Patrick Costello v The Government of Ireland, Ireland and The Attorney General

JurisdictionIreland
CourtHigh Court
JudgeMs. Justice Butler
Judgment Date16 September 2021
Neutral Citation[2021] IEHC 600
Docket Number[2021 No. 1282 P.]
Between
Patrick Costello
Plaintiff
and
The Government of Ireland, Ireland and The Attorney General
Defendants

[2021] IEHC 600

[2021 No. 1282 P.]

THE HIGH COURT

Constitutionality – Ratification – Comprehensive Economic Trade Agreement – Plaintiff challenging the ratification of a Comprehensive Economic Trade Agreement – Whether the plaintiff had locus standi to bring the action

Facts: A Comprehensive Economic Trade Agreement (CETA) was entered into between Canada on the one part and the European Union and its Member States on the other, on the 30th October, 2016. The plaintiff, Mr Costello, was a member of Dáil Éireann having been elected for the Green Party in the general election of February, 2020. A proposed resolution to ratify CETA was laid before the Dáil on 15th December, 2020. In the event, a vote was not taken and, instead, CETA was referred for scrutiny to certain Oireachtas Committees. The plaintiff gave evidence of his concerns as to the potential impact ratification of CETA might have on the State’s ability to introduce regulation, particularly in the environmental sphere. His concern was that although CETA does not purport to restrict the type of environmental regulation that the State can introduce, the fact that the State can be made liable in damages for loss suffered by a Canadian investor as a result of such regulation may have a chilling effect on the willingness of the State to introduce measures which are otherwise desirable. He also queried how, what he termed an “investor court service”, could be created without CETA being put to the people in a referendum and he cited examples of previous constitutional referenda to facilitate the State’s participation in other analogous international bodies. The defendants, the Government of Ireland, Ireland and the Attorney General, raised issues as regards the plaintiff’s locus standi to advance certain discrete arguments.

Held by the High Court (Butler J) that the plaintiff had locus standi to bring the action. Butler J held that the presumption of constitutionality applied. She held that CETA is an international agreement which, if ratified, will bind the State as a matter of international law. However, she held that, under its own terms it will not have direct effect in Ireland and cannot be invoked before the Irish Courts; equally, the CETA Tribunals will not have jurisdiction to declare any provision of Irish law or any act taken by an Irish authority to be invalid. She held that because CETA will operate only at the level of international law, its provisions cannot be characterised as laws made for the State in breach of Article 15.2 of the Constitution. She held that the decision making power of the CETA Joint Committee does not amount to a power to make laws for the State. She held that although investors will have a choice of jurisdiction in which to bring their claims, the choice to bring a claim before the CETA Tribunal does not amount to a subtraction of jurisdiction from the Irish Courts; consequently, the creation of and conferral of jurisdiction on the CETA Tribunals is not contrary to Article 34.1 of the Constitution. She held that if the CETA Tribunal is administering justice within the meaning of Article 34, then its jurisdiction is not “limited” for the purposes of Article 37. She held that CETA does not entail an unconstitutional transfer of the State’s sovereignty; consequently, ratification of CETA through Article 29.5.2 is constitutionally appropriate and permissible. She held that the subject matter of the entire of CETA falls within the competence of the EU being either a matter of exclusive EU competence (under the common commercial policy) or a matter of shared competence (under free movement of capital); however, the CJEU has held as regards a similar free trade agreement that ratification by Member States was required not just because of the fact that part of the subject matter fell within an area of shared competence, but because of a dispute resolution mechanism contained within that agreement. In those circumstances she held that it was difficult to construe ratification of CETA as something that is “necessitated” by virtue of obligations of membership of the EU for the purposes of Article 29.4.6 of the Constitution.

Butler J held that the plaintiff had not established that ratification of CETA in the manner proposed would be clearly unconstitutional. Butler J refused the relief sought by the plaintiff.

Relief refused.

JUDGMENT of Ms. Justice Butler delivered on the 16th day of September, 2021

Introduction
1

A Comprehensive Economic Trade Agreement (CETA) was entered into between Canada on the one part and the European Union and its Member States, including Ireland, on the other, on the 30th October, 2016. The signing of CETA on behalf of Canada, the EU and each of its Member States represent both the conclusion of seven years of negotiation and the commencement of a process of ratification. The entry into force and provisional application of CETA is governed by Article 30.7 of CETA. Article 30.7.1 stipulates that the parties are to approve the agreement in accordance with their respective internal requirements and procedures. Under Article 30.7.2, CETA will not enter into force until a prescribed date after the parties have exchanged written notifications certifying that they have completed their respective internal requirements and procedures. From a European Union (EU) perspective, CETA must be ratified by each Member State in accordance with the constitutional requirements of that Member State as well as by the EU itself.

2

However, Article 30.7.3 of CETA allows the parties to apply CETA on a provisional basis pending full ratification and also allows the parties to identify and notify to each other provisions that they do not intend to apply provisionally. Consequently, since February, 2017, CETA has applied on a provisional basis subject to certain reservations while the ratification process has been underway. Many of the articles which are the subject of these proceedings and which are contained in Sections C, D and F of Chapter 8 have been excluded from the provisional application of CETA.

3

On the 28th October, 2016, the Council of the EU adopted Council Decision (EU) 2017/37 which authorised the signing of CETA on behalf of the EU. The preceding day, 27th October, 2016, a number of statements and declarations were entered as statements to the Council minutes on the occasion of the adoption by the Council of the decision authorising the signing of CETA. These statements were made variously by the Council, the Commission and certain Member States. Statement 36 by the Commission and Council on “investment protection and the Investment Court System” confirms that the institutions of the EU regard CETA as aiming “at a major reform of investment dispute resolution” and that the mechanisms provided in CETA constitutes a step towards the establishment of a multilateral investment court which will, in the long term, become the body responsible for resolving disputes between investors and States. Significantly for the purposes of this case, statement 36 goes on to provide:-

“All of these provisions having been excluded from the scope of provisional application of CETA, the Commission and the Council confirm that they will not enter into force before the ratification of CETA by all Member States, each in accordance with its own constitutional procedures.”

Thus, ratification of CETA by Ireland is a precondition to the provisions to which the plaintiff objects coming into force. The central issue in these proceedings is the form such ratification must take in order to be constitutionally valid.

4

The plaintiff is a member of Dáil Éireann having been elected for the Green Party in the general election of February, 2020. His evidence to the court is that he has been aware of CETA, although not all of its detail, since 2016 and that the Green Party (including, presumably, himself) was part of an alliance of NGOs and advocacy groups campaigning against it. A proposed resolution to ratify CETA was laid before the Dáil on 15th December, 2020. In the event, a vote was not taken and, instead, CETA was referred for scrutiny to certain Oireachtas Committees. At the time this case was heard, the EU Affairs Committee had concluded its deliberations but had not yet reported. The Budgetary Oversight Committee was not due to commence its deliberations until after the Dáil recess in October, 2021.

5

The plaintiff gave evidence of his concerns as to the potential impact ratification of CETA might have on the State's ability to introduce regulation, particularly in the environmental sphere. In simple terms his concern is that although CETA does not purport to restrict the type of environmental regulation that the State can introduce, the fact that the State can be made liable in damages for loss suffered by a Canadian investor as a result of such regulation may have a chilling effect on the willingness of the State to introduce measures which are otherwise desirable. He also queried how, what he termed an “ investor court service”, could be created without CETA being put to the people in a referendum and he cited examples of previous constitutional referenda to facilitate the State's participation in other analogous international bodies. There is no doubt that the plaintiff is sincere in his concerns and, as an elected public representative, he is perhaps an especially suitable plaintiff to take proceedings of this nature. His entitlement to do so as a matter of general principle was not questioned by the defendants. However, the defendants have raised issues as regards the plaintiff's locus standi to advance certain discrete arguments, a matter to which I shall return in due course.

Overview of Legal Issues
6

As noted above, Article 30.7.1 of CETA...

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