Edited by Jürgen Basedow, Giesela Rühl, Franco Ferrari and Pedro de Miguel Asensio
Chapter R.5: Recognition of administrative acts
I. Concept, notion and historical development
The legal effects of an administrative act issued by a state are, in principle, confined to the legal system and the territory of that state. The recognition of administrative acts serves as a mechanism to overcome this limited territorial effect. In this respect, the recognition of foreign administrative acts is very much related to the field of private international law, particularly to its procedural aspects such as the recognition and enforcement of foreign judgments (→Recognition and enforcement of judgments (civil law); →Recognition and enforcement of judgments (common law)) and the recognition and enforcement of foreign arbitral awards (→Arbitration, recognition of awards) (Matthias Ruffert, ‘Recognition of Foreign Legislative and Administrative Acts’ in Rüdiger Wolfrum (ed), Max Planck Encyclopedia of Public International Law (2011) no 2).
The notion of recognition is widely used in various fields of the law, often with varied meanings. When it comes to the conflict of laws, the term ‘recognition’ is commonly used to express the extension of effects of the law occurred abroad to the domestic legal sphere and is to be distinguished from the application of foreign law (→Foreign law, application and ascertainment). Within the terms of the definition commonly employed in the conflict of laws, the recognition of administrative acts can be described as the extension of the legal effects of an administrative act of a foreign authority to the domestic jurisdiction. As this broad definition indicates, the concept of recognition of foreign administrative acts includes a range of different meanings, depending on the type of administrative act – in particular on the legal effects it is intended to generate in the state of origin – and depending on which effects are sought to be transferred to the host state. The most far-reaching transfer of legal effects constitutes enforcement, eg of a payment order or a prohibition order, aiming at the full implementation of the foreign act in the territory of the host state, ie the recovery of money or the suppression of the prohibited activity. It is to be distinguished from mere recognition. Recognition in a strict sense may relate to foreign administrative acts providing for the certification of certain abilities, the award of entitlements or the imposition of duties which are sought to be recognized as such, eg in view of certain legal effects, and without any enforcement being applied for in the host state. Not covered by the notion of recognition, by contrast, is the taking into consideration of an administrative act as a mere matter of fact. If, for example, the competent authorities of an exporting country intervene in the performance process of an international sales contract by way of an export prohibition, such foreign act will surely be taken into consideration in civil proceedings as an impediment preventing the seller from performing its →contractual obligations. However, this constitutes a mere factual consequence of the existence of the foreign administrative act since it does not produce any legal effect outside the territory of the state of origin; it must therefore be differentiated from recognition in a strict sense.
With respect to the legal effects to be attributed to the foreign administrative act in the domestic legal sphere and corresponding to the recognition of foreign judgments in the law of civil procedure, the administrative act in question may have the same effects as it does in the state of origin (Wirkungserstreckung) or the administrative act may be assimilated to a respective administrative act of the host state (Wirkungsgleichstellung), or, thirdly, there may be a combination in the sense that the effects of an equivalent administrative act in the host state form the ceiling for the effects that may be attributed to the foreign administrative act (Christoph Ohler, Die Kollisionsordnung des Allgemeinen Verwaltungsrechts (Mohr Siebeck 2005) 53).
As to the recognition procedure, explicit recognition in each individual case may be required, taking the form of an administrative or judicial decision dealing exclusively with the issue of recognition in the host state, as opposed to an ‘automatic’ recognition in an abstract manner based on a legal provision of general application of the host state. In the latter case, the authority or court confronted with the foreign administrative act will deal with its recognition incidentally and without a separate procedure in the course of its own proceedings. An explicit recognition will, for instance, generally be required for the recognition of a professional qualification that is contingent upon the prior assessment of ‘equivalence’ by the competent authority in the host state. By contrast, for example, in civil proceedings on damages actions for the infringements of antitrust rules, the adjudicating court might in the course of these proceedings incidentally recognize (or p. 1487treat as at least prima facie evidence) the prior finding of a foreign competition authority that a breach of the antitrust rules has occurred (see section V.3. below).
Where the recognition of foreign administrative acts is prescribed by EU law or public international law, scholars have stressed the transnational character of such acts, in particular in the context of recognition duties within the EU. From this perspective, foreign administrative acts recognized in such an abstract and anticipated manner are, by themselves, deemed to have effects outside the legal system they derive from and are therefore characterized as ‘transnational administrative acts’ (Transnationaler Verwaltungsakt; see eg Eberhard Schmidt-Aßmann, ‘Deutsches und Europäisches Verwaltungsrecht’  DVBl 924, 935; Matthias Ruffert, ‘Der transnationale Verwaltungsakt’  Die Verwaltung 453).
Historically, administrative law has generally been characterized as an area of law that is strictly limited to a certain state and to the territory of that state (‘principle of territoriality’; →Territoriality) and, accordingly, by the strictly territorial effect of administrative acts, although exceptions to this basic premise have traditionally been acknowledged with respect to certain acts, eg the conferment of nationality, and particularly in view of certain private law effects of such acts (see also section V. below). This basic premise has been markedly loosened by recent developments, in particular within the EU. As cross-border relations have significantly increased and have become increasingly normal, cases involving the recognition of foreign administrative acts have become an everyday occurrence. Today, many international legal regimes require the recognition of foreign administrative acts, particularly in order to deal with the tasks and challenges brought about by the process of globalization (Matthias Ruffert, ‘Recognition of Foreign Legislative and Administrative Acts’ in Rüdiger Wolfrum (ed), Max Planck Encyclopedia of Public International Law (2011) no 3). The traditional view that administrative acts, in principle, only produce effects within the legal system and the territory of the state of origin has thereby gradually become less important.
II. Purpose and function
The recognition of foreign administrative acts serves as a means to achieve coordination between states and is to a large extent based on social or economic policy considerations. With respect to the recognition of administrative acts with favourable effects on the individual, eg the recognition of authorizations or professional qualifications, a lack of coordination between administrative legal orders can impair individual freedom and mobility, cross-border economic exchange and international trade: an individual or company offering certain products authorized in one country may wish to market and sell its products in other countries and will need to seek different authorizations in order to do so; an individual wishing to pursue a regulated profession in a country other than the one in which he or she has obtained his or her professional qualification may be hindered from doing so in the event that his or her professional qualification is not recognized by the host state. In addition to the harmonization of laws and regulations of the states concerned, the recognition of foreign administrative acts can help to eliminate such ‘double burdens’ for individuals or companies. The recognition of administrative acts can therefore be considered a means to reduce transaction costs, favouring an efficient allocation of resources (Sascha Michaels, Anerkennungspflichten im Wirtschaftsverwaltungsrecht der Europäischen Gemeinschaft und der Bundesrepublik Deutschland (Duncker & Humblot 2004) 140 et seq). With respect to professional qualifications, recognition may further be motivated by the better integration of immigrants in the host labour market and society (Werner Meng, Extraterritoriale Jurisdiktion im öffentlichen Wirtschaftsrecht (Springer 1994) 90). The mutual recognition of administrative acts may also facilitate the administrative decision-making process by making a separate decision in the host state simpler or even superfluous, thus reducing the administrative workload. This may be further underpinned by the fact that the state of origin is in a better factual or legal position than the host state to issue the administrative decision in question (Karl Neumeyer, Internationales Verwaltungsrecht, IV (Schweitzer 1936) 306). As regards the recognition of administrative acts having burdensome effects on the individual, such as prohibitions or penalties, the recognition of such acts may be based on various public interests such as public order or security. Whereas the recognition of the favourable effects of administrative acts inherently reflects a liberal tendency, the contrary is true for the burdensome effects of administrative acts: the individual may see himself or herself confronted not only with the authority of p. 1488one state, but also with the authorities of potentially all states participating in the recognition of each other’s burdensome administrative acts (cf Anatol Dutta, Die Durchsetzung öffentlichrechtlicher Forderungen ausländischer Staaten durch deutsche Gerichte (Mohr Siebeck 2006) 10 et seq; Markus Möstl, ‘Preconditions and Limits of Mutual Recognition’  47 CMLR 405, 409).
III. Legal sources of recognition duties
Under public international and EU law, numerous rules can be ascertained that provide for the duty to recognize certain foreign administrative acts. The recognition of foreign administrative acts may further be envisaged under national law.
1. Public international law
a) General international law
Pursuant to general international law, states are not under a general obligation to recognize and enforce foreign administrative acts in their territory; at the same time, general international law does not prohibit the recognition and enforcement of foreign administrative acts. In the absence of treaty commitments, states are thus free to recognize and enforce – or not to recognize and enforce – foreign administrative acts.
However, in respect of certain foreign administrative acts having declaratory effect or establishing or altering a legal relationship, the complete non-recognition of such acts may touch upon the basic principle of non-interference in the internal affairs of states; in the event that a state is vested with exclusive jurisdiction under public international law, the non-recognition of an administrative act that derives from such exclusive jurisdiction by another state may amount to the infringement of a customary rule of public international law (Alfred Verdross and Bruno Simma, Universelles Völkerrecht (3rd edn, Duncker & Humblot 1984) § 1021). Accordingly, matters such as the conferment of nationality or the appointment of public officials by a state ought to be recognized by all other states (Christoph Ohler, Die Kollisionsordnung des Allgemeinen Verwaltungsrechts (Mohr Siebeck 2005) 51). Typically, however, more than one state will have a basis for the exercise of jurisdiction over the same matter; in the case of concurrent jurisdiction, the duty to recognize a foreign administrative act would contravene the (equal) sovereignty of other states (Alfred Verdross and Bruno Simma, Universelles Völkerrecht (3rd edn, Duncker & Humblot 1984) § 1021). States thus remain generally free to recognize or not to recognize foreign administrative acts.
The Act of State doctrine, based on an assumption to recognize acts by foreign governments, is not considered to be a rule of customary international law; this assessment has also been affirmed by the US Supreme Court in the famous Sabbatino case of 1964 (Banco Nacional de Cuba v Sabbatino (1964) 376 US 398, 422: ‘international law does not require application of the doctrine’; see also Federal Constitutional Court of Germany (BVerfG), 15 May 1995, 92 BVerfGE 277, 321 et seq). The Act of State doctrine, developed in Anglo-Saxon case-law, sets out a judicial rule barring domestic courts from reviewing the validity of another government’s acts done within its own territory (see § 443(1) Restatement (Third) of Foreign Relations Law (American Law Institute, Restatement of the Law, Third: The Foreign Relations Law of the United States, St Paul 1987); Maria Berentelg, Die Act of State-Doktrin als Zukunftsmodell für Deutschland? (Mohr Siebeck 2010) 28 et seq).
While there is thus no evidence of a general duty to recognize foreign administrative acts in customary international law, there is often an undeniable practical necessity for the recognition of administrative acts. States therefore often do recognize foreign administrative acts as a matter of their respective national laws, ie autonomously, or enter into particular international treaties in order to establish reciprocal recognition duties.
b) Particular international treaties
In areas where the necessity of mutual recognition is particularly striking, many international treaties have been concluded on a global level to provide for the mutual recognition of foreign administrative acts.
The field of international transport may serve as an illustrative example. As early as 1926, the contracting states of the Convention internationale relative à la circulation automobile – done at Paris on 24 April 1926 (Recueil systématique (RS) 0.741.11) and still in force in many countries – prescribed in its art 7 the recognition of driving licences issued by the authorities of other contracting states. In more recent times, the Convention on Road Traffic, concluded at Vienna on 8 November 1968 p. 1489under the auspices of the Economic and Social Council of the United Nations (1042 UNTS 17), provides in its art 41 for the mutual recognition of driving permits granted in other contracting states. In a similar vein, art 33 Chicago Convention (Convention of 7 December 1944 on International Civil Aviation, 15 UNTS 295), establishing the International Civil Aviation Organization (→ICAO) requires the contracting states to recognize ‘certificates of airworthiness and certificates of competency and licences issued or rendered valid by the contracting State in which the aircraft is registered’. In the field of maritime safety, the SOLAS (International Convention of 1 November 1974 for the safety of life at sea, 1184 UNTS 278) provides for the duty to recognize certificates issued under the authority of a Contracting Government for all purposes covered by the Convention and stipulates that they ‘shall be regarded ... as having the same force as certificates issued by them’ (see art 17 of the Annex to the SOLAS Convention).
The core international agreement in Europe regarding the recognition of educational qualifications is the Convention on the Recognition of Qualifications concerning Higher Education in the European Region, signed in Lisbon by several European states on 11 April 1997 (2136 UNTS 3). The Convention, jointly drafted by the Council of Europe and UNESCO, stipulates that qualifications giving access to higher education and higher education qualifications (as well as periods of study) must be recognized unless ‘substantial differences’ can be proved by the institution of the host country that is charged with recognition.
In the field of international trade, the legal framework of the World Trade Organization may provide, at least to some degree, for the mutual recognition of foreign administrative acts. For instance, the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) (1867 UNTS 493) stipulates in its art 4(1) a duty to recognize the sanitary and phytosanitary measures of other members even if such measures differ from a member’s own or from those used by other members, provided that the exporting member can objectively demonstrate that its measures achieve the importing member’s appropriate level of sanitary or phytosanitary protection (the ‘equivalence principle’; see Peter Stoll and Frank Schorkopf, WTO – World Economic Order, World Trade Law (Nijhoff 2006) 142). Article VII GATS (General Agreement on Trade in Services of 15 April 1994, 1869 UNTS 183) addresses, inter alia, the recognition of professional qualifications. While art VII GATS does not in any way require WTO members to recognize professional qualifications of other members, it allows members to recognize qualifications granted by some members and not others; that is, it permits members to deviate from the basic rule that treatment offered to one member must be extended to all others (‘Most Favoured Nation’, MFN) and, in that way, intends to encourage the conclusion of Mutual Recognition Agreements (MRAs). At the same time, art VII GATS tries, through several procedural and substantive requirements, to ensure the openness of such MRAs and to prevent members from completely undermining the MFN principle.
In the field of →nationality, the Convention on Certain Questions relating to the Conflicts of Nationality Laws, concluded at The Hague on 12 April 1930 (179 LNTS 89), provides for the duty to recognize the conferment of nationality of other contracting states ‘in so far as it is consistent with international conventions, international custom, and the principles of law generally recognized with regard to nationality’ (art 1). It can be assumed that to this extent the Convention reflects a rule of customary international law (see above under section III.1.a); Werner Meng, Extraterritoriale Jurisdiktion im öffentlichen Wirtschaftsrecht (Springer 1994) 95).
2. EU law
The duties amongst EU Member States to recognize each other’s administrative acts are of quite a different scale compared to those existing between states whose relations to each other are determined solely by public international law. EU law constitutes a much more integrated legal framework providing for a wide range of recognition duties resulting from both primary EU Treaty law as well as EU secondary legislation.
a) EU primary law
Under EU primary law, duties to recognize foreign administrative acts may essentially follow from an application of the European basic freedoms (ie free movement of goods, workers, establishment and the provision of services, and capital) and the provisions on citizenship of the EU. By contrast, the principle of sincere cooperation p. 1490according to art 4(3) TEU (Consolidated Version of the Treaty on European Union  OJ C 326/13) does not in itself entail a general duty of the Member States to recognize each other’s administrative acts, nor can a general principle of law of such content be ascertained in EU law (Sascha Michaels, Anerkennungspflichten im Wirtschaftsverwaltungsrecht der Europäischen Gemeinschaft und der Bundesrepublik Deutschland (Duncker & Humblot 2004) 215).
As early as 1979, the European Court of Justice (ECJ) implemented the basic principle that compliance with the administrative regulations that govern the production, quality and marketing of goods in the country of origin will usually suffice for the admission of such products in any other Member State within the Internal Market (the ‘principle of mutual recognition’; see ECJ Case 120/78 Rewe-Zentral AG v Bundesmonopolverwaltung für Branntwein – ‘Cassis de Dijon’  ECR 649, para 14 – the effects of this principle are outlined in the Commission interpretative communication on facilitating the access of products to the markets of other Member States: the practical application of mutual recognition,  OJ C 265/2; for the further design of the principle in secondary legislation, see the Mutual Recognition Regulation concerning technical requirements (Regulation (EC) No 764/2008 of the European Parliament and of the Council of 9 July 2008 laying down procedures relating to the application of certain national technical rules to products lawfully marketed in another Member State and repealing Decision No 3052/95/EC,  OJ L 218/21)). Apart from the defences explicitly laid down in the Treaty, limitations are only permitted in exceptional cases of ‘mandatory requirements’, such as environmental or consumer protection. While compliance with the administrative regulations of the Member State of origin does not necessarily depend on the issuing of an administrative act, the recognition of such acts where issued is ensured under this basic principle. The rationale of the principle of mutual recognition – as established in Cassis de Dijon – has in a long series of judgments successively been extended to the various European basic freedoms (Christine Janssens, The Principle of Mutual Recognition in EU Law (OUP 2013) 11 et seq). With respect to the freedom of establishment (art 49 TFEU (Treaty on the Functioning of the European Union,  OJ C 326/47)), the ECJ has outlined the principle that Member State authorities have to examine the qualifications acquired by the person concerned in another Member State and must compare the knowledge and skills acquired with those required by the domestic qualification. If the qualification is found to be equivalent, the host Member State must recognize the qualification (ECJ Case C-340/89 Vlassopoulou v Ministerium für Justiz, Bundes und Europaangelegenheiten Baden-Württemberg  ECR I-2357, paras 16 and 19; ECJ Case C-238/98 Hugo Fernando Hocsman v Ministre de l’Emploi et de la Solidarité  ECR I-06623, para 36). In non-harmonized areas of law, where secondary legislation on the mutual recognition of administrative acts is lacking, the assessment of equivalence is thus essential for a possible recognition duty.
b) EU secondary law
Numerous EU instruments providing for the mutual recognition of administrative acts have been adopted by means of EU secondary legislation. These EU instruments typically share the characteristic that they provide for the harmonization or even unification of rules in a specific field of law, combined with an obligation of the Member States to recognize administrative acts taken in accordance with these harmonized or unified rules in the Member State of origin (Jürgen Basedow, ‘Recognition of Foreign Decisions within the European Competition Network’ in Jürgen Basedow, Stéphanie Francq and Laurence Idot (eds), International Antitrust Litigation (Hart Publishing 2012) 393, 394). While the recognition duties that may follow from an application of the European basic freedoms are by their nature – as subjective rights of the individual – confined to the favourable effects of an administrative act for the individual (Anatol Dutta, Die Durchsetzung öffentlichrechtlicher Forderungen ausländischer Staaten durch deutsche Gerichte (Mohr Siebeck 2006) 263; Christine E Linke, Europäisches Internationales Verwaltungsrecht (Peter Lang 2001) 211), EU secondary legislation also provides for the recognition of particular administrative acts that have burdensome effects on the individual, such as financial penalties (Council of the European Union, ‘Council Framework Decision 2005/214/JHA of 24 February 2005 on the application of the principle of mutual recognition to financial penalties’  OJ L 76/16), the expulsion of third country nationals (Council Directive 2001/40/p. 1491EC of 28 May 2001 on the mutual recognition of decisions on the expulsion of third country nationals,  OJ L 149/34) or claims relating to taxes, duties and other measures (Council Directive 2010/24/EU of 16 March 2010 concerning mutual assistance for the recovery of claims relating to taxes, duties and other measures,  OJ L 84/1). The principle of mutual recognition, developed under the European basic freedoms, is now firmly established in many other areas of EU law; the TFEU, for instance, refers to the principle of mutual recognition with respect to judicial cooperation in criminal matters within the ‘area of freedom, security and justice’ (art 82(1) TFEU). EU secondary legislation has led to an increasing number of instruments which apply the principle of mutual recognition in this area of law (for details, see Christine Janssens, The Principle of Mutual Recognition in EU Law (OUP 2013) 131 et seq). The greater part of the EU instruments providing for mutual recognition of administrative acts still relates to administrative acts favourable to the individual, particularly secondary legislation in the areas of freedom of establishment (→Freedom of establishment/persons (EU) and private international law), free movement of goods and services, and the coordination and harmonization of standards builds on the instrument of mutual recognition of foreign administrative acts (Matthias Ruffert, ‘Recognition of Foreign Legislative and Administrative Acts’ in Rüdiger Wolfrum (ed), Max Planck Encyclopedia of Public International Law (2011) no 13).
In some economic sectors, secondary legislation provides that an authorization granted by one Member State will allow the economic operator to provide its services throughout the EU without further authorization requirements (the so-called ‘single licence’ or ‘single passport system’). This is the case, for example, in the insurance and banking sector (for the insurance sector, see art 15(1) Solvency II Directive (Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of insurance and reinsurance,  OJ L 335/1); for credit institutions, see arts 33 et seq Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms,  OJ L 176/338).
Secondary legislation also implemented the mutual recognition of driving licences at an early stage. Directive 2006/126/EC of the European Parliament and of the Council of 20 December 2006 on driving licences ( OJ L 403/18) recast the prior legislation and further harmonized the conditions for issuing national driving licences. In some instances, the regime of mutual recognition of driving licences has led to so-called ‘driving licence tourism’; drivers who had lost their driving permit for driving under the influence of alcohol in their state of residence acquired driving permits in another Member State, circumventing the legislation of the state of residence. This phenomenon has given rise to several rulings of the ECJ (see eg more recently ECJ Case C-419/10 Wolfgang Hofmann v Freistaat Bayern, ECLI:EU:C:2012:240, with references to further case-law of the Court).
With regard to professional qualifications, there has for many years been an active programme of EU secondary legislation, accompanied by a large amount of case-law from the ECJ. The EU has moved progressively from a sectoral harmonization and coordination approach towards a comprehensive mutual recognition approach (Paul Craig and Gráinne de Búrca, EU Law (6th edn, OUP 2015) 842 et seq). In 2005 the prior legislation regarding the recognition of professional qualifications was consolidated and replaced by the umbrella Directive 2005/36/EC of the European Parliament and of the Council of 7 September 2005 on the recognition of professional qualifications ( OJ L 255/22).
3. National law
In the absence of an obligation under public international or under EU law to recognize specific foreign administrative acts, states often still do so as a matter of their respective national laws, ie autonomously. For instance, the German legislator broadly provides for the application of the rules on mutual recognition of professional qualifications laid down in Directive 2005/36/EC on the recognition of professional qualifications also vis-à-vis third country nationals (Berufsqualifikationsfeststellungsgesetz of 6 December 2011, BGBl. I 2515). Third country nationals established in the EU have no general rights of mutual recognition under Directive 2005/36/EC, even if they have undergone exactly the same education as EU nationals within a Member State; they are not protected by the p. 1492basic freedoms of the Treaty or by secondary legislation. It is thus a matter of national law to provide for recognition vis-à-vis third country nationals (see also Recital (10) of Directive 2005/36/EC declaring that: ‘This Directive does not create an obstacle to the possibility of Member States recognising, in accordance with their rules, the professional qualifications acquired outside the territory of the European Union by third country nationals’).
IV. Limits to the recognition of foreign administrative acts
The recognition of foreign administrative acts is a method to avoid situations in which the authorities of several states fully examine the same legal matter; it is the basic idea of recognition not to fully reconsider the foreign decision in the host state (Henrik Wenander, ‘Recognition of Foreign Administrative Decisions’  ZaöRV 755, 773). Therefore, foreign administrative acts that are to be recognized according to particular instruments may not be reassessed with regard to the legal conditions to issue them and may, in general, not be refused on the ground that they are contrary to the domestic law of the host state, unless a provision would allow for derogations (Matthias Ruffert, ‘Der transnationale Verwaltungsakt’  Die Verwaltung 453, 474 et seq). With respect to the EU instruments requiring the mutual recognition of driving licences, the ECJ has ruled in a series of judgments that it is for the issuing Member State to investigate whether the minimum conditions imposed by EU law have been satisfied and therefore whether the issuing of a driving licence is justified. Once the authorities of one Member State have issued a driving licence, the other Member States are not permitted to investigate further whether the conditions for issuing the licence have been met. The possession of a driving licence issued by one Member State has to be regarded as constituting proof that on the day on which the licence was issued, its holder satisfied those conditions (see ECJ Case C-419/10 Wolfgang Hofmann v Freistaat Bayern ECLI:EU:C:2012:240, paras 45 et seq; ECJ Case C-184/10 Mathilde Grasser v Freistaat Bayern  ECR I-4057, paras 20 et seq; ECJ Case C-321/07 Criminal Proceedings against Karl Schwarz  ECR I-1113, paras 76 et seq).
There are, however, important limitations to the recognition of foreign administrative acts. As regards recognition duties which may (exceptionally) flow from customary international law, the recognition of an administrative act issued by a state in the exercise of an exclusive international competence may be refused in the event that the recognition would be contrary to the public policy of the host state, ie its ordre public (→Public policy (ordre public)), or if the administrative act in question was rendered in violation of a rule of public international law (Alfred Verdross and Bruno Simma, Universelles Völkerrecht (3rd edn, Duncker & Humblot 1984) § 1021; Martin Kment, Grenzüberschreitendes Verwaltungshandeln (Mohr Siebeck 2010) 452 et seq). With respect to the recognition duties that may flow from an application of the basic freedoms of the Treaty, recognition may essentially be refused under the ‘mandatory requirements’ established by the ECJ. Under secondary EU law, the scope for refusing recognition depends on the specific instrument in question and the specific rules contained therein.
V. Foreign administrative acts and private international law
1. General remarks
Foreign administrative acts, such as →expropriations or authorizations, may have important repercussions on the relationship between individuals. Above and beyond the purely factual role that foreign administrative acts may have in private law matters (see section I. above), questions as to the recognition of foreign administrative acts commonly arise in the context of private international law, where the legal situation created by an administrative act is an incidental (or preliminary) question in the application of a rule of private law; furthermore, the question may occur whether or not an administrative act referred to in a rule of private law may be substituted with a foreign administrative act (question of →Substitution). For either case, it is irrelevant whether a favourable or a burdensome administrative act is in question and the private role of the foreign administrative act suggests that the act is to be recognized (Hans Jürgen Sonnenberger, ‘IPR Einleitung’ in Franz Jürgen Säcker and Roland Rixecker (eds), Münchener Kommentar zum Bürgerlichen Gesetzbuch, vol 11 (5th edn, CH Beck 2010) para 397). Because of their relevance for private law, particular interest in private international law literature p. 1493is traditionally devoted to the effects of foreign expropriations (→Expropriation) and the effects of foreign environmental authorizations in cases of civil liability. In addition, findings by foreign competition authorities in damages actions for the infringement of antitrust rules serve as an example of the private role of foreign administrative acts.
2. Foreign environmental authorizations in cases of civil liability
Regarding foreign environmental authorizations, the question whether the effects of such authorizations should be recognized (and may possibly exclude the possibility of obtaining civil law remedies for →damages or →injunctions in neighbouring countries) has proved to be an as-yet unresolved issue concerning the application of the provision in the →Rome II Regulation (Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations (Rome II),  OJ L 199/40) on →environmental liability, ie art 7. The Rome II Regulation does not (explicitly) address this issue and international treaties on cross-border environmental damage are usually lacking (but see, for example, the Convention between Germany and Austria of 19 December 1967 Concerning the Effects on the Territory of the Federal Republic of Germany of the Construction and Operation of the Salzburg Airport, 945 UNTS 87). The explanatory memorandum accompanying the proposal for the Rome II Regulation by the European Commission suggests that foreign authorizations could be treated as →‘local data’ under art 17 of the Rome II Regulation (European Commission, ‘Proposal for a Regulation of the European Parliament and the Council on the Law Applicable to Non-contractual Obligations (“Rome II”)’ COM(2003) 427 final, 20).
In the past, some courts in Europe held that pursuant to the principle of territoriality, administrative authorizations deploy their effect only within the territory of the state in which they were issued, and they have consequently declined to take account of such foreign environmental authorizations under the applicable lex fori (German Federal Court of Justice (BGH),  IPRspr. no 40; Higher Regional Court (OLG) of Saarbrücken  NJW 752, 754). Other courts were more permissive and found that foreign environmental authorizations can be taken into account if the emissions are in accordance with international environmental law, if the conditions of the foreign authorization are equivalent to those existing under the lex fori and if the individual seeking civil remedies has had the possibility to raise objections in the administrative procedure which led to the issuing of the authorization (Higher Regional Court (OLG) Linz,  JBl. 577, 579; confirmed by the Austrian Supreme Court of Justice (Oberster Gerichtshof)  JBl. 239; see also Rechtbank Rotterdam  Nederlandse Jurisprudentie no 341).
In line with the explanatory memorandum accompanying the proposal of the European Commission, some authors favour a solution where foreign environmental authorizations are taken into consideration as ‘local data’ under art 17 Rome II Regulation if certain criteria of the kind established by the aforementioned case-law are met (see eg Thomas Kadner Graziano, ‘The Law Applicable to Cross-Border Damage to the Environment’  9 YbPIL 71, 79 et seq). Since art 17 Rome II Regulation accords some discretion to the adjudicating court (‘in so far as is appropriate’), this solution would allow for flexibility as to the recognition requirements and thus would not lead to an automatic recognition in each case. Others reject the application of art 17 Rome II Regulation, which refers to ‘rules of safety and conduct’ such as road safety rules, but still approve the recognition of foreign environmental authorizations provided that certain requirements are met (Peter Mankowksi, ‘Ausgewählte Einzelfragen zur Rom II-VO’  IPRax 389, 390 et seq). The specific requirements for recognition still need to be clarified; a subject of particular scepticism is the requirement that the foreign public law conditions allowing authorization be ‘equivalent’ with those conditions existing under the lex fori. While the conditions under which foreign authorization can be recognized still need to be settled, the view adopted by some courts in the past that foreign authorizations can only deploy their effects in the state where they were issued and therefore cannot be recognized seems to be outdated (see also the judgment of the ECJ in Case C-115/08 Land Oberösterreich v ČEZ as  ECR I-10265, relying on the principle of prohibition of discrimination on the grounds of nationality within the scope of application of the EAEC Treaty).
3. p. 1494Findings of foreign competition authorities in damages actions for infringement of antitrust rules
In civil proceedings, where victims of an infringement of the antitrust rules contained in arts 101 and 102 TFEU sue the infringers for →damages after a competition authority has found that a breach of the antitrust rules occurred (usually referred to as ‘follow-on actions’), related questions arise with respect to the effects of decisions taken by national competition authorities within the ‘European Competition Network’. While it follows from art 16(1) of Regulation 1/2003 (Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty,  OJ L 1/1) that a Commission decision finding an infringement under art 101 or 102 TFEU constitutes a binding act to which decisions by national courts must not run counter Regulation 1/2003 does not address the question of the recognition of decisions of the national competition authorities. With a view to facilitating follow-on actions, art 9 Directive 2014/104/EU of the European Parliament and of the Council of 26 November 2014 on certain rules governing actions for damages under national law for infringements of the competition law provisions of the Member States and of the European Union ( OJ l 349/1) requires Member States to ensure that a prior infringement decision taken by their own national competition authority is binding on their civil courts and that an infringement decision taken in another Member State can be presented as at least prima facie evidence that an infringement has occurred. Some Member States were reluctant to accept the strictly binding effect of foreign infringement decisions in damages actions, while others implemented the binding effect of foreign infringement decisions quite some time before the adoption of the Directive (see § 33(4) of the German Act against restrictions of competition (Gesetz gegen Wettbewerbsbeschränkungen of 27 July 1957, BGBl. I 1081, English translation of the current version as amended available at <www.gesetze-im-internet.de/englisch_gwb/index.html>)). Whatever effect is attributed to foreign infringement decisions, it is essential to identify the precise material, personal, temporal and territorial scope of the decision in question. It is noteworthy that the effect of infringement decisions is limited to damages actions; it does not extend to other possible private law remedies resulting from an infringement of antitrust rules. Furthermore, the effect is limited to the positive finding of an infringement; not covered are further requirements of a damages action, such as the extent of the loss suffered by the victim and the causal link between the infringement and the loss or the fault of the defendant.
VI. Modern trends and perspectives
A survey of the existing recognition duties illustrates that the traditional view according to which administrative acts only produce effects within the territory of the legal system they derive from has become subject to numerous exceptions. Today, there are multiple regimes requiring the recognition of foreign administrative acts and they are likely to increase even further in the future, in particular within the integration process of the EU. The effects of foreign administrative acts in the context of private law, ie their implications on the relationship between individuals, have been studied with respect to specific types of administrative acts. By contrast, general principles on the conditions and possible limits for recognition – as they exist with respect to the recognition and enforcement of foreign judgments (see eg arts 36 et seq and regarding refusal of recognition art 45 Brussels I Regulation (Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters,  OJ L 351/1; →Brussels I (Convention and Regulation))) – are lacking and still have to be elaborated.
Jürgen Basedow, ‘Recognition of Foreign Decisions within the European Competition Network’ in Jürgen Basedow, Stéphanie Francq and Laurence Idot (eds), International Antitrust Litigation (Hart Publishing 2012) 393;
Maria Berentelg, Die Act of State-Doktrin als Zukunftsmodell für Deutschland? (Mohr Siebeck 2010);
Giuseppe Biscottini, ‘L’efficacité des actes administratifs étrangers’ (1961) 104 Collected Courses of the Hague Academy of International Law 635; p. 1495Anatol Dutta, Die Durchsetzung öffentlichrechtlicher Forderungen ausländischer Staaten durch deutsche Gerichte (Mohr Siebeck 2006);
Christine Janssens, The Principle of Mutual Recognition in EU Law (OUP 2013);
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Klaus König, Die Anerkennung ausländischer Verwaltungsakte (Carl Heymanns 1965);
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Sascha Michaels, Anerkennungspflichten im Wirtschaftsverwaltungsrecht der Europäischen Gemeinschaft und der Bundesrepublik Deutschland (Duncker & Humblot 2004);
Markus Möstl, ‘Preconditions and Limits of Mutual Recognition’ (2010) 47 CMLR 405;
Karl Neumeyer, Internationales Verwaltungsrecht, IV (Schweitzer 1936);
Christoph Ohler, Die Kollisionsordnung des Allgemeinen Verwaltungsrechts (Mohr Siebeck 2005);
Charalambous Pamboukis, L’acte public étranger en droit international privé (Librairie générale de droit et de jurisprudence 1993);
Matthias Ruffert, ‘Der transnationale Verwaltungsakt’  Die Verwaltung 453;
Matthias Ruffert, ‘Recognition of Foreign Legislative and Administrative Acts’ in Rüdiger Wolfrum (ed), Max Planck Encyclopedia of Public International Law (2011);
Klaus Vogel, Der räumliche Anwendungsbereich der Verwaltungsrechtsnorm (Metzner 1965);
Henrik Wenander, ‘Recognition of Foreign Administrative Decisions’  ZaöRV 755.