This is an important, ambitious and timely book in an area of huge economic importance. It is directed to legislators, administrators and the courts. Its subject is one which has not, so far as I know, been comprehensively covered by any other, namely, the allocation to economic actors of limited rights by the European Union and Member States – rights to receive a subsidy or to licences to carry on an activity which can not lawfully be carried on without such a licence. A careful reading of the first chapter gives a good insight into what is being attempted by the authors.

The book does not walk again down well trodden paths but rather exposes and discusses a collection of often overlapping and at times conflicting Treaty provisions, Directives, Regulations, legal decisions and economic and political desiderata. It seeks to identify tools which will help to construct something orderly.

As a former judge of the Court of Justice of the European Union who has had to try with his colleagues to find a path through inconsistent case law and concepts it was a joy on being asked whether I would write this preface, to come across – alas too late – a draft of this book. It should help my successors to find a conceptually coherent approach to draft ing judgments in a particular field so that they do not conflict with other judgments in overlapping fields.

The law is currently being developed and is still sufficiently flexible and uncrystallised for this book to be in a position to make a significant contribution to that development. I hope that in due course it will be found possible to translate it into French – still the working language of the CJEU.

Konrad Schiemann

Former Judge of the Court of Justice of the European Union

This book is the result of a Europe-wide exploration of building blocks for a consistent and general legal theory on the allocation of limited rights by administrative authorities. The idea of an international book project on this theme was launched at an inspiring international conference, organised by researchers from the Departments of Constitutional and Administrative law of Leiden University and VU University Amsterdam, the Netherlands. The project has been realised with the help of many researchers from various EU Member States. The contributions in this book deal with the subject from a general perspective, as well as from an EU law perspective and a comparative law perspective. These contributions have been enriched by the information provided by national reports on the allocation of gambling licences, radio frequencies and CO2 emission permits in seven EU Member States: France, Germany, Greece, Italy, the Netherlands, Romania and Spain. Together, all these contributions have resulted in a valuable and interesting collection of legal scholarship, which sheds light on various complex issues concerning the allocation of limited rights by administrative authorities. We sincerely hope that, based on these building blocks, further research in this field can be carried out. We wish to thank all the authors for their efforts and contributions to this book project.

Paul Adriaanse, Frank van Ommeren, Willemien den Ouden and Johan Wolswinkel Leiden/Amsterdam, November 2015

Introduction

This book deals with limited public rights, such as authorisations and subsidies. Limited public rights often represent a specific value for the holder of such rights, who commonly regards them as property. Authorisations are sometimes limited as a consequence of scare natural resources, but they also often concern intentionally created scarcity as a result of specific government policy objectives, for instance gambling licences, parking licences or licences to operate a pharmacy. These policy objectives tend to change over time. If, for example, the government wants to pursue a stricter policy in the area of betting and gaming in order to reduce gambling addiction, this can have consequences for the holder of a gambling licence. What if this limited right, his ‘property’, is taken away and re-allocated or amended (for example in scope or conditions) to the detriment of the holder? What if the government takes other measures which result in the value of the licence decreasing? Can holders of limited public rights claim property rights in such cases in order to prevent changes to their rights?

In this book the authors seek to demonstrate the need for a consistent approach to the allocation of limited public rights from a legal perspective. The issues highlighted above show that when addressing the question of which rules and principles are relevant in a general legal theory on the allocation of limited public rights in the EU and its Member States, the right to property must be included. In this chapter we will focus on how the concept of the protection of property can be incorporated into a consistent legal framework.

To answer this question, we will take a closer look at the implications and influence of the European Convention on Human Rights (ECHR). The right to property as governed by Article 1 of the First Protocol to the ECHR is much more developed in the case law on the revocation of authorisations than its mirror image laid down in Article 17 of the EU Charter of Fundamental Rights (CFR). In ECtHR case law, licences (and even subsidies) are acknowledged to be property in certain circumstances.

Introduction

Managing scarcity to serve the public interest is a classic task of government. Whereas economic and political theory have paid much attention to the allocation of scarce goods and rights, until now a consistent and general legal theory of ‘the allocating government’ has been more or less absent. In fact, the law of public administration seems to assume that every party shall be granted a good or right once it satisfies all the necessary conditions. This assumption neglects the fact that in several areas of government regulation, individual rights such as authorisations and (financial) claims are available only in a limited quantity. As a result of this limited availability, certain applications for those rights must be denied even though the applicants satisfy all the necessary conditions. In other words, there may not be enough rights available to satisfy all qualified parties.

This idiosyncratic feature of limited rights can be illustrated using a number of examples. First, it is worth mentioning the auctions of the 4G spectrum in several Member States as an example of rights which are scarce for natural reasons. With revenues running up to billions of euros, the financial importance of these frequencies for both the allocating authorities and the bidding undertakings is clear from the outset. In the area of gambling law, an area entirely different from telecommunications law at first sight, scarcity exists as well: in order to ensure the protection of consumers and to combat crime and gambling addiction, many Member States artificially restrict the number of authorisations that are available to be granted. The same holds true for financial grants, although the background is different: in order to restrict expenditure, most kinds of financial grants and subsidies are available in limited budget only, both at the European level and at the level of the Member States. Last but not least, we mention the many procurement procedures being performed in order to conclude supply contracts with market parties.

This book seeks to demonstrate the need for a consistent and general theory on the allocation of limited rights by administrative authorities from a legal perspective.