Drawing the Lines between Validity and Bindingness in EU Law: The FBF Case

The Fédération Bancaire Française (FBF) case adds significant insights into the role of EU soft law in the EU governance system and the avenues available to challenge these instruments. The case has already attracted academic attention for the (novel and less novel) constitutional principles on EU soft law it established. First, starting with the ‘less innovative’ principles, EU soft law acts such as guidelines issued by the European Banking Authority (EBA) are not reviewable through an action for annulment because of the lack of legally binding effects. In Commission v Belgium, the Court of Justice (CJEU) had already indicated that another type of EU soft law, that is EU recommendations, cannot be challenged via an action for annulment. Second, and more innovatively, FBF posited that EU soft law can be challenged by way of a preliminary ruling on validity, notwithstanding the absence of legally binding effects. Yet the judgment in FBF also has a broader consequence for the functioning of the EU judicial review model: that of rescinding questions on validity from those on bindingness. Prima facie, this may be a dictum affecting only EU judges’ activity. Indeed, as a result of this decision, in the context of actions for annulment, EU courts should first assess the bindingness of an EU act as a matter of admissibility, and – only if the act is binding and thus reviewable – then consider its validity on the merits. Such distinction de facto reflects the current interplay between questions of admissibility and substance in the context of judicial review of EU acts. However, stark bifurcation of the question of validity from that of bindingness in EU law has implications concerning the effects of EU law, as well as its application. As this paper will demonstrate, the production of legal effects by an EU act (bindingness) is part of the broader assessment of validity. Therefore, it is conceptually and legally flawed to separate enquiries on the bindingness and the validity of an EU measure in the context of judicial review. Additionally, the distinction between validity and bindingness may complicate the way in which EU law’s effects may be understood at the national level and, in particular, how national authorities apply EU law. This paper contributes to the existing literature on EU soft law and judicial review by analysing the FBF judgment and reflecting on the rationales underlying its outcome. It then critically assesses the soundness of the bifurcation between validity and bindingness, and explores its implications for the EU model of judicial review and, more broadly, the EU legal landscape.