Soft law in the European Union – Should we take it into account in our business?
In the legal system of the European Union, apart from primary law (e.g. Treaties) and secondary law (e.g. resolutions, directives), a phenomenon called soft law may be distinguished. Both acts of primary and secondary law are characterised by their binding force which soft law does not possess. Soft law may be materialised in specific legal instruments, e.g. communications, notices, guidelines, recommendations or opinions. Such instruments are getting more common in EU, especially in competition law. However, this lack of binding element may cause some confusion. The main concern is to what extent we should get familiar with soft law instruments and comply? Do they have any practical and legal effects? Below, you will find a brief overview that will show you that it is crucial to take soft law into account while running your business and in relations with authorities.
As for practical effects, they vary depending on the soft law instrument. For example, preparatory documents like green papers, white papers, action programs help to create a basis for future legal acts, identify a legislative gap and express the intention of the institution to regulate a certain issue. As an entrepreneur, you can see in what directions the future legislation is planned to be formed and what the priorities of EU institutions are. You may take it into account while setting your business plans.
As far as legal effects are concerned, basing on the jurisdiction of the Court of Justice of the European Union (CJEU), they may be divided into three categories:
1. legal effect towards courts and national authorities which are obliged to take soft law instruments into account in order to assure consistent interpretation and loyal cooperation, it regards also EU institutions and bodies, including CJEU (e.g. case C-322/88 Salvatore Grimaldi v Fonds des maladies professionnelles).
2. legal effect towards Member States if soft law instruments have been previously presented to the Member State, and such Member State has ensured their application, e.g. guidelines, it means that Member State authorities should take into account such soft law instruments while making decisions directed to third parties (e.g. case C-311/94 IJssel-Vliet Combinatie BV v Minister van Economische Zaken).
3. legal effect towards institution, bodies, offices, and agencies of EU which issued the soft law instrument, such effect is based on good faith, they must apply such soft law instruments, they cannot depart from them without justification, because of the violation of the principle of legal certainty and the principle of legitimate expectations (e.g. case C-526/14 Tadej Kotnik and Others v Državni zbor Republike Slovenije, joined cases C-189/02 P, C-202/02 P, C-205/02 P to C-208/02 P and C-213/02 Dansk Rørindustri and Others v Commission of the European Communities). The deviation from such an instrument should be justified.
In articles to follow, we will explain in detail the effects that are listed above and how precisely it may influence your business, relations with authorities or your legal situation.