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A National Measure Annulled by the European Court of Justice, or: High-level Judicial Protection for Independent Central Bankers: ECJ 26 February 2019, Cases C-202/18, Ilmārs Rimšēvičs v Republic of Latvia, and C-238/18 European Central Bank v Republic of Latvia, ECLI:EU:C:2019:139

  • René Smits
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      A National Measure Annulled by the European Court of Justice, or: High-level Judicial Protection for Independent Central Bankers: ECJ 26 February 2019, Cases C-202/18, Ilmārs Rimšēvičs v Republic of Latvia, and C-238/18 European Central Bank v Republic of Latvia, ECLI:EU:C:2019:139
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Footnotes

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This case note is an elaboration of a blogpost entitled ‘ECJ annuls a national measure against an independent central banker’, of 5 March 2019 in the European Law Blog, available at ⟨europeanlawblog.eu/2019/03/05/ecj-annuls-a-national-measure-against-an-independent-central-banker/⟩ (all websites cited in this case note were visited on 20 February 2020).

*

The author is Professor of the Law of the Economic and Monetary Union at the University of Amsterdam, an Alternate Member of the ECB’s Administrative Board of Review, an Assessor at the Belgian Competition Authority and a consultant on banking regulation.

Footnotes

References

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1 Art. 267 TFEU.

2 The Eurosystem is the term for the European Central Bank and the National Central Banks of the member states that have adopted the Euro: Art. 282(1) TFEU. This term is used to differentiate between the EU’s monetary authority and the European System of Central Banks, which includes the Union’s non-Euro Area central banks.

3 The Governing Council of the European Central Bank is the ultimate decision-making body of the European System of Central Banks, and of the Eurosystem: Arts. 8, 10 and 12 of the Statute of the European System of Central Banks and of the European Central Bank (ESCB Statute). The Governing Council consists of the Executive Board of the ECB and the governors of the national central banks of the member states that have adopted the Euro: Art. 283(1) TFEU and Art. 10.1 ESCB Statute.

4 Art. 263 TFEU.

5 Arts. 267 and 258 TFEU.

6 Art. 14.2 of the ESCB Statute.

7 Opinion of AG Kokott of 19 December 2018, ECLI:EU:C:2018:1030.

8 The European Central Bank – Institutional Aspects (PhD thesis 1997) p. 165.

9 The bank at the centre of the corruption allegations against the central bank governor is reported to have played a major role in channelling funds from Russia to off-shore destinations. See OCCRP, ‘The Russian Laundromat Exposed’, ⟨www.occrp.org/en/laundromat/the-russian-laundromat-exposed/⟩.

10 On alleged misinformation from outside the EU in the corruption allegations against Mr Rimšēvičs, see the press release of the Latvian Defence Ministry of 20 February 2018: ‘Ministry of Defence of Latvia: Information operation conducted against Latvia’, ⟨www.mod.gov.lv/en/news/ministry-defence-latvia-information-operation-conducted-against-latvia⟩.

11 Treaty on European Union, OJ C 191/1, 29.7.1992.

12 Art. 127(1) TFEU and Art. 2 ESCB Statute.

13 Arts. 127(2)-(6), 128 and 132 TFEU and Arts. 3, 4, 5, 6, 16, 25 and 34 ESCB Statute.

14 Arts. 17-24 ESCB Statute.

15 Art. 130 TFEU and Art. 7 ESCB Statute. The independence requirement also applies to central banks of the member states that have not introduced the Euro as the provisions cited are not excluded from application in these member states with a derogation (Art. 139 TFEU and Art. 42.1 ESCB Statute); only for the Bank of England the independence requirement is avoided on the basis of paras. 4 and 7 of Protocol No. 16.

16 Which cannot be discussed here. For a recent overview, see N. Fraccaroli et al., ‘The evolution of the ECB’s accountability practices during the crisis’, 5 Economic Bulletin (2018), ⟨www.ecb.europa.eu/pub/pdf/ecbu/eb201805.en.pdf?cf0d79521f2ebf831be86a8e836715ff⟩.

17 The entities entrusted with providing the public good of price stability are separate legal entities and the European Central Bank is an institution: Art. 13(1) TEU; Arts. 282-284 TFEU.

18 This refers to the attribution of autonomous decision-making powers to the central bank, thus allowing it to act without the need for political clearance when deciding how to carry out tasks that are core to the functioning of the European economy. G Tett, ‘Central banks are rethinking their roles – Staunch independence makes less sense in deflationary times’, Financial Times, 13 September 2019, provides a recent history of thinking on central bank independence; seewww.ft.com/content/eb1143fc-d543-11e9-8367-807ebd53ab77⟩.

19 The Eurosystem has its own finances, not included in the Union budget, whilst limited scrutiny by the Court of Auditors on the European Central Bank’s ‘operational efficiency’ is foreseen (Art. 27.2 ESCB Statute), thus excluding interference with policy choices of the central banking system based on auditing concerns.

20 Arts. 131 and 140(1) TFEU.

21 The European Council may only appoint persons of recognised standing and professional experience in monetary or banking matters, on a recommendation of the Council and after consultation of the European Parliament and the ECB’s Governing Council: Art. 283(2) TFEU and Art. 11.2 ESCB Statute.

22 An Executive Board member can only be dismissed if he or she ‘no longer fulfils the conditions required for the performance of his [her] duties or if he [or she] has been guilty of serious misconduct’. Then, ‘the Court of Justice may, on application by the Governing Council or the Executive Board, compulsorily retire him’ or her (Art. 11.4 ESCB Statute; female form added, RS).

23 Arts. 8 and 12.1 ESCB Statute.

24 Art. 127(2) TFEU and Art. 3.1 ESCB Statute.

25 Art. 3(1)(c) TFEU.

26 i.e. 19 out of the 28 member states, with two States having an opt-out from adopting the single currency (the United Kingdom and Denmark; see Protocol Nos. 15 and 16 to the TFEU), while the other seven have the status of a Member State with a derogation (Art. 139(1) TFEU and the Accession Treaties of 2003, 2005 and 2012), i.e. they are constitutionally obliged to adopt the Euro once they have met the convergence criteria (Art. 140 TFEU and Protocol No. 13).

27 Art. 10.2 ESCB Statute. For the schedule in 2020 and 2021, seewww.ecb.europa.eu/ecb/orga/decisions/govc/html/votingrights.en.html⟩.

28 This system is explained in an article in the ECB’s Monthly Bulletin, July 2009, ‘Rotation of voting rights in the Governing Council of the ECB’, ⟨www.ecb.europa.eu/pub/pdf/other/mb200907_pp91-99en.pdf⟩.

29 Art. 131 TFEU.

30 Based on Art. 127(6) TFEU and Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions, OJ L 287/63, 29.10.2013 (SSM Regulation).

31 Monetary stability refers to price stability; financial stability refers to the stability of the financial system (Art. 25.2 ESCB Statute; recitals 30 and 65 to, and Art. 1 of, the SSM Regulation) and the stability of (financing conditions for governments and enterprises in) the Euro Area; for the latter, see the judgment of the ECJ of 27 November 2012 in Case C-370/12, Pringle, notably paras. 65, 110, 135-136, and 164.

32 A national competent authority may also be the national central bank but this is not necessarily so; all national competent authorities are represented in the Supervisory Board of the ECB which proposes decisions to the Governing Council and executes them; next to the members of the ECB’s Executive Board, only national central bank governors are members of the Governing Council. Seewww.bankingsupervision.europa.eu/organisation/nationalsupervisors/html/index.en.html⟩.

33 The Single Supervisory Mechanism forms one pillar of the so-called ‘banking union’. The second pillar is a Single Resolution Mechanism (SRM), with the Single Resolution Board as the Union agency to decide on resolution of significant banks. See Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of a single resolution mechanism and a single resolution fund and amending Regulation (EU) No 1093/2010, OJ L 225/1, 30.7.2014, as amended by Regulation (EU) 2019/877 of the European Parliament and of the Council of 20 May 2019, OJ L 150/226, 7.6.2019. The third pillar of ‘banking union’ is intended to be a European Deposit Insurance Scheme for which the Commission has submitted a proposal in 2015 that is currently stalled in the Council.

34 In another judgment, the allocation of powers under the SSM Regulation has been qualified as conferring exclusive powers to the European Central Bank with the national competent authorities implementing their tasks as derived, delegated powers under a decentralised system of operation of the Single Supervisory Mechanism; see the General Court’s judgment of 16 May 2017 in Case T-122/15, Landeskreditbank Baden-Württemberg – Förderbank v ECB, ECLI:EU:T:2017:337, confirmed by the ECJ’s judgment of 8 May 2019 in Case C-450/17 P; ECLI:EU:C:2019:372. The German Constitutional Court takes issue with this interpretation in the L-Bank case in a recent judgment on the validity of ‘banking union’ under German law: Judgment of 30 July 2019, 2 BvR 1685/14, 2 BvR 2631/14. I summarise this ruling in my paper ‘The ECB and the rule of law’ for the ECB Legal Conference 2019: Building bridges – central banking law in an interconnected world, ⟨www.ecb.europa.eu/pub/pdf/other/ecb.ecblegalconferenceproceedings201912~9325c45957.en.pdf⟩.

35 Art. 6(4) SSM Regulation.

36 See supra n. 32.

37 Art. 26 SSM Regulation. In the proceedings before the European Court of Justice, the ECB had pleaded, rather incongruously, that the activity in which corruption was alleged to have taken place concerned a bank subject to the supervision of the Finanšu un kapitāla tirgus komisija, the Latvian Financial and Capital Market Commission. This activity was, therefore, beyond the withdrawal of the licence, outside the mandate of the ECB and, moreover, the ECB was involved ‘only in the context of a procedure in which the Governing Council raised no objections and which does not require express consent on the part of its members’. The Advocate General easily dismissed such reasoning: the Governing Council is ‘at least associated in the prudential supervision of credit institutions such as Trasta Komercbanka and responsible for taking decisions relating to their authorisation’ so that ‘it cannot be precluded outright’ that the activity investigated by the Latvian authorities consisted of ‘acts carried out by Mr Rimšēvičs in the performance of his duties as a Member of the Governing Council’; see paras. 149 and 150 of her Opinion.

38 Art. 4(1)(a) in conjunction with Art. 6(4) SSM Regulation.

39 i.e. shareholdings which exceed a certain threshold.

40 Art. 4(1)(c) in conjunction with Art. 6(4) SSM Regulation.

41 See the report by the Organized Crime and Corruption Reporting Project (OCCRP), ‘Latvian Bank Was Laundering Tool’, ⟨www.reportingproject.net/therussianlaundromat/latvian-bank-was-laundering-tool.php⟩.

42 On the proposal of the Financial and Capital Market Commission, the Latvian competent authority.

43 See the notice on the appointment of a liquidator, published pursuant to Directive 2001/24/EC on the reorganisation and winding-up of credit institutions in OJ C 123/2, 7.4.2016.

44 See Case T-247/16, Trasta Komercbanka and Others v ECB, renamed Fursin and Others v ECB, notably the Order of the General Court of 12 September 2017 rejecting the claim of Trasta Komercbanka as inadmissible and upholding the shareholders’ claim as admissible; ECLI:EU:T:2017:623. This Order has been the subject of a threefold appeal: by the ECB (Case C-663/17 P), by the Commission (Case C-665/17 P) and by Trasta Komercbanka itself (Case C-669/17 P), with the ECJ ruling, on 5 November 2019, ‘that the General Court was wrong to consider that the shareholders of Trasta Komercbanka were directly concerned by the decision at issue’ and, thus, rejecting the standing of shareholders, referring the case back for a decision on the action brought by Trasta against the ECB’s withdrawal of its banking licence; ECLI:EU:C:2019:923. For the Opinion of Advocate General Kokott in Joined cases C-663/17 P, C-665/17 P and C-669/17 P of 11 April 2019 ECLI:EU:C:2019:323, see my summary, at ⟨ebi-europa.eu/wp-content/uploads/2019/05/Challenging-a-banks-license-withdrawal-by-the-ECB-can-the-bank-act-or-can-its-shareholders_280419_def_.pdf⟩. See also Case T-698/16, Trasta Komercbanka and Others v ECB.

45 Disclosure: I have been a non-voting member in the review proceedings before the Administrative Board of Review, the ECB’s body for independent outside administrative review of supervisory decisions, concerning Trasta. For a description of the Trasta cases, see my ‘Interplay of administrative review and judicial protection in European prudential supervision – Some issues and concerns’, 84 Quaderni di Ricerca Giuridica della Consulenza Legale p. 43-46.

46 In para. 2 of her Opinion.

47 Another Latvian commercial bank, ABVL Bank, saw its licence withdrawn in 2018 after the US Treasury accused it of money laundering and circumventing sanctions against the People’s Republic of Korea; appeals against the ECB’s ‘fail or likely to fail’ decision leading to the closing of the bank were dismissed as inadmissible by Orders of 6 May 2019 in Case T-281/18, ABLV Bank v ECB and Case T-283/18, Bernis and Others v ECB; appeals pending: Case C-551/19 P and Case C-552/19 P.

48 In para. 15 of the judgment.

49 ‘ECB governor accused of bribery in Latvia corruption trial’, Reuters, 4 November 2019, ⟨www.reuters.com/article/us-europe-ecb-fraud-latvia/ecb-governor-accused-of-bribery-in-latvia-corruption-trial-idUSKBN1XE1PJ⟩.

50 The Korupcijas novēršanas un apkarošanas birojs, or KNAB; seewww.knab.gov.lv/en/⟩.

51 See the statement by the Latvian Prime Minister on the situation at the Latvian national central bank, 18 February 2018, ⟨www.mk.gov.lv/en/aktualitates/statement-prime-minister-maris-kucinskis-regarding-situation-bank-latvia⟩.

52 Mr Rimšēvičs’ story is recorded by Bloomberg in an interview published online on 25 September 2018, ⟨www.bloomberg.com/news/features/2018-09-25/the-face-of-latvia-s-scandal-ridden-financial-system-is-caught-in-a-corruption-case⟩.

53 Art. 130 TFEU prohibits instructions from EU and member state authorities ‘or from any other body’.

54 The statutory appeal against formal dismissal by the appointing authority, the parliament of Latvia, was unavailable to Mr Rimšēvičs, as the measure against him had been taken by another public authority, the Anti-Corruption Office. The Law on the Bank of Latvia provides that ‘[t]he Governor of the Bank of Latvia may lodge an appeal against the decision of the Parliament to relieve him from office according to the procedure laid down in Article 14.2’; see para. 10 of the judgment.

55 See para. 17 of the judgment.

56 See para. 18 of the judgment. As indicated, the criminal trial only started in November 2019.

57 Para. 19 of the judgment.

58 Under Art. 24 of the Statute of the Court of Justice of the European Union and Art. 62 of the Rules of Procedure of the Court of Justice.

59 Para. 20 of the judgment.

60 Interlocutory order of the Vice President of the ECJ of 20 July 2018 in Case C-238/18 R, ECB v Latvia, EU:C:2018:581.

61 Art. 10(2), second para., ESCB Statute allows that a member of the Governing Council who is prevented from attending for a prolonged period may appoint an alternate. See Arts. 3.3 and 3.4 of the Rules of Procedure of the ECB, Decision of the European Central Bank of 19 February 2004 adopting the Rules of Procedure of the European Central Bank (ECB/2004/2) (2004/257/EC), OJ L 80/3, 18.3.2004, as lastly amended by Decision (EU) 2016/1717 of the ECB of 21 September 2016 amending Decision ECB/2004/2 adopting the Rules of Procedure of the ECB (ECB/2016/27), OJ L 258, 24.9.2016, p. 17; consolidated version at ⟨eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:02004D0002-20160924&from=EN⟩.

62 Paras. 31 and 37 of the judgment.

63 Paras. 33-36 of the judgment.

64 Para. 38 of the judgment.

65 Ibid.

66 Para. 38 of the Opinion.

67 Para. 39 of the Opinion.

68 ‘(…) the present actions must be analysed as actions for a declaration by the Court that (…) Latvia failed to fulfil its obligations under Article 14.2 of the [ESCB Statute]’; para. 68 of the Opinion.

69 Paras. 54-55 of the Opinion.

70 Para. 68 of the Opinion.

71 Para. 167 of the Opinion.

72 Para. 64 of the judgment. Mr Rimšēvičs himself had requested that the decision be declared unlawful.

73 Para. 66 of the judgment.

74 Both provisions provide (in French and other languages, e.g. Dutch) for an action ‘against’ a legal act; the similar wording of two grounds that can be invoked against the measure and the two-month deadline for contesting it constitute further terminological similarities: para. 43 of the Opinion.

75 Para. 44 of the Opinion.

76 Para. 67 of the judgment.

77 Paras. 52-62 of the Opinion. The English word ‘inadmissible’ used in para. 62 is an awkward translation of the French inadmissibilité and the German Unzulässigkeit, which, in this context, must be read as unlawfulness or illegitimacy, not inadmissibility.

78 Para. 69; italics added. Unless specified otherwise, further references to paragraphs are to the ECJ’s judgment.

79 Para. 70. The reference to a ‘highly integrated system’ contradicts the tenor of the AG who relied on ‘the separation of those two spheres of competence’ in EU law; the Eurosystem forms an exception to this.

80 Para. 71.

81 Para. 74.

82 Paras. 42-55, with a reference to its judgment in the Gauweiler case on the ECB’s mandate to engage in non-standard monetary policy measures, the so-called Outright Monetary Transactions, announced in September 2012 and never actually employed – but the subject of fierce controversy in Germany, with the German Constitutional Court referring questions on the validity of the ECB’s decision; judgment of 16 June 2015 in Case C-62/14; ECLI:EU:C:2015:400.

83 Para. 49.

84 Para. 51. The broad terminology of Art. 14.2, which speaks of ‘relieved from office’ (‘relevé de ses fonctions’) rather than ‘dismissed’, is helpful: even in the absence of a formal dismissal, protection is available.

85 Para. 52.

86 Para. 53.

87 Para. 55.

88 Para. 57.

89 Para. 91, which deserves to be quoted in full: ‘It should be specified at the outset that it is not for the Court, when an action is brought before it on the basis of Article 14.2 of that statute, to take the place of the national courts having jurisdiction to give a ruling on the criminal liability of the governor involved, nor even to interfere with the preliminary criminal investigation being conducted in respect of that person by the competent administrative or judicial authorities under the law of the Member State concerned. For the purposes of such an investigation, and in particular in order to prevent the governor concerned from obstructing that investigation, it may be necessary to decide to suspend that person temporarily from office’.

90 Para. 90.

91 Paras. 72-73, with a reference to the interlocutory order of the Vice President of the ECJ of 20 July 2018.

92 Para. 91.

93 Para. 92.

94 Para. 39.

95 Paras. 26-28.

96 Paras. 60-63.

97 Paras. 91-96.

98 Point 2 of the operative part of the judgment.

99 Rendered in an expedited procedure in which interim measures were imposed on Latvia ordering it to allow Mr Rimšēvičs to designate an alternate member of the ECB’s Governing Council; see supra n. 60.

100 Illuminating on the integration of the national central banks in the Eurosystem is Art. 14.3 ESCB Statute, according to which ‘[t]he national central banks are an integral part of the ESCB and shall act in accordance with the guidelines and instructions of the ECB. The Governing Council shall take the necessary steps to ensure compliance with the guidelines and instructions of the ECB, and shall require that any necessary information be given to it’.

101 ‘i.e. this provision vests the Court with the power to declare the contested act to be void’: J. Bast, ‘Autonomy in Decline? A Commentary on Rimšēvičs and ECB v Latvia’, Verfassungsblog, 13 May 2019, ⟨verfassungsblog.de/autonomy-in-decline-a-commentary-on-rimsevics-and-ecb-v-latvia/⟩.

102 Supra n. 8.

103 Para. 49, cited in the text accompanying supra n. 83.

104 Para. 51.

105 See the misgivings in paras. 51-54 and 93-96 of the judgment. In her assessment of ‘whether [Latvia] has demonstrated to the requisite legal standard the reality of the facts in respect of which it accuses Mr Rimšēvičs’, the AG is not convinced of the judicial protection the national central bank governor could rely on (Opinion, paras. 108-118).

106 See para. 85 of the judgment: ‘However, it could be accepted that, in exceptional circumstances, a governor of a central bank of a Member State whose currency is the euro could be relieved from office even before delivery of a judgment convicting him. This would be the case, for example, where the measure was adopted on the basis of established or undisputed evidence’. (italics added)

107 Para. 85, cited in the previous footnote.

108 Para. 91.

109 The judgment of 10 July 2003 in Case C-11/00, Commission v ECB, EU:C:2003:395 on the competences of the Commission’s anti-fraud office at the ECB, and the judgment of 16 June 2015 in Case C-62/14, Gauweiler and Others, on the non-standard monetary policy measure that the ECB envisaged to undertake in 2012 to ensure transmission of its monetary policy across the Euro Area and ensure the irreversible nature of the Euro.

110 Para. 47.

111 Para. 52.

112 Para. 53.

113 Para. 54.

114 D. Sarmiento, ‘Crossing the Baltic Rubicon’, verfassungsblog, 4 March 2019, ⟨verfassungsblog.de/crossing-the-baltic-rubicon/⟩.

115 Council Regulation (EU) 2017/1939 of 12 October 2017 implementing enhanced cooperation on the establishment of the European Public Prosecutor’s Office, OJ L 283/1, 31.10.2017.

116 See the L-Bank judgment, referred to supra n. 34.

117 i.e. the Eurosystem (monetary policy and adjacent tasks) and the Single Supervisory Mechanism (supervision).

118 On national competent authorities and national central banks, see supra n. 32.

119 See supra n. 33.

121 See Regulation (EU) 2019/876 of the European Parliament and of the Council of 20 May 2019 amending Regulation (EU) No 575/2013 as regards the leverage ratio, the net stable funding ratio, requirements for own funds and eligible liabilities, counterparty credit risk, market risk, exposures to central counterparties, exposures to collective investment undertakings, large exposures, reporting and disclosure requirements, and Regulation (EU) No 648/2012, OJ L 150/1, 7.6.2019 (CRR).

122 Directive (EU) 2019/878 of the European Parliament and of the Council of 20 May 2019 amending Directive 2013/36/EU as regards exempted entities, financial holding companies, mixed financial holding companies, remuneration, supervisory measures and powers and capital conservation measures, OJ L 150/253, 7.6.2019 (CRD).

123 Art. 4(3) SSM Regulation; I have added the word ‘also’ for clarity’s sake.

124 Discussed during the 2019 ECB Legal Conference Building bridges – central banking law in an interconnected world (see supra n. 34) by K. Banks, ‘Incorrect implementation of EU directives: what effects for the ECB and the CJEU, and what mechanisms for rectification?’, by M. Prek, ‘Mutual judicial deference? The delineation of the (interpretative) competence of European and national courts in the judicial review of ECB acts based on national law’, and by F. Amtenbrink, ‘The application of national law by the European Central Bank: challenging European legal doctrine?’.

125 See the proceedings concerning Trasta mentioned supra n. 44.

126 A. Hinarejos, ‘The Court of Justice annuls a national measure directly to protect ECB independence: Rimšēvičs’, 56 Common Market Law Review (2019) p. 1649: ‘The decision in Rimšēvičs is doubtless a momentous one, but it is too early to tell exactly how much so’, calling the judgment ‘clearly rooted in, and justified by (…) the specific institutional context and highly integrated nature of the area [of EMU]’. Asking whether the judgment is a ‘feeler’ for the Court to test the reactions before going further afield, she does not rule out an extension of the Rimšēvičs approach but considers it likely to be bound with the institutional setting and the safeguarding of the independence of the ECB.

127 Judgment of 19 December 2018 in Case C-219/17, Silvio Berlusconi and Fininvest v Banca d’Italia and Others, ECLI:EU:C:2018:1023. For a summary by Federico Della Negra of this judgment, seeebi-europa.eu/wp-content/uploads/2019/01/Summary-judgment-Fininvest.pdf⟩. See also F. Brito Bastos, ‘Judicial review of composite administrative procedures in the Single Supervisory Mechanism: Berlusconi’, 56(5) Common Market Law Review (2019) p. 1355.

128 See the text accompanying supra nn. 39 and 40.

129 In para. 44, the Court held that ‘a single judicial review’ by the Union courts of European Central Bank acts to which preparatory measures by national competent authorities had contributed would ‘rule on the legality of the final decision adopted by the EU institution at issue and to examine, in order to ensure effective judicial protection of the persons concerned, any defects vitiating the preparatory acts or the proposals of the national authorities that would be such as to affect the validity of that final decision’.

130 Art. 11(6) of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty, OJ L 1, 4.1.2003, p. 1.

131 Bast, supra n. 101, who wrote: ‘(…) a national court may cite Rimšēvičs as a precedent that in such a legal order neither side can hide behind a shield protecting its autonomy. If an EU court can declare a national act void, certainly a national court can do so vis-à-vis an EU act, as well? That national court will not fail to mention, just like the Court of Justice did, that such a legal remedy derogating from the general distribution of powers is “very specific” and will be exercised in “exceptional circumstances” only’.

132 For instance, the German Constitutional Court’s manner of requesting preliminary rulings (providing its own reading of EU law in the questions) or of ruling on the validity of EU measures (re-interpreting the L-Bank judgment of the ECJ while accepting banking union as not beyond the scope of EU integration allowed by the Grundgesetz). See the judgment of the ECJ of 16 June 2015 in C-62/14, Gauweiler and the sequel to the judgment of the ECJ of 11 December 2018 in Case C-493/17, Weiss and Others, ECLI:EU:C:2018:1000.

133 Art. 2 TEU. For the rule of law in central banking, see ‘The ECB and the rule of law’, September 2019, my paper for the 2019 ECB Legal Conference; see supra n. 34.

134 See supra n. 27.

135 ‘Court stays proceedings in Rimsevics’ case, turns to Court of Justice of EU’, Leta100, 20 December 2019, ⟨www.leta.lv/eng/home/important/BD288D88-8026-48E3-B70D-CA710F0F4808/⟩; A Eglitis, ‘Latvian Court to Request ECJ Opinion on Rimsevics Immunity’, Bloomberg, 20 December 2019.

136 She stated: ‘(…) there is admittedly no need to dwell on the admissibility of any evidence that may have been obtained in breach of Mr Rimšēvičs’s immunity before he was relieved from office, since the Republic of Latvia has not in any event adduced any evidence and, consequently, there is no need to adjudicate on Mr Rimšēvičs’s complaint alleging infringement of Protocol (No 7) on the privileges and immunities of the European Union. Conversely, the immunity conferred on Mr Rimšēvičs by that protocol might become relevant again should he be reinstated in office following a judgment of the Court finding that the conditions for relieving him from office were not fulfilled’ (paras. 147 and 148 of the Opinion).

137 A. Eglitis, ‘Toughest Test for New ECB Official Is Repairing Homeland’s Image’, Bloomberg, 19 December 2019.

138 ‘ECJ judge set to become Latvia president’, Emerging Europe, 17 April 2019, ⟨emerging-europe.com/news/ecj-judge-set-to-become-latvia-president/⟩; ‘Latvian parliament elects former judge Levits president’, Reuters, 29 May 2019, ⟨www.reuters.com/article/us-latvia-election-president/latvian-parliament-elects-former-judge-levits-president-idUSKCN1SZ18R⟩.

139 N. Buckley, ‘Latvia: a banking scandal on the Baltic’, Financial Times, 23 February 2018, ⟨www.ft.com/content/e7b586c4-1883-11e8-9376-4a6390addb44⟩; ‘Russian businessman behind shuttered Latvian bank PNB attacks ECB’, Reuters, 16 August 2019, ⟨www.reuters.com/article/us-latvia-bank-closure/russian-businessman-behind-shuttered-latvian-bank-pnb-attacks-ecb-idUSKCN1V61NI⟩.

140 ‘Guselnikov sells off stake in Latvia’s PNB bank’, eng.lsm.lv (Latvian Public Broadcasting), ⟨eng.lsm.lv/article/economy/banks/guselnikov-sells-off-stake-in-latvias-pnb-bank.a323936/⟩.

141 ‘ECB has assessed that AS PNB Banka in Latvia was failing or likely to fail’, ECB press release, 15 August 2019, ⟨www.bankingsupervision.europa.eu/press/pr/date/2019/html/ssm.pr190815~b8e2038aa9.en.html⟩.

142 ‘AS PNB Banka: SRB Decides No Resolution Required’, SRB press release, 15 August 2019, ⟨srb.europa.eu/en/node/814⟩; A. Eglitis, ‘Latvian Court Declares PNB Bank Insolvent After ECB Suspension’, 12 September 2019, Bloomberg, ⟨www.bloomberg.com/news/articles/2019-09-12/latvian-court-declares-pnb-bank-insolvent-after-ecb-suspension⟩.

143 The following proceedings are pending (see R Smits and F Della Negra, ‘The Banking Union and Union Courts: overview of cases as at 19 August 2019’, ⟨ebi-europa.eu/publications/eu-cases-or-jurisprudence/⟩): Case T-275/19, PNB Banka and Others v ECB, seeking annulment of the ECB’s decision of 14 February 2019 to conduct an on-site inspection on the premises of PNB Banka AS; Case T-301/19, PNB Banka and Others v ECB, seeking annulment of the ECB’s decision of 1 March 2019 to classify PNB Banka as a significant supervised entity; Case T-330/19, PNB Banka and Others v ECB, seeking annulment of the ECB’s decision of 21 March 2019 on the proposed acquisition of qualifying holdings by the applicants in PNB Banka.

This case note is an elaboration of a blogpost entitled ‘ECJ annuls a national measure against an independent central banker’, of 5 March 2019 in the European Law Blog, available at ⟨europeanlawblog.eu/2019/03/05/ecj-annuls-a-national-measure-against-an-independent-central-banker/⟩ (all websites cited in this case note were visited on 20 February 2020).

* The author is Professor of the Law of the Economic and Monetary Union at the University of Amsterdam, an Alternate Member of the ECB’s Administrative Board of Review, an Assessor at the Belgian Competition Authority and a consultant on banking regulation.

A National Measure Annulled by the European Court of Justice, or: High-level Judicial Protection for Independent Central Bankers: ECJ 26 February 2019, Cases C-202/18, Ilmārs Rimšēvičs v Republic of Latvia, and C-238/18 European Central Bank v Republic of Latvia, ECLI:EU:C:2019:139

  • René Smits

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