Notes drawn from: Alina Kaczorowska, European Union Law (Routledge, 3rd ed, 2013) ch 1.

  • EU member states have differing views on the growth and depth of integration.
  • Commitment to integration is often affected by changes in the international political and economic environemtn.
  • The EU continues to grow:
    • Deepening/vertical integration — expansion of the scope and strength of the EU’s powers.
    • Widening/horizontal integration — geographic expansion of the EU.
  • European integration is a process used by member states to
    • create ‘ever closer union among the peoples of Europe’ — Treaty on EU art 1, and
    • promote peace, EU values and the well-being of the EU’s citizens — art 3(1).
  • To achieve these common objectives member states have conferred important competences on the EU.
  • The result is that the EU is a unique regionally-integrated political entity.

Key instruments:

  • Treaty Establishing the European Atomic Energy Community, opened for signature 25 March 1957, 298 UNTS 167 (entered into force 1 January 1958) (‘Euratom Treaty’).
  • Treaty Establishing the European Economic Community, opened for signature 25 March 1957, 298 UNTS 11 (entered into force 1 January 1958) (‘EEC Treaty’).
  • Treaty Instituting the European Coal and Steel Community, signed 18 April 1951, 261 UNTS 140 (entered into force 23 July 1952) (‘ECSC Treaty’).
  • Treaty of Amsterdam Amending the Treaty on European Union, the Treaties Establishing the European Communities and Certain Related Acts, opened for signature 2 October 1997, [1997] OJ C 340/1 (entered into force 1 May 1999) (‘Treaty of Amsterdam’).
  • Treaty of Nice Amending the Treaty on European Union, the Treaties Establishing the European Communities and Certain Related Acts, opened for signature 26 February 2001, [2001] OJ C 80/1 (entered into force 1 February 2003) (‘Treaty of Nice’).
  • Treaty on European Union, opened for signature 7 February 1992, [2009] OJ C 115/13 (entered into force 1 November 1993) (‘Treaty on EU’).
  • Treaty on the Functioning of the European Union, opened for signature 7 February 1992, [2009] OJ C 115/199 (entered into force 1 November 1993) (‘TFEU’).

Europe after World War II

  • After WWII Europe was in ruins and was politically divided.
  • Rebuilding Europe was the catalyst for European unity.
  • A significant influence was the United States’ ‘vision’ of the reconstruction of Europe:
    • Politically the containment of communism played an important role in the way the US perceived reconstruction.
    • Economically the United States benefited from WWII:
      • It was a major supplier of the allied forces so its industry and business had boomed.
      • It was the only major belligerent that had not seen conflict on its own territory (apart from Pearl Harbor, etc).
      • In 1945–1946 the US accounted for half of the gross world product of goods and services and held two-thirds of the world’s gold.
      • New markets were needed and a prosperous Europe would provide an opportunity for American exports.
      • US self-interest contributed to European recovery.
    • Humanitarian considerations.

The Marshall Plan

  • In 1947 US Secretary of State George C Marshall announced the American plan for European reconstruction.
  • Cash grants were to be made to all European nations on two conditions:
    • European States would be required to cooperate in distributing the American aid, and
    • they would be required to progressively abolish trade barriers.
  • Stalin, First Secretary of the Russian Communist Party, called the Marshall Plan a capitalist plot; all states under Soviet control were forced to withdraw from the plan.
  • $13.6 billion was transferred to Europe under the plan.
  • This was in addition to $9.5 billion in earlier loans and $500 million in private charity.
  • The Marshall Plan helped restore Western European trade and production while controlling inflation.
  • Initially 16 European countries participated: Austria, Belgium, Denmark, France, Greece, Iceland, Ireland, Italy, Luxembourg, the Netherlands, Norway, Portugal, Sweden, Switzerland, Turkey and the united Kingdom.
  • West Germany joined the plan later and was reconciled with other European countries through this economic cooperation.
  • Lead by France and the UK the Committee for European Cooperation was set up to plan and distribute aid.
    • This was later replaced by the Organisation for European Economic Cooperation (‘OEEC’).
  • The success of centrally coordinated planning and cooperation made it clear that the best way for Europe to recover its prestige was to act as a single entity in world markets.
  • Following the Marshall Plan various European organisations began to emerge with the goal of strengthening integration.

The Schuman Plan and the European Coal and Steel Community

  • French Minister for Foreign Affairs Robert Schuman followed the advice of Winston Churchill that France should accept Germany back into the community of nations.
  • Schuman believed Europe was facing three problems:
    • Economic dominance by the US.
    • Military dominance by the Soviet Union.
    • Possible war with a rejuvenated Germany.
  • The US supported political and economic integration in Europe because it would reduce the cost of their obligations and commitments to Europe.
  • Schuman believed the best way to achieve peace and stability in Europe was placing steel and coal under the control of a supranational entity.
    • Steel and coal were essential commodities to conduct conventional wars.
    • A common market for these commodities would involve interested countries transferring relevant power to an independent authority.
  • The Schuman Plan was announced in 1950 and based on proposals by eminent French economist Jean Monet (‘the father of European integration’).
  • The plan expressly mentioned only France and Germany, but other countries were invited to join (in particular the UK, Italy and the Benelux countries).
  • Germany enthusiastically accepted the plan as a breakthrough for German statehood and independence.
    • Chancellor of Germany Konrad Adenauer was in favour of shifting the concentration of German policy from Eastern Europe to Western Europe.
  • The European Coal and Steel Community (‘ECSC’) was created by treaty in 1951, entering into force in 1952.
  • The ECSC Treaty was signed by Belgium, France, Italy, Luxembourg, the Netherlands and West Germany.
  • The ECSC had an original institutional structure consisting of:
    • The High Authority:
      • Supranational body composed of nine representatives.
      • The representatives were appointed by the Member States and acted independently in the interests of the ECSC.
      • It was in charge of the production and distribution of coal and steel.
      • It was given supranational competencies including the power to make legally-binding ‘decisions’ and ‘recommendations’ directly applicable to the Member Stats.
      • Policy measures were initiated by the ECSC and adopted by majority vote.
      • It could impose fines and withhold funds to enforce compliance with the ECSC Treaty.
    • A Special Council of Ministers:
      • Represented the interests of Member States.
      • Function was to harmonise the actions of the High Authority with domestic economic policy.
      • Assent was required for important decisions of the High Authority.
    • The Common Assembly:
      • Composed of MPS from Member States.
      • Had only supervisory and advisory functions.
    • A Court of Justice responsible for ensuring ‘that in the interpretation and application of [the ECSC] Treaty … the law is observed.’
  • The Treaty period was 50 years and was allowed to expire in 2002, after which the ECSC ceased to exist.
  • The demise of the ECSC had a number of causes:
    • The situation for which it was created never materialised:
      • Germany did not regain dominance over steel and coal.
      • External supplies were not scarce.
      • The ECSC had to deal with failing demand due to oversupplies of coal and steel.
    • The ECSC did not create a common market for coal and steel or play a central role in the development of those industries.
      • Member States had little interest in making the ECSC successful.
      • Rules were not enforced.
      • Member States persistently protected and subsidised national industries in breach of the ECSC Treaty and its objectives.
    • The creation of the European Economic Community focused attention on integration of entire economies rather than just one sector.
  • Nevertheless the ECSC was important to European integration — John Gillingham, Coal, Steel, and the Rebirth of Europe, 1945–1955: The Germans and French from Ruhr to Economic Community (Cambridge, 1991) 364:

The Schumann Plan … ended the competitive bids for heavy industry domination that had wrecked every previous large-scale attempt to reorganise the Continent since 1918, led to Westintegration and Franco-German partnership, and resulted in the creation of a new entity, Europe.

  • The ECSC Treaty was used as a blueprint for the EEC and Euratom Treaties.

The Messina Conference

  • In 1955 the foreign ministers of the ECSC Member States met in Messina.
  • They decided pursue a united Europe through:
    • common institutions,
    • progressive integration of economies,
    • creation of a common market, and
    • harmonisation of social policies.
  • The result of the Messina Conference was two treaties signed in 1957 establishing the
    • European Economic Community, and
    • European Atomic Energy Community.

The European Atomic Energy Community (‘Euratom’)

  • The main objective of the Euratom Treaty was to create ‘the conditions necessary for the speedy establishment and growth of nuclear industries: art 1.
  • Under article 2 its tasks were:
    • promotion of research and dissemination of technical information regarding atomic energy,
    • establishment of uniform standards for health and safety,
    • the promotion of investment,
    • the equitable supply of ores and nuclear fuels,
    • the security of nuclear materials,
    • the international promotion of peaceful uses of nuclear energy, and
    • the creation of a common market in this area.
  • The institutional framework is identical to that of the EEC Treaty.
  • Euratom’s main success was the establishment and enforcement of effective and lasting comprehensive safeguards for nuclear energy.
    • Member States have an excellent safety record.
    • Civil nuclear materials are not misappropriated for military purposes.
    • Nuclear research and development has been promoted resulting in modernisation of technology.
    • Regular and equitable supply of materials has been ensured.
  • At the same time, nuclear research remained with the domain of each Member State: there is limited integration of nuclear research.
  • The Euratom Treaty did not evolve like the EEC Treaty and suffers many failings:
    • Its objective of developing nuclear energy is obsolete given only 11 of the 27 Member States are pursuing nuclear energy.
    • It has a democratic deficit: there is no requirement for the Council to consult the European Parliament on measures adopted.
    • It does not solve a major concern of citizens about the impact of the nuclear industry on public health and on the environment.
    • It supports what many view as an outdated, dangerous and expensive technology.
  • Euratom remains a distinct, controversial and uninspiring community legally separate from the EU.

The European Economic Community (‘EEC’)

  • The EEC became the most important of the three communities.
  • It was the heart of European integration.
  • The EEC Treaty mainly concerned economic cooperation including the establishment of an internal market.
  • The Treaty also contained a political agenda with the long-term objective of an economic and monetary union (‘EMU’).
  • The first decade of the EEC saw exception economic growth, investment and integration.
  • Smaller countries (eg, the Benelux countries) had an influence on international matters disproportionate to their size.
  • In the first decade of the EEC’s existence the European Court of Justice (‘ECJ’) laid the constitutional foundations of the EU.
    • The principles of:
      • supremacy,
      • direct effect, and
      • direct applicability of EU laws.
    • These principles were not mentioned in the EEC Treaty.
    • The judgments made the ECJ a ‘law-maker’ and a vital integrating player in the EEC, then later the EU.
    • Member States were unable ‘to react with unanimity. … The result was that [the] legal system began to evolve along paths that could not be predicted from the constellation of the Member State preferences at any given time’: A Stone Sweet, ‘The European Court of Justice’ in P Craig and G de Búrca (eds), The Evolution of EU Law (Oxford, 2011) 131.
  • Despite the goal of integration, implementation has been problematic.
  • The most important point of contention is the method of integration that should be used in the decision-making procedure of the EU.
    • The ‘EU method’ (previously known as the ‘Jean Monnet’ or ‘Community’ method) — policy outcomes are controlled by the EU.
    • The ‘intergovernmental method’ — policy outcomes are controlled by the Member States.
  • The EU method has four main components:
    • The Commission has a monopoly on making legislative proposals and the power to bring a Member State before the ECJ for non-implementation of any EU measure.
    • The Council of Ministers votes by qualified majority and amendment to the Commission’s legislative proposal requires a unanimous vote of the Council.
    • The European Parliament is a co-legislator via the ordinary legislative procedure.
    • Member States and EU institutions can take a case to the ECJ.
  • Under the intergovernmental method:
    • The power of the Commission to initiate legislative proposals is either abolished or greatly reduced to being shared with Member States.
    • The Council decides by unanimity giving each Member State a right of veto.
    • The European Parliament is only consulted and has no influence on the adoption or otherwise of a measure.
  • Under the EU method Member States and the Council have considerable influence, but only the intergovernmental method allows for a Member State to veto.
  • A supranational model requires restrictions on national sovereignty and creates a federal structure.
  • Intergovernmentalism will lead to a confederation in which the competencies of Member States remain intact unless unanimously agreed.

The Luxembourg Accord

  • The first disagreement among the Member States was in 1965 when France refused to attend Council meetings.
  • French President Charles de Gaulle was in favour of intergovernmentalism and opposed proposals to increase the competencies of the Commission and the Parliament.
  • The two proposals rejected would increase the resource independence of the EEC’s institutions and increase the involvement of the Parliament in decision-making.
  • France expressed dissatisfaction in two areas:
    • The Commission was allegedly exceeding its competence by acting as a supranational rather than inter-governmental body.
    • It opposed the change in Council decision-making from unanimity to qualified majority voting.
  • Under pressure from French farmers de Gaulle negotiated with other member states and reached an informal agreement.
  • The 1966 Luxembourg Accord created a de facto right of veto for Member States.
  • Unanimous voting was the main way of adopting EEC legislation from 1966 to 1986.
  • Consequently caution was necessary to ensure proposals would not adversely affect the interests of Member States.
  • The Luxembourg Accord was a serious blow to supranationality despite being non-binding.
    • It was the main reason for the stagnation of the EEC because it prevented further integration by prioritising individual States’ interests.

The Merger Treaty

  • Rationalising the institutional structure of the three communities was introduced in 1957 by the Convention on Certain Institutions Common to the European Communities.
    • The Convention provided for the establishment of:
      • a single assembly (the European Parliament),
      • a single Court of Justice, and
      • a single Economic and Social Committee for all three communities.
  • Under the 1965 Treaty Establishing a Single Council and a Single Commission of the European Communities (‘Merger Treaty’) the communities shared the same institutions while remaining legally independent.

The 1969 Hague Summit

  • French President Georges Pompidou succeeded de Gaulle and convened the Hague Summit which decided to:
    • Enlarge the communities by admitting the UK, Denmark, Norway and Ireland.
    • Establish European Political Cooperation.
    • Adopt measures leading to economic and monetary union.
    • Introduce regular meetings of foreign ministers of the Member States.
    • Reform the Common Agricultural Policy financing.
    • Establish technical cooperation.
    • Put development aid and social policy on the European Cccommunities agenda.
  • The international oil crisis and budgetary crisis within the Community stunted its growth for almost two decades.

Establishment of European Political Cooperation (‘EPC’)

  • The Hague Summit resolved to examine the best ways of achieving progress toward a political union.
  • The 1970 Davignon Report was adopted by the foreign ministers of the Member States as a basic strategy and then approved by the Copenhagen Summit in 1973.
    • It proposed harmonisation of foreign policy outside the Community framework and when possible a common position.
    • It recommended traditional intergovernmental cooperation in political matters without any supporting structures.
  • A subsequent report that made some changes to EPC was tabled and adopted in 1981.
  • These reports and the ‘Solemn Declaration on European Union’ agreed by the European Council Summit in 1983 constituted the foundation of EPC.
  • It was incorporated in Title III of the Single European Act.

The Community from 1970–1985

  • This was a period of stagnation as a result of a lack of desire for further integration.
  • Rather than cooperate when dealing with the 1973 oil embargo the Member States acted on their own.
  • The UK and France signed agreements with Iran and Saudi Arabia for oil supplies; the Netherlands’ supplies were completely cut off by OPEC.
  • National interests and policies prevailed over Community objectives.
  • Three major issues remained unsolved:
    • budgetary matters,
    • the UK’s contribution to the budget, and
    • reform of the Common Agricultural Policy.
  • Despite this there were some positive developments including:
    • Reform of the Community budget.
    • Creation of ‘own resources’ of the Community that aimed to replace the system of national contributions.
    • The first direct elections in 1979 to the European Parliament.
    • Formalisation by the Heads of State/Government of their meetings as the European Council in 1974 (to be known as ‘European Council summits’).

Relaunch of European integration

  • Enthusiasm for European integration increased in the early-1980s as a result of
    • improvements in the international economic situation,
    • commitment of French President François Mitterrand and German Chancellor Helmut Kohl to the development of the Community,
    • the appointment of Jacques Delors as President of the European Commission in 1985 who decided to accelerate the integration process through concrete projects,
    • the realisation that only common action could improve the competitiveness of national economies and increase their share of exports, and
    • the possibility of an accord between the United States and Soviet Union to the detriment of European interests.
  • The European Council commissioned and examined a number of proposals to reform the EEC.
    • The Dodge Report was adopted by the European Council Summit of March 1985, and recommended:
      • the introduction of a co-decision procedure designed to give more power to the European Parliament,
      • the recognition of the European Council as a Community institution, and
      • the preparation of a new treaty on the European Union.
    • A white paper prepared by Lord Cockfield proposed the establishment of an international market by the end of 1992, and
      • identified remaining barriers to trade,
      • proposed 300 legislative measures necessary to eliminate those barriers, and
      • set out a timetable for their elimination.
    • A precise programme was initiated by the European Council Summit of June 1985 and based on the Cockfield White Paper.

The Single European Act (‘SEA’)

  • The European Council also decided to convene an Intergovernmental Conference to revise the EEC Treaty which met in 1985.
  • The outcome of this conference was the Single European Act, signed in 1986 and entered into force in 1987.
  • It was relatively unambitious but had potential for expansion.

The completion of the internal market by 31 December 1992

  • The SEA defined the internal market as ‘an area without international frontiers in which the free movement of goods, persons, services and capital is ensured’: TFEU art 26(2).
  • Nearly 300 legislative measures were adopted by the Council to complete the internal market.

The extension of Community competencies to new areas

  • New competencies were given to the EEC concerning economic and social cohesion, research and technological development and the environment.
  • The SEA provided a legal basis for directives to improve health and safety in the working environment: TFEU art 153.
    • Harmonising measures were restricted to setting minimum requirements.
  • The SEA allowed the Commission to encourage social dialogue: TFEU art 174.
  • These articles and a cooperative legislative procedure were used to create the social dimension of the Community.
  • At the European Council summit of December 1989 all Member States except the UK supported the Charter of the Fundamental Social Rights of Workers.
    • The rejection by the UK led to the adoption by the remaining states of a Protocol on Social Policy.
  • The SEA provided a formal footing for some areas the Community was already active in under general Treaty provisions (eg, environmental protection).
  • The SEA made formal reference to the European Monetary System for the first time.

Institutional changes

  • Several institutional improvements were made that pushed the Community in a federal direction and increased its democratic legitimacy.
  • A new cooperation procedure enhanced the participation of the European Parliament in decision-making in 10 areas.
    • The procedure has been modified and renamed; it is now the ordinary legislative procedure: TFEU art 294.
  • The ‘assent procedure’ (now ‘consent procedure’) gave the European Parliament a new role in approving by absolute majority
    • the admission of new members to the Community, and
    • the conclusion of association agreements with third countries.
  • The SEA confirmed the existence of the European Council and affirmed its composition.
  • The SEA extended the areas covered by qualified majority voting within the Council of Ministers, which concerned measures relating to the completion of the internal market.
  • The SEA formalised the Commission’s committee procedure and provided that the Commission was to exercise implementing powers with regard to measures adopted by the Council of Ministers; the Council could only exercise direct implementing powers in specific cases.
  • The SEA created the Court of First Instance (which later became the General Court) to ease the workload of the ECJ.

The formalisation of the mechanism for European Political Cooperation (‘EPC’)

  • The EPC was initiated by the Hague Summit in 1969.
  • It was incorporated into the structure of the EEC in Title III of the SEA.
  • It was not subject to judicial review by the ECJ.
  • Title III declared that Member States would endeavour to jointly formulate and implement a European foreign policy.
    • It did not entail the transfer of any legal powers to community institutions.
  • The improvements made were:
    • Abolition of the distinction between EPC and Council of Ministers meetings.
    • An EPC secretariat was set up in Brussels.
    • A mechanism was provided to convene emergency meetings of the Political Committee of foreign ministers within 48 hours upon request from at least three Member States.
    • The Commission and the European Parliament became associated with EPC.
    • The Commission and the Presidency of the Council of Ministers became responsible for ensuring consistency between external policies of the Community and policies agreed within the EPC framework.
  • EPC resulted in common positions on many issues but was undermined by vague declarations and little direct action.
  • Member States could not agree on the use of force against Iraq in the 1990 Gulf Crisis (eg, the UK promised support, Ireland wanted neutrality and non-intervention).
  • The crisis in the former Yugoslavia ‘emphasised deep foreign policy differences’: D Dinan, Ever Closer Union? (Anne Riener Publishers, 1994) 489.
  • These hurdles contributed to the incorporation of a common foreign and security policy into the Treaty on EU.

Assessment

  • The SEA provided a political impetus and legal framework necessary for the creation of an internal market by the 31 December 1992 deadline.
  • Unanimity voting in the Council of Ministers was replaced by qualified majority voting to eliminate barriers to the internal market.
  • The role of the European Parliament in decision-making was enhanced.
  • Coordination of foreign policy became a formal priority.

From the SEA to the Treaty on EU

  • The SEA contained a ‘hidden agenda’ — the creation of an economic and monetary union.
  • To achieve the objectives of the SEA persisting internal conflicts had to be dealt with.
  • The Commission proposed the Delors I Package in 1987 to radically reform the Community’s financial system for the 1988–1993 period.
  • The adoption of the Delors I Package introduced budgetary discipline, ended the ‘British rebate’ sage, reform the Common Agricultural Product and provided for the Commission to put forward new initiatives.
  • Under the Presidency of Jacques Delors the Commission was committed to further integration with a view to introducing an economic and monetary union (‘EMU’).
  • The European Council affirmed the goal of an EMU and set up a Committee to examine measures necessary to achieve it.
  • In 1989 Delors set the agenda for the Commission — to promote the devolution of more power to the European Parliament by the Member States and creation of an EMU.
  • A new stage of integration began in the 1990s as a result of political developments in 1989–1990.
    • The barbed wire border between Hungary and Austria was dismantled — ‘the first tear in the “Iron Curtain”.’
    • East Germany was accepted into the Community in 1990 ahead of German reunification.
  • The European Council summit on 25–26 June 1990 decided to convene two Inter-Governmental Conferences on 14 December 1990 on EMU and political union.
    • The conferences were intended to proceed in parallel so that ratification of instruments occurred within the same timeframe.
  • In the course of negotiations two approaches emerged:
    • The ‘Three Pillars’ or ‘Temple’ structure: a main agreement based on the EEC treaty, and two separate arrangements covering cooperation on
      • common foreign and security policy, and
      • justice and home affairs.
    • The ‘Tree’ model: a single trunk with several branches and treating integration in all three areas as a common foundation with special arrangements in specific fields.
      • This was strongly federalist and too controversial to be submitted for consideration at Maastricht.
  • The Three Pillars structure was used as the basis for deliberations.
  • The European Council summit held on 9–10 December 1991 approved the Treaty on EU; it was signed on 7 February 1992.
  • It was agreed ratification should be completed in 1992 and enter into force alongside the completion of a single market.
  • Danish voters rejected the Treaty on EU in June 1992 but, after reassurance by the European Council, passed in May 1993.
  • The Treaty on EU was challenged in the German Constitutional Court.
  • It was also challenged in the English High Court: R (Rees-Mogg) v Secretary of Foreign and Commonwealth Affairs [1994] 1 All ER 457.

The Treaty on EU

  • The Treaty was based on the ‘Temple’ structure.
    • The roof consisted of common provisions laying down the objectives of the EU.
    • The main purpose was to ‘establish the foundations of an ever closer union among the people of Europe’.
    • The Treaty set several general objectives of the EU:
      • Promotion of economic and social progress and a high level of employment.
      • Balanced and sustainable development.
      • Establishment of an area without internal frontiers.
      • Strengthening of economic and social cohesion.
      • Establishment of an economic and monetary union.
      • Establishment of a single currency with the EMU framework.
      • Promotion of an international identity for the EU through implementation of a common foreign and security policy (possibly leading to a common defence policy).
      • Establishment of EU citizenship.
      • Development of closer cooperation in the fields of justice and home affairs.
      • Improvement in the effectiveness of EU institutions.
      • Extending legislative powers of the European Parliament.
      • Extending EU competences to new policies and reinforcing existing policies.
      • Affirmation of the commitment of the EU to the protection of fundamental rights.
      • Introduction of the principle of subsidiarity.
    • Pillar 1 — ‘The Community Pillar’
      • Covered all policies existing under previous treaties and introduced fundamental amendments to the EEC Treaty.
      • The EEC was renamed by the Treaty on EU to be the ‘European Community’.
      • The most important changes were:
        • Recognition of the principle of subsidiarity, which restricts Community involvement in national matters.
        • Establishment of European citizenship, creating new rights for nationals of Member States.
        • Redefinition of objectives of the Community in areas like
          • health,
          • education,
          • training
          • industrial policy,
          • telecommunications and energy,
          • research and development,
          • consumer protection,
          • trans-European networks, and
          • culture.
        • Extension of EC competences in environmental protection and development aid for poor countries.
        • Deepening of Commission accountability to the European Parliament.
        • Further extension of the Parliament’s participation in decision-making procedures.
        • Establishment of an economic and monetary union.
        • Extension of the ECJ’s powers in relation to Member States that refuse to comply with ECJ judgments.
    • Pillar 2 — ‘The Common Foreign and Security Policy Pillar’.
    • Pillar 3 — ‘The Justice and Home Affairs Pillar’.
      • Covers inter-governmental cooperation in the fields of justice and home affairs.
      • Under the Treaty on EU, Pillar 3 consisted of determination of nine areas regarded as ‘matters of common interest’ related to cooperation in matters of
        • criminal justice,
        • civil justice,
        • asylum,
        • immigration, and
        • visas.
      • The Council acting unanimously on a proposal from the Commission or a Member State could transfer certain matters from Pillar 3 to Pillar 1.
      • All matters relating to these areas were gradually transferred to Pillar 1.
      • The Pillar structure was subsequently abolished and Pillar 3 became Title IV of the TFEU.
    • The plinth of the Temple consisted of the final provisions:
    • Pillar 1 was based on the EU method while Pillars 2 and 3 were based on the intergovernmental method.
      • Unanimity was required for any measure to be adopted under Pillar 2 or 3.
  • The Treaty on EU was criticised for undermining the unity and cohesiveness of the EU legal order.
    • The UK and Denmark opted out of participation in the EMU.
    • The UK opted out of the 1989 Social Charter of Rights of Workers.
    • Member States could be exempt from various aspects (eg, defence in the case of neutral Member States).
    • The Pillars based on the intergovernmental method of decision-making excluded any control by the ECJ or European Parliament of relevant matters.
  • It was also lengthy and badly drafted.
  • But it had many important innovations:
    • Creation of EU citizenship.
    • A timetable for the creation of an EMU.
    • Introduction of the principle of subsidiarity.
    • Establishment of new competences for the EC.
    • Reinforcement of the powers of the European Parliament.
    • The creation of new bodies:
      • The Committee of the Regions.
      • The European Ombudsman.

The Treaty of Amsterdam

  • The Treaty of Amsterdam came into effect on 1 May 1999.
  • It included extension of the objectives of the EU, including
    • promotion of economic and social progress,
    • progressive establishment of the area of freedom, security and justice,
    • furthered development of the concept of EU citizenship, and
    • strengthening of existing policies.
  • It imposed a new obligation on the EC to assess legislative measures in the light of
    • the prohibition of discrimination between men and women, and
    • protection of the environment.
  • The EC gained competence to adopt measures concerning
    • ingress of non-EU nationals,
    • movement of persons, and
    • coordination of employment policies.
  • It confirmed the stability pact and the timetable for EMU.
  • Provision was made to suspend the rights of a Member State that violates fundamental rights.
  • The scope of the principle of non-discrimination was extended to prohibit discrimination based on ‘sex, racial or ethnic origin, religion or belief, disability, age, and sexual orientation’.
  • It included protection of the processing of personal data and the free movement of such data in respect of both individuals and institutions.
  • It included a chapter on employment.
  • It incorporated the Social Charter into the EC Treaty.
  • The powers of the European Parliament were extended.
    • The co-decision procedure (now the ordinary legislative procedure) has been extended to fifteen treaty provisions concerning eight areas.
  • Involvement of national legislatures in decision-making procedures was improved.
    • They were given an opportunity to express their views on matters of particular interest to them.
    • The Commission was required to promptly forward all proposals to national parliaments.
    • Except in cases of urgency proposals could not be placed before the Council of Ministers until six weeks after being made available to national legislatures.
  • The principle of transparency was established.
  • It contained an explanation of the role and application of the principles of subsidiarity and proportionality.
  • The concept of enhanced cooperation was introduced.
    • It permits differential integration so that in certain projects only some Member States participate.
    • Previously Member States were allowed various opt-outs (eg, participation in the EMU or Schengen System).
    • This was mainstreamed in the Treaty of Amsterdam.
  • Changes were made to the implementation of the common foreign and security policy.
  • The Schengen acquis was incorporated into the Treaty on EU.
  • The Treaty of Amsterdam was less ambitious than the Treaty on EU and failed to introduce institutional reforms necessary for the accession of new Member States.
  • It did, however, address employment and fundamental rights and pave the way for future integration and cooperation while introducing flexibility.

The Treaty of Nice

  • The European Council summit in Nice in December 2000 resolved the legacy of the 1997 Treaty of Amsterdam.
  • The Treaty of Nice entered into force on 1 February 2003.
  • It made important changes to the Treaty of Amsterdam, such as:
    • Reform of the institutions of the EU, including redistribution of votes in the Council of the EU.
    • Revision of the enhanced cooperation procedure.
    • Establishment of a new mechanism to prevent infringements of fundamental rights.
  • Although attacked by the European Parliament for being unambitious it paved the way for future enlargements of the EU.
  • Some important matters were left out until a new IGC was convened in 2004:
    • Whether the Charter of Fundamental Rights should be binding, and if so how?
    • Simplification and consolidation of existing treaties into one comprehensive treaty.
    • Clear delimitation of competences between the EU and the Member States (particularly relevant to Germany).
    • The role of national legislatures within the European system.

The constitution that never was

  • The European Council summit at Laeken in December 2001 adopted a ‘Declaration on the Future of the European Union’ which
    • committed the EU to becoming more democratic, transparent and effective, and
    • paved the way towards an EU Constitution.
  • The Laeken Declaration posed some 60 questions to be debated and considered by a convention of 105 members from various national and supranational bodies.
  • The questions focused on:
    • Better division and definition of competences in the EU.
    • Simplification of the EU’s instruments and assessment of their influence.
    • Different aspects of the perceived democratic deficit of EU institutions.
    • More democracy, transparency and effectiveness.
    • Simplification of the existing treaties.
  • A draft treaty establishing a European Constitution was ready by July 2003.
  • It was approved by the European Council in June 2004.
  • It was signed on 20 October 2004 by the Heads of State/Government of the 25 Member States.
  • The EU Constitution required all members to ratify it for it to enter into force.
  • Member States could choose their method of ratification (either approval by the legislature or by referendum).
  • The 1 November 2006 deadline for entry into force was not met because referenda failed in France and the Netherlands in mid-2005.
  • The European Council agreed on a ‘period of reflection’ that effectively extended the deadline into 2007.
  • 18 Member States had ratified the EU Constitution by June 2007.
  • The European Council abandoned the project in June 2007.
  • It decided to convene an intergovernmental conference to determine how best to institute the necessary institutional reforms that the Constitution would have implemented.
  • The Constitution was ambitious and would have
    • clearly defined the division of power between the EU and its Member States,
    • given the EU greater powers,
    • enhanced the role of the European Parliament,
    • bolstered democratic accountability and transparency,
    • given national legislatures an important role in adoption of EU legislation,
    • assigned the Charter of Fundamental Rights a constitutional place, and
    • consolidated the EU’s three treaties.

The Treaty of Lisbon

  • The European Council approved the Treaty of Lisbon in 2007.
  • It replaced the EU Constitution Treaty.
  • It entered into force in 2009.

Ratification

  • All member states except Ireland decided to ratify the Treaty of Lisbon via the legislature rather than referendum.
  • The Irish Constitution required it to hold a referendum.
    • The first referendum failed in 2008.
    • A second referendum succeeded in 2009 with the assurances from the European Council that
      • each Member State would be represented in the Commission of the EU by one commissioner of its own nationality,
      • Irish neutrality would not be affected by EU law,
      • sensitive issues such as abortion would be within the exclusive competence of Ireland, and
      • workers’ rights and public service would remain valued and protected in Ireland and the EU.
  • The Treaty of Lisbon was challenged in the German Federal Constitutional Court:
    • The Court ruled in 2009 that the Treaty was compatible with the German Constitution:
      • It did not transform the EU into a federal state.
      • EU citizenship did not replace national citizenship.
      • Member States were not required to provide troops for a ‘European Army’.
    • But the Court also held that modification of domestic legislation ensuring greater participation of the German legislature in controlling and supervision EU affairs was needed.
      • The required legislation was subsequently adopted.
      • The Court confirmed that the supremacy of EU law derives from German legislation conferring power on the EU, not from the EU itself.
      • It has maintained its reservations on supremacy of EU law over the German Constitution.
  • A final hurdle was the refusal of the President of the Czech Republic to sign the Treaty.
    • The Czech legislature had approved it.
    • The Czech Constitutional Court declared it to be in conformity with the Czech Constitution.
    • The President wanted a guarantee that that the Czech Republic would not be exposed to massive property claims by Germans expelled from Czechoslovakia after WWII.
    • ‘Protocol 30 On the Application of the Charter of Fundamental Rights of the EU to Poland and the UK’ was extended to the Czech Republic as a result.

The position of the UK

  • The UK has opted out of many key areas.
  • Like Ireland and Denmark it is allowed to decide to opt in or opt out of polices relating to the area of freedom, security and justice.
  • The UK negotiated ‘Protocol 30’ that provides that no ‘court can rule that laws, regulations or administrative practice or action’ of the UK are inconsistent with the principles set out in the Charter of Fundamental Right of the EU.
    • Protocol 30 also emphasis that the Charter creates no new rights enforceable in the UK (as well as Poland or the Czech Republic).
  • Previous opt-outs have been confirmed, such as non-participation in the EMU and Schengen Agreement.
  • The UK was satisfied with its opt-outs as well as unanimity voting for the common foreign and security policy, direct taxation and social security matters.

The structure of the Treaty of Lisbon

  • The Treaty of Lisbon has seven articles.
    • Articles 1–2 make amendments to the Treaty on EU and EC Treaty (now ‘TFEU’).
    • Article 3 states that the Treaty of Lisbon is concluded for an unlimited time.
    • Article 4 refers to Protocols 1–2 attached to the Treaty.
    • Article 5 deals with renumbering of articles, sections and titles.
    • Article 6 concerns the ratification procedure for the Treaty of Lisbon.
    • Article 7 confirms that each official language in which the Treaty was drafted is authentic, and that Italy is the depository of the Treaty.
  • Also attached are
    • two protocols,
    • one annex, and
    • the Final Act of the IGC.
  • The Treaty on EU and TFEU have attached
    • 37 protocols,
    • 2 annexes, and
    • 65 declarations.
  • Technically the Treaty on EU and TFEU form part of the Treaty of Lisbon.
  • Protocol 1 amends the protocols annexed to the Treaty on EU, EC Treaty and Euratom Treaty.
  • Protocol 2 amends the Euratom Treaty.
  • The Treaty is merely a ‘wrapping’ or ‘introductory’ treaty designed to effect amendments to the Treaty on EU and TFEU.
  • Elements of the EU Constitution Treaty are present, but the Treaty of Lisbon does not merge the three existing treaties into one; it only makes amendments.
    • Article 1(3) of the Treaty on EU provides that the EU should be based on two treaties:
      • The Treaty on European Union.
      • The Treaty on the Functioning of the European Union (ie, TFEU, formerly the EC Treaty).
    • Both treaties are of equal legal value.
    • TFEU abolishes the pillar structure but special procedures are provided for the common foreign and security policy.
    • The Treaty of Lisbon removed the distinction between the European Community and the European Union.
      • The EU replaces and succeeds the European Community.
    • Only the EU has legal personality and is the only entity able to enter into international agreements.
    • Euratom remains outside the Treaty of Lisbon, but some amendments were made to the Euratom Treaty.

Values and objectives of the EU

  • Treaty on EU art 2 states that the EU is founded on the values of
    • respect for human dignity, freedom, democracy, equality and the rule of law,
    • respect for human rights, including the rights of persons belonging to minorities, and
    • pluralism, tolerance, justice, solidarity and gender equality.
  • Five founding values can be drawn from the Treaty on EU art 2, ECJ case law and 1973 European Council Copenhagen Declaration:
    • Participatory democracy.
    • Rule of law.
    • Protection of fundamental rights.
    • Social justice.
    • Cultural diversity.
  • Treaty on TEU art 3 lists overarching and specific objectives of the EU:
    • Promoting peace, EU values and well being of its peoples.
    • Offering to its citizens an area of freedom, security and justice without internal frontiers.
    • Ensuring the free movement of persons in conjunction with appropriate measures for external border controls, asylum, immigration and prevention of crime.
    • Establishing an internal market that works for the sustainable development of Europe based on
      • balanced economic growth,
      • price stability,
      • a highly competitive social market economy,
      • the goal of full employment and social progress,
      • a high level of environmental protection and improvement, and
      • promotion of scientific and technological advancement.
    • Combatting social exclusion and discrimination.
    • Promoting social justice and protection, gender equality, generational solidarity and protection of the rights of children.
    • Promoting economic, social and territorial cohesion, and solidarity between Member States.
    • Respecting rich cultural and linguistic diversity, and protecting and enhancing Europe’s cultural heritage.
    • Establishing an economic and monetary union using the Euro.
    • Upholding and promoting its values and interests in international relations.
    • Contributing to peace, security, sustainable development, solidarity and mutual respect, free and fair trade, eradication of poverty and protection of human rights.
  • The objectives include social, environmental, cultural and economic objectives.
  • The Treaty of Lisbon grants the EU international legal personality allowing it to play a greater role in international affairs.

The relationship between values and objectives

  • The values characterise the EU’s identity and provide the key to achieving its objectives.
  • A measure adopted in breach of fundamental values will be invalid.
  • The Council may determine the existence of a ‘clear risk of a serious breach’ of values by a Member State and may if it persists suspend certain rights of that member: Treaty on EU art 7.
  • To be admitted into the EU a candidate state must demonstrate it respects the values of the EU.
  • The founding values are the basis for relations with non-Member States.
  • International commitments entered into by the EU must not compromise its values.
  • The EU is required to promote the values upon which it is based in an international context.

Brief assessment of the Treaty of Lisbon

  • The Treaty of Lisbon did not revive the failed EU Constitution.
  • It adopted some of the aspects and necessary reforms that the EU Constitution would have instituted.
  • The Treaty of Lisbon does not mention terminology suggesting a state-like status, such as
    • anything suggesting an ambition of the EU to become a federation, or
    • the words or concepts of constitution, anthem, motto or flag.
  • In essence, the Treaty of Lisbon effected reforms necessary for the ever-enlarging EU:
    • Improvements in efficiency of the decision-making process:
      • The ordinary legislative procedure became the main legislative procedure and was extended to a further 44 areas.
      • Double majority voting in the Council is more effective than the weighted voting system.
      • The reduction in the size of the European Parliament makes it less unwieldy.
      • Granting of legal personality to the EU.
    • Greater democratisation of the EU:
      • More legislative, budgetary and political powers for the European Parliament
      • Involvement of national legislatures in the functioning of the EU.
      • Better protection of the social rights of EU citizens.
      • Enhancement of rights through the binding legal status of the Charter of Fundamental Rights of the EU and the accession of the EU to the European Court of Human Rights.
      • Wider access of natural and legal persons to EU courts: TFEU art 263.
      • Reinforcement of the principles of representative democracy.
      • Ensuring transparency of the legislative process and political participation of EU citizens.
      • A ‘citizen’s initiative’ provision.
      • Clarification of the division of competences between the EU and its Member States.
      • Procedures of Member States wishing to leave the EU

Treaty on Stability, Coordination and Governance in the Economic and Monetary Union

  • The Treaty on EU provided the basis for the establishment of an economic and monetary union (‘EMU’)
  • On 1 January 1999 the Euro became the common currency and sole legal tender in 11 Member States.
  • Criticisms:
    • Extreme independence of the European Central Bank (‘ECB’): it is not accountable to any EU institution nor to the participating Member States.
    • Incomplete institutional design: the budgetary and fiscal policies remain within the domain of each Member State.
  • The 2008 global financial crisis emphasised the weaknesses of the EMU:
    • The requirements relating to budgetary deficits were not respected or enforced.
    • The crisis and subsequent economic downturn resulted in a debt crisis affecting Portugal, Ireland, Italy, Greece and Spain in particular, and threatening to undermine economies of all Member States.
  • The 2012 Treaty on Stability, Coordination and Governance in the Economic and Monetary Union (the ‘Fiscal Pact’) was signed by 25 of the 27 Member States.
    • The Czech Republic and UK are not members of the Eurozone, so chose not to become parties.
  • The Fiscal Pact was concluded outside the Treaty on EU and TFEU framework but stipulates it must conform with those treaties and EU law.
  • Its main objective was to remedy the weaknesses of the original rules.
  • Under the Fiscal Pact a member state must take legislative measures to ensure its budget is in balance or surplus.
  • Failure to comply may result in ECJ proceedings and ultimately the imposition of a fine of up to 0.1% of a Member State’s GDP.