Provisional text
JUDGMENT OF THE COURT (Second Chamber)
12 November 2026 (*)
( Action for annulment – Council Decision (EU) 2023/852 – Amendment of Decision (EU) 2015/1814 – Number of allowances to be placed in the market stability reserve for the Union greenhouse gas emission trading system until 2030 – Legal basis of Decision 2023/852 – Determination – Account taken of the effects of that decision – Article 192(1) TFEU – Point (c) of the first subparagraph of Article 192(2) TFEU – Principle of energy solidarity – Article 194(1) TFEU – Inapplicability – Principle of solidarity – Applicability – Article 3(1) and (3) TEU – Deterioration in the well-being of the peoples of the Union and social cohesion between Member States – Inadmissibility – Council Decision (EU) 2015/1814 – Establishment and operation of a market stability reserve for the Union greenhouse gas emission trading scheme – Article 3 – Obligation to review the reserve – Ineffectiveness )
In Case C‑445/23,
ACTION for annulment under Article 263 TFEU, brought on 17 July 2023,
Republic of Poland, represented by B. Majczyna, acting as Agent,
applicant,
v
European Parliament, represented by O. Denkov, W.D. Kuzmienko and L. Taïeb, acting as Agents,
Council of the European Union, represented initially by R. Boucquey, A. Maceroni, M. Moore and A. Sikora-Kalėda, acting as Agents, and subsequently by R. Boucquey, A. Maceroni and M. Moore, acting as Agents, and lastly by A. Maceroni, M. Moore and K. Pleśniak, acting as Agents,
defendants,
supported by:
European Commission, represented by D. Milanowska, M. Owsiany-Hornung, K. Talabér-Ritz and G. Wils, acting as Agents,
intervener,
THE COURT (Second Chamber),
composed of K. Jürimäe, President of Chamber, K. Lenaerts, President of the Court, acting as a Judge of the Second Chamber, Z. Csehi, M. Gavalec (Rapporteur) and F. Schalin, Judges,
Advocate General: T. Ćapeta,
Registrar: V. Di Bucci,
having regard to the written procedure,
having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,
gives the following
Judgment
1 By its application, the Republic of Poland asks the Court to annul Decision (EU) 2023/852 of the European Parliament and of the Council of 19 April 2023 amending Decision (EU) 2015/1814 as regards the number of allowances to be placed in the market stability reserve for the Union greenhouse gas emission trading system until 2030 (OJ 2023 L 110, p. 21; ‘the contested decision’).
Legal context
The EU Treaty
2 Article 3(1) and (3) TEU provides:
‘1. The Union’s aim is to promote peace, its values and the well-being of its peoples.
…
3. …
…
It shall promote economic, social and territorial cohesion, and solidarity among Member States.
…’
3 Article 5(4) TEU provides:
‘Under the principle of proportionality, the content and form of Union action shall not exceed what is necessary to achieve the objectives of the Treaties.
…’
4 Article 13(2) TEU provides:
‘Each institution shall act within the limits of the powers conferred on it in the Treaties, and in conformity with the procedures, conditions and objectives set out in them. The institutions shall practice mutual sincere cooperation.’
The FEU Treaty
5 Article 192(1) and point (c) of the first subparagraph of Article 192(2) TFEU provides:
‘1. The European Parliament and the Council [of the European Union], acting in accordance with the ordinary legislative procedure and after consulting the [European Economic and Social Committee (EESC)] and the [European Committee of the Regions (CoR)], shall decide what action is to be taken by the Union in order to achieve the objectives referred to in Article 191.
2. By way of derogation from the decision-making procedure provided for in paragraph 1 and without prejudice to Article 114, the Council acting unanimously in accordance with a special legislative procedure and after consulting the [Parliament], the [EESC] and the [CoR], shall adopt:
…
(c) measures significantly affecting a Member State’s choice between different energy sources and the general structure of its energy supply.’
6 Article 194(1)(b) TFEU provides:
‘In the context of the establishment and functioning of the internal market and with regard for the need to preserve and improve the environment, Union policy on energy shall aim, in a spirit of solidarity between Member States, to:
…
(b) ensure security of energy supply in the Union’.
Directive 2003/87/EC
7 Point (b) of the first subparagraph of Article 10(2) of Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Union and amending Council Directive 96/61/EC (OJ 2003 L 275, p. 32), as amended by Directive (EU) 2023/959 of the European Parliament and of the Council of 10 May 2023 (OJ 2023 L 130, p. 134) (‘Directive 2003/87’) provides:
‘The total quantity of allowances to be auctioned by each Member State shall be composed as follows:
…
(b) 10% of the total quantity of allowances to be auctioned being distributed amongst certain Member States for the purposes of solidarity, growth and interconnections within the Union, thereby increasing the amount of allowances that those Member States auction under point (a) by the percentages specified in Annex IIa.’
8 Part A of Annex IIb to Directive 2003/87, entitled ‘Distribution of funds from the modernisation fund corresponding to Article 10(1), third subparagraph’, provides that the Republic of Poland’s share is 43.41%. Part B of Annex IIb, entitled ‘Distribution of funds from the modernisation fund corresponding to Article 10(1), fourth subparagraph’, provides that the Republic of Poland’s share is 34.2%.
Decision 2015/1814
9 The first subparagraph of Article 1(5) of Decision (EU) 2015/1814 of the European Parliament and of the Council of 6 October 2015 concerning the establishment and operation of a market stability reserve for the Union greenhouse gas emission trading scheme and amending Directive 2003/87/EC (OJ 2015 L 264, p. 1), entitled ‘Market stability reserve’ (‘the reserve’), provided:
‘Each year, a number of allowances equal to 12% of the total number of allowances in circulation, as set out in the most recent publication as referred to in paragraph 4 of this Article, shall be deducted from the volume of allowances to be auctioned by the Member States under Article 10(2) of Directive 2003/87/EC and shall be placed in the reserve over a period of 12 months beginning on 1 September of that year, unless the number of allowances to be placed in the reserve would be less than 100 million. In the first year of the reserve’s operation, placements shall also take place between 1 January and 1 September of that year of 8% (representing 1% for each calendar month) of the total number of allowances in circulation as set out in the most recent publication.’
10 Article 3 of Decision 2015/1814, entitled ‘Review’, provided:
‘The [European] Commission shall monitor the functioning of the reserve in the context of the report provided for in Article 10(5) of Directive 2003/87/EC. That report should consider relevant effects on competitiveness, in particular in the industrial sector, including in relation to [Gross Domestic Product (GDP)], employment and investment indicators. Within three years of the start of the operation of the reserve and at five-year intervals thereafter, the Commission shall, on the basis of an analysis of the orderly functioning of the European carbon market, review the reserve and submit a proposal, where appropriate, to the [Parliament] and to the Council. Each review shall pay particular attention to the percentage figure for the determination of the number of allowances to be placed in the reserve pursuant to Article 1(5) of this Decision, as well as the numerical value of the threshold for the total number of allowances in circulation and the number of allowances to be released from the reserve pursuant to Article 1(6) or (7) of this Decision. In its review, the Commission shall also look into the impact of the reserve on growth, jobs, the Union’s industrial competitiveness and on the risk of carbon leakage.’
Decision 2015/1814, as amended by Directive (EU) 2018/410
11 The first subparagraph of Article 1(5) of Decision 2015/1814, as amended by Directive (EU) 2018/410 of the European Parliament and of the Council of 14 March 2018 (OJ 2018 L 76, p. 3), provided:
‘Each year, a number of allowances equal to 12% of the total number of allowances in circulation, as set out in the most recent publication as referred to in paragraph 4 of this Article, shall be deducted from the volume of allowances to be auctioned by the Member States under Article 10(2) of Directive 2003/87/EC and shall be placed in the reserve over a period of 12 months beginning on 1 September of that year, unless the number of allowances to be placed in the reserve would be less than 100 million. In the first year of the reserve’s operation, placements shall also take place between 1 January and 1 September of that year of 8% (representing 1% for each calendar month) of the total number of allowances in circulation as set out in the most recent publication. By way of derogation from the first and second sentences, until 31 December 2023, the percentages and the 100 million allowances referred to in those sentences shall be doubled.’
Decision 2015/1814, as amended by the contested decision
12 The first subparagraph of Article 1(5) of Decision 2015/1814, as amended by the contested decision, provided:
‘Each year, a number of allowances equal to 12% of the total number of allowances in circulation, as set out in the most recent publication as referred to in paragraph 4 of this Article, shall be deducted from the volume of allowances to be auctioned by the Member States under Article 10(2) of Directive 2003/87/EC and shall be placed in the reserve over a period of 12 months beginning on 1 September of that year, unless the number of allowances to be placed in the reserve would be less than 100 million. In the first year of the reserve’s operation, placements shall also take place between 1 January and 1 September of that year of 8% (representing 1% for each calendar month) of the total number of allowances in circulation as set out in the most recent publication. By way of derogation from the first and second sentences of this subparagraph, until 31 December 2030, the percentages and the 100 million allowances referred to in those sentences shall be doubled.’
Decision 2015/1814, as amended by Directive 2023/959
13 Under the first subparagraph of Article 1(5) of Decision 2015/1814, as amended by Directive 2023/959:
‘In any given year, if the total number of allowances in circulation is between 833 million and 1 096 million, a number of allowances equal to the difference between the total number of allowances in circulation, as set out in the most recent publication as referred to in paragraph 4 of this Article, and 833 million shall be deducted from the quantity of allowances to be auctioned by the Member States under Article 10(2) of Directive 2003/87/EC and shall be placed in the reserve over a period of 12 months beginning on 1 September of that year. If the total number of allowances in circulation is above 1 096 million allowances, the number of allowances to be deducted from the quantity of allowances to be auctioned by the Member States under Article 10(2) of Directive 2003/87/EC and to be placed in the reserve over a period of 12 months beginning on 1 September of that year shall be equal to 12% of the total number of allowances in circulation. By way of derogation from the second sentence of this subparagraph, until 31 December 2030, the percentage referred to in that sentence shall be doubled.’
European Climate Law
14 Article 2 of Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’) (OJ 2021 L 243, p. 1) provides:
‘1. Union-wide greenhouse gas emissions and removals regulated in Union law shall be balanced within the Union at the latest by 2050, thus reducing emissions to net zero by that date, and the Union shall aim to achieve negative emissions thereafter.
2. The relevant Union institutions and the Member States shall take the necessary measures at Union and national level, respectively, to enable the collective achievement of the climate-neutrality objective set out in paragraph 1, taking into account the importance of promoting both fairness and solidarity among Member States and cost-effectiveness in achieving this objective.’
15 Article 4 of the European Climate Law, entitled ‘Intermediate Union climate targets’, provides, in paragraph 1:
‘In order to reach the climate-neutrality objective set out in Article 2(1), the binding Union 2030 climate target shall be a domestic reduction of net greenhouse gas emissions (emissions after deduction of removals) by at least 55% compared to 1990 levels by 2030.
When implementing the target referred to in the first subparagraph, the relevant Union institutions and the Member States shall prioritise swift and predictable emission reductions and, at the same time, enhance removals by natural sinks.
…’
Regulation (EU) 2023/955
16 Under Annex II to Regulation (EU) 2023/955 of the European Parliament and of the Council of 10 May 2023 establishing a Social Climate Fund and amending Regulation (EU) 2021/1060 (OJ 2023 L 130, p. 1), entitled ‘Maximum financial allocation for each Member State under the Fund pursuant to Articles 10 and 14’, for the 2026-2032 period, pursuant to Article 10(1), first and second subparagraphs, and Article 10(1), third subparagraph, of that regulation, the Republic of Poland will be able to obtain EUR 11 439 026 446 and EUR 9 608 782 215, respectively, representing 17.6% of the total allocation to all Member States under that fund.
Directive 2023/959
17 Under the second paragraph of Article 5 of Directive 2023/959, Article 2 thereof, entitled ‘Amendments to Decision [2015/1814]’, by which the first subparagraph of Article 1(5) of Decision 2015/1814 was amended as referred to in paragraph 13 of the present judgment, applies as from 1 January 2024.
The contested decision
18 Recitals 1 to 4, 7 to 10, 12, 14 and 15 of the contested decision state:
‘(1) … The Parties to the Paris Agreement […], adopted on 12 December 2015 under the United Nations Framework Convention on Climate Change (UNFCCC) [(OJ 2016 L 282, p. 4) (“the Paris Agreement”), approved on behalf of the Union by Council Decision (EU) 2016/1841 of 5 October 2016 (OJ 2016 L 282, p. 1)] have agreed to hold the increase in the global average temperature well below 2 °C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5 °C above pre-industrial levels. That commitment has been reinforced with the adoption under the UNFCCC of the Glasgow Climate Pact on 13 November 2021, in which the Conference of the Parties to the UNFCCC, serving as the meeting of the Parties to the Paris Agreement, recognises that the impacts of climate change will be much lower at a temperature increase of 1.5 °C, compared with 2 °C, and resolves to pursue efforts to limit the temperature increase to 1.5 °C.
(2) The urgency of the need to keep the Paris Agreement goal of 1.5 °C alive has become more significant following the findings of the Intergovernmental Panel on Climate Change in its Sixth Assessment Report that global warming can only be limited to 1.5 °C if strong and sustained reductions in global greenhouse gas emissions within this decade are immediately undertaken.
(3) Tackling climate- and environmental-related challenges and reaching the objectives of the Paris Agreement are at the core of the communication of the Commission of 11 December 2019 on “The European Green Deal” (“the European Green Deal”).
(4) The European Green Deal combines a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the Union by 2050, and sets out a new growth strategy that aims to transform the Union into a fair and prosperous society, with a modern, resource-efficient and competitive economy where economic growth is decoupled from resource use. It also aims to protect, conserve and enhance the Union’s natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. At the same time, that transition has gender equality aspects as well as a particular impact on some disadvantaged and vulnerable groups, such as older people, persons with disabilities, persons with a minority racial or ethnic background and low and lower-middle income individuals and households. It also imposes greater challenges on certain regions, in particular structurally disadvantaged and peripheral regions, as well as on islands. It must therefore be ensured that the transition is just and inclusive, leaving no one behind.
…
(7) Through the adoption of [the European Climate Law], the Union has enshrined in legislation the objective of economy-wide climate neutrality by 2050 at the latest and the aim of achieving negative emissions thereafter. That [Law] also establishes a binding Union domestic reduction target for net greenhouse gas emissions (emissions after deduction of removals) of at least 55% compared to 1990 levels by 2030, and provides that the Commission is to endeavour to align all future draft measures or legislative proposals, including budgetary proposals, with the objectives of that [Law] and, in any case of non-alignment, provide the reasons for such non-alignment as part of the impact assessment accompanying those proposals.
(8) All sectors of the economy need to contribute to achieving the emission reductions established by [the European Climate Law]. Therefore, the ambition of the EU Emissions Trading System (“EU ETS”), established by Directive 2003/87/EC of the European Parliament and of the Council […], should be adjusted so as to be in line with the economy-wide net greenhouse gas emission reduction target for 2030, the objective of achieving climate neutrality by 2050 at the latest and the aim of achieving negative emissions thereafter, as laid down in [the European Climate Law].
(9) In order to address the structural imbalance between supply of and demand for allowances in the market, Decision [2015/1814] established a [reserve] in 2018, which has been operational since 2019. Without prejudice to further revisions of the reserve as part of the general revision of Directive 2003/87/EC and of Decision [2015/1814] in 2023, the Commission should continuously monitor the functioning of the reserve and ensure that the reserve is kept fit for purpose in case of future unforeseeable external shocks. A robust and forward-looking reserve is essential to ensure the integrity of the EU ETS and to effectively steer the EU ETS so that it can contribute, as a policy tool, to achieving the Union’s climate-neutrality objective by 2050 at the latest and to the aim of achieving negative emissions thereafter, as laid down in [the European Climate Law].
(10) The reserve functions by triggering adjustments to the annual volumes of allowances to be auctioned. In order to preserve a maximum degree of predictability, Decision [2015/1814] established clear rules for placing allowances in the reserve and releasing them from it.
…
(12) Directive [2018/410] amended Decision [2015/1814] by doubling the percentage rate to be used for determining the number of allowances to be placed each year in the reserve from 12% to 24% until 31 December 2023 for the purpose of delivering a credible investment signal to reduce CO2 [carbon dioxide] emissions in a cost-efficient manner. That amendment was adopted in the context of the former Union 2030 climate target of reducing economy-wide greenhouse gas emissions by at least 40% compared to 1990 levels.
…
(14) In the review of the reserve, carried out in accordance with Decision [2015/1814], the Commission paid particular attention to the percentage rate for the determination of the number of allowances to be placed in the reserve, as well as to the numerical value of the threshold for the total number of allowances in circulation and the number of allowances to be released from the reserve.
(15) The analysis carried out in the context of the Commission’s review of the reserve and the expected developments relevant to the carbon market demonstrate that a rate of 12% of the total number of allowances in circulation for the determination of the number of allowances to be placed in the reserve each year after 2023 is insufficient to prevent a significant increase of the surplus of allowances in the EU ETS. Maintaining the rate of 24% in this Decision should be without prejudice to further revisions of the reserve, including, if appropriate, a further revision of the percentage rate for the determination of the number of allowances to be placed in the reserve, as part of the general revision of Directive [2003/87] and Decision [2015/1814] in 2023.’
Forms of order sought and procedure before the Court of Justice
19 The Republic of Poland claims that the Court should:
– annul the contested decision in its entirety; and
– order the Parliament and the Council to pay the costs.
20 The Parliament and the Council contend that the Court should:
– dismiss the application; and
– order the Republic of Poland to pay the costs.
21 By decision of the President of the Court of 15 November 2023, the Commission was granted leave to intervene in support of the forms of order sought by the Parliament and the Council.
The action
The plea of inadmissibility
22 The Parliament, supported by the Commission, suggests that the Court should hold that the present action has served no purpose since 1 January 2024, the date on which Article 1(5) of Decision 2015/1814 was amended by Article 2 of Directive 2023/959. The Parliament submits that the Republic of Poland has not challenged Article 1(5) of Decision 2015/1814, as amended by that directive, either in the present action or in the action brought against that directive in Case C‑505/23.
23 The Republic of Poland submits that that plea of inadmissibility should be dismissed.
24 In that regard, the Court finds that the Parliament’s line of argument is based on an incorrect premiss. In the action it brought in Case C‑505/23 challenging Directive 2023/959, the Republic of Poland claimed that that directive should be annulled in its entirety, relying, inter alia, on an error as to the choice of legal basis for that directive. As a result, the Parliament may not argue that the Republic of Poland has not challenged Article 2 of that same directive.
25 Moreover, the amendment of the contested decision by Decision 2023/959 allowed the past effects of that decision to remain and has therefore not resulted in effects equivalent to those which the annulment of the decision would, in principle, have had. Furthermore, before the Court, the Parliament merely relied on the amendment of the contested decision by that directive, without arguing that that amendment had a retroactive effect equivalent to that of annulment of that decision. Therefore, the applicability of Article 2 of that directive as from 1 January 2024 did not put an end to the body of effects of the contested decision and, consequently, did not entirely deprive of its purpose the action brought by the Republic of Poland in the present case (see, by analogy, judgment of 23 December 2015, Parliament v Council, C‑595/14, EU:C:2015:847, paragraphs 23, 27 and 28).
26 Consequently, the plea of inadmissibility put forward by the Parliament must be dismissed.
Substance
27 In support of its action, the Republic of Poland puts forward four pleas in law, alleging an infringement of, first, point (c) of the first subparagraph of Article 192(2) TFEU; second, the principle of energy solidarity referred to in Article 194(1)(b) TFEU; third, Article 3(1) and (3) TEU; and fourth, Article 13(2) TEU, read in conjunction with Article 3 of Decision 2015/1814, and of the principle of proportionality guaranteed in Article 5(4) TEU.
First plea in law: infringement of point (c) of the first subparagraph of Article 192(2) TFEU
– Arguments of the parties
28 In support of its first plea, the Republic of Poland submits that the contested decision should have been adopted not on the basis of Article 192(1) TFEU but rather point (c) of the first subparagraph of Article 192(2) TFEU, since that decision has a significant impact on the right of at least one Member State to choose from among different energy sources and the general structure of its energy supply.
29 In the first place, the Republic of Poland submits that, when a draft piece of legislation is being drawn up under Article 191 TFEU, the Commission should imperatively examine of its own motion whether the conditions of application of point (c) of the first subparagraph of Article 192(2) TFEU are satisfied. The EU legislature’s decision not to apply that provision should be clear from the travaux préparatoires for the contested decision in order for the Court to be able to review objectively whether the adoption of that decision under Article 192(1) TFEU is contrary to point (c) of the first subparagraph of Article 192(2) TFEU.
30 In the second place, the Republic of Poland submits that the doubling of the quantity of greenhouse gas emission allowances placed in the reserve until 2030 will have the effect of increasing the price of those allowances, which will have a significant impact on the freedom of Member States in defining their energy mix. In that regard, the introduction of a ground for the permanent cancellation of greenhouse gas emission allowances accumulated in that reserve will lead to their permanent elimination from the market, which will lead to a worsening of the deficit of such allowances and, consequently, an increase in their price. Therefore, the growth of the reserve since it was established in 2015 is undeniable, with the result that the considerations set out in the judgment of 21 June 2018, Poland v Parliament and Council (C‑5/16, EU:C:2018:483) concerning the neutrality of the reserve vis-à-vis price levels of the greenhouse gas emission allowances, are no longer relevant. It would, moreover, be contradictory to claim, on the one hand, that the reserve is a mechanism that is neutral as regards developments in the price of greenhouse gas emission allowances and, on the other hand, that, by creating a scarcity of those allowances on the market, it ‘sends a price signal’ intended to influence investors’ operational and strategic decisions.
31 Furthermore, since, by 2030, CO2 capture and storage technology will not be sufficiently developed, it will not be possible to achieve the CO2 emission reduction targets, including the climate neutrality target, without excluding fossil fuels from the Member States’ energy mix. In those circumstances, the neutrality of the EU ETS is illusory. In fact, the ‘Fit for 55’ legislative package, which is a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the Union by 2050, seeks by design to reduce significantly the use of coal, which tends to support the choice of point (c) of the first subparagraph of Article 192(2) TFEU as the legal basis for the adoption of the contested decision. Contrary to the Court’s ruling in the judgment of 21 June 2018, Poland v Parliament and Council (C‑5/16, EU:C:2018:483), that provision applies to any measure having a significant effect on a Member State’s energy mix, irrespective of whether the sole or primary purpose of that measure is to have a significant effect on that mix. The criterion of the effects of an act are, moreover, applied in certain areas of EU law, such as competition law or the freedoms of movement. In the present case, the contested decision is liable to deter Member States from using fossil fuels and is thus, by definition, a measure significantly affecting the choice between different energy sources, within the meaning of point (c) of the first subparagraph of Article 192(2) TFEU.
32 On that point, the Republic of Poland submits that that provision constitutes lex specialis. Whilst acknowledging that that provision must be interpreted strictly, the Republic of Poland nevertheless considers that it must not be interpreted in such a way that its application depends on the subjective will of the EU legislature and, consequently, that it becomes ‘completely illusory’. The same provision seeks to guarantee each Member State, first, the right to choose between different energy sources and the general structure of its energy supply and, second, that, in those matters, it will be placed on an equal footing with the other Member States.
33 In the third place, as is apparent from the judgment of 21 June 2018, Poland v Parliament and Council (C‑5/16, EU:C:2018:483, paragraph 49), the legal basis of an amending act does not necessarily have to be the same as the basis of the act being amended. Decision 2015/1814 and the contested decision were adopted in different circumstances, as is apparent, inter alia, from recital 12 of the latter. In its current form, the reserve plays an even more significant role than that envisaged at the time it was established in achieving the Union’s binding greenhouse gas emission reduction targets.
34 In the fourth place, the legal context surrounding the contested decision consists primarily of the other components of the ‘Fit for 55’ legislative package, such as Regulation (EU) 2023/956 of the European Parliament and of the Council of 10 May 2023 establishing a carbon border adjustment mechanism (OJ 2023 L 130, p. 52), Directive 2023/959, or Regulation (EU) 2023/851 of the European Parliament and of the Council of 19 April 2023 amending Regulation (EU) 2019/631 as regards strengthening the CO2 emission performance standards for new passenger cars and new light commercial vehicles in line with the Union’s increased climate ambition (OJ 2023 L 110, p. 5), none of which existed at the time the contested decision was adopted.
35 In the fifth place, the Republic of Poland submits that the reserve’s responsiveness to market changes may prove insufficient to meet the economy’s growing needs.
36 The Parliament and the Council, supported by the Commission, contend that the first plea in law should be rejected as unfounded.
– Findings of the Court
37 In support of its first plea in law, the Republic of Poland submits that the contested decision should have been adopted not on the basis of Article 192(1) TFEU but rather point (c) of the first subparagraph of Article 192(2) TFEU, since that decision has a significant impact, at the very least, on its right to choose from among different energy sources and the general structure of its energy supply.
38 In that regard, it should be borne in mind that the choice of point (c) of the first subparagraph of Article 192(2) TFEU as a legal basis for a measure cannot be founded on factors other than those consistently taken into the account by the Court in its case-law (see, to that effect, judgment of 21 June 2018, Poland v Parliament and Council, C‑5/16, EU:C:2018:483, paragraphs 37 to 39).
39 The Court has consistently held, first, that the choice of the legal basis for a measure may not depend simply on an institution’s conviction as to the objective pursued but must be based on objective factors which are amenable to judicial review, such as the aim and the content of the measure (see, to that effect, judgments of 26 March 1987, Commission v Council, 45/86, EU:C:1987:163, paragraph 11; of 29 April 2004, Commission v Council, C‑338/01, EU:C:2004:253, paragraph 54; and of 16 February 2022, Poland v Parliament and Council, C‑157/21, EU:C:2022:98, paragraph 121).
40 If the choice of legal basis of a legislative measure were to depend on an assessment of the likely impact thereof which, by its nature, is speculative, only an assessment after its entry into force would make it possible to know the real and specific effects of such a measure. That assessment would therefore in no way be an objective factor amenable to judicial review (see, to that effect, judgment of 21 June 2018, Poland v Parliament and Council, C‑5/16, EU:C:2018:483, paragraph 41).
41 It is, moreover, settled case-law that the validity of an EU measure cannot depend on retrospective assessment of its efficacy (judgments of 7 February 1973, Schroeder, 40/72, EU:C:1973:14, paragraph 14; of 5 October 1994, Crispoltoni and Others, C‑133/93, C‑300/93 and C‑362/93, EU:C:1994:364, paragraph 43; and of 12 July 2001, Jippes and Others, C‑189/01, EU:C:2001:420, paragraph 84).
42 Consequently, the assessment of the anticipated effect of an EU measure on a Member State’s energy policy may be taken into consideration only in the assessment of the aim or content of that measure (see, to that effect, judgment of 21 June 2018, Poland v Parliament and Council, C‑5/16, EU:C:2018:483, paragraph 42).
43 Secondly, the choice of legal basis for a measure may also be based on the context of which it forms part, since that context is capable of shedding light on the aim pursued by that measure (see, to that effect, judgments of 27 February 2014, United Kingdom v Council, C‑656/11, EU:C:2014:97, paragraph 50; of 3 December 2019, Czech Republic v Parliament and Council, C‑482/17, EU:C:2019:1035, paragraph 32; of 8 December 2020, Hungary v Parliament and Council, C‑620/18, EU:C:2020:1001, paragraph 39; and of 16 February 2022, Poland v Parliament and Council, C‑157/21, EU:C:2022:98, paragraph 122).
44 On that point, a distinction should be drawn between a measure analogous to a pre-existing measure and a measure that amends a pre-existing measure. According to settled case-law, the legal basis for a measure must be determined having regard to its own aim and content and not to the legal basis used for the adoption of other EU measures that might, in certain cases, display similar characteristics (judgments of 10 January 2006, Commission v Parliament and Council, C‑178/03, EU:C:2006:4, paragraph 55, and of 21 June 2018, Poland v Parliament and Council, C‑5/16, EU:C:2018:483, paragraph 49). However, with respect to legislation which amends existing legislation, it is important also to take into account, for the purposes of identifying its legal basis, the existing legislation that it amends and in particular, its objective and content (judgments of 3 December 2019, Czech Republic v Parliament and Council, C‑482/17, EU:C:2019:1035, paragraph 42, and of 8 December 2020, Hungary v Parliament and Council, C‑620/18, EU:C:2020:1001, paragraph 40).
45 Thirdly, if the examination of an EU measure reveals that it pursues several purposes or that it comprises several components and if one of those purposes or components is identifiable as the main or predominant purpose or component, whereas the others are merely incidental or are only extremely limited in scope, the legal basis for adopting that measure must be determined in accordance with that main purpose or component (see, to that effect, judgments of 23 February 1999, Parliament v Council, C‑42/97, EU:C:1999:81, paragraphs 39 and 40; of 8 December 2020, Hungary v Parliament and Council, C‑620/18, EU:C:2020:1001, paragraph 38; and of 21 March 2024, Landeshauptstadt Wiesbaden, C‑61/22, EU:C:2024:251, paragraph 47).
46 Fourthly, a broad interpretation of the first subparagraph of Article 192(2) TFEU would risk having the effect of making recourse to the special legislative procedure, which the Treaty FEU intended as an exception, into the general rule. However, under the principle that exceptions must be interpreted strictly, point (c) of the first subparagraph of Article 192(2) TFEU can form the legal basis of an EU measure only if it follows from the aim and content of that measure that the primary outcome sought by that measure is significantly to affect a Member State’s choice between different energy sources and the general structure of the energy supply of that Member State (judgment of 21 June 2018, Poland v Parliament and Council, C‑5/16, EU:C:2018:483, paragraphs 44 to 46).
47 In the present case, it is appropriate to examine, in the first place, the second and third arguments put forward by the Republic of Poland, by which it claims mainly that the contested decision would lead to an increase in the price of greenhouse gas emission allowances, which constitutes a change in circumstances.
48 It should be noted that, in its judgment of 21 June 2018, Poland v Parliament and Council (C‑5/16, EU:C:2018:483, paragraphs 65 to 67), the Court had previously noted that, taking into account the detailed rules governing the EU ETS and, inter alia, the fact that the reserve can either prevent the entry of greenhouse gas allowances onto the market or release a number of them, the likely effect thereof is that it will stabilise the price of greenhouse gas emissions rather than increase it. Nonetheless, due to the fact that the total quantity of allowances available in the ETS falls on the basis of an annual linear reduction factor, it is intrinsic to the logic thereof that the price of allowances will gradually increase as time goes on. Thus, in so far as Decision 2015/1814 corrects a structural weakness of the EU ETS, it contributes to that scheme emitting a carbon price signal at EU level, which allows the Union to reach its goals in terms of emission reductions and logically involves an increase in the price of allowances in the future.
49 It is apparent, in particular, from recitals 1 to 4, 7 to 10, 12, 14 and 15 of the contested decision that it is intended to reinforce and adapt the EU’s climate objectives in view of the conclusions of the Intergovernmental Panel on Climate Change in its Sixth Assessment Report. Indeed, the worsening consequences of global warming have, inter alia, led the EU to enshrine in the European Climate Law the target of achieving climate neutrality across the entire economy by 2050 at the latest, and to set itself a binding target of reducing net greenhouse gas emissions in the EU by at least 55% by 2030 compared with 1990 levels. That law also provides that the Commission must endeavour to align all future draft measures or draft legislation, including draft budgets, with those targets.
50 The aim pursued by the contested decision is thus, like that of Decision 2015/1814, to use the reserve to remedy the structural imbalance between supply and demand for greenhouse gas emission allowances on the market, and thereby to contribute to the achievement of the Union’s climate neutrality objective by 2050 at the latest.
51 It also follows from recitals 12, 14 and 15 of the contested decision that it is fully in line with Decision 2015/1814 and Directive 2018/410. In that regard, recital 12 of the contested decision states that Directive 2018/410 amended Decision 2015/1814 by doubling the percentage rate to be used for determining the number of greenhouse gas allowances to be placed each year in the reserve from 12% to 24% until 31 December 2023 for the purpose of delivering a credible investment signal to reduce CO2 emissions in a cost-efficient manner. However, that amendment was adopted in the context of the former Union 2030 climate target of reducing economy-wide greenhouse gas emissions by at least 40% compared to 1990 levels. However, in view of the new market conditions and the stricter targets for reducing greenhouse gas emissions, a return to a set-aside rate of 12% of the total number of greenhouse gas emission allowances in circulation each year is insufficient to prevent a significant increase in the surplus of allowances in the EU ETS.
52 Therefore, as contended by the Parliament and the Council in their written pleadings, by adding a sentence to Article 1(5) of Decision 2015/1814, Directive 2018/410 merely doubled the rate for determining the number of CO2 emission allowances to be placed in the reserve up to 2023, without altering its fundamental nature. Similarly, the contested decision merely maintained that rate until the year 2030. The purpose of the measures amending the reserve remains the same as that set out in Decision 2015/1814; only the percentages used to determine the number of greenhouse gas emission allowances to be placed in that reserve, and the numerical value of those allowances, have been amended. Consequently, such a ‘doubling’ could only be challenged under the principle of proportionality which is, however, ineffective with respect to the choice of the legal basis for the contested decision.
53 Consequently, even if the contested decision could potentially lead to an increase in the price of greenhouse gas emission allowances and affect the energy mix of the Member States, that cannot constitute its primary objective. Consequently, in accordance with the interpretation of point (c) of the first subparagraph of Article 192(2) TFEU, referred to in paragraph 46 of the present judgment, it is impossible for the contested decision to be based on that provision.
54 Moreover, the EU legislature cannot be denied the possibility of adapting Decision 2015/1814 to any change in circumstances or any development of knowledge, having regard to its task of safeguarding the general interests recognised by the Treaties, including the protection of the environment (see, to that effect, judgments of 10 December 2002, British American Tobacco (Investments) and Imperial Tobacco, C‑491/01, EU:C:2002:741, paragraph 77; of 3 December 2019, Czech Republic v Parliament and Council, C‑482/17, EU:C:2019:1035, paragraph 56; and of 4 October 2024, Lithuania and Others v Parliament and Council (Mobility Package), C‑541/20 to C‑555/20, EU:C:2024:818, paragraphs 266 and 1426).
55 Moreover, Article 3 of Decision 2015/1814, entitled ‘Review’, provides expressly that, within three years of its adoption and at five-year intervals thereafter, the Commission, on the basis of an analysis of the orderly functioning of the European carbon market, is to review the reserve, paying particular attention to the percentage figure for the determination of the number of allowances to be placed in the reserve pursuant to Article 1(5) of that decision, as well as the numerical value of the threshold for the total number of allowances in circulation and the number of allowances to be released from the reserve pursuant to Article 1(6) or (7) of that decision.
56 In the second place, as regards the Republic of Poland’s argument to the effect that the contextual arguments referred to by the Parliament and the Council relate principally to the other components of the ‘Fit for 55’ legislative package, the Court notes that, in their written pleadings, those institutions rely on legislative measures preceding the adoption of that package. They intend primarily to emphasise the continuity between the contested decision and the decision it amends, namely Decision 2015/1814, both in its original version and as amended by Directive 2018/410.
57 In any event, it is apparent from recitals 3 and 4 of the contested decision that the European Green Deal, of which the ‘Fit for 55’ legislative package forms part, is a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the Union by 2050, in order to tackle climate- and environmental-related challenges faced by the Union and to attain the objectives of the Paris Agreement. It follows that, in adopting that set of measures and initiatives, the EU legislature has merely complied with the objective, set out in the first subparagraph of Article 13(1) TEU and Article 7 TFEU, of ensuring the coherence, effectiveness and continuity of its policies and actions, whilst continuing to pursue the Union’s enhanced climate objectives.
58 In the third place, as regards the Republic of Poland’s argument relating to the scope of the obligation to provide a statement of reasons for the choice of legal basis for the adoption of the contested decision, the Court notes that there is no provision of EU law requiring the EU institutions to state the reasons why they opted not to use Article 192(2) FEU as a legal basis for a decision such as the contested decision if Article 192(1) seems duly justified. Indeed, the choice of a legal basis inherently implies that the other potential legal bases which might have served as a basis for a measure were deemed not to be appropriate.
59 Lastly, the Republic of Poland’s argument to the effect that, in the event of changes on the market, the reserve’s responsiveness may prove insufficient to meet the economy’s growing needs, is ineffective. Such an argument does not concern the determination of the legal basis of the contested decision, which is the subject of the first plea in law, but rather the assessment of whether that decision complies with the principle of proportionality and, more specifically, whether it is capable of achieving the objectives set by the EU legislature.
60 In the light of the foregoing considerations, the first plea in law must be rejected as in part unfounded and in part ineffective.
Second plea in law: infringement of the principle of energy solidarity laid down in Article 194(1)(b) TFEU
– Arguments of the parties
61 In support of its second plea in law, The Republic of Poland submits that, by maintaining, between 2024 and 2030, the percentages and the number of greenhouse gas emission allowances referred to in the first subparagraph of Article 1(5) of Decision 2015/1814, as amended by Directive 2018/410, the contested decision threatens the security of its energy supply by obliging Member States to reduce their consumption of fossil fuels, such as coal.
62 Yet the importance of coal is comparable to that of petroleum products for the Republic of Poland. In the judgment of 10 July 1984, Campus Oil and Others (72/83, EU:C:1984:256, paragraph 34), it was recognised that the supply of petroleum products is of fundamental importance to not only a country’s economy but above all its institutions, its essential public services and even the survival of its inhabitants.
63 Moreover, even if it was formally adopted under the EU’s environmental policy, the contested decision undeniably has a bearing on its energy policy because of the artificial increase it brings about in the cost of electricity generation. That increase not only leads to the bankruptcy of many companies in the industrial sector and negative social consequences, but also increases the risk of carbon leakage, due to the relocation of electricity generation facilities to third countries that do not have as stringent a climate policy as the EU.
64 Furthermore, during the legislative process leading to the adoption of the contested decision, the Commission, the Parliament and the Council all failed to comply with the obligation inherent in the principle of energy solidarity, as set out in Article 194(1)(b) TFEU, to take account, in the context of the implementation of the Union’s energy policy, of the interests of both the Union and the various Member States likely to be affected, and to weigh up those interests in the event of conflicts. Therefore, the mere act of adopting a legal measure using an incorrect legal basis is sufficient to rule out the application of the principle of energy solidarity, whereas that principle underpins the entire legal system of the European Union, as stated in the judgment of 15 July 2021, Germany v Poland (C‑848/19 P, EU:C:2021:598, paragraphs 37 to 41).
65 The Parliament and the Council, supported by the Commission, contend that the second plea in law should be rejected as unfounded.
– Findings of the Court
66 By its second plea in law, the Republic of Poland submits that the contested decision disregards the principle of energy solidarity referred to in Article 194(1) TFEU. It argues that the contested decision not only threatens its energy supply, but that the EU institutions also failed to take account or reconcile the potentially conflicting interests of the EU and the various Member States concerned.
67 It should be noted as a preliminary point that the judgment of 10 July 1984, Campus Oil and Others (72/83, EU:C:1984:256), relied on by the Republic of Poland, is irrelevant to the present case, as it has not in any way demonstrated that the contested decision has the consequence of interrupting its supply of fossil fuels. Moreover, that judgment, which concerned the free movement of goods, was delivered before any environmental objectives and the principle of energy solidarity were included in the treaties, which limits its scope in the context of the present proceedings.
68 That said, it should be borne in mind that Article 194 TFEU provides that, in the context of the establishment and functioning of the internal market and with regard for the need to preserve and improve the environment, European Union policy on energy is to aim, in a spirit of solidarity between Member States, to ensure the functioning of the energy market, ensure security of energy supply in the Union, promote energy efficiency and energy saving and the development of new and renewable forms of energy, and promote the interconnection of energy networks.
69 Since it is apparent from the examination of the first plea in law that the contested decision was correctly adopted on the basis of Article 192(1) TFEU and that it therefore comes within the ambit of the EU environmental policy, the principle of energy solidarity, which applies only to acts coming within the scope of the EU energy policy, may not successfully be relied on.
70 Nevertheless, as the Court stated, in essence, in the judgment of 15 July 2021, Germany v Poland (C‑848/19 P, EU:C:2021:598, paragraphs 38 and 41), that principle is a specific expression, in the field of energy, of the principle of solidarity, which is itself one of the fundamental principles of EU law and which underpins the entire legal system of the European Union.
71 In that context, the Republic of Poland’s plea in law alleging infringement of the principle of energy solidarity referred to in Article 194(1) TFEU must be understood as claiming that there has been a failure to observe the principle of solidarity which, like the general principles of EU law, constitutes a criterion for assessing the legality of measures adopted by the EU institutions (see, by analogy, judgment of 15 July 2021, Germany v Poland (C‑848/19 P, EU:C:2021:598, paragraph 45).
72 Like the principle of energy solidarity, first, the principle of solidarity involves the observance of rights and obligations by the European Union and by the Member States. Although the European Union is bound by an obligation of solidarity towards the Member States, the Member States are bound by an obligation of solidarity between themselves and with regard to the common interest of the European Union and the policies pursued by it. Secondly, that principle requires that the EU institutions, including the Commission, conduct an analysis of the interests involved in the light of that principle, taking into account the interests both of the Member States and of the European Union as a whole. Thirdly, the application of the principle of energy solidarity does not mean, however, that an EU act must never, under any circumstances, have negative impacts for the particular interests of a Member State in the relevant field (see, by analogy, judgment of 15 July 2021, Germany v Poland, C‑848/19 P, EU:C:2021:598, paragraphs 49, 53 and 73).
73 In the present case, the Republic of Poland alleges that the artificial increase in the cost of producing electricity brought about by the contested decision has negative social repercussions and risks increasing carbon leakage.
74 That claim is not substantiated, however. In any event, the EU legislature took the interests of the Member States into consideration in adopting the contested decision. As observed in paragraph 57 of the present judgment, it follows from recital 4 of the contested decision that it forms part of a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the Union by 2050. That comprehensive and coherent set of rules has recently been updated by the ‘Fit for 55’ legislative package. The EU legislature has provided for specific compensatory measures in order to take into account the specific situation and interests of each Member State. From that point of view, it is necessary, in order to assess whether the contested decision complies with the principle of solidarity, to take into account the compensatory measures which were introduced at the time it was adopted (see, to that effect, judgment delivered today, Poland v Parliament and Council, C‑505/23, paragraphs 124 to 127).
75 In particular, as observed by the Commission in its statement in intervention, Article 10(2)(b) of Directive 2003/87 provides that 10% of the total quantity of greenhouse gas emission allowances to be auctioned is to be distributed amongst certain Member States for the purposes of solidarity, growth and interconnections within the Union.
76 Part A of Annex IIb to Directive 2003/87, entitled ‘Distribution of funds from the modernisation fund corresponding to Article 10(1), third subparagraph’, provides that the Republic of Poland’s share is 43.41% of those funds. Part B of Annex IIb, entitled ‘Distribution of funds from the modernisation fund corresponding to Article 10(1), fourth subparagraph’, provides that the Republic of Poland’s share is 34.2% of those funds.
77 Similarly, compensatory measures benefiting the Republic of Poland have been provided for in the Social Climate Fund, introduced by Regulation 2023/955. Annex II to that regulation provides that, for the 2026-2032 period, pursuant to Article 10(1), first and second subparagraphs and Article 10(1), third subparagraph of that regulation, the Republic of Poland will be able to obtain EUR 11 439 026 446 and EUR 9 608 782 215, respectively, representing 17.6% of the total allocation to all Member States under that fund.
78 In any event, as observed in paragraph 72 of the present judgment, the principle of solidarity does not preclude an EU act from having negative impacts for the particular interests of a Member State in the relevant field.
79 In the light of the foregoing considerations, the second plea in law put forward by the Republic of Poland must be rejected as unfounded.
Third plea in law: infringement of Article 3(1) and (3) TEU
– Arguments of the parties
80 In support of its third plea in law, the Republic of Poland claims that the contested decision infringes Article 3(1) and (3) TEU by exacerbating social inequalities between Member States and that it is likely to augment social exclusion. A reduction in the supply of greenhouse gas emission allowances on the market will lead to a new increase in the price of those allowances and, therefore, in price levels of coal-generated electricity. Due to the declining competitiveness of coal-generated electricity compared with other energy sources, 45 500 jobs are expected to be lost in Poland’s mining sector and 50 000 in related sectors.
81 Furthermore, the increase in the reserve level following the adoption of the contested decision will lead to a reduction in the disposable income of all Polish households, whose energy expenditure will account for more than 9% of their disposable income in 2030, compared with just over 2% in 2020, which will constitute a disproportionate burden on those households.
82 In addition, the reform of the EU ETS and, in particular, the contested decision will place the Republic of Poland at a disadvantage, as it will be forced to generate electricity from coal pending the completion of the energy transition, whilst wealthier Member States with well-developed renewable energy sectors will obtain electricity at a lower cost.
83 The Parliament and the Council, supported by the Commission, contend that the third plea in law should be rejected as unfounded.
– Findings of the Court
84 By its third plea in law, the Republic of Poland claims that the contested decision is contrary to Article 3(1) and (3) TEU, inasmuch as it results in a deterioration in the well-being of the peoples of the Union and social cohesion between Member States. By reducing the supply of greenhouse gas emission allowances, that decision is expected to lead to a rise in the price of those allowances and in the cost of coal-generated electricity and, as a result, the loss of around 95 500 jobs in Poland.
85 In that regard, as has been held in the case-law, Article 3 TEU sets out various essential objectives pursued by the European Union, without establishing a hierarchy between them. Therefore, the implementation of those objectives, which include, in the same way as the well-being of the peoples of the Union and social cohesion between Member States, inter alia, the sustainable development of Europe, the protection of the environment and the promotion of scientific and technological advance, must be the result of the policies and activities of the European Union and the Member States. That provision cannot therefore, unlike the specific provisions of the FEU Treaty that implement the general objectives which it sets out and govern the matter in question, form part of the parameters for assessing the conformity with primary law of a provision of secondary legislation (see, to that effect, judgments of 29 January 1985, Cullet and Chambre syndicale des réparateurs automobiles et détaillants de produits pétroliers, 231/83, EU:C:1985:29, paragraph 10; of 23 November 1999, Portugal v Council, C‑149/96, EU:C:1999:574, point 86; and of 4 October 2024, Lithuania and Others v Parliament and Council (Mobility Package), C‑541/20 to C‑555/20, EU:C:2024:818, paragraphs 423 and 424).
86 Therefore, since Article 3 TEU cannot, on its own, be relied upon to support an application for annulment directed against a Union act, the third plea in law must be rejected as unfounded.
Fourth plea in law: infringement of Article 13(2) TEU, read in conjunction with Article 3 of Decision 2015/1814, and of the principle of proportionality, laid down in Article 5(4) TEU
– Arguments of the parties
87 In support of its fourth plea in law, the Republic of Poland submits, in essence, that the Parliament, the Council and the Commission infringed Article 13(2) TEU, read in conjunction with Article 3 of Decision 2015/1814, which requires the Commission to review the reserve within three years of the start of the operation thereof and at five-year intervals thereafter. Yet it is apparent from the travaux préparatoires for the contested decision that none of those institutions has complied with that obligation of review. That decision is in fact based on data considered to be out of date at the time of its adoption, since the EU legislature did not take into account the Russian Federation’s war of aggression against Ukraine, or the fact that greenhouse gas emission allowances are subject to market speculation. The EU ETS and the reserve are designed in such a way that, in the event of a speculative attack, no measures are in place to prevent it.
88 The Parliament and the Council, supported by the Commission, contend that the fourth plea in law should be rejected as ineffective and, at the very least, as unfounded.
– Findings of the Court
89 By its fourth plea in law, the Republic of Poland criticises the Parliament, the Council and the Commission for having infringed Article 13(2) TEU, read in conjunction with Article 3 of Decision 2015/1814, by reviewing the reserve on the basis of data considered to be out of date on the date of adoption of the contested decision.
90 Under Article 3 of Decision 2015/1814, within three years of the start of the operation of the reserve and at five-year intervals thereafter, the Commission is, on the basis of an analysis of the orderly functioning of the European carbon market, to review the reserve and submit a proposal, where appropriate, to the Parliament and to the Council. In that review, the Commission is to look into, inter alia, the impact of the reserve on growth, jobs, and the Union’s industrial competitiveness and on the risk of carbon leakage.
91 It is readily apparent from that provision that the obligation of review for which it provides falls solely to the Commission and not in any way to the Parliament or the Council.
92 It follows that the fourth plea in law must be rejected as ineffective, inasmuch as it seeks to have the Court find an infringement of Article 3 of Decision 2015/1814 by the Parliament and the Council.
93 Moreover, Article 13(2) TEU, which is relied on in conjunction with Article 3 of that decision, provides that each institution is to act within the limits of the powers conferred on it in the Treaties, and in conformity with the procedures, conditions and objectives set out in them, and that the institutions are to practice mutual sincere cooperation. Article 13(2) TEU cannot therefore be used to justify any encroachment whatsoever by the EU legislature on powers conferred exclusively on the Commission by Decision 2015/1814.
94 Lastly, the fourth plea in law also alleges infringement of the principle of proportionality, laid down in Article 5(4) TEU. In that regard, it should be borne in mind that, under the first paragraph of Article 21 of the Statute of the Court of Justice of the European Union and Article 120(c) of the Rules of Procedure of the Court of Justice, in a direct action before the Court, an application initiating proceedings must state, inter alia, the subject matter of the dispute and a summary of the pleas in law on which the application is based. That statement must be sufficiently clear and precise to enable the defendant to prepare his or her defence and the Court to rule on the application. It is therefore necessary for the essential points of law and of fact on which a case is based to be indicated coherently and intelligibly in the application itself and for the heads of claim to be set out unambiguously so that the Court does not rule ultra petita or fail to rule on a claim (see, to that effect, judgments of 9 January 2003, Italy v Commission, C‑178/00, EU:C:2003:7, paragraph 6; of 30 April 2014, United Kingdom v Council, C‑209/13, EU:C:2014:283, paragraph 30; and of 3 June 2021, Hungary v Parliament, C‑650/18, EU:C:2021:426, paragraph 78).
95 In the present case, since the Republic of Poland has not put forward any argument in support of its fourth plea in law capable of establishing that the contested decision is disproportionate, it must be rejected as inadmissible inasmuch as it alleges infringement of the principle of proportionality.
96 In the light of the foregoing considerations, the fourth plea in law must be rejected as in part ineffective and in part inadmissible.
97 It follows that the action must be dismissed in its entirety.
Costs
98 Under Article 138(1) of the Rules of Procedure of the Court of Justice, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Parliament and the Council have applied for costs to be awarded against the Republic of Poland, and since the latter has been unsuccessful, the Republic of Poland must be ordered to bear its own costs and to pay those incurred by the Parliament and the Council.
99 In accordance with Article 140(1) of the Rules of Procedure, which provides that institutions which intervene in the proceedings are to bear their own costs, the Commission shall bear its own costs.
On those grounds, the Court (Second Chamber) hereby:
1. Dismisses the action;
2. Orders the Republic of Poland to bear its own costs and to pay the costs incurred by the European Parliament and the Council of the European Union.
3. Orders the European Commission to bear its own costs.
[Signatures]
* Language of the case: Polish.