The background to the complaint

1. On 29 October 2010, the Committee of European Banking Supervisors (CEBS)[1] organised a "public hearing" on its draft Guidelines on Remuneration Policies and Practices. The hearing was open to all interested parties. The complainant, a Swedish national working for a Swedish trade union for employees in the financial sector, participated in the public hearing. On 1 November 2010, he sent an e-mail to CEBS asking for a list of the participants at the public hearing. He renewed that request on 19 November 2010. CEBS replied on the same day stating that it did not disclose lists of participants in public hearings[2].

2. As of 1 January 2011, CEBS was replaced by the European Banking Authority (the 'Authority')[3].

The subject matter of the inquiry

3. The complainant alleged that CEBS wrongly refused to make publicly accessible the list of participants in the public hearing it organised on 29 October 2010. The complainant claimed that CEBS should make the list of participants publicly accessible.

The inquiry

4. The complaint was submitted on 22 November 2010. On 9 December 2010, the Ombudsman opened an inquiry and requested CEBS to submit an opinion. Since CEBS would become the Authority as of 1 January 2011, the Ombudsman, in his letter opening the inquiry, informed CEBS that he would consider the Authority responsible for responding to the allegation and claim as of 1 January 2011. On 21 March 2011, the Authority submitted its opinion to the Ombudsman. The Ombudsman forwarded the opinion to the complainant and requested him to submit his observations in relation thereto. On 11 April 2011, the complainant submitted his observations.

The Ombudsman's analysis and conclusions

A. Preliminary Remark

5. In the opinion it sent to the Ombudsman and before dealing with the specific subject matter of the complaint, the Authority underlined that CEBS was a limited liability company established under the laws of England and Wales (registered as CEBS Secretariat Ltd.). Therefore, the Authority maintains that CEBS was subject to, and governed by, the laws of England and Wales.

6. In his observations, the complainant took issue with the Authority's statements as regards the status of CEBS. He stated that it was clear that CEBS had powers granted to it "by the citizens of the EU". He argued that it was also clear - abundantly so after the financial crisis - that its workings are of great concern to the EU as a whole, and to every EU citizen. In his view, placing EU powers in the hands of a limited liability company was "not a very good idea" and would lead to informational barriers so high that "even a modicum of information could not escape". He stated that, as an EU citizen, he should be able to monitor those in power and to see which interests influence decision making in the public sphere. Given that CEBS was a limited liability company, he was able to do neither. Moreover, as a limited liability company, CEBS had an incentive to disclose as little information as possible in relation to its activities. Given its status as a limited liability company, CEBS was free to decide how much information to disclose.

7. In the complainant's view, no EU powers should be put in the hands of a limited liability company. He outlined that a limited liability company "could manage the gardens of the European Parliament in Brussels". However, the Commission, the Council and Parliament should not put legislative, supervisory, administrative, informational or other (public) powers into the hands of limited liability companies.

8. The Ombudsman notes that the European Banking Authority drew no specific conclusions from its declaration that CEBS was a limited liability company. For example, it did not state specifically that, as a limited liability company, CEBS was not subject to review by the Ombudsman or by the EU courts. Nor did it specifically state that CEBS was not required to comply with EU transparency rules. However, in light of the concerns expressed by the complainant, and notwithstanding the fact that CEBS has now been replaced by the Authority, the Ombudsman considers it useful to clarify his position as regards the status of CEBS, and the status of any other similar entities.

9. Article 263 of the Treaty on the Functioning of the European Union (TFEU), which establishes the jurisdiction of the Court of Justice, states that the Court shall review the legality of all acts of the EU institutions, bodies, offices or agencies that are intended to produce legal effects vis-à-vis third parties.

10. The Court has stated that the judicial system of the EU is a "complete system of legal remedies and procedures"[4]. An entity within the "institutional framework of the EU" cannot escape judicial review by the Court of Justice in relation to any acts it adopts that are intended to produce legal effects vis-à-vis third parties. As such, the terms "institutions", "bodies", "offices" and "agencies", as used in Article 263 TFEU, must be understood as being all encompassing. They cover all entities established by the Treaties and all entities established by an act adopted in the implementation of the Treaties.

11. Article 228 TFEU states that the European Ombudsman shall be empowered to receive complaints concerning instances of maladministration in the activities of the EU institutions, bodies, offices or agencies (with the exception of the Court of Justice acting in its judicial role).

12. If the terms "institutions", "bodies", "offices" and "agencies", as used in Article 263 TFEU, must be understood as being all encompassing, the exact same terms, as used in Article 228 TFEU, must also be all encompassing.

13. In sum, an entity falling within the institutional framework of the EU, that is, an entity established by the Treaties or an entity established by an act adopted in the implementation of the Treaties cannot escape judicial review by the Court in relation to any acts it adopts that are intended to produce legal effects vis-à-vis third parties. Nor can such an entity escape review by the Ombudsman in relation to any alleged instances of maladministration.

14. If an existing institution, body, office or agency establishes functional units within its own organisational structure, any justiciable acts or alleged instances of maladministration by those functional units will be attributed to the institution, body, office or agency of which it forms part. Such functional units cannot be understood to be separate "institutions, bodies, offices or agencies" within the meaning of Article 263 TFEU and Article 228 TFEU.

15. However, if, through an act adopted in the implementation of the Treaties, a "separate" entity is created, that entity will be subject to judicial review by the Court for any justiciable acts it adopts and will be subject to review by the Ombudsman for any alleged instances of maladministration. It would run counter to the principles set out above if an entity which exercises competences derived from the Treaties were deemed to fall outside the system of judicial control and the control of maladministration by the Ombudsman.

16. The Ombudsman notes that the Commission's decision establishing CEBS did not give the CEBS legal personality[5]. The Ombudsman does not consider that the absence of legal personality would alter the fact that CEBS' acts were subject either to the review of the EU Courts and the Ombudsman[6].

17. Given that CEBS ceased to exist when the Authority was established on 1 January 2011, and it is not disputed that the Authority is subject to review by the Ombudsman, the Ombudsman does not consider it necessary to pursue this issue further in the present case.

B. Allegation of failure to provide access to a document and related claim

Arguments presented to the Ombudsman

18. The complainant stated in his complaint that CEBS' refusal demonstrated a troubling and unnecessary lack of transparency. In his view, the refusal infringed Article 15 TFEU and "other laws/rules/guidelines". He pointed out that the Commission's public hearings are sometimes streamed live on the internet and all kinds of documents are available. He asked why CEBS would not reveal a simple list of participants in a public hearing and stated that he was concerned about the "democratic process" in the EU.

19. In its opinion sent to the Ombudsman, the Authority stated that it was established on 1 January 2011. Measures were then taken, with immediate effect, to conform to the all the requirements relating to an EU agency. In fact, during the very first meeting of the Authority's Management Board, the Code of Good Administrative Behaviour was adopted. A copy of the Code was enclosed with the Authority's opinion. The Authority stated that, as an EU Agency, it will strive to meet all of its obligations, including those of full transparency and openness. Article 72(2) of Regulation 1093/2010 stipulates that the Authority's Management Board shall adopt practical measures for applying Regulation 1049/2001 by 31 May 2011. The Authority is currently in the process of finalising such measures and will provide the complainant with a copy as soon as they are adopted.

20. By way of derogation from the above, and as a sign of commitment to transparency and openness, the Authority agreed to share the list of organisations which were registered to attend the CEBS hearing on 29 October 2010. A copy of the list was attached to the Authority's opinion.

21. In his observations on the Authority's opinion, the complainant pointed out that CEBS supervised the banking sector, which is not known for its openness. He stated that CEBS obviously had to ensure the secrecy of the supervised entities' business information. However, this did not in any way prohibit it from informing citizens about who or what influenced CEBS in the exercise of its powers granted by the EU. It is plausible that officials working in this environment were influenced by the demands for information security in the sector. It is of course true that it is sometimes difficult to see which information can be safely disclosed and which information cannot. However this is not the case with respect to a participation list of a public meeting, especially if the person requesting the information participated in that meeting. The decision to grant access to the list he requested should have been easy. However, he argued that it was presumably easier for an individual official of CEBS simply to say no to all requests, or for the management of CEBS to issue a blanket rule with the same effect, rather than to agree to such requests. He stated that CEBS may have believed that it was "administratively cheaper" to say no rather than to say yes. CEBS' denial of his request, regarding such a simple matter, showed that it was impossible for EU citizens to know the extent to which special interests influence the financial markets in Europe.

22. The complainant pointed out that, following the establishment of the Authority, other rules apply. After examining the Authority's Code of Good Administrative Behaviour, he considered that it lacked detail in some places. However, its provisions concerning proportionality, independence, objectivity, acknowledgments of receipt, reasonable time limits for taking decisions, requests for information and public access to documents, as well as the duty to state grounds for decisions and indicate the possibilities for appeal, could lead to clear improvements.

23. He emphasised that, in its reply, the Authority showed its commitment to transparency and openness. This is very positive and a credit to the Authority. However, it would have been even better if the Authority had acknowledged that CEBS also had a duty to disclose this information.

24. The complainant stated that the list provided by the Authority contained the subject of the meeting, the date, the names of the attending organisations and their respective countries of origin. He noted that this is the minimum amount of information needed to create such a list. Ideally, such a list would contain (1) the subject of the meeting, (2) the location of the meeting and the date, (3) the names of the attending organisations and their countries of origin, and (4) the names of the representatives and their contact information. Given that the organisations are often large and international, the contact information of the responsible departments within these organisations should be present as a matter of form. However, the complainant emphasised that these points are not of pressing concern to him at present. He is satisfied with the list provided.

25. Finally, the complainant thanked the Authority for providing him with the list and thanked the Ombudsman for his work.

The Ombudsman's assessment

26. Transparency helps to build and maintain public trust in the EU institutions, bodies, offices or agencies and strengthens their democratic nature. Public access to documents gives substance to the principle of transparency by empowering citizens to monitor and scrutinise effectively the exercise of the powers vested in the EU institutions, bodies, offices or agencies. The recognition of public access to documents as a fundamental right of Union citizenship, guaranteed by the Charter of Fundamental Rights[7] and by the Treaty on the Functioning of the Union[8], underlines the special importance the Union attributes to transparency as a means of building and maintaining public trust in the EU institutions, bodies, offices or agencies.

27. The Ombudsman underlines that Article 15 TFEU and Article 42 of the Charter of Fundamental Rights applies to all EU institutions, bodies, offices or agencies. It applies to CEBS and it applies to the Authority.[9]

28. The Regulation establishing the Authority, Regulation 1093/2010, states that "in order to ensure the transparent operation of the Authority, Regulation 1049/2001[10] regarding public access to documents should apply to the Authority." Regulation 1049/2001 establishes rules on how the Union institutions must react to requests for access. It provides, in particular, that they must grant such requests unless one or more of the exceptions defined by the Regulation applies. The Regulation also establishes obligations to be proactive and, in particular, to make documents directly accessible to the public in electronic form.

29. Article 72(2) of Regulation 1093/2010 states that the Management Board of the Authority shall, by 31 May 2011, adopt practical measures for applying Regulation 1049/2001.

30. The Ombudsman notes that CEBS itself underlined the importance and benefits of transparency in the banking sector. On 13 October 2010, CEBS published a consultation paper concerning the draft Guidebook on Internal Governance. Principle 30 (Internal governance transparency) of the draft Guidebook states that the internal governance framework of a banking institution should be transparent. A banking institution should present its current position and future prospects in a clear, balanced, accurate and timely way. The objective of transparency in the area of internal governance is to provide all relevant stakeholders of an institution, including the general public, with key information necessary to enable them to judge the effectiveness of the management body in governing the institution. A banking institution should thus disclose comprehensive and meaningful information that fully describes its internal governance. According to the draft Guidebook, an institution should publicly disclose at least the following:

• its governance structures and policies, including its objectives; organisational structure; internal governance arrangements; structure and organisation of the management body, including attendances; and the incentive and remuneration structure of the institution;

• the nature, extent, purpose and economic substance of transactions with affiliates and related parties, and an explanation of how they could influence the entire organisation;

• how its business and risk strategy is set (including the involvement of the management body) and foreseeable risk factors;

• its internal control framework and how its control functions are organised, the major tasks they perform, how their performance is monitored by the management body and any planned material changes to these functions; and

• material information about its financial and operating results;

According to the draft Guidebook, information about the current position of the institution should comply with any legal disclosure requirements. Information should be clear, accurate, relevant, delivered in a timely manner and accessible.

31. It is clear from the above that CEBS recognised the importance of transparency in terms of generating legitimacy and trust in banking institutions. The Ombudsman considers that the Authority should also recognise the importance of transparency in terms of generating legitimacy and trust in its own operations.

32. The Authority has now provided the complainant with the document requested by the complainant. The Authority has also informed the Ombudsman that it is currently in the process of finalising practical measures for applying Regulation 1049/2001 and will provide the Ombudsman with a copy of such practical measures in due course. In this context, the Ombudsman closes his inquiry with a finding that the complaint has been settled by the Authority.

C. Conclusion

On the basis of his inquiry into this complaint, the Ombudsman closes it with the following conclusion:

The case has been settled by the Authority.

The complainant and the Authority will be informed of this decision.

 

P. Nikiforos Diamandouros

Done in Strasbourg on 26 May 2011

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[1] CEBS was established by the European Commission on 1 January 2004, under the so-called "Lamfalussy approach" to the European financial services regulations, to provide advice on banking supervision in the European Union" (see Commission Decision 2004/5/EC of 5 November 2003 (OJ L 3, 7 January 2004, p. 28)). In that context, the Commission also established the Committee of European Securities Regulators (CESR) in the securities field and the Committee of European Insurance and Occupational Pensions Supervisors (CEIOPS) in the insurance field.

[2] At the time when the facts giving rise to the present complaint took place, CEBS was governed by revised rules set out in the Commission Decision of 23 January 2009 (OJ L 25 of 29 January 2009, p. 23).

[3] See Regulation 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331 of 15 December 2010, p. 12). Recital 67 of the Regulation states that the Authority should assume all current tasks and powers of CEBS. Article 76 of the Regulation states that "the Authority shall be considered the legal successor of CEBS. By the date of establishment of the Authority, all assets and liabilities and all pending operations of CEBS shall be automatically transferred to the Authority."

[4] See Case C-50/00 P Unión de Pequeños Agricultores v Council [2002] ECR I-6677, paragraph 40, and Opinion 1/09 of the Court of 8 March 2011 (not yet reported) at paragraphs 70 and 71.

[5] It must be noted that no EU institution has, of itself, legal personality. Rather, it is it the EU itself which embodies legal personality (see Judgement of the Court of Justice of 5 May 2011 in Case C-137/10, European Communities v Région de Bruxelles-Capitale).

[6] As regards the relevance, if any, of CEBS Secretariat Ltd., the Ombudsman also notes that all the "CEBS" reports sent to the Commission were sent by CEBS, and not CEBS Secretariat Ltd. (see for example, the report of 23 July 2010 entitled "Aggregate outcome of the 2010 EU wide stress test exercise coordinated by CEBS in cooperation with the ECB", which was sent by "CEBS" to the Commission). In sum, as regards its public function, which was to supply advice to the European Commission, it was CEBS, and not CEBS Secretariat Ltd., which acted.

[7] Article 42 of the Charter states that any citizen of the Union, and any natural or legal person residing or having its registered office in a Member State has a right of access to European Parliament, Council and Commission documents.

[8] Article 15(3) TFEU provides, among other things, that in order to promote good governance and ensure the participation of civil society, the Union institutions, bodies, offices and agencies shall conduct their work as openly as possible. Any citizen of the Union, and any natural or legal person residing or having its registered office in a Member State, shall have a right of access to documents of the Union institutions, bodies, offices and agencies, whatever their medium, subject to the principles and the conditions to be defined in accordance with the following. General principles and limits on grounds of public or private interest governing this right of access to documents shall be determined by the European Parliament and the Council, by means of regulations, acting in accordance with the ordinary legislative procedure. Each institution, body, office or agency shall ensure that its proceedings are transparent and shall elaborate in its own Rules of Procedure specific provisions regarding access to its documents.

[9] It seems that, from the very early stages of its operations, CEBS recognised the importance of transparency. In his speech "Looking beyond implementing Basel II" at Eurofinas on 4 October 2004, José María Roldán, then Chairman of CEBS, stressed "once more the importance of transparency and dialogue as we enter into the new phase of Basel II. CEBS has a vocation to be as transparent as possible".

[10] OJ 2001 L 145, p. 43.