I thank the committee for the invitation to address members today. The committee has asked me to address two points in evidence. The first is the ratification of CETA and its compatibility with the Constitution, with particular regard to the well-known Crotty case. The second relates to the implications of ratification and non-ratification.
Before I address those issues, I should probably start with two caveats. The first is that my evidence is concerned solely with the legal dimension of these issues. As we have just heard, there are important political dimensions to those issues. In my evidence I am not concerned with the merits or demerits of CETA or its ratification by the State. Second, as proceedings have been issued in the High Court raising the issue of whether CETA can be ratified by Parliament or must be put to the people in a constitutional referendum, some caution is warranted in addressing these issues in this forum. It is of course ultimately a matter for the courts to determine whether ratification of CETA is compatible with the Constitution, so the purpose of my evidence and the briefing paper I furnished to the committee is to assist it by outlining the legal principles that are relevant to its consideration of these important issues.
It is probably appropriate to address the first issue, the compatibility of ratification of CETA with the Constitution, in three steps. First, it may be helpful to outline the framework within which Ireland's international relations are conducted under the Constitution. Second, I will look at the case law: the Crotty case and a later case known as Pringle, that address the principles of when we need a referendum in order to ratify a treaty. Finally, I will look to CETA briefly to assess how it fits within this scheme.
Let us look at the constitutional scheme first. The important point to note is that under Articles 28 and 29 of the Constitution, it is for the Government to conduct the foreign affairs of the State. In conducting the State's foreign affairs, the Government has a very wide discretion. Second, Parliament does have a very important oversight role when it comes to foreign affairs, particularly in the context of treaty making. We see this in Articles 29.5 and 29.6 of the Constitution. All international agreements to which the State is party must be laid before the Dáil. Any agreement involving a charge on public funds must be approved by the Dáil, and where there is a change of law necessitated by an international agreement, this must be conducted by the Oireachtas in accordance with its law-making power under Article 15.
In this way, the Parliament exercises an important role and today's meeting and the other meetings on CETA are important examples of this power being exercised in practice.
When it comes to the people, when is it necessary to consult the people on a particular international agreement? To date, it has only been in exceptional cases that international treaties have been put to the people. There have been eight international agreements put to the people by way of referendum. Some six of those international agreements concerned the European Union, our original accession to the European communities and the major revisions of the treaties that have followed in later decades. The other two are the Good Friday Agreement of 1998 and the Rome Statute of the International Criminal Court of 2001. It is pretty exceptional, therefore, for international treaties to be put to the people.
It is important to note that our international relations are increasingly being conducted within the framework of the European Union. More power has been transferred to the European Union in the field of foreign affairs and CETA is a good example of this. The recent EU-UK Trade and Co-operation Agreement is another vivid example. Unlike the EU-UK Trade and Co-operation Agreement, which has been concluded as an EU-only agreement, CETA is a mixed agreement and therefore member states and this Parliament have their say in determining whether or not they should ratify this particular agreement. That is important by way of context.
When is a referendum required before the State can ratify or conclude an international agreement? The starting point here is the Supreme Court's judgment in the Crotty case. Members may be familiar with this case, which was concerned with Ireland's ratification of the first major revision of the European treaties, the Single European Act. That was a treaty of two parts. Title 2 of the Single European Act concerned revisions of the existing treaties and title 3 concerned European political co-operation and putting structured co-operation among member states in the field of foreign policy on a formal treaty footing. Mr. Raymond Crotty challenged the Government's ratification of this agreement before the courts, ultimately ending up in the Supreme Court. The Supreme Court's judgment is also of two parts. In the first part the court upheld Ireland's ratification and implementation of title 2 of the Single European Act, that is, the amendments to the existing treaties. According to the Supreme Court, this did not go beyond the essential scope and objectives of the original amendment to the Constitution in 1972 and therefore was permissible without referendum. Second, when it came to title 3 of the Single European Act, that is, the part dealing with structured foreign policy co-operation, the Supreme Court held, by a majority of three to two, that this part of the Single European Act involved the alienation or fettering of powers conferred under the Constitution on the Government in the field of foreign affairs. Because it involved this alienation of sovereign powers of the Government under the Constitution, it had to be put to the people by way of referendum before the State could ratify this particular international agreement. Thereafter, a referendum was duly passed and Ireland ratified the Single European Act.
In two subsequent judgments, the Supreme Court has significantly qualified the scope of its Crotty ruling. First, in the McGimpsey case in 1990, the Supreme Court rejected a challenge to Ireland's ratification of the Anglo-Irish Agreement and the court ruled that there was vast difference between that agreement, which involved establishing a forum for co-operation between the two states, and title 3 of the Single European Act. Second and more significant for our purposes, in the Supreme Court's more recent judgment in the Pringle case, the Supreme Court rejected by a majority of six to one a challenge by a Member of Dáil Éireann to the State's ratification of the treaty establishing the European Stability Mechanism, ESM. Members may recall that this treaty established the mechanisms to provide financial assistance to eurozone member states during the economic crisis. Under that system, states had to contribute in a significant way and were exposed to significant liability once they signed up to this mechanism. Deputy Pringle challenged this before the Irish and European courts.
The Supreme Court, in considering this issue, had to determine whether the ESM treaty involves such a substantial transfer of power to this new institution that it required an amendment and, in fairly trenchant terms, the Supreme Court decided that no referendum was required. According to a number of members of the court, ratification of the ESM treaty involved the exercise of sovereignty, not its alienation or abdication. It is that language of alienation, abdication of sovereignty and subordination of sovereign powers that is the feature of the Pringle judgment and sets the test now for when an international agreement must be approved by the people by way of a referendum before it can be ratified. The Chief Justice, Mrs. Justice Denham, said that if a treaty involves a fundamental transformation - a ceding of sovereignty - then it would require the mandate of the people.
What do we take from these judgments, and in particular this most recent judgment in the Pringle case? Essentially, we see a narrowing of the court's earlier judgment in the Crotty case. The court maintains the principle that if there is an alienation or abdication of the State's sovereign powers, then there must be a referendum. However, it has set a very high threshold for when it will intervene and, by extension, for when treaties must be put to the people by way of referendum. One former member of the Supreme Court has described the Pringle judgment as putting the earlier Crotty judgment to sleep.
What the Pringle judgment certainly signals is that in the ordinary course treaties entered into by the State will be considered to be the exercise rather than the alienation of sovereignty. It is only when they involve a very significant and open-ended transfer of power to an international institution or a grouping of states that a referendum will be required. In doing so the Supreme Court affirms not only the role of governments in conducting foreign relations but also the pre-eminent role of the Parliament in the scrutiny of international agreements. The Pringle judgment reduces but does not eliminate the uncertainty around when an international agreement may require to be put to the people. Ultimately, that question has to be answered by reference to the terms of the particular agreement.
Third, what does this mean for CETA? We would need to carry out a very close and detailed examination of the agreement to assess that question but what we can say is that in its treaty-making practice to date the State has frequently signed up to international agreements that set up mechanisms of international dispute settlement. The European Court of Human Rights is one example. There are various mechanisms under the UN Convention on the Law of the Sea; the World Trade Organization Agreement, which is signed up to by the member states but also by the EU; the Aarhus convention and, in the context of investor protection, the Energy Charter Treaty. None of those have been put to the people by way of a referendum.
In two cases, the State has put or proposed to put international agreements involving such mechanisms to the people. The first is the International Criminal Court referendum, which I have referred to, and the second is the commitment given to put the Unified Patent Court to a referendum when Ireland proposes to accede to it. I can deal with the detail of those or any questions about those if members have questions.
Turning to CETA specifically, Dr. Ankersmit set out certain important features of the agreement's tribunal system. As I said, this matter is currently pending before the courts so I will be circumspect in my comments on it but a helpful reference point for the members in considering this is the assessment by the Court of Justice of the CETA tribunal system in its opinion 1/17. In that opinion, the court emphasises certain important features of the CETA tribunal system, which may be of relevance when the Irish courts come to consider this issue.
The reference point for the Irish courts will be the Constitution as opposed to the EU treaties but analogous issues are likely to arise insofar as the Constitution is concerned. First, the jurisdiction of the CETA tribunals is limited to claims for loss or damage or for breach of the obligations under chapter eight of the CETA agreement. Second, Article 8.9 of CETA expressly recognises the right of parties to regulate, including in pursuing legitimate policy objectives, for example, in the field of the environment. There is controversy about whether that goes far enough. I simply point to it as an example and a feature of the system. Third, and this is important when it comes to the assessment of our constitutional framework, the tribunals have no jurisdiction to determine the legality of measures of domestic or European law and any interpretation given by them of domestic law will not be binding on the courts of the EU, Canada or the EU's member states.
These are important features of the CETA system. There are others such as the enforcement of the awards, which is given effect under the New York convention and the ICSID convention regimes, which Ireland is party to.
Under Article 30.6 of CETA, the provisions of the agreement do not create rights or impose obligations that can be directly invoked in the domestic legal systems. A party cannot provide for a right of action in the domestic courts for breach of the provisions of the treaty. This goes back to a point made by Dr. Ankersmit. She mentioned that there is certainly no requirement to exhaust domestic remedies, but investors could nonetheless take action under domestic law, and particularly under domestic constitutional law in the Irish context, if they felt aggrieved, as an alternative to taking their dispute to the CETA tribunal. I emphasise I am not taking a view on whether the CETA tribunals involve such a significant or open-ended transfer of power to those bodies that they would require a constitutional referendum, an issue that is live before the Irish courts. Nevertheless, those elements of the regime would certainly be taken into account, alongside some of the elements I referred to earlier, in assessing whether the treaty must be put to the people by way of referendum or whether it is sufficient for the Oireachtas as Parliament, and Dáil Éireann in particular, to approve its terms.
The issue of the implications of ratification versus non-ratification is more straightforward. If CETA is ratified, whether by parliamentary approval or a vote of the people if that is deemed to be required, the Government will be in a position to proceed to ratify the agreement on behalf of the State. Assuming all the other member states had completed their domestic ratification processes, and we have heard that that process is ongoing, CETA could be concluded by the EU and its member states and come into force for them. At the moment, CETA is being only provisionally applied in certain areas within the exclusive competence of the Union.
The second, trickier issue relates to non-ratification. If the Dáil did not approve the terms of CETA or it was put to a referendum and the people rejected it, what would be the position then? Traditionally, the practice of the Union in agreements of this kind has been to await the outcome of the domestic ratification processes before concluding the agreement on behalf of the EU. If one or more of the member states were not in a position to ratify CETA, the agreement could not be concluded in accordance with Article 30.7 of CETA, at least in its current form. Obviously, Ireland could not be compelled to ratify an agreement contrary to its domestic constitutional procedures but the member states would be under a duty of sincere co-operation with the Union in the context of agreements of this kind and the untangling of those agreements. This arises under Article 4.3 of the Treaty on European Union, TEU, and under the case law of the European Courts of Justice. There may be an obligation on member states to engage at least with the Union institutions in teasing out the implications and outcomes arising from non-ratification. Ultimately, of course, these matters would have to be resolved at the political level, whether by amendment to the treaties or otherwise, which would not be a straightforward process, as we have heard.
I welcome any questions from members. I refer them to my briefing document for further detail on the various points.