Norms Emanating from International Bodies and Their Role in the Legal Order of the European Union

Abstract

The EU recognises that engagement with international organisations is vital to allow it to realise its objectives. Although the EU takes part in the work of a considerable number of international organisations and fora, the effects of norms emanating from these international bodies upon the EU often remain unclear. In addition to legal instruments that are binding on the Union and Member States, there is also a growing body of other norms developed at the international level that influences legal and policy developments within the EU and that may even be referred to in EU legislation or case law. The chapter explores, in a non-exhaustive manner, how norms developed at the international level, such as rules, standards, principles and best practices, influence the development of EU law, even though they are not strictly legally binding upon the Union. It examines how norms developed within several bodies—the Food and Agriculture Organization (FAO) and the Codex Alimentarius Commission, the World Health Organization (WHO), OECD and the G20—have been dealt with within the EU legislature and judiciary.

Jan Wouters—Professor of International Law and International Organizations, Director of the Leuven Center for Global Governance Studies/Institute for International Law. Jed Odermatt—Research Fellow.

1 Introduction

The European Union (EU or Union) recognises that engagement with international organisations is vital for allowing it to realise its objectives. Article 21(1) TEU inter alia sets out that the EU “shall seek to develop relations and build partnerships with […] international, regional or global organisations” and that it “shall promote multilateral solutions to common problems, in particular in the framework of the United Nations.”¹ One of the cross-cutting aims of EU external relations is to “promote an international system based on stronger multilateral cooperation and good global governance.”² Although the Union takes part in the work of a considerable number of international organisations and fora, the effects of norms emanating from international bodies upon the EU often remain unclear. There has been much focus on the status of international agreements and other legally binding international instruments within the EU legal order.³ Yet in addition to these, there is also a growing body of other norms developed at the international level that influences legal and policy developments within the EU and that may even be referred to in EU legislation or case law. The present chapter explores, in a non-exhaustive manner, how norms developed at the international level influence the development of EU law, even though they are not strictly legally binding upon the Union.

The first part of this chapter discusses the range of international bodies that influence the EU. Rather than only examining traditional “international organisations” that possess legal personality, such as the United Nations or the World Trade Organization,⁴ our analysis is broadened to encompass a wider range of norm-generating bodies at the international level that may affect the EU. It then examines the types of norms adopted by these bodies, which include, in addition to binding legal decisions of these bodies, an array of non-binding norms, codes of conduct, guidelines, principles, recommendations, standards and other instruments that are developed within a variety of international organisations and bodies and that may find their way into EU legislative acts and case law. The next part provides an overview of how these instruments affect the EU legal order by discussing the EU’s relationship with several international organisations and bodies. It first discusses bodies associated with the UN: the Food and Agriculture Organization and the Codex Alimentarius Commission, and the World Health Organization. It then turns to the EU’s relationship with the Organization for Economic Co-operation and Development (OECD) and the Group of Twenty (G20) and bodies such as the Financial Stability Board (FSB) and the Basel Committee on Banking Supervision (BCBS). In analysing the EU’s relationship with each of these bodies, the EU’s position and role within them is first discussed, in order to see whether and to what extent the EU exercises influence within the international body’s decision-making process. It then goes on to examine how the norms adopted by that body are received within the EU legal order, with examples of EU legislation that incorporates these norms, and case law that discusses how these norms are to be treated. As we will see, in many instances, the EU legislature demonstrates openness towards these norms and often directly refers to the international processes that led to their development. This is the case especially where the EU is represented in the international body at hand, helps to shape the rules, and where the EU has an interest in seeing them implemented. However, quite a number of examples in the case law demonstrate a tendency to pursue a more “European” approach, downplaying the influence of some international bodies and highlighting the “autonomy” of the EU legal order.

2 International Organisations, Bodies and the Norms They Generate

In order to examine the role of norms emanating from international organisations and bodies in the EU legal order, it is necessary to understand what is meant by an “international organisation” or an “international body” as well as the types of norms they generate.

Interestingly, there is no standard definition of the term “international organisation” in public international law. The International Law Commission describes it as “an organization established by a treaty or other instrument governed by international law and possessing its own international legal personality.”⁵ Most legal definitions place importance on the organisation’s legal personality or the separate will of the organisation distinct from its members.⁶ Bindschedler does not mention legal personality in his definition of international organisations, but whether it has its own aims and organs.⁷ White is critical of the “separate organ/will” criterion: “It has been stated that an organisation must have at least one organ with a will of its own, but this precise requirement tends to blur the distinction between the existence of an organisation on the international stage, and the existence of one possessing international legal personality.”⁸ A precise legal definition that covers the complete range of bodies at the international level is hard to come by. Klabbers points out that “it has so far appeared impossible to actually define such organizations in a comprehensive way.”⁹

A strict legal understanding of “international organisation” tends to leave out bodies that, although not international organisations under available public international law definitions, are nevertheless influential and affect the EU legal order. Sands and Klein refer to this problem in classifying international organisations, pointing out that “a number of recent developments have called into question the traditional approaches to categories, functions and status of international organizations” and that “important decisions are frequently taken by states in meetings which are not taking place under the auspices of international organizations”,¹⁰ of which the G20 (see Sect. 3.3.3) is a prime illustration. Under the heading “other autonomous organizations” they try to capture this reality.¹¹

In order to take full account of the wide range of international fora that affect the EU legal order, it may be necessary to broaden this concept to include a range of what will be further referred to as “international bodies”. Such international bodies include, for example, a variety of international committees which may be intergovernmental but may also consist exclusively of independent experts that have their basis in multilateral treaties, such as the UN human rights treaty bodies.¹² It would also include bodies established by resolutions or decisions of international organisations at a global level such as the Intergovernmental Panel on Climate Change (IPCC), established by the UN Environmental Programme (UNEP) and the World Meteorological Organization (WMO).¹³ At a regional level, the Venice Commission (“European Commission for Democracy through Law”),¹⁴ a Council of Europe advisory body established in 1990 and currently regulated by a revised statute adopted by the Committee of Ministers in 2002, offers an example. Beyond this, we may also consider normative activity established in the context of what international relations scholars refer to as “international regimes”.¹⁵ This includes actors such as the G20¹⁶ and some of the machinery it has brought to life, such as the FSB, as well as specific bodies bringing together financial watchdogs like the BCBS or the International Organization of Securities Commissions (IOSCO). These do not meet the classic definition of “international organisation” under international law, but may—and do, see Sect. 3.3.3—affect the EU legal order. One can go even further and examine international bodies that are purely private in nature. These bodies may also display normative activity that impacts upon the EU legal order. For instance, the International Accounting Standards Board (IASB) is a purely private body, but has had a strong impact on European accounting law through the so-called “IAS Regulation” of 19 July 2002.¹⁷

Not only the classical definition of “international organisation” must be widened to include a range of other actors and bodies. Similarly, one ought to broaden the notion of “norms” emanating from these international bodies. Many, if not most, international organisations and bodies are not capable of producing documents with binding legal effect. Even for those who can, much of their activity lies beyond binding legal instruments. International organisations and bodies nowadays produce a great number of rules, recommendations, best practices, standards and guidelines, which raises questions regarding how these should be given effect within the EU. Most of these instruments are not “hard law” binding on the Union. They can be “rules” characterised by a more rigid formulation and constraining nature¹⁸; “standards”, which typically leave a greater range of choice or discretion¹⁹; and even “principles” or “best practices”, which are still more flexible and leave scope to balance a number of legal and policy considerations.²⁰ A full account of norms should include both hard law such as treaty provisions or Chapter VII-based UN Security Council resolutions as well as guidelines and recommendations adopted by a variety of international organisations and bodies. Limiting an analysis to binding legal rules tends to leave out an important layer of normative activity at the international level. The next section will discuss, from the viewpoint of EU legislative and judicial practice, how a number of selected norms developed by international organisations and bodies are treated within the EU legal order.

3 EU Legislative and Judicial Practice

3.1 United Nations

Although the EU is not, and cannot be, a member of the United Nations,²¹ it has sought to increase its visibility and participation within various UN organs, bodies and agencies. This is in line with the Union’s stated political goal within the Lisbon Treaty to enhance its role in the international arena.²² For instance, in May 2011 the EU’s participation rights within the UN General Assembly, one of the principal organs of the UN, were enhanced.²³ Even before this, the EU had been involved in numerous other UN organs, bodies and agencies. Within these entities, the position and role of the EU may vary greatly. This depends both on the EU’s competence in the organisation’s field as well as the extent to which the organisation has allowed for the Union’s participation or membership. One of the most controversial cases on the EU’s relationship with the United Nations is the Kadi case,²⁴ which in essence dealt with the relationship between UN Security Council resolutions and the EU legal order, particularly the validity of regulations implementing Security Council “smart sanctions”. Although the UN Security Council is the highest political organ within the UN system and in spite of Articles 25, 48(2) and 103 of the UN Charter, the Court of Justice held in 2008 that norms established by this body may be still deemed to be incompatible with EU primary law since “the obligations imposed by an international agreement cannot have the effect of prejudicing the constitutional principles of the EC Treaty.”²⁵ That the Court of Justice views the UN Charter as just another international agreement subject to the primacy of EU law²⁶ has, in the words of the General Court, “given rise to a number of questions.”²⁷ Further discussion of this case law, and the extent to which it represents a shift in the Court’s approach to international norms, is beyond this chapter, and is discussed extensively elsewhere²⁸ including further in this volume.²⁹ The Court of Justice’s 2008 judgment in Kadi shows a certain attitude towards norms adopted by other international organisations and may set the tone, if continued, on how the Court will consider other norms developed at the international level.

3.1.1 The Food and Agriculture Organization and the Codex Alimentarius Commission

The Food and Agriculture Organization (FAO) currently offers the one and only example of a UN specialised agency in which the EU is a full member.³⁰ In 1991, after several years of negotiation, the European Economic Community (EEC) formally joined the organisation as a member alongside its Member States.³¹ The EU’s position within the FAO is therefore somewhat different to other UN organs. Due to an amendment to the FAO constitution and the EEC’s submission of a declaration of competences, the EU is now capable of exercising its capacity as a full member in its areas of competence.³²

The European legislature has consistently referred to FAO documents in its legislative instruments. One area where the Union pays particular attention to FAO instruments is in the field of fisheries and marine resources, for the latter of which the EU has exclusive competence under Article 3.1(d) TFEU. Commission Decision 2010/93/EU³³ incorporates the definitions used by the FAO for certain technical terms. Council Regulation 1005/2008 establishing a system to prevent, deter and eliminate illegal, unreported and unregulated fishing³⁴ refers to the FAO Agreement to Promote Compliance with International Conservation and Management Measures by Fishing Vessels on the High Seas. Council Regulation 1225/2010³⁵ refers to the FAO’s 2008 International Guidelines for the Management of Deep-sea Fisheries in the High Seas. The EU legislative action also implements FAO guidelines such as the “Code of Conduct for Responsible Fisheries”.³⁶

EU legislation also refers to decisions of the FAO in the field of the environment, particularly when ensuring that terms are consistently defined with the meanings at the international level. References to FAO documents often include technical standards or recommendations developed by FAO experts. Directive 2009/28/EC³⁷ on the promotion of the use of energy from renewable sources is an example of where the EU refers to FAO definitions and standards. In the field of development, the 2008 Regulation establishing a facility for rapid response to soaring food prices in developing countries³⁸ refers to the 2008 FAO Conference Declaration to promote a global partnership for food and agriculture in which members undertook to take steps to reduce food insecurity.

FAO and Codex Alimentarius—since 2003 the EU has been a member of the latter as well³⁹—instruments have also been referred to in EU case law. Cp-Pharma Handels GmbH v Bundesrepublik Deutschland ⁴⁰ concerned the validity of a Regulation amending Annex II to Regulation No. 2377/90⁴¹ for the establishment of maximum residue limits (MRLs) of veterinary medicinal products in foodstuffs of animal origin. The Court noted that the preamble to Regulation 2377/90⁴² states that “in the course of establishing MRLs, the Commission must take account of any scientific assessment of the safety of the substances concerned which may have been undertaken by international organizations, in particular the Codex Alimentarius, or by other scientific committees established within the Community.”⁴³ At the time the regulation was adopted there was scientific uncertainty about the effects of progesterone, as evidenced by the differing opinions of the EU’s Committee for Veterinary Medicinal Products (CVMP), the Scientific Committee on Veterinary Measures relating to Public Health (SCVPH) and other international scientific bodies.⁴⁴ The Court held that the Commission was not bound by the CVMP recommendation, and could legitimately base its decision on the scientific assessment of other organisations.⁴⁵ In Alphapharma v Council ⁴⁶ the Court examined the precautionary principle and explained that it could only be applied in situations where there is a risk to human health. It referred to the meaning of the terms “risk” and “hazard” as understood by the Codex Alimentarius.⁴⁷ It also took into account the definition of “scientific risk assessment” at both the European level and at the international level through the Codex Alimentarius Commission.⁴⁸

The FAO and Codex Alimentarius Commission are relatively technical organisations. The definitions, guidelines and standards which EU legislation and case law refer to are developed by experts in the fields of forestry, fisheries, agronomy, livestock etc. Furthermore, as a full member of these organisations, the EU has a hand in shaping the norms produced within the organisation.⁴⁹

3.1.2 World Health Organization

The World Health Organization (WHO) is another UN specialised agency that influences EU legislation. Unlike the FAO, where the EU is a member, the EU only has an observer status at the WHO. In spite of this weak status the EU (previously the EC) and the WHO have cooperated since the 1980s and the EU has notably played an important role in the negotiations on the WHO’s revised International Health Regulations and its Framework Convention on Tobacco Control.⁵⁰ There is EU legislation that incorporates WHO standards. Directive 2010/45/EU on Standards of Quality and Safety of Human Organs intended for transplantation⁵¹ seeks to implement internationally-recognised standards in relation to organ donation and transplants. The Directive implements standards defined by the World Health Organization Guiding Principles on Human Cell, Tissue and Organs Transplantation,⁵² which include the principle that human body parts should not be the subject of commercial transactions. The Directive also refers to a Recommendation of the Committee of Ministers of the Council of Europe on the Background, Functions, and Responsibilities of a National Transplant Organisation (NTO)⁵³ and to the Convention on Human Rights and Biomedicine of the Council of Europe. Directive 2003/40/EC⁵⁴ on natural mineral waters lists in its preamble the WHO’s recommended amount of fluoride and other chemicals for drinking water. It states that the Scientific Committee for Food issued an opinion⁵⁵ that validates the limits recommended by the WHO.

Several ECJ cases have discussed WHO instruments in the EU legal order. Monsanto Agricoltura Italia ⁵⁶ related to the use of GMO maize, and referred in particular to the concept of “substantial equivalence” to existing foods. It refers to Recommendation 97/618/EC in which the Commission states that the concept of “substantial equivalence” “has been introduced by WHO [the World Health Organization] and OECD [the Organization for Economic Cooperation and Development] with particular reference to foods produced by modern biotechnology.”⁵⁷ In 1996 the Court interpreted the notion of public health under EU law in light of the preamble to the WHO Constitution.⁵⁸ The case concerned an action by the United Kingdom for the annulment of the Working Time Directive.⁵⁹ The Directive itself does not refer to the WHO; however, the Court held that “[t]here is nothing in the wording of Article 118a [EC treaty] to indicate that the concepts of “working environment”, “safety” and “health” as used in that provision should, in the absence of other indications, be interpreted restrictively.”⁶⁰ The Court favoured a broad interpretation: “such an interpretation of the words “safety” and “health” derives support in particular from the preamble to the Constitution of the World Health Organization to which all the Member States belong. Health is there defined as a state of complete physical, mental and social well-being that does not consist only in the absence of illness or infirmity.”⁶¹

Yet the Court may also choose not to follow standards developed at the international level. In Chacon Navas ⁶² the Court explored the meaning of “disability” for the purposes of EU non-discrimination law. It examined the definition of disability in the WHO International Classification of Functioning, Disability and Health (ICF). It found that there was an autonomous European meaning of the term which did not intend to include “sickness” as part of disability for the purpose of discrimination law. In cases in other fields, the Court has similarly found a “European” meaning of a concept which differs from how it may be understood internationally. For example, in Grant v South-West Trains Ltd ⁶³ the Court discussed whether “discrimination based on sex” includes discrimination based on a person’s sexual orientation. Various UN human rights bodies have interpreted “sexual discrimination” to include discrimination on the grounds of sexual orientation. However, the Court found that it should interpret this in its European meaning, and not a meaning consistent with human rights law as defined by the various UN monitoring bodies, including the Human Rights Committee.⁶⁴ Even where they do not represent instruments binding on the EU, the norms developed by international bodies seem to be highly persuasive, especially in more scientific or technical fields in which they have expertise, such as the FAO or WHO. However, the Court may still assert the autonomy of the European legal order, and will apply a “European” meaning where it considers this necessary.

3.2 OECD

The Organization for Economic Co-operation and Development (OECD) is another organisation included in Article 220 TFEU with whom the Union is to “establish all appropriate forms of cooperation.” In fact, “close cooperation” with the OECD was mentioned from the very beginning in the Rome Treaty.⁶⁵ The EU is not a member of the OECD; however, due to an agreement allowing for EU participation,⁶⁶ its role goes “well beyond that of a mere observer” and boils down to the most ample “full participant” status, the only difference with members being that the EU does not have the right to vote, does not participate in the adoption of legal acts submitted to the OECD Council and does not contribute to the budget.⁶⁷ The EU is present in a great number of OECD committees⁶⁸ and is even a full member of the DAC.⁶⁹ EU legislation frequently refers to standards and guidelines developed in the context of the OECD.

The EU is a participant in the OECD Arrangement on Officially Supported Export Credits, and most of the EU’s legislation on export credits reflects instruments developed within the framework of the OECD. Regulation 1233/2011⁷⁰ on the application of certain guidelines in the field of officially supported export credits makes numerous references to OECD guidelines and instruments. In this field, some relevant OECD instruments include the OECD Recommendation on Bribery and Officially Supported Export Credits to deter bribery and the OECD Recommendation on Common Approaches on the Environment and Officially Supported Export Credits on the protection of the environment.⁷¹

Regulation 1905/2006 establishing a financing instrument for development co-operation⁷² also refers to numerous international organisations, including the OECD. The Regulation seeks to implement international norms in relation to poverty reduction and development established by the ILO (core labour standards), the Beijing Declaration and Platform for Action (women’s rights and empowerment) and the Dakar Framework for Action on Education for All (education). According to the Regulation’s preamble “[u]ntying aid in line with best practices of the OECD/DAC is a key factor in adding value to aid and in building local capacity.”⁷³ The Regulation also defines “developing countries” with reference to the OECD DAC list.⁷⁴ Similarly, Regulation 1934/2006 establishing a financing instrument for cooperation with industrialised and other high-income countries states that the Commission may amend its list of developing countries “following the regular OECD/DAC reviews of its list of developing countries.”⁷⁵

This issue of what can be considered to be a “developing country” was examined in 2008⁷⁶ in a case where the European Parliament had brought an action for the annulment of a Council Decision granting a Community guarantee to the European Investment Bank against losses under loans and loan guarantees for projects outside the Community.⁷⁷ The Parliament argued that the Decision included an element of development cooperation and therefore Article 179 EC should have been used as a legal basis for the decision, and noted that the countries included in the Decision were mostly “developing countries” according to the World Bank and OECD classifications.⁷⁸ The Court noted that “developing country” in the EU context commonly refers to that defined by the OECD and the World Bank, and that “particular importance is accorded in Community practice to the list of Official Development Assistance recipients adopted by the Development Assistance Committee of the OECD.”⁷⁹ However, it held that the concept of “developing country” “must be given an autonomous Community interpretation.”⁸⁰ Similarly, EURL Le Levant 001 v Commission ⁸¹ related to whether certain state aid in the form of tax relief for ship building was in accordance with EU legislation. Article 4(7) of Council Directive 90/684/EEC on aid to shipbuilding states that state aid “may be deemed compatible with the common market if it complies with the terms laid down for that purpose by OECD Working Party No. 6 in its Agreement concerning the interpretation of Articles 6 to 8 of the Understanding [on Export Credits for Ships of 3 August 1981]”.⁸² The aid in question met the criteria for aid under the OECD development criteria. The Court referred to a case Germany had started against the Commission⁸³ for the annulment of Decision 92/569/EEC,⁸⁴ where the Court had held that the Commission must determine the development criteria separately from the OECD criteria. In that case, the German government had argued that only the OECD procedure had to be complied with. However, the Court held that Article 4(7) confers discretion on the Commission and that it may take into account the OECD criteria, but must still determine whether the aid also has a development component. In both cases, the Court found that in this case the aid did not have a genuine development component and therefore was incompatible with the common market. This again demonstrates how the Court may still give an “autonomous” European interpretation to certain concepts. In a similar way to the UN bodies discussed above, most of the norms referred to by the EU legislature are guidelines and recommendations, mostly of a technical nature. Again, as the EU takes part in the functioning of the OECD and its committees, it is open to adopting OECD standards in its legislation.

3.3 G20

Since the 2008 global financial crisis, international bodies such as the G20 have engaged in collaborative efforts to stabilise the world economy and to prevent another similar crisis from developing. The G20 was elevated to the level of heads of state and government and given a new role to help manage the international financial system. Unlike international organisations where the EU remains an observer or sits alongside 27 Member States, the G20 is a body where the EU, as one of the 20 members, has a relatively strong voice. Also, the G20 is not a classic international organisation—there is no founding treaty or constitution, it lacks international legal personality, a permanent secretariat and even its own staff, and largely depends on its members and a number of international organisations to fulfil its goals. Yet representatives of the world’s major economies, including the EU,⁸⁵ have chosen the G20 to play a large role in managing global governance. Although it may not be considered an international organisation under international law and it is not capable of taking legally binding decisions, decisions made at G20 summits have directly inspired much of the EU’s legislative action in the wake of the financial crisis.

The G20 is referred to frequently in EU legislative acts in the field of economic governance. Directive 2010/76/EU on credit institutions states in its first recital:

While the causes of such risk-taking are many and complex, there is agreement by supervisors and regulatory bodies, including the G-20 and the Committee of European Banking Supervisors (CEBS), that the inappropriate remuneration structures of some financial institutions have been a contributory factor.⁸⁶

It also states that the provisions of the Directive “constitute steps in the reform process in response to the financial crisis. In line with the conclusions of the G-20, the FSB and the Basel Committee on Banking Supervision, further reforms may be necessary.”⁸⁷ Directive 2009/111/EC revising rules applicable in the banking sector states that:

In accordance with the European Council and Ecofin Conclusions and international initiatives such as the Group of Twenty (G-20) summit on 2 April 2009, this Directive represents a first important step to address shortcomings revealed by the financial crisis […]⁸⁸

The establishment of the European Systemic Risk Board (ESRB),⁸⁹ designed to establish EU-level macro-prudential regulation and supervision, was influenced by the response of international organisations to the global financial crisis, in particular the G20 and the FSB and the need to establish oversight at the regional and international level. The de Larosière Report, ⁹⁰ which recommended the establishment of the ESRB, states that the EU “must work with [its] partners to converge towards high global standards, through the IMF, FSF, the Basel committee and G20 processes.” This language appears in the Preamble to the Regulation which states that “The ESRB should contribute, inter alia, towards implementing the recommendations of the IMF, the FSB and the Bank for International Settlements (BIS) to the G-20.”⁹¹

The G20 has also been highly concerned with the regulation of over-the-counter derivatives (OTC derivatives). The lack of regulation in this field, especially “credit default swaps”, has been seen as a major factor leading to the crisis. The European Commission’s proposal for a Regulation on OTC derivatives⁹² states that it has been inspired by the G20 leaders’ commitment to “improve transparency and regulatory oversight of over-the-counter derivatives in an internationally consistent and non-discriminatory way.”⁹³ The proposal states that

The European Commission has also gained valuable information by participating in various international fora, in particular the OTC Derivatives Regulators Group and the Basel Committee’s Risk Management and Modeling Group. The Commission has recently also gained observer status on the steering committee of the joint CPSS-IOSCO9 working group that is currently reviewing the recommendations for CCPs and preparing recommendations for trade repositories. In addition, the Commission has engaged in frequent dialogue with non-EU authorities, in particular US authorities (the CFTC, the SEC10, the Federal Reserve Bank of New York and the Federal Reserve Board and the US Congress) and is co-chairing a work stream of the Financial Stability Board (FSB) focusing on addressing the challenges related to the implementation of the reporting, clearing and trading obligations agreed at G20 level.⁹⁴

The Parliament and Council agreed to new rules regulating OTC derivatives on 9 February 2012.⁹⁵ The Commission has also proposed legislation to strengthen the regulation of the banking sector.⁹⁶ These proposals reflect commitments made by leaders at the G20 summit in London and Pittsburgh in 2009.⁹⁷ The Commission states that this proposal “translates in Europe international standards on bank capital agreed at the G20 level (most commonly known as the Basel III agreement). Europe will be leading on this matter, applying these rules to more than 8000 banks, amounting for 53 % of global assets.”⁹⁸ Likewise, the Directive on Alternative Investment Funds Managers (AIFM)⁹⁹ cites the G20 as inspiring the directive:

G20 Leaders in Toronto reaffirmed their commitment and also committed to accelerate the implementation of strong measures to improve transparency and regulatory oversight of hedge funds in an internationally consistent and non-discriminatory way.

Regulation and oversight of hedge funds were other key topics of G20 discussions. The European Commission President stated that “[the] directive—which coincides with the G20 Summit meeting in Seoul—is another example of how the EU is leading the way in implementing our G20 commitments.”¹⁰⁰

Along with references to the G20, the EU legislature also refers to numerous other bodies responsible for advising on issues of international banking and finance. The European Commission has proposed changes to rules protecting deposits¹⁰¹ including a pan-European Deposit protection scheme. These changes are expected to be in line with the Core Principles for Effective Deposit Insurance Systems ¹⁰² jointly developed by the Basel Committee on Banking Supervision (BCBS) and the International Association of Deposit Insurers (IADI). The 2009 Regulation on Credit Rating Agencies¹⁰³ was influenced by international commitments to regulate credit rating agencies, also seen as one of the causes of the global financial crisis. The Regulation, which oversees the registration and supervision of credit rating agencies, states that “Credit rating agencies should, on a voluntary basis, apply the Code of Conduct Fundamentals for credit rating agencies issued by the International Organization of Securities Commissions (IOSCO Code)” and is broadly based on the Code of Conduct.¹⁰⁴ The G20 saw that one of the most important areas of financial reform is the so-called “too big to fail” institutions, known as Systematically Important Financial Institutions (SIFIs). On 4 November 2011 the FSB delivered a set of “Policy Measures to Address Systemically Important Financial Institutions” at the request of the G20. In response to these developments, the European Commission is developing an EU-wide crisis management framework¹⁰⁵ to address SIFIs. This work has been done in connection with the work on SIFIs by the Committee on Payment and Settlement Systems (CPSS) and IOSCO. The Commission is set to present legislative proposals and states that they “will be accompanied by an impact assessment, and will complete the Commission’s implementation of the principal G20 reforms in the area of financial regulation.”¹⁰⁶

These above examples illustrate how the EU is often quite open to acknowledging that its legislation is inspired by commitments made at the international level. This includes not only commitments made at G20 meetings, but also the decisions of other bodies tasked with developing guidelines and recommendations such as the FSB. One reason for this is the need for regulation in this field to be done in a coordinated fashion, to ensure that policies are implemented consistently across G20 countries. Another reason is that as a member of the G20 the EU is able to shape the outcome of G20 decisions. When referring to G20 decisions in its legislation and proposals, the EU is referring to documents that it has had a hand in negotiating and drafting.

4 Conclusion

This chapter looked at some of the ways that EU law has been influenced by norms developed at the international level. It aimed to show how these norms may affect the EU even when they are informal, and non-binding, or when the EU is not a formal member of the organisation or body at hand. Much of the discussion on the relationship between EU law and the norms adopted by international organisations and bodies has dealt with the traditional intergovernmental organisations, such as the UN and the WTO. The Kadi case law illustrates how with regard to bodies such as the UN Security Council, the Court of Justice insists on the autonomy of the EU legal order. In addition to these “classical” organisations, this chapter has argued that there has been a proliferation of other international bodies and processes which states have tasked with developing international norms and standards. And they do have effects on EU law, at least at the legislative level. Informal bodies such as the G20 are referred to in EU legislation and do influence its development. Yet the Court of Justice has rarely relied on norms emanating from these bodies in a substantive fashion.

The Union seems to have a somewhat ambivalent relationship with international bodies and the numerous norms they develop. It currently lacks a comprehensive strategy for its participation in a great number of international organisations, conferences and processes. As the EU seeks to enhance its role within these various international bodies, and even becomes a full member, it should consider how the norms developed by these bodies are to be treated within the EU legal order. At times, the EU legislature seems considerably open to using these instruments as a basis for legislation, especially where the Union has been in a position to influence them. Indeed, much of the EU’s recent legislation in financial governance explicitly mentions commitments made at the international level, in particular within the G20. While the Court of Justice sometimes refers to these norms, it has often given a more autonomous meaning to the EU rules concerned. In practice, this means that the influence of international norms varies considerably. This might seem to be somewhat paradoxical, but it could be seen as mirroring the Union’s approach to international law generally: While the EU legislature remains open to international law and norms developed at the international level, the idea of an autonomous legal order is dear to the heart of the Court.