation of the network-based industries, see D Geradin, ‘The Liberalization of Network Industries in the European Union: Where Do We Come From and Where Do We Go?’ (paper prepared for the Finnish Presidency, 20 September 2006). Available at: www.vnk.fi/hankkeet/talousneuvosto/tyo-kokoukset/globalisaatioselvitys9-2006/artikkelit/Geradin_06-09-20.pdf. See also European Commission, ‘Evaluation of the Performance of Network Industries Providing Serices of General Interest 2006 Report (Staff Working Document)’ SEC (2007) 1024 final.

19 Essentially through the adoption of the MiFID: European Parliament and Council Directive 2004/39/EC of 21 April 2004 on markets in financial instruments amending Council Directives 85/611/EEC and 93/6/EEC and Directive 2000/12/EC of the European Parliament and of the Council and repealing Council Directive 93/22/EEC [2004] OJ L145/1.

20 For which, see briefly below under ‘Networking’.

21 Based on the ‘Final Report of the Committee of Wise Men on the Regulation of European Securities Markets (Lamfalussy Report)’ (Brussels, 15 February 2001). Available at: http://ec.europa.eu/internal_market/securities/docs/lamfalussy/wisemen/final-report-wise-men_en.pdf. A new regulatory process was formally instituted by the ‘Presidency Conclusions’ of the Stockholm European Council (23–24 March 2001). Available at: http://ue.eu.int/ueDocs/cms_Data/docs/pressData/en/ec/00100-r1.%20ann-r1.en1.html. It was further revisited by the European Commission, ‘Review of the Lamfalussy Process: Strengthening Supervisory Convergence’ COM(2007) 727 final, which foresaw a regulatory process in three phases, whereby after the framework legislation was in place according to the CEUM, the adoption of more specific measures and their implementation was orchestrated by three ad hoc committees made up by experts (essentially from the banking sector).

22 Above n 16 and corresponding text.

23 See below, under ‘Mutual Recognition—Managed—Standards’.

24 Council Directive 89/552/EEC of 3 October 1989 on the coordination of certain provisions laid down by Law, Regulation or Administrative Action in Member States concerning the pursuit of television broadcasting activities (Television without Frontiers Directive) [1989] OJ L298/23, Preamble Rec 3.

25 E-signature Directive (n 17) Preamble Rec 8.

26 Above n 13. It is true, however, that the directive does not distinguish further between the various techniques for one-way or interactive transmission.

27 For more on legislative spill-over, see McGee, A and Weatherill, S, ‘The Evolution of the Single Market, Harmonisation or Liberalisation’ (1990) 53 MLR 578–96CrossRefGoogle Scholar.

28 See, eg, the by now infamous judgment in Case C-144/04 Werner Mangold [2005] ECR I-9981; for another recent Grand Chamber judgment going in the same direction, see Case C-283/11 Sky Österreich (CJEU, 22 January 2013) [39], where the Court considered that the parties should evaluate their rights on the basis of Directive 2007/65 (TV without Frontiers Directive) which had entered into force but whose transposition period had not lapsed yet; similarly, in Case C-577/10 Commission v Belgium (LIMOSA) (CJEU, 19 December 2012), concerning inter alia the effects of the Services Directive whose transposition period had not yet lapsed at the date of the facts; the Court, contrary to AG Villalon’s Opinion, did not set aside the directive’s text, but proceeded to an obiter evaluation of its effects.

29 Joined Cases C-95–97/99 Khalil [2001] ECR I-7413, in which it was held that Regulation 1408/71 on the coordination of social security systems could validly apply to cover asylum seekers and stateless people on the EU territory, even if these were not EU nationals.

30 The most flagrant example in this category is the Court’s ‘transparency’ case law in the field of public procurement, where the rules of the Public Procurement Directives (Directives 2004/17 and 2004/18, OJ L134/1 and 134/114, respectively) are made to apply to under-thethreshold and concession contracts, explicitly excluded from the directives’ scope of application; see, eg, Case C-324/98 Telaustria [2000] ECR I-10745; and Case C-458/03 Parking Brixen AG [2005] ECR I-8585.

31 Olivi, E, ‘The EU Better Regulation Agenda’ in Weatherill, S (ed), Better Regulation (Oxford, Hart Publishing, 2007) 191, 194Google Scholar, who refers to a Dutch study of May 2006, suggesting that ‘more than half the obstacles associated with European legislation result from additional national requirements’. See also Ambler, T, Chittenden, F and Obodovski, M, How Much Regulation is Gold Plate? A Study of UK Elaboration of EU Directives (London, British Chambers of Commerce, 2004)Google Scholar.

32 Barnard, C and Deakin, S, ‘Market Access and Regulatory Competition’ in Barnard, C and Scott, J (eds), The Law of the Single European Market: Unpacking the Premises (Oxford, Hart Publishing, 2002) 197224 Google Scholar, also available as Jean Monnet Working Paper No 9/2001 at: www.jeanmonnetprogram.org/papers/01/012701.html. See also G Davies, ‘The Legal Framework of Regulatory Competition’ (2006), available at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=903138. See also P Zumbansen, ‘Spaces and Places: A Systems Theory Approach to Regulatory Competition in European Company Law’ (2006) European Law Journal 534–56; Ogus, A, ‘Competition between National Legal Systems: A Contribution of Economic Analysis to Comparative Law’ (1999) 48 International and Comparative Law Quarterly 405–18CrossRefGoogle Scholar.

33 Indeed, there are some qualified findings that in policy areas where agent mobility is greater, such as company law, Member States do draw inspiration from one another; see Hornuf, L, Regulatory Competition in European Corporate and Capital Market Law: An Empirical Anlaysis (Inresentia, Elsevier, 2012), especially ch 2Google Scholar.

34 See Griffin, P, ‘The Delaware Effect: Keeping the Tiger in its Cage—The European Experience of Mutual Recognition in Financial Services’ (2001) 7 Columbia Journal of European Law 337–54Google Scholar; and more recently Deakin, S, ‘Regulatory Competition after Laval ’ (2008) 10 Cambridge Yearbook of European Legal Studies 581609 CrossRefGoogle Scholar. It should be noted that next to ‘Delaware effect’ stories, there are also stories of races to the top (also known as the ‘California effect’, after this state managed to impose its own higher standards of antipollution rules on the entire US).

35 Above n 33. The fact that the race to the bottom has been limited within the EU may be connected to: a) the mediating role of the Commission and the adoption, under its initiative, of common rules or standards (for which, see below under ‘Standards’); and b) the creation of supranational networks composed by national supervisory authorities (for which, see below under ‘Networking’).

36 This pressure in the area of taxation is explained in economic theory by the Laffer curve, in the shape of a reversed U, which shows that states may only increase taxes to a certain level, after which taxpayers are going to move to lower-tax countries; this ‘certain level’ directly depends on the tax regime applicable in other countries with which there is free movement.

37 Scharpf, F, ‘Introduction: The Problem-Solving Capacity of Multi-level Governance’ (1997) 4 Journal of European Public Policy 520–38CrossRefGoogle Scholar.

38 Case 33/74 Van Binsbergen [1974] ECR 1299; Case 120/78 Rewe-Zentral, Cassis de Dijon [1979] ECR 649; and the Cassis de Dijon Interpretative Communication [1980] OJ C256/2.

39 Case C-382/08 Neukirchinger [2011] ECR I-139.

40 Further on this idea, see Hatzopoulos, V, Le principe communautaire d’équivalence et de reconnaissance mutuelle dans la libre prestation de services (Athens/Brussels, Sakkoulas/Bruylant, 1999) 419–35Google Scholar; and more recently, Hatzopoulos, VMutual Recognition in the Field of Services’ in Lianos, I and Odudu, O (eds), Regulating Trade in Services in the EU and the WTO: Trust, Distrust and Economic Integration (Cambridge, Cambridge University Press, 2012) 5998 CrossRefGoogle Scholar.

41 In this respect, see the gambling cases Case C-42/07 Liga Portuguesa de Futebol Profissional and Bwin International [2009] ECR I-7633; Case C-258/08 Ladbrokes Betting [2010] ECR I-4757 [55]; Case C-212/08 Zeturf Ltd [2011] ECR I-05633 [80]; Case C-347/09 Dickinger and Ömer [2011] ECR I-08185 [96].

42 Competence transfer is horizontal in the sense that it allows the law makers of Member State (MS) B to decide on the standards applicable/acceptable in MS A, while there is no formal link between law makers in MS B and the people or other control institutions of MS A—a situation quite different from the vertical transfer of competences to some supra-national body, such as the EU (or the WTO), where there is some institutionalised means, procedures and institutions for the representation of the interests of MS A.

43 See Council Resolution (85/C 136/01) of 7 May 1985 on a new approach concerning technical harmonisation and standardisation [1985] OJ C136/1.

44 On standards in the EU, see Boy, L, ‘Normes’ (1998) 12 Revue Internationale de Droit Economique 115–46Google Scholar; Graz, JC, ‘Quand les normes font loi: Topologie intégrée et processus différenciés de la normalisation internationale’ (2004) 35 Etudes Internationales 233–60CrossRefGoogle Scholar, available at: www.erudit.org/revue/ei/2004/v35/n2/009036ar.html.

45 Case C-6/05 Medipac [2007] ECR I-4557; Case C-489/06 Commission v Greece, EC Markings [2009] ECR I-1797.

46 For which, see below under ‘Agencies’.

47 For which, see below under ‘Networking’.

48 For the distinction between incorporated and non-incorporated regulations and the risk of the ‘race to the bottom’, see Scharpf (n 37). See also, more recently, Davies, G, ‘Process and Production Method-Based Trade Restrictions in the EU’ (2008) 10 Cambridge Yearbook of European Legal Studies 6997 CrossRefGoogle Scholar; and for a critical review of the distinction and of its legal consequence, see Howse, R and Regan, D, ‘The Product/Process Distinction—An Illusory Basis for Disciplining Unilateralism’ (2000) 11(2) European Journal of International Law 249–89CrossRefGoogle Scholar.

49 Europe 2020, Single Market Act I, Single Market Act II (n 1).

50 For the distinction and the way in which it may be affected by the use of standards, see Horner, J, ‘Reputation and Competition’ (2002) 92 American Economic Review 644–61CrossRefGoogle Scholar; Leland, H, ‘Quacks, Lemons, and Licensing: A Theory of Minimum Quality Standards’ (1979) 87 Journal of Political Economy 1328–46CrossRefGoogle Scholar.

51 On the accountability of standard-setting bodies, see Kerwer, D, ‘Rules That Many Use: Standards and Global Regulation’ (2005) 18 Governance 611–32CrossRefGoogle Scholar; a well-known example where the legislature promoted a bill drafted under the impulse of the relevant industry, against the will of the European ‘demos’ and its representatives in the European Parliament, was the ratification of the Anti-Counterfeiting Trade Agreement (ACTA), which imposed really heavy monitoring obligations on Internet service providers. Ratification of the Act was eventually blocked by the European Parliament; see 20120703IPR48247 and the relevant documentation, available at: www.europarl.europa.eu/news/en/pressroom/content/20120703IPR48247/html/European-Parliament-rejects-ACTA. Another area in which the industry is actively trying to push through its own preferences, occasionally with success, is in the area of genetically modified organisms (GMOs).

52 The Microsoft saga is an example of the competition law issues raised by ‘closed’ standards; for a general presentation of this Commission and CJEU case law, see, among many others, Economides, N and Lianos, I, ‘A Critical Approach of Remedies in the EU Microsoft Cases’ (2010) 2 Columbia Business Law Review (2010) 346420 Google Scholar.

53 One of the few CJEU cases dealing with essential facilities did indeed concern some protected standard; see Case C-418/01 IMS Health v NDC Health [2004] ECR I-5039 and corresponding case comment: V Hatzopoulos (2004) CML Rev 1613–38 (note). For a more comprehensive presentation of the doctrine of essential facilities, see Hatzopoulos, V, ‘The Evolution of the Essential Facilities Doctrine’ in Amato, G and Elhermann, C-D (eds), EC Competition Law: A Critical View (Oxford, Hart Publishing, 2007) 317–58Google Scholar.

54 The literature on private regulation is not scarce, especially US literature. At the EU level, the area has been ‘monopolised’ in recent years by F Cafaggi, whose works are very comprehensive and contain extremely rich bibliographic references to previous works; see, eg, F Cafaggi, ‘Private Regulation in European Private Law’ (2009) EUI RSCAS Working Paper No 2009/31, available at: http://cadmus.eui.eu/dspace/bitstream/1814/12054/3/RSCAS_2009_31.pdf. See also F Cafaggi, ‘Rethinking Private Regulation in the European Regulatory Space’ (2006) EUI Law Working Paper No 2006/13, available at: http://cadmus.eui.eu/dspace/bitstream/1814/4369/1/LAW2006.13.pdf. See also F Caffaggi and H Muir-Watt, ‘The Making of European Private Law: Regulation and Governance design’ (2007) European Governance Papers (EUROGOV) No N-07-02, available at: http://www.mzes.uni-mannheim.de/projekte/typo3/site/fileadmin/wp/abstract/N-07-02.htm See also Chalmers, D, ‘Private Power and Public Authority in European Union Law’ (2005–06) 8 Cambridge Yearbook of European Legal Studies 5994 CrossRefGoogle Scholar; Scott, C, ‘Regulating Private Legislation’ in Caffagi, F and Muir-Watt, H (eds), The Regulatory Function of European Private Law (Cheltenham, Edward Elgar, 2009) 254–68Google Scholar; Rudolph, P, ‘The History, Variations, Impact and Future of Self-Regulation’ in Mullerat, R (ed), Corporate Social Responsibility: The Corporate Governance of the 21st Century (The Hague, Kluwer Law International, 2005) 365–84Google Scholar; Black, J, ‘Decentering Regulation: Understanding the Role of Regulation and Self-Regulation in a Post-Regulatory world’ (2001) 54 Current Legal Problems 103–46CrossRefGoogle Scholar; Pattberg, P, ‘The Institutionalisation of Private Governance: How Business and Non-profit Organizations Agree on Transnational Rules’ (2005) 18 Governance 589610 CrossRefGoogle Scholar; and in a more general way, Prosser, T, Law and the Regulators (Oxford, Oxford University Press, 1997)Google Scholar. See also a more sceptical approach, in French, by E Mazuyer and S de la Rosa, ‘La régulation sociale européenne et l’autorégulation: le défi de la cohérence dans le recours à la soft law ‘ (2009) 3–4 Cahiers de Droit Européen 295–333.

55 Delimatsis, P, ‘“Thou Shall Not … (Dis)trust”: Codes of Conduct and Harmonisation of Professional Standards in the EU’ (2010) 47 CML Rev 1049–87, 1069Google Scholar.

56 See Caffagi (2006) (n 54), where further references are to be found.

57 Taxonomy borrowed by ibid 15–26.

58 See above n 21 briefly for the Lamfalussy process.

59 European Parliament and Council Directive (EC) 2003/6 of 28 January 2003 on insider dealing and market manipulation [2003] OJ L96/16, art 12.

60 Other examples may be found in the European Parliament and Council Directive 2005/29/EC of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450/EEC, Directives 97/7/EC, 98/27/EC and 2002/65/EC of the European Parliament and of the Council and Regulation 2006/2004/EC of the European Parliament and of the Council (Unfair Commercial Practices Directive) [2005] OJ L149/22), art 11(1).

61 European Parliament and Council Regulation (EC) 733/2002 of 22 April 2002 on the implementation of the eu Top Level Domain [2002] OJ L113/1, art 3.

62 The representatives of the European trade unions on the one hand and employers’ organisations on the other; see http://ec.europa.eu/social/main.jsp?catId=329&langId=en.

63 For which see, among many others, Franssen, E, Legal Aspects of the European Social Dialogue (Antwerp, Intersentia, 2002)Google Scholar; Weltz, C, The European Social Dialogue under Articles 138 and 139 of the EC Treaty: Actors, Processes, Outcomes (Alphen aan den Rijn, Kluwer Law International, 2008)Google Scholar. More briefly, see also Smismans, S, ‘The European Social Dialogue in the Shadow of Hierarchy’ (2008) 28 Journal of Public Law 161–80Google Scholar; Barnard, C, ‘The Social Partners and the Governance Agenda’ (2002) 8 European Law Journal 80101 CrossRefGoogle Scholar; and A Reale, ‘Representation of Interests, Participatory Democracy and Lawmaking in the EU: Which Role and Which Rules for the Social Partners?’ (2003) Jean Monnet Working Paper No 15/2003, available at: http://centers.law.nyu.edu/jeanmonnet/archive/papers/03/031501.html.

64 For more on the CSR, see the following paragraphs.

65 For the criteria developed by different legal orders in order to define whether a regulator is subject to judicial review, see Craig, P, Administrative Law, 6th edn (Oxford, Oxford University Press, 2008) 893–95Google Scholar; Harlow, C, ‘Public Service, Market Ideology and Citizenship’ in Freedland, M and Sciarra, S (eds), Public Services and Citizenship in European Law: Public and Labour Law Perspectives (Oxford, Clarendon Press, 1998) 4856 Google Scholar. In the EU context, the question has been indirectly raised in Case C-160/03 Spain v Eurojust (Temporary Staff) [2005] ECR I-2077 as to whether the (rare) regulatory acts adopted by EU agencies are subject to scrutiny by the CJEU—a question answered in the negative on this occasion.

66 On the issue of compliance, see primarily Scott (n 54).

67 On default rules, see, among many others, Ayres, I and Gertner, R, ‘Filling Gaps in Incomplete Contracts: An Economic Theory of Default Rules’ (1989) 99 Yale Law Journal 87128 CrossRefGoogle Scholar.

68 Scott, C, ‘Regulating Private Legislation’ in Caffagi, F and Muir-Watt, H (eds), The Regulatory Function of European Private Law (Cheltenham, Edward Elgar, 2009) 254–68 263–66Google Scholar.

69 Ibid 264.

70 Caffagi (2006) (n 54).

71 The extent to which private regulation may be made to satisfy the above characteristics is being seriously questioned by legal and political scientists; see the rather critical accounts contained in Curtin, D, Mair, P and Papadopoulos, Y (eds), Special Issue on Accountability and European Governance (2010) 33 West European Politics CrossRefGoogle Scholar; see also Papadopoulos, Y, ‘Problems of Democratic Accountability in Network and Multi-Level Governance’ in Conzelmann, T and Smith, R (eds), Multi-Level Governance in the European Union: Taking Stock and Looking Ahead (Baden-Baden, Nomos, 2008) 3152 CrossRefGoogle Scholar.

72 McGee and Weatherill (n 27) 579.

73 Chalmers (n 54).

74 European Parliament, Council and Commission, Interinstitutional Agreement (2003/C 321/01) on better law-making [2003] OJ C321/1.

75 Also known as corporate responsibility, corporate citizenship, responsible business, sustainable responsible business (SRB) or corporate social performance: see Wood, D, ‘Corporate Social Performance Revisited’ (1991) 16 Academy of Management Review 691718 Google Scholar.

76 European Commission, ‘Corporate Social Responsibility: A Business Contribution to Sustainable Development (Communication)’ COM(2002) 347 final, 5.

78 Williams, C and Aguilera, R, ‘Corporate Social Responsibility in a Comparative Perspective’ in Crane, A, McWilliams, A, Matten, D, Moon, J and Siegel, D (eds), The Oxford Handbook of Corporate Social Responsibility (Oxford, Oxford University Press, 2008) 522–31Google Scholar.

79 Habisch, A, Wegner, M, Schmidpeter, R and Jonker, J, Corporate Social Responsibility Across Europe (Berlin, Springler, 2005)CrossRefGoogle Scholar; European Commission, ‘Corporate Social Responsibility: National Public Policies in the EU’ (Luxembourg, EUR-OP, 2004); and more up to date and extensively, European Commission, ‘Corporate Social Responsibility: National Public Policies in the EU’ (Luxembourg, EUR-OP, 2007).

80 European Commission, ‘A Renewed EU Strategy 2011–14 for Corporate Social Responsibiliy (Communication)’ COM(2011) 681 final, 6.

81 See more recently Mullerat (n 54); Demirag, I (ed), Corporate Social Responsibility, Accountability and Governance: Global Perspectives (Sheffield, Greenleaf, 2005)Google Scholar. For a more empirical approach, see Barth, R and Wolff, F (eds), Corporate Social Responsibility in Europe: Rhetoric and Realities (Cheltenham, Edward Elgar, 2009)CrossRefGoogle Scholar; and also, from a different perspective, Breitbarth, T, Harris, P and Aitken, R, ‘Corporate Social Responsibility in the EU: A New Trade Barrier?’ (2009) 9 Journal of Public Affairs 239–55CrossRefGoogle Scholar; de Cannart d’Hamale, E, de Walsche, E, Hachez, N and Cools, P, La responsabilité sociale des enterprises: concept, pratiques et droit (Bruges, Vanden Broele, 2006)Google Scholar; Drai, E, ‘Responsabilité sociétale des entreprises: un mouvement créateur de valeur’ (2008) 54 Petites Affiches 48 Google Scholar.

82 European Commission, ‘Green Paper Promoting a European Framework for Corporate Social Responsibility’ COM(2001) 366 final.

83 Communication (n 76); and European Commission, ‘Implementing the Partnership for Growth and Jobs: Making Europe a Pole of Excellence on Corporate Social Responsibility (Communication)’ COM(2006) 136 final.

84 See the responses to the Green Paper (n 82); see also the academic literature (n 81) for views that the responsibility for defining the general interest should not be left to corporations alone, but requires the intervention of actors with a more global vision of general interest and a higher degree of legitimacy.

85 A number of the Europe 2020 flagship initiatives make reference to CSR: European Commission, ‘An Integrated Industrial Policy for the Globalisation Era Putting Competitiveness and Sustainability at Centre Stage (Communication)’ COM(2010) 614; European Commission, ‘The European Platform Against Poverty and Social Exclusion: A European Framework for Social and Territorial Cohesion (Communication)’ COM(2010) 758; European Commission, ‘An Agenda for New Skills and Jobs: A European Contribution Towards Full Employment (Communication)’ COM(2010) 682; European Commission, ‘Youth on the Move’ COM(2010) 477; and the Single Market Act (n 1). In addition, European Commission, ‘Europe 2020 Flagship Initiative: The Innovation Union (Communication)’ COM(2010) 546 aims to enhance the capacity of enterprises to address societal challenges through innovation, and the contribution of enterprises is central to achieving the objectives of the European Commission, ‘A Resource-Efficient Europe—Flagship Initiative under the 2020 Strategy (Communication)’ COM(2011) 21; and European Commission, ‘Roadmap to a Resource Efficient Europe (Communication) COM(2011) 571.

86 Strategy for ESR Communication (n 80).

87 According to an early account by the Commission (http://europa.eu/agencies/community_agencies/history/index_en.htm), a second generation of agencies started their activities in 1994–95, and a third generation (the most endowed) emerged in the early years of the 2000s; this historical account has subsequently been dropped by the relevant webpage, see http://europa.eu/about-eu/agencies/index_en.htm.

88 See Majone, G, ‘Delegation of Regulatory Powers in a Mixed Polity’ (2002) 8 European Law Journal 319–39CrossRefGoogle Scholar.

89 Schout, A and Pereyra, F, ‘The Institutionalization of EU Agencies: Agencies as “Mini-Commissions”’ (2010) 88 Public Administration 115 Google Scholar.

90 See, in this sense, M Groenleer, E Versluis and M Kaeding, ‘Regulatory Governance through EU Agencies? The Implementation of Transport Directives’ (2010) Journal of European Public Policy 1212–30, 6.

91 See, eg, Vos, E, ‘Reforming the European Commission: What Role to Play for EU Agencies?’ (2000) 47 CML Rev 1113–34, 1120Google Scholar.

92 See http://europa.eu/agencies/index_en.htm. The fact that the agencies are distinguished as above, however, may be a sign that this page has not been updated since the entry into force of the Lisbon Treaty in December 2009.

93 Schout and Pereyra (n 89) 1.

94 Eg, the UK Parliament expressed itself about the EASA, one of the earliest and most endowed EU agencies, in the following terms: ‘The brief history of the founding, planning and implementation of EASA inspires a feeling of despondency about the ability of those minded to make transnational European agencies work either effectively or efficiently. The Commission must examine closely the lamentable history of this half-baked, halfcock project, and apply the lessons learnt to future endeavours. We also hope it will seek to provide evidence of its competence by righting the situation of EASA promptly’; see Select Committee on Transport, The Work of the Civil Aviation Authority (Thirteenth Report) (2005–6, HC 809). Available at: www.parliament.the-stationery-office.com/pa/cm200506/cmselect/cmtran/809/80902.htm.

95 Schout and Pereyra (n 89) 4.

96 Ibid 5.

97 The analysis which follows draws heavily on Keleman, D, ‘The Politics of “Eurocratic” Structure and the New European Agencies’ (2002) 25 West European Politics 93118 CrossRefGoogle Scholar. His views have been confirmed by the more recent and empirical study by Christensen, J Gronnegaard and Nielsen, V Lehmann, ‘Administrative Capacity, Structural Choice and the Creation of EU Agencies’ (2010) 17 Journal of European Public Policy 176204 CrossRefGoogle Scholar.

98 Joined Cases 10/56 Meroni & Co, Industrie Metallurgiche, società in accomandita semplice v High Authority of the European Coal and Steel Community [1958] Special English Edition 157. On the issue of institutional balance, see Prechal, S, ‘Institutional Balance: A Fragile Principle with Uncertain Contents’ in Heukels, T, Blokker, N and Brus, M (eds), The European Union after Amsterdam (The Hague, Kluwer Law International, 1998) 273–94Google Scholar; and, more recently, Jacqué, JP, ‘The Principle of Institutional Balance’ (2004) 41 CML Rev 383–91Google Scholar.

99 See especially Lenaerts, K, ‘Regulating the Regulatory Process: Delegation of Powers in the European Community’ (1993) 18 EL Rev 2349, 40Google Scholar; and more recently, Lenaerts, K and Verhoeven, ATowards a Legal Framework for Executive Rule-Making in the EU?: The Contribution of the New Comitology Decision’ (2000) 37 CML Rev 645–86, 657Google Scholar.

100 For a fuller account of the criticisms of the Meroni doctrine in relation to agencies, see X Yataganas, ‘Delegation of Regulatory Authority in the EU: The Relevance of the American Model of Independent Agencies’ (2001) Jean Monnet Working Paper No 03/2001, available at: http://centers.law.nyu.edu/jeanmonnet/archive/papers/01/010301.html, 34–36. See also R Dehousse, ‘Misfits: EU Law and the Transformation of European Governance’ (2002) Jean Monnet Working Paper 02/2002, available at: http://centers.law.nyu.edu/jeanmonnet/archive/papers/02/020201.html, 7–9; and more recently, Griller, S and Orator, A, ‘Everything under Control? The Way Forward for Agencies in the Footsteps of the Meroni Doctrine’ (2010) 35 EL Rev 335 Google Scholar.

101 For these criticisms, see Dehousse, R (ed), L’Europe sans Bruxelles?: Une analyse de la Méthode Ouverte de Coordination (Paris, L’Harmattan, 2004) 79 Google Scholar.

102 For this line of argument, see Yataganas (n 100) 34–36.

103 See Mashaw, J, ‘Prodelegation: Why Administrators Should Make Political Decisions’ (1985) 1 Journal of Law Economics and Organization 81100 Google Scholar.

104 Yataganas (n 100).

106 See, eg, Kassim, H, ‘Policy Networks, Networks and EU Policy Making: A Sceptical View’ (1994) 17 West European Politics 1527 CrossRefGoogle Scholar; Peterson, J, ‘Policy Networks and EU Policy Making: A Reply to Kassim’ (1995) 18 West European Politics 389407 CrossRefGoogle Scholar; Ward, S and Williams, R, ‘From Hierarchy to Networks? Sub-central Government and EU Urban Environment Policy’ (1997) 35 Journal of Common Market Studies 439–64CrossRefGoogle Scholar; Schout, A and Jordan, A, ‘Coordinated European Governance: Self-Organizing or Centrally Steered?’ (2005) 83 Public Administration 201–20CrossRefGoogle Scholar; Jönsson, C and Strömvik, M, ‘Negotiations in Networks’ in Jönsson, C (ed), European Union Negotiations: Processes, Networks and Institutions (London, Routledge, 2005) 1326 Google Scholar.

107 See, among many others, Slaughter, AM, ‘Global Government Networks, Global Information Agencies and Disaggregated Democracy’ (2003) 24 Michigan Journal of International law 1041–76Google Scholar; Rhodes, RAW, ‘Governance and Public Administration’ in Pierre, J (ed), Debating Governance (Oxford, Oxford University Press, 2000) 5490 Google Scholar; T Borzel, ‘What’s so Special about Policy Networks? An Exploration of the Concept and its Usefulness’ in Studying European Governance (European Integration Online Papers No 16, 1997), available at: http://eiop.or.at/eiop/texte/1997-016a.htm.

108 See Coen, D and Thatcher, M, ‘Network Governance and Multi-level Delegation: European Networks of Regulatory Agencies’ (2008) 28 Journal of Public Policy 4971, 50CrossRefGoogle Scholar.

109 Ward and Williams (n 106) 440–41.

110 The former was set up by Council Decision 2003/769, which consolidated prior practice, while the latter has been formalised by Regulation (EC) 713/09 of 13 July 2009 establishing an Agency for the Cooperation of Energy Regulators [2011] OJ L211/1.

111 All created by a Commission Decision (2004/10/EC) of 5 November 2003 establishing the European Banking Committee [2004] OJ L3/36, which consolidated prior practice.

112 The three committees have been turned into agencies by Regulations 1093/10,1094/10 and 1095/10, respectively; the ESRB has been set up by Regulation (EU) 1092/2010, all of 24 November 2010 [2010] OJ L331.

113 For a more detailed presentation of the characteristics of networking in the EU, see, among many others, Ward and Williams (n 106).

114 Coen and Thatcher (n 108) 50.

115 Ibid 61.

116 Eberlein, B and Newman, A, ‘Escaping the International Governance Dilemma?: Incorporated Transgovernmental Networks in the European Union’ (2008) 21 Governance 2552 CrossRefGoogle Scholar.

117 J Zeitlin, ‘Is the Open Method of Coordination an Alternative to the Community Method?’ in Dehousse (n 3).

118 L Senden, ‘The OMC and its Patch in the European Regulatory and Constitutional Landscape’ (2010) EUI RSCAS Working Paper No 2010/61, 8, available at: http://cadmus.eui.eu/dspace/bitstream/1814/14436/1/RSCAS_2010_61.pdf.

119 Szyszczak, E, ‘Experimental Governance: The Open Method of Coordination’ (2006) 12 European Law Journal 486502, 494CrossRefGoogle Scholar.

121 Borràs, S and Greve, B, ‘Concluding Remarks: New Method or Just Cheap Talk?’ (2004) 11 Journal of European Public Policy 329–36Google Scholar. See also Zeitlin, J, ‘The OMC in Question’ in Zeitlin, J and Pochet, P (eds), The Open Method of Coordination in Action: The European Employment and Social Inclusion Strategies (Brussels, Peter Lang, 2005) 1933, 20–21CrossRefGoogle Scholar.

122 European Comission, ‘A Strategy for Smart, Sustainable and Inclusive Growth (Communication)’ COM(2010) 2020 final, 27–30.

123 For the OMC, see, among many others, the books (in relevance order) by Zeitlin and Pochet (n 121); Dehousse (n 101); Snyder, F (ed), The EU and Governance/L’UE et la Gouvernance (Brussels, Bruylant, 2006)Google Scholar; de Búrca, G and Scott, J, Law and New Governance in the EU and the US (Oxford, Hart Publishing, 2006)Google Scholar. In periodic literature, see the special issues of (2002) 1 European Law Journal; (2004) 2 Journal of European Public Policy; (2007) 3 Columbia Journal of European Law, dedicated to the OMC and other new methods of governance. See also the following (recent) articles: Senden (n 118); Tholoniat, L, ‘The Career of the OMC: Lessons from a “Soft” EU Instrument’ (2010) 33 West European Politics 93117 CrossRefGoogle Scholar; Büchs, M, ‘How Legitimate is the OMC?’ (2008) 46 Journal of Common Market Studies 765–86CrossRefGoogle Scholar; Armstrong, K, Begg, I and Zeitlin, J, ‘The Open Method of Co-ordination and the Governance of the Lisbon Strategy’ (2008) 46 Journal of Common Market Studies 413–50Google Scholar; M Citi and M Rhodes, ‘New Modes of Governance in the EU: Common Objectives versus National Preferences’ (2007) European Governance Papers (EUROGOV) No N-07-01, available at: www.connex-network.org/eurogov/pdf/egp-newgov-N-07-01.pdf; Hatzopoulos, V, ‘Why the Open Method of Coordination is Bad for You: A Letter to the EU’ (2007) 13 European Law Journal 259–92CrossRefGoogle Scholar; Armstrong, K and Kilpatrick, C, ‘Law, Governance or New Governance?: The Changing Open Method of Coordination’ (2007) 13 Columbia Journal of European Law 649–77Google Scholar. For a more complete bibliography on the OMC, see the website of the Wisconsin/Madison EU Centre of Excellence at http://eucenter.wisc.edu/OMC/open12.html.

124 Hatzopoulos (n 123).

125 Moravcsik, A, ‘The European Constitutional Compromise and the Neofunctionalist Legacy’ (2005) 12 Journal of European Public Policy 349–86CrossRefGoogle Scholar; Kröger, S, ‘The End of Democracy as We Know it?: The Legitimacy Deficits of Bureaucratic Social Policy Governance’ (2007) 29 Journal of European Integration 565–82CrossRefGoogle Scholar; Citi and Rhodes (n 123).

126 Zeitlin (n 123) 9 (of the electronic version).

127 See, eg, Featherstone, K, ‘Soft Co-ordination Meets “Hard” Politics: The EU and Pension Reform in Greece’ (2005) 12 Journal of European Public Policy 733–50CrossRefGoogle Scholar; Lodge, MThe Importance of Being Modern: International Benchmarking and National Regulatory Innovation’ (2005) 12 Journal of European Public Policy 649–67CrossRefGoogle Scholar.

128 Above n 24. See also Radaelli, C, The Open Method of Coordination: A New Governance Architecture for the European Union?: Swedish Institute for European Policy Studies (SIEPS) Report No. 1 (Stockholm, SIEPS, 2007)Google Scholar; Hatzopoulos (n 123) above.

129 Zeitlin (n 123).

130 See, eg, Wearden, G, ‘Eurozone Now in its Longest RecessionThe Guardian (London, 15 May 2013)Google Scholar. Available at: www.guardian.co.uk/business/2013/may/15/eurozone-recession-deepens. It may also be noted that even the five EU Member States that do rank well for their competitiveness (see www3.weforum.org/docs/CSI/2012-13/GCR_Rankings_2012-13.pdf) owe little to the Lisbon Strategy.

131 Communication (n 122).

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