Proceedings before the Referring Court after a Reference has been Made



1. The Case Remains Pending before the National Court

Article 23 of the Statute of the Court of Justice presupposes that the national court stays the proceedings when it refers a preliminary question to the Court of Justice and this is indeed a normal consequence of making a preliminary reference.1 However, to make a preliminary reference does not imply that the case as such is transferred to the Court of Justice. On the contrary, the main proceedings remain pending before the referring court and that court thus retains jurisdiction to take any procedural measures which it is empowered to take under national law. For example, it may order protective measures to safeguard the interests of the parties pending the judgment of the Court of Justice.2 Furthermore, EU law does not prevent the referring court from withdrawing a preliminary question, and there is no duty to give reasons for such a withdrawal.3 Nevertheless, with the introduction in 2012 of Article 100(1) of the Court’s Rules of Procedure it has also been established that the withdrawal of a preliminary question may be taken into account until notice of the date of delivery of the judgment has been served on the interested persons referred to in Article 23 of the Statute. Presumably this means that the Court of Justice may render a judgment even if the referring national court has withdrawn its question(s) after this date. Moreover, by definition, Article 23 of the Statute does not apply to cases decided by a reasoned order, as the Court does not give prior notification with regard to that type of decisions.

Frequently a preliminary reference is withdrawn because the main proceedings before the referring court are terminated—for instance due to a settlement or withdrawal of appeal.4

In Zabala Erasun, following a reference to the Court of Justice for a preliminary ruling, the defendant Spanish government acquiesced to the claims of the plaintiff and paid the unemployment benefits claimed by the latter. Furthermore, the government declared that the payment, with retrospective effect, should be regarded as being covered by the scope of the applicable EU rule, as the plaintiff had argued in the main proceedings. Finally, the government submitted that the preliminary reference should be withdrawn, as the dispute no longer existed. However, the referring court maintained its request for a preliminary ruling. Indeed, it informed the Court of Justice that, since the case was no longer pending before it but had been referred to the Court of Justice, it was not in a position to terminate the case and withdraw the preliminary questions. The Court of Justice replied that it follows from Article 267 that where a national court makes a reference for a preliminary ruling only the request for interpretation or a decision on validity is addressed to the Court; the case as such is not transferred. The national court therefore remains seized of the case, which is still pending before it. Accordingly, EU law does not preclude a national court which has made a preliminary reference from finding that in national law the claims of the appellants have been acceded to and, where appropriate, that the main proceedings are thereby terminated. On this basis, the Court of Justice declared that it did not have jurisdiction as long as the Spanish court had not confirmed that, under Spanish law, the proceedings had been terminated.5

Another common reason for withdrawing a preliminary reference is that following the reference a judgment of the Court of Justice, on an issue similar to that raised in the preliminary reference, has rendered the matter acte éclairé so that the referring court can now confidently decide the matter itself without first obtaining a preliminary ruling.6 Depending on the stage of the preliminary proceedings, the referring court might, however, find it more appropriate to maintain the reference.

In Royscott Leasing Ltd and others v Commissioners of Customs and Excise, in connection with Directive 77/388, the English Court of Appeal refused to withdraw a request for a preliminary ruling which it had made to the Court of Justice despite an intervening ruling by the latter in another case relating to the same directive. In the opinion of the Court of Appeal there was only reason to withdraw a preliminary reference if it was clear that a ruling on the question posed had become entirely without interest. That condition was not met in the instant case. Indeed, as the Court of Justice had not suggested that the preliminary reference should be withdrawn, it apparently did not itself find that the issue had already been decided in the other case. Moreover, the proceedings before the Court of Justice were at an advanced stage as the hearing was imminent and the Advocate General was to deliver his Opinion in about two months’ time. Hence, to withdraw the reference would not entail a substantial reduction of the length of the national proceedings. Rather to the contrary, at this advanced stage of the proceedings withdrawing the reference for a preliminary ruling could unduly prolong the case as a whole.7

It may also happen that a judgment from the Court of Justice, handed down after the preliminary reference has been made, induces the referring court to either withdraw or add questions to those already posed.8

Only the referring national court can ask the Court of Justice to remove a request for a preliminary ruling from its case register.9 Thus, Article 100(1) of the Rules of Procedure lays down that the Court shall remain seised of a request for a preliminary ruling for as long as it is not withdrawn by the court or tribunal which made that request to the Court. In contrast, as the procedure in Article 267 is wholly independent of the will of the parties to the main proceedings, even a joint request to strike a preliminary reference from the register will be in vain. The parties may nevertheless draw the Court’s attention to developments in the national proceedings and thereby induce it to ask the referring national court whether it maintains its preliminary reference. Unfortunately, national courts do not always respond to the Court’s questions, and in such situations it has happened that the Court of Justice has removed a preliminary case from its register where it seemed apparent from other information available to the Court of Justice that the national proceedings had been terminated.10

2. Appeal against a Decision to Make a Preliminary Reference

2.1. Court’s Case Law

It was for a long time believed that EU law allowed a decision to make a preliminary reference to be overturned by an appellate court according to national rules on the administration of justice. Already in 1962, in De Geus, the Court seemed to accept that references could be subject to appeal, at the same time stating that it would comply with a request for a preliminary ruling as long as the preliminary questions have not been revoked.11 The matter was reconsidered in the first Rheinmühlen ruling in January 1974, when the Court ruled that ‘a rule of national law whereby a court is bound on points of law by the rulings of a superior court cannot deprive the inferior courts of their power to refer to the Court questions of interpretation of EU law involving such rulings’.12 In his Opinion in the case, Advocate General Warner had argued the same and suggested that national appellate courts should not have the last word on whether there was a need to ask for a preliminary ruling, so it should not be possible to appeal against a decision to make a reference.13 However, less than a month later, in the second Rheinmühlen ruling, the Court held that ‘in the case of a court against whose decisions there is a judicial remedy under national law, Article [267 TFEU] does not preclude a decision of such a court referring a question to this court for a preliminary ruling from remaining subject to the remedies normally available under national law’.14 Moreover, in several subsequent cases the Court of Justice has accepted that appellate courts may annul preliminary references submitted by lower courts.15 Hence, it was a matter for national law to determine whether an appeal was possible in such situations.16

In 2008, in the Cartesio ruling the Court, however, qualified that approach and underlined the autonomy of the referring court.

In Cartesio, a Hungarian court asked whether it was in accordance with Article 267 that Hungarian law conferred a right to bring an appeal against an order making a preliminary reference thereby limiting the power of the lower courts to refer questions for a preliminary ruling. The Court of Justice first restated its above-mentioned established case law according to which Article 267 does not preclude a decision of a national court to make a preliminary reference being subject to the remedies that are normally available under national law. It added, however, that the outcome of such an appeal could not limit the referring court’s jurisdiction to make a preliminary reference if it considered that a case pending before it raised questions on the interpretation of provisions of EU law necessitating a ruling by the Court of Justice. In this respect, the Court stated that Article 267 confers an autonomous jurisdiction on the referring court to make a preliminary reference. This autonomous jurisdiction would be called into question, if—by varying the order for reference, by setting it aside, and by ordering the referring court to resume the proceedings—the appellate court could prevent the referring court from exercising the right to make a preliminary reference. Therefore, it was solely for the referring court to draw the proper inferences from a judgment delivered on an appeal against its decision to refer and, in particular, to come to a conclusion as to whether it would be appropriate to maintain the preliminary reference, or to amend it or to withdraw it.17

In essence, in Cartesio, the Court established that, while nothing prevents a lower national court’s decision to make a preliminary reference from being appealed to a superior court, Article 267 does preclude the decision of the appellate court from having a binding effect on the referring (lower) national court; the decision of the superior court can merely be an advisory opinion for the lower court as, under Article 267, a national court’s jurisdiction to make a preliminary reference cannot be limited.18 One could say that the Cartesio ruling has made the lower court superior to the appellate court and thus reversed the hierarchy between them in this respect.

The consequences of the Cartesio ruling vary from Member State to Member State according to their procedural laws. In those Member States where, prior to the ruling there was no right of appeal against decisions to make preliminary references, the ruling is unlikely to cause any changes.

In contrast, in those Member States where such appeal was possible prior to the Court’s ruling in Cartesio, the consequences may be far-reaching, depending on how the different national courts and legislators react to the judgment. As already indicated, nothing in EU law prevents the national legal system from continuing letting appellate courts continue to hear appeals on preliminary reference decisions, as long as their rulings will not be binding. However, it might not be compatible with national rules on court procedure that the appellate court cannot issue rulings that are binding on the lower courts whose decision are subject to appeal. Moreover, even where national law would not preclude such limited effects of an appeal ruling, it might be debatable whether it is appropriate with a system whereby the lower court is placed in a rather delicate position in cases where an appellate court overrules the lower court’s decision, and the lower court then will have to choose between complying with the ‘non-binding ruling’ of the appellate court and maintaining that there is a need for a preliminary reference.19

The Danish Supreme Court’s order in Lady & Kid provides an illustration of the choices which national courts face. This order originated in civil litigation before the Danish Eastern High Court between a number of undertakings as plaintiffs and the Danish Ministry of Taxation as defendant. According to the undertakings, the Danish tax authorities should repay a tax which had been imposed on the undertakings in contravention of EU law. The High Court decided to stay the proceedings in order to make a preliminary reference to the Court of Justice. The tax authorities appealed to the Danish Supreme Court against this decision. According to the tax authorities, there was no reasonable doubt about the requirements of EU law concerning the repayment of an unlawfully imposed tax. Hence, there was no basis for making preliminary reference to the Court. Second, the tax authorities argued that some of the preliminary questions were incomprehensible and did not properly reflect the facts of the case. Third, the tax authorities argued that the giving of evidence to the High Court should have been completed before deciding whether or not to make a preliminary reference. At the time when the tax authorities appealed against the High Court’s decision to make a preliminary reference in Lady & Kid, it was the established practice in Denmark that such decisions could be subject to appeal. Nevertheless, in this case, the tax authorities readily acknowledged that, following the Court of Justice’s ruling in Cartesio, the Supreme Court could no longer deprive the High Court of the right to make a preliminary reference under Article 267. However, the tax authorities went on to argue that the ruling in Cartesio did not prevent an appellate court from rescinding a lower court’s decision to make preliminary references since, following such rescission, the lower court could simply make a new decision to uphold the original preliminary reference, or it could decide to refer some new questions to the Court of Justice. In its ruling, the Danish Supreme Court first unanimously ruled that it followed from the Court of Justice’s Cartesio ruling that an appellate court is not competent to overturn a lower court’s decision to make a preliminary reference. Hence, the Supreme Court could not require the Danish Eastern High Court to vary its order for reference, or to abstain from submitting the reference to the Court of Justice, or to withdraw a reference which had already been referred to Luxembourg. Following this initial and unanimous ruling, the Supreme Court turned to the question of the consequences of this for the construction of Danish law. In this respect the Supreme Court held that it was difficult to reconcile the Danish appellate court system, where a decision of a lower court could be overruled by an appellate court, with a system where a decision on an appeal regarding a preliminary reference would not be binding. Moreover, the court considered that there was no appreciable need for this type of special arrangement, not least because the appellate court would have to show considerable restraint in its examination of the lower court’s decision to make a preliminary reference. On this basis the Supreme Court ruled that, following Cartesio, decisions by Danish courts to make preliminary references should no longer be subject to appeal. Consequently, the appeal against the High Court’s decision to make a preliminary reference in Lady & Kid was dismissed. In contrast, the Supreme Court ruled that appeals against decisions not to refer would still be possible and, in this situation, an appeal decision that a reference should be made would be binding on a lower court.20

2.2. In What Situations May a National Appeal Procedure Be Binding on the Lower Court?

In the following we analyse in more detail the extent to which EU law precludes an appeal from having binding effect on the lower court. In this respect, it is important to bear in mind that Cartesio is purely concerned with the effects of an appeal against a decision to make a preliminary reference to obtain guidance on issues of EU law. This ruling does not affect appeals contesting the jurisdiction of the referring court under national law, nor does it relate to interlocutory appeals on matters solely related to national law or an obligation merely to inform national bodies such as the Ministry of Justice when a preliminary ruling has been made.21

2.2.1. Appeals on matters falling outside the Court’s jurisdiction under Article 267 TFEU

A preliminary reference must concern the validity or interpretation of EU law. Article 267 TFEU does not give the Court jurisdiction to consider the facts of the main proceedings or the validity or interpretation of national law.22 Thus, Article 267 does not preclude an appellate court from considering these aspects of the main proceedings with binding effect, even in connection with an appeal against a lower court’s decision to make a preliminary reference.

If an appellate court disagrees with a lower court about the statement of the facts or about the national law applicable in the main proceedings, and if it overruled these elements of the lower court’s decision to make a preliminary reference, this may well mean that a preliminary reference about EU law becomes hypothetical and thus inadmissible, since the Court does not rule on hypothetical questions. Hence, if a decision to make a preliminary reference is appealed to a higher court, if this higher court overrules a statement of the facts and/or national law in the preliminary reference, and if this means that the questions in the preliminary reference becomes hypothetical, then the preliminary reference will become inadmissible. However, even where an appellate court essentially undermines the basis for a lower court making a preliminary reference, the ruling in Cartesio

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