Keywords: Article 228 EC, lump sum penalties, implementation of Directives, delayed implementation of Article 226 EC judgments. Directive 2001/18, deliberate release into the environment and placing on the market of GMOs
Article 226 of the European Community Treaty provides a well-known enforcement procedure under which the European Commission can bring infringement proceedings against Member States before the European Court of Justice. The procedure gives the Commission and the Court an important role in upholding the Community's environmental laws. Not only can Member States be compelled to implement European Community Directives on environmental law, they can also be policed to ensure that they do so fully and accurately. However, not until the adoption of the Treaty on European Union in 1994 did the Community augment this with a power to impose financial penalties. Now, under Article 228 EC, if a Member State fails to comply with a Court judgment, the European Commission can bring that country back before the Court and the Court can impose such penalties.
Subsequent case law has gradually clarified the way in which these penalties will be applied. Article 228 provides that 'if the Court of Justice finds that the Member State concerned has not complied with its judgment it may impose a lump sum or penalty payment on it'. The European Commission's initial policy, in practice, was simply to ask the Court to impose a penalty payment - a type of 'running' fine intended to encourage Member States to comply with the Court's judgment in the second (Article 228) case as soon as possible. For example, Greece was ordered to pay €20,000 per day until it complied with the terms of a previous judgment on waste management.1 Similarly, Spain was fined €624,500 per year for each percentage of its bathing waters that continued not to comply with bathing water standards and with a previous Court judgment requiring Spain's compliance with those standards.2 One important side effect of this policy was that Member States could delay taking the action needed to comply with a judgment delivered in an Article 226 enforcement action. As long as that action was taken by the time the subsequent Article 228 case came before the Court, no financial penalty would be imposed, other than a requirement to pay legal costs.
In 2005 the European Court of Justice exercised its powers under Article 228 to require France to pay a penalty payment of €316,500 per day for every six-month period in which France failed to comply with an earlier 1991 judgment concerning fishery conservation law.3 In addition, the Court also ordered France to pay a lump sum of €20 million. Thus, for the first time, it became clear that the Court could impose both a penalty payment and a lump sum order. This gave the European Commission an idea and it introduced new enforcement policy guidelines.4 From 1 January 2006, the Commission has asked the Court, in every new Article 228 enforcement case it has brought, to impose both a penalty payment running from the date of delivery of the Court's judgment under Article 228 and a lump sum payment designed to penalise the Member State for its delay in complying with the initial judgment delivered under Article 226. Thus, Member States would not only have a financial incentive to comply quickly with the Article 228 judgment, they would also now have a financial incentive to comply with the initial Article 226 judgment as soon as possible.
The present case was the first test of the Commission's new enforcement strategy before the European Court of Justice. The importance of the issues raised is testified by the fact that the case was heard by the full Grand Chamber of the Court.