CJ, 23-04-2015, nr. C-69/14

I recall that, in the case to hand, Romanian law provides a designated avenue for the setting aside of final judgments which, on the basis of subsequent case-law of the Court, appear to be inconsistent with EU law. However, it is limited to judgments issued in administrative proceedings. It cannot be used to overturn judgments issued in civil proceedings. And this is so even though Romanian law further provides that civil judgments that are subsequently found to be in breach of Romanian constitutional law, due to a (subsequent) ruling of the Romanian Constitutional court, can also be set aside.

At the outset it is important to be mindful of the outer limits of the duty of sincere cooperation set out in Article 4(3) TEU that is incumbent on Member States, including their courts. It requires them to ‘take any appropriate measure, general or particular, to ensure fulfilment of the obligations arising out of the Treaties’ and to ‘refrain from any measure which could jeopardise the attainment of the Union's objectives’. This obligation is to be read in conjunction with the second paragraph of Article 19(1) TEU. It states that ‘Member States shall provide remedies sufficient to ensure effective legal protection in the fields covered by Union law’.

The Court has held that as ‘regards the remedies which Member States must provide … neither the FEU Treaty nor Article 19 TEU intended to create new remedies before the national courts to ensure the observance of European Union law other than those already laid down by national law’. 24. The Court has added that the ‘position would be otherwise only if the structure of the domestic legal system concerned were such that there was no remedy making it possible, even indirectly, to ensure respect for the rights which individuals derive from European Union law, or again if the sole means of access to a court was available to parties who were compelled to act unlawfully’25. (my emphasis).

The right to an effective remedy is also guaranteed by Article 47(1) of the Charter to everyone whose rights guaranteed by EU law are violated. It is beyond doubt that the Romanian authorities were implementing EU law, in the sense of Article 51(1) of the EU Charter, when recovery of the part of the special vehicle tax corresponding to the pollution tax was denied in breach of Article 110 TFEU. The requisite subject matter connection between the Member State measures impugned and substantive EU rules 26. necessarily exists when a Member State levies a tax in breach of primary, and indeed secondary, EU law. The Court's case-law further confirms that, whenever an individual seeks a judicial remedy to correct a breach of EU law concerning Member State implementation thereof, the Member State courts are bound by all of the requirements of Article 47 of the Charter. 27.

I recall that in the absence of EU rules on the recovery of national taxes unduly levied, it is for the domestic legal system of each Member State, in accordance with the principle of the procedural autonomy of the Member States, to designate the courts and tribunals having jurisdiction and to lay down the detailed procedural rules governing actions at law for safeguarding the rights which taxpayers derive from EU law. The Member States none the less have responsibility for ensuring that those rights are effectively protected in each case. The detailed procedural rules governing actions for safeguarding a taxpayer's rights under EU law must not be framed in such a way as to render impossible in practice or excessively difficult the exercise of rights conferred by EU law. 28.

In this respect Romanian legislation, and more specifically the Code of Fiscal Procedure, provides access to administrative and fiscal tribunals or to administrative and fiscal chambers of appellate courts as the case may be, 29. in situations where decisions of tax authorities are challenged, including claims pertaining to restitution of illegally levied taxes. 30. These avenues of redress seem to apply also in situations in which tax decisions are challenged by reference to EU law rights. Thus, Romanian legislation prima facie ensures effective judicial protection with respect of these rights.

Moreover, Article 21(2) of Law No 554/2004 on administrative proceedings enables final decisions of organs of administrative proceedings to be set aside when they appear incompatible with EU law because of a later judgment of the Court. In the light of the Court's above described case-law relating to the specific question of res judicata, this goes further than is required by EU law. 31.

Yet, as I have already noted, all national procedural rules that are relevant to the enforcement of EU law, including exceptions to res judicata, must comply with the right to an effective remedy, and the principles of effectiveness and equivalence. The difficulty arises, in the case to hand, with respect to the lack of clarity that appeared to be inherent in Romanian procedural law at the material time when proceedings were first instituted by Mr Târşia to recover special motor tax paid in June 2007 before a civil court. 32.

In my opinion, it is arguable that the lack of clarity in Romanian procedural law was inconsistent with Article 47 of the Charter, EU law requirements pertaining to legal certainty, and may have rendered the recovery of the car pollution tax that was incompatible with EU law impossible in practice or excessively difficult to enforce.

It is to be recalled that the judicial decision forming an obstacle to restitution of the pollution tax, and that was issued prior to the Court's ruling in the judgment in Tatu (C-402/09, EU:C:2011:219), was given by a civil appellate court (Tribunalul Sibiu) in civil proceedings as a result of an appeal of the Romanian State against the first instance civil judgment delivered by the Judecătoria Sibiu. The main proceedings also take place in the same civil appellate court, i.e. Tribunalul Sibiu.

The Commission points out in its written observations that such actions have been raised in Romania both before administrative courts and civil courts. In view of this, it is perplexing that, at the hearing, the Romanian Government claimed that civil courts are absolutely incompetent to hear such cases, and that any civil Romanian court so seized is empowered or even obliged to raise the issue of its competence of its own motion.

Thus there has clearly been a measure of confusion on the correct judicial procedure applicable to recovery of the tax in issue in this case. 33. Whatever the correct procedure may be now, the fact remains that the final (Romanian) civil judgment (decision No 401/2008 of the Tribunalul Sibiu) refusing recovery of the part of the special motor vehicle tax corresponding to the pollution tax is res judicata. This is what has created the legal problem to hand.

There is room for doubt, therefore, on which Romanian courts are (or were) empowered to hear claims for recovery of unlawfully levied car pollution tax at the pertinent time. I conclude that Romanian law has been unclear in this respect. Therein lies the problem, particularly with respect to Article 47 of the Charter.

Article 47(1) of the Charter states that everyone whose rights and freedoms guaranteed by the law of the Union are violated has the right to an effective remedy before a tribunal in compliance with the conditions set down by that article. 34. According to the explanations accompanying Article 47, the first paragraph, encapsulating the right to an effective remedy, is based on, but goes beyond, the protection afforded under Article 13 of the European Convention on Human Rights (ECHR). 35. I further note that, pursuant to Article 52(3) of the Charter, in so far as the rights contained therein correspond with the rights guaranteed by the ECHR, the meaning and scope of those rights shall be the same as those laid down in the ECHR, although the EU is not to be prevented from providing more extensive protection.

Under the case-law of the European Court of Human Rights concerning Article 6(1) ECHR, systems of judicial review must be ‘sufficiently coherent and clear’ so as to afford a ‘practical, effective right of access’ to a court. 36. If the rules are of ‘such complexity’ that they generate ‘legal uncertainty’ then infraction of Article 6(1) results. 37. The Court of Human Rights has also held that judicial remedies must be ‘sufficiently attended by safeguards to prevent a misunderstanding as to the procedures for making use of the available remedies’. 38. Further, an unreasonable construction of a procedural requirement can result in breach of right of access to a court. 39. The European Court of Human Rights has recently reiterated that ‘the authorities should respect and apply domestic legislation in a foreseeable and consistent manner’ and ‘the prescribed elements should be sufficiently developed and transparent in practice in order to provide for legal and procedural certainty’. 40. Procedural rules are to serve the aims of legal certainty and the proper administration of justice. They are not to ‘form a sort of barrier preventing the litigant from having his or her case determined on the merits by the competent court’. 41.

Furthermore, I recall that according to the established case-law of the Court ‘legal certainty is a general principle of European Union law which requires in particular that rules involving negative consequences for individuals should be clear and precise and their application predictable for those subject to them’ (my emphasis). 42.

In my opinion, and in the light of the above, the lack of clarity on the correct judicial procedure applicable to recovery of taxes levied in breach of EU law precipitates breach of the Article 47 of the Charter, both in terms of the right to an effective remedy and access to justice. This is even more so if a decision given by an absolutely incompetent civil court could create res judicata in the sense that it would bar raising a further action for recovery before the competent court, be that a civil court or an administrative court. In my opinion it is for the national referring Court in the case to hand to make the assessment of Romanian procedural law as a whole in terms of effective judicial protection with regard to the recovery of unduly paid pollution taxes on motor vehicles. 43.

The Court has consistently held that ‘every case in which the question arises whether a national procedural provision makes the exercise of rights arising under the EU legal order impossible or excessively difficult must be analysed by reference to the role of that provision in the procedure, its progress and its special features, viewed as a whole, before the various national bodies. For those purposes account must be taken of the basic principles which lie at the basis of the domestic judicial system, such as the protection of the rights of the defence, the principle of legal certainty and the proper conduct [of] procedure’. 44.

Here it is first necessary to point out that the national court and all the parties having presented observations seem to assume that Article 21(2) of Law No 554/2004 cannot be applied in civil proceedings. This strikes me as logical, provided that Romanian procedural law makes a sharp distinction between different forms of judicial proceedings. In such a case there would be no scope for the interpretation of provisions defining the scope of application of Law No 554/2004 in a way which would enable its application by civil courts in disputes which are ratione materiae of an administrative or fiscal law nature. However, if such leeway existed, then the national referring court would be obliged to interpret the relevant national provisions in a way that promoted achieving conformity with EU law. 45.

It is the task of the national referring court to make the assessment of whether the Romanian rules in issue render the recovery of pollution tax levied incompatibly with EU law impossible in practice or excessively difficult to enforce. It suffices to note, however, that the confusion on whether recourse should have been made to civil or administrative remedies for recovery of the car pollution tax appears to have that effect.

Mr Târşia contends that, excluding application of the exception contained in Article 21(2) of Law No 554/2004 to res judicata from civil proceedings would be incompatible with both equality before the law, as reflected in Article 20 of the Charter, and the principle of equivalence.

Compliance with the principle of equivalence requires that the national rule in question apply without distinction to actions based on infringement of EU law and those based on infringement of national law having a similar purpose and cause of action. 46.

To my mind this means that EU law would have no objection, in the context of the principle of equivalence, to Romanian law supplying an exception to res judicata in administrative proceedings concerning EU law, and not civil proceedings concerning the same subject matter. The principle of equivalence requires equal treatment between comparable claims based on national law, on the one hand, and on EU law, on the other, not equivalence between different forms of procedure under national law. 47.

In any event, non-identical grounds for deviating from the principle of res judicata are reasonable in the case of final civil, criminal and administrative judgments. 48. The effect of these judgments is different, and so are the legal policy concerns relevant to defining exceptions (if any) to res judicata. In the case of civil judgments, legal certainty and stability of legal relations confirmed by a judgment having become final are of the utmost importance. In contrast, the conditions for revising a criminal judgment in the interest of a wrongfully condemned person should not be too harsh. In administrative law the interest of protecting the rights of individuals and of the principle of legality may justify a more flexible stand towards revision of final judgments than in the case of civil judgments.

Hence, Mr Târşia's suggestion that confining the exception to res judicata to administrative proceedings concerning EU law is incompatible with equality before the law is unfounded. I recall that unequal treatment before the law can arise only if the relevant situations are comparable. 49. This is not the case in so far as the grounds for setting aside final civil judgments and administrative judgments are concerned. In situations where there is a later judgment of the Court rendering a national provision incompatible with EU law, setting aside a final administrative law decision to the detriment of a Member State authority may be justified, but setting aside a final civil judgment determining a private law relationship between two individuals may be inappropriate for reasons of legal certainty. Therefore, as a legislative solution of the kind in place in Romania, opening this possibility in administrative proceedings but excluding it in civil proceedings, is as such not against the principle of equality before the law.

However, equality before the law is a different legal rule from the principle of equivalence. As pointed out in the written observations of the Commission, if Romanian law also supplies an exception to res judicata in the light of subsequent case-law of the Constitutional Court challenging the correctness of prior judicial rulings (and traversing all domestic jurisdictions) 50. then the principle of equivalence might well dictate that the same is to applied to Court rulings concerning EU law. 51.

While I admit that this may lead the discussion outside of the scope of the preliminary reference, 52. in my opinion the principle of equivalence is not complied with if a later decision of the national Constitutional Court can lead to revision of an earlier final civil judgment, and thus enable recovery of unduly levied tax when a judgment of the Court cannot. In such a situation rights based on the national constitution would enjoy more protection than EU law rights, and thus the latter would not enjoy protection equivalent to that enjoyed by this category of national law based rights. A similar asymmetry prevails, pursuant to Article 322(9) of the Romanian Code of Civil Procedure, in respect of the effects of judgments of the European Court of Human Rights when compared to those of the judgments of the Court.