Research note on the PhD project conducted by Miroslava Scholten (defended 3 April 2014, Maastricht University) on the topic of The Political Accountability of EU and US Independent Regulatory Agencies.
By Miroslava Scholten
A general setting
In recent decades, two trends have been characterizing the exercise and delimitation of public power. First, it is the growing scope of delegation of public authority to the executive branch. Second, it is cutting “the executive into smaller pieces” or, in other words, the dispersion of the locus of the executive branch within and beyond the nation state border. The former trend can be mainly explained by globalization and technological developments, which leave legislatures with a rather challenging task of regulating a great number of quite technical and internationalized issues. The lack of time and expertise necessitate the delegation of vast powers (in quantitative and qualitative terms) to the executive that can act on the spot and respond to the at times quickly changing realities in a prompt and effective manner. The latter trend seems to have mixed origins – functional necessities and political compromises – and can be roughly brought down to the ‘agencification phenomenon’ since various sorts of agencies, including the independent ones, have become an important part of the executive branch.
The delegation to the so-called independent regulatory agencies (IRAs) raises the question of such agencies’ accountability. This is a complex issue as such but also in relation to the EU. Firstly, any delegation raises a classic ‘principal-agent’ question, namely whether and how the recipient of delegated powers can be held to account for the exercise of the delegated functions. Given the multi-level structure of the EU, the question of delegation and accountability becomes even more complicated as the multiplicity of levels implies a multiplicity of principals and actors and a multiplicity of delegation and accountability chains, which carry certain implications for the accountability of EU agencies. Secondly, as IRAs enjoy some degree of autonomy, the question of their political accountability involves a classic dilemma of accountability and independence, namely whether an agency can be held to account, if it is independent.
Why to investigate the political accountability of EU agencies?
So far, the EU agencies’ accountability has been understudied largely due to the fact that most EU agencies were entrusted with formally weak powers. Recently, however, the number, de facto influence as well as de jure powers of EU agencies have grown considerably. There are 35 EU agencies, which are no longer merely information-gathering assistants of the Commission and national authorities; they may enjoy decision-making and supervisory powers. The growing number and powers of EU agencies has prompted a number of studies on EU agencies as well as the reform, which the EU three main institutions have launched with a view of making the creation and operation of EU agencies clearer, more transparent and accountable. So far, scholars have been focusing on the following issues. Some looked at the legality of agencies’ creation, the position and the role that EU agencies have been playing within the EU institutional constellation, especially within the EU emerging executive power, while others analyzed questions such as EU agencies’ functional necessity and autonomy. A number of reports produced by or for the EU institutions offered good overviews of the existing de jure but also de facto concerns and challenges to various aspects of EU agencies’ operation, including staffing and discharge. Whereas the issue of EU agencies’ independence and accountability has also been noticed by scholars, this question has been largely discussed by means of a limited number of case-studies or at a rather general level, which is not surprising considering the great number of EU agencies and considerable differences between their accountability arrangements. While the existing studies have provided a good point of departure, a comprehensive study on the political accountability of all EU agencies was a necessary supplement. In this light, I have conducted a four-year PhD research project on the political accountability of EU agencies; the commercial version of the dissertation is published by Brill, Nijhoff Studies on European Union Law.
What is the book about?
‘The Political Accountability of EU and US Independent Regulatory Agencies’ offers an in-depth analysis of the laws and practices of the political accountability arrangements of all 35 EU and 16 US independent regulatory agencies. An important added value of this book is that it compares the EU situation with a jurisdiction that has more than a century-long experience concerning the matter at stake, the US. The comparative analysis reveals similarities between the political accountability arsenals and challenges to political oversight in the EU and the US. The greatest differences are identified in the organization of the political accountability of independent regulatory agencies, i.e., ‘excessive diversity in the EU vs. uniformity in the US’, and the design of accountability obligations. The US experience offers valuable lessons to consider for the EU, sends warning signals in relation to some experiences that would be better avoided, and demonstrates similar concerns that indicate the fundamental character of certain questions in the field of the political accountability of independent regulatory agencies. In light of the ongoing reform of EU agencies’ creation and operation at the EU level, this book concludes with a few recommendations on how the political accountability of EU agencies should be adjusted.
How did I investigate the topic?
In order to analyze the political accountability of EU agencies, including from a comparative perspective, the research project faced the question of how political accountability was to be investigated and assessed given the absence of a relevant general framework. Following one of the leading definitions on accountability, that of Prof. Mark Bovens, this study focused on the political accountability between representative bodies and IRAs, which involves a relationship where the latter have an obligation to inform representative bodies about their actions, justify their decisions and choices, and where agencies may face consequences for their behavior. This is the relationship in which three stages of accountability can be distinguished: information, discussion, and rectification. Whereas the Bovens’ definition is a narrow view of accountability because it excludes ex ante processes, such as making appointments to relevant institutions, in this book the political accountability of IRAs was studied from a broader perspective. Let me explain.
It is true that the processes of providing information, justifications, and facing consequences (i.e., the three stages) take place ex post, i.e., after the agency has acted and during scrutiny of the agencies’ performance and financial accounts before the representatives bodies. However, accountability obligations, such as obligations to inform and to justify behavior and performance, which the agency can be subject to are established predominantly ex ante and can influence the ex post application. “If you want to hold people accountable, you have to be able to specify what you expect them to do and not do” and how. This occurs usually upon the creation of the agency and the delegation of tasks to it and pursuant to the creation and delegation standards. In addition, when talking about the accountability actor ‘independent agency’, the actor’s institutional and personal features stand out, which makes it necessary to distinguish between the political accountability of the institution called independent agency and the political accountability of persons heading the institution, for instance, members of management boards and executive directors. This implies the necessity to consider not only processes and obligations of an institutional character, but also those of a personal character when studying political accountability of an independent agency and probably other executive institutions for that matter.
In this light, this study established an investigation framework of five dimensions in which political accountability can be shaped and exercised. These were: (1) the creation of and delegation to IRAs by representative bodies, (2) the appointment and removal of agencies’ top officials by representative bodies (3) statutory regulation of accountability aspects of the operation of agencies, (4) financial oversight, and (5) (parliamentary) scrutiny. These five dimensions harbor aspects of an institutional (1, 3-5) and personal (2); ex ante (1-3) and ex post (2, 4, 5) nature, which enabled a comprehensive investigation of political accountability in a broader institutional environment.
The next question is clearly how political accountability can be assessed. Is accountability problematic or not? If so, where does the source of the problem lie and in reference to what is it problematic? One way of assessing political accountability is mapping out accountability mechanisms with regard to the three stages of accountability; information, discussion and rectification. For instance, political accountability can be evaluated as problematic if mechanisms ensuring one or more stages of accountability are missing. At the same time, the fact that a parliament has relevant mechanisms says little about their soundness and whether they are applied in practice. In this light, next to the assessment of accountability capacity, i.e., the presence or absence of accountability mechanisms ensuring the three stages of accountability, it is necessary to evaluate what I would call ‘accountability quality’. The latter implies the degree to which accountability obligations and mechanisms are consciously designed to serve the purposes of accountability and whether accountability mechanisms are applied in practice.
Upon the findings gathered in the earlier mentioned five dimensions political accountability was assessed and then compared on the basis of a proposed formula, namely political accountability = the availability of accountability mechanisms + design of accountability mechanisms and obligations + practical application of accountability mechanisms. Assessing political accountability with the help of these three elements helps to recognize the quantity (mechanisms) and quality of political accountability (design and practical application) and to identify more specifically the sources of problems. Knowing the source of a problem makes it more feasible to think of appropriate solutions.
Finally, it is important to note that while the research focus has been a legal study, it did take the literature of other disciplines, including empirical findings, on board. In addition, since the existing legal provisions and academic literature lack necessary information, partly because the political accountability of EU agencies is an understudied subject, a ‘field research’ has been undertaken. It included visiting various institutions and conducting semi-structured interviews. In total, I have visited and talked to (former) officials from seven US independent regulatory agencies and eight EU agencies, members and staff of the European Parliament, officials from the EU Commission, US congressional support agencies’ specialists (Administrative Conference of the United States, Congressional Research Service, and Government Accountability Office), and other (academic) experts in the field. Also, I have had a chance to visit several congressional hearings and participate in the meetings of the Interinstitutional Working Group (IWG) on EU agencies, which have certainly given me more insights on how things work in reality. The content of meetings of the IWG on agencies is not discussed in the book since these meetings were not pubic. The results of some interviews are included in the book for illustrative purposes.
What are the findings?
By analyzing the political accountability arrangements of all 35 EU agencies and comparing their US counterparts, this study showed that excessive diversity dominated the current situation in the EU. As an example, the European Parliament has the power to question 16 (out of 35) directors of EU agencies on the performance of their agencies and there are 12 different procedures used in relation to appointing EU agencies’ directors. Conversely, the organization of the political accountability of US independent regulatory agencies (IRAs) is done in quite a uniform way. In fact, the rules and practices governing the political accountability of US IRAs before Congress do not differ that much from how the US Congress hold all other agencies to account.
While not being an accountability problem as such, excessive diversity has harmful consequences with respect to the political accountability of EU agencies and also to the legitimacy of the EU. The diverse accountability arrangements shadow the existing gaps in the delegation-accountability chain between individual EU agencies and the EU representative institutions, and hence also “the ultimate principals, the citizens.” For instance, while an obligation to submit an annual report to the EU representative institutions seems to be the general practice, the Community Plant Variety Office (CPVO) is not formally obliged to do that. Moreover, the existing excessive diversity is not based upon clear reasons of why accountability obligations of individual EU agencies, including those who enjoy similar functions and were created in the same period of time, (should) differ. Created in 1994 and enjoying similar decision-making powers (registration of plant varieties and trade marks respectively) the earlier mentioned CPVO and the Office for Harmonization in the Internal Market (OHIM) submit annual reports to different EU institutions: to the Commission in the case of CPVO and to the Commission and the European Parliament in the case of OHIM. The lack of justifications behind the existing differences has negative implications for the EU democratic legitimacy; “it is doubtful that the exercise of public authority may be perceived as legitimate if it is not understood.”
This study concluded by putting three recommendations forward for the EU representative institutions to consider in the ongoing reform of the operation of EU agencies. It argued for the necessity of (1) a treaty provision regulating the possibilities to create EU agencies and delegate to them certain powers supported by an obligation to set up an accountability framework of EU agencies in a secondary legislative act; (2) a legally-binding accountability framework based on a streamlining approach (e.g., S, M, and L models) to organize the political accountability of agencies in a more uniform and reasoned, yet flexible, way; and (3) introducing and adhering to measures promoting the accountability of EU representative institutions for holding EU agencies to account. Such measures are necessary to promote incentives for the EU representative institutions to stick to their accountability tasks and to enhance the legitimacy of the EU structures and processes. In fact, promoting incentives of representative bodies in holding agencies to account, a challenge identified in both studied jurisdictions, seems to be one of the fundamental concerns that deserves special research attention in the future. Hence, the question of ‘how to oblige the government to control itself’ is one of the greatest difficulties that lie ahead.
All in all, the study has both an academic and practical value: it develops an analytical framework in relation to how political accountability can be investigated and assessed and it gives a comprehensive legal and to a certain extent empiric analysis on how the political accountability of EU and US IRAs is and could be organized.
Dr. Miroslava Scholten is a Postdoctoral Researcher at the Utrecht Centre for Regulation and Enforcement in Europe; Faculty of Law, Economic and Governance, Utrecht University.
 Verhey, Luc. “Political Accountability: A Useful Concept in EU Inter-Institutional Relations?” In Political Accountability and European Integration, edited by Luc Verhey, Phillipp Kiiver, and Sandor Loeffen, 55-70. Groningen: Europa Law Publishing, 2009. P. 67.
 Agencification is used as a generic term implying the creation of agencies and delegation of powers to hem.
 The accountability problems of IRAs are however not necessarily caused by independence (see Scholten, Miroslava. “Accountability vs. Independence: Proving the Negative Correlation.” Maastricht Journal of European and Comparative Law, 21 (1) 2014), even though independence and accountability can co-exist only at each other’s cost (Scholten, Miroslava. “Independent, hence unaccountable? The need for a broader debate on accountability of the executive.” Review of European Administrative Law 4 ( 1), 2011).
 According to Vos, “The literature on European agencies is by now abundant” (Vos, Ellen. “European Agencies and the Composite EU Executive.” In European Agencies in between Institutions and Member States, edited by Michelle Everson, Cosimo Monda, and Ellen Vos, 11-48. Alphen aan de Rijn: Wolters Kluwer, 2014. P. 13).
 For the critical review of the progress of the reform, see: Scholten, Miroslava. “The Newly Released ‘Common Approach’ on EU Agencies: Going Forward or Standing Still?” Columbia Journal of European Law 19, no. 1 (2012) http://www.cjel.net/online/search-by-author/?a=Miroslava Scholten .
 Chiti, Eduoardo. “An Important Part of the EU’s Institutional Machinery: Features, Problems and Perspectives of European Agencies.” Common Market Law Review 46, no. 5 (2009): 1395 – 1442; Curtin, Deirdre. Executive Power of the European Union: Law, Practices, and the Living Constitution. Oxford: Oxford University Press, 2009; Hofmann, Herwig C.H., and Morini, Alessandro. “The Pluralisation of EU Executive—Constitutional Aspects of “Agencification”. Working Paper Series 2012-01, University of Luxembourg Law, 2012. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2031499; to name but a few (see the book for a more elaborate list).
Dehousse, Renaud. “Regulation by networks in the European Community: The Role of European Agencies.” Journal of European Public Policy 4, no. 2 (1997): 246 – 261; Yataganas, Xénophon. “Delegation of Regulatory Authority in the European Union: The Relevance of the American Model of Independent Agencies.” Jean Monnet Working Papers 03/01 (2001). https://infoeuropa.eurocid.pt/files/database/000036001-000037000/000036463.pdf; Kelemen, Daniel. “The Politics of ‘Eurocratic’ Structure and the New European Agencies.” West European Politics 25, no. 4 (2002): 93 – 118.
 Groenleer, Martijn. The Autonomy of European Union Agencies: A Comparative Study of Institutional Development. Delft: Eburon, 2009.
 Agencies’ discharge (2006); Agencies: Origin of tasks, local conditions and staffing (2007); Best practice in governance of agencies – A comparative study in view of identifying best practice for governing agencies carrying out activities on behalf of the European Union (2008); Budgetary implementation of EU agencies: the use of EC appropriations by agencies and the assigned revenue instrument (2008); Opportunities and feasibility of establishing common support services for EU agencies (2009); and Agencies’ buildings (2009).
 The comprehensive study on the accountability of EU agencies offered by Busuioc focuses on different types of accountability and offers insightful empirical evidence based on the investigation of five EU agencies (Busuioc, Madalina. The Accountability of European Agencies: Legal Provisions and Ongoing Practices. Delft: Eburon, 2010).
 Everson, Michelle. “Independent Agencies: Hierarchy Beaters?” European Law Journal 1, no. 2 (1995): 180 – 204; Shapiro, Martin. “Independent Agencies: US and EU.” Jean Monnet Chair Papers 34 (1996); to name but a few (see the book for a more elaborate list).
 See, e.g., Christensen and Lægreid who argue for the necessity to investigate the political accountability of the executive within and beyond the nation-state (Christensen, Tom, and Lægreid, Per. “Rebalancing the State: Reregulation and the Reassertion of the Centre.” In Autonomy and Regulation: Coping with Agencies in the Modern State, edited by Tom Christensen and Per Lægreid, 359 – 380. Cheltenham, MA: Edward Elgar Publishing, 2006. P. 38-39).
 Bovens, Mark. “Analysing and Assessing Public Accountability: A Conceptual Framework.” European Law Journal 13, no. 4 (2007): 447 – 468; see also: Mulgan, Richard. Holding Power to Account: Accountability in Modern Democracies. Hampshire, UK: Palgrave Macmillan, 2003.
 Behn, Robert. Rethinking Democratic Accountability.WashingtonDC: The Brooklings Institute, 2001. P. 7.
 Auel, Katrin. “Democratic Accountability and National Parliaments: Redefining the Impact of Parliamentary Scrutiny in EU Affairs.” European Law Journal 13, no. 4 (2007): 487 – 504. P. 504.
 Dyrberg, Peter. “Accountability and Legitimacy: What is the Contribution of Transparency?” In Accountability and Legitimacy in the European Union, edited by Antony Arnull and Daniel Wincott, 81 – 96. Oxford: OxfordUniversity Press, 2002. P. 83.
 “If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary. In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself” (Madison, James. “The Federalist No. 51: The Structure of the Government Must Furnish the Proper Checks and Balances Between the Different Departments.” In: The Federalist Papers, edited by Charles Kessler, and Clinton Rossiter, 317 – 322. New York: Signet Classics, 2003. P. 319).