EUROPEAN UNION WORLD

The European Union Explained

The EU and the rest of Europe

A most impressive aspect of the European Union project has been its ability to develop and expand from a small group of relatively similar states in Western Europe into a European Union of much greater width and depth. Within this long process of enlargement, it is the expansion into Central and Eastern Europe that has, apart from de Gaulle’s reaction to the British application, been the most contentious. While member states generally agreed that Eastern enlargement was to be welcomed, to extend the area of prosperity and security, there have also been greatly varying degrees of enthusiasm, to the point where discussion of ‘enlargement fatigue’ became not uncommon in the old member states. Certainly, there have been problems on the way, but enlargement can be seen as an essential part of the EU and its continued development, not least in its dealings with those who remain outside; and the treaty still affirms that membership is open to any European state that respects ‘the principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law’.

European Union - 50 years in 5 minutes!

Policy-making and law-making processes

 The Union’s responsibilities (‘competences’) have significantly developed in recent decades, so that today EU policies and laws have a considerable impact at national and sometimes international and subnational levels as well.

Here we examine the sources of policy, the various procedures by which the EU takes decisions on policy issues and how it makes laws.

Origins of EU policy

Proposals for and decisions on Union action come about in various ways, the impetus sometimes deriving from within the Community’s institutions (the Community method) and at others resulting from the expressed wishes of the member states who give a strong lead (the intergovernmental method). On occasions, EU powers are exercised jointly by Union institutions and national governments or national policies are coordinated at the Union level (the coordination method).

There is, then, no fixed process by which policies emerge. At times in EU history, national governments have been actively involved in pushing forward new initiatives, but in other phases of the Union’s development there has been a greater interest in supranational policy-making. Of course, there is an overlap between the two fields of activity. Some of the same personnel can be involved in national political life and in EU politics. Ministers from each country – and the officials who advise them – meet together periodically in the Council of Ministers, but much of their time is spent in the domestic arena. Even MEPs, members of the supranational Parliament, spend varying amounts of their time ‘back home’. In other words, ‘European’ and ‘national’ politics are not entirely distinct from each other.

Moreover, the bargaining that is part of EU policy-making is not always a matter of the potential conflict between EU and national interests. There will be negotiations and sometimes clashes in the home country between different government departments over how a particular issue should be handled. As Bomberg and Stubb explain: ‘Perhaps naturally, environment ministers often find agreement easier among themselves in Brussels than agreement with their “own” industry ministries’.

Three sources

The Community method applies where treaties have granted specific powers to the EU. In these circumstances, the initiative in policy-making usually comes from the Commission, which tables a formal proposal. The Council then takes the final decision via one of three law-making procedures, of which co-decision is the most common. The Court of Justice resolves any conflicts and enforces the resulting laws.

This was the traditional approach to policy-making as the Community evolved from its earliest days. In various areas, national governments had granted specific responsibilities to the EC to be handled by the machinery in Brussels and to a lesser extent in Strasbourg. The emphasis was on supranational institutions agreeing common policies, the CAP being an obvious example. In this case, Parliament had only modest involvement, whereas on matters affecting the internal market it exercises much greater influence. Even the Council of Ministers, usually portrayed as the defender of national interests, was involved in the bargaining process, for instance helping to make the deals which made the CAP possible.

The intergovernmental method covers policy areas over which national governments have control. In these circumstances, the supranational bodies – the Commission, Parliament and the Court – play only a very limited role. Ever since the formation of the Community, there have always been issues which have been handled primarily by member states within the European Council and Council of Ministers. National representatives engage in frank discussions and prolonged bargaining, as they seek to achieve a compromise position which they can sell to their ministerial colleagues and to the public in their own countries.

Some of the issues resolved in this way concern matters that are fundamental to the national interests of member states, such as tax harmonisation and defence and foreign policy. In these cases, cooperation between states may be desirable if it can be achieved, but for politicians of some countries – particularly those less known for their communautaire approach – they wish to retain the chance to determine the future outcome of policy areas that affect vital national interests.

On policies decided primarily at intergovernmental level, the bulk of the work will be done by the Council of Ministers and the national delegations and working groups that service it. Individual ministers will seek support from others around the negotiating table who share at least some of their outlook and priorities, creating coalitions of support around particular issues. Where necessary, the summits of the European Council can provide a sense of direction and urgency to the process of reaching agreement.

There are obvious difficulties in achieving any consensus on ‘sensitive matters’ affecting national interests, which is why the Maastricht negotiators excluded national security (the CFSP) and justice and home affairs (JHA) from supranational decision-making. Whereas the Commission and Parliament are active within the First Pillar, they are much more distantly associated with these second- and third-pillar topics. But even on JHA-related policy, there has been considerable progress in developing a common approach to matters affecting asylum, migration and terrorism, illustrating how intergovernmental cooperation can have a role in progress towards integration within the European Union.

The coordination method has developed in recent years, most obviously in the area of JHA, where – as we have seen – there is a trend towards the adoption of a common approach. On employment policy too, there has been a trend towards member states working more closely together either to agree on non-binding policy recommendations or to examine the practice of those countries which are having greater success in combating the problems, with a view to learning from their experiences. In this process, experts are called in to assess the value of initiatives taken in individual countries and make recommendations. The Commission has an input, facilitating the contribution from outside specialists and examining national policies. So too does Parliament, whose specialist committees can be involved in monitoring new initiatives and suggesting future  action.

Policy-making: a reflection

What is apparent from this brief description of how policy emerges is that both the traditional Community and intergovernmental approaches can contribute to the evolution of European integration. Supranational institutions can drive and often have driven the Union forward, but so too the actions of national governments can provide a momentum of their won. Sometimes, as a result of intergovernmentalism in action – as with JHA – there are clear signs that the close and regular interaction between member states can create the conditions that lead the Union forward into greater cooperation.

Whatever the method of policy-making, there is a constant search for agreement and – if possible – consensus. It is recognised that member states have their own national priorities and difficulties. If it is possible to accommodate them, then the emphasis is on compromise, doing deals with which politicians and the public in each country can live. Discussions at summit gatherings where disputes are ironed out can help to promote the agreement that drives integration forward. It sometimes requires what Holland2 calls ‘the bargaining process characteristic of intergovernmentalism’.

Bomberg and Stubb have also noted this tendency towards seeking an outcome satisfactory to all players: Competition is fierce but so, too, is the search for consensus. Enormous efforts go into forging agreements acceptable to most. The overall trajectory of the integration process is thus a result of to-ing and fro-ing between a wide variety of actors and external pressures . . . the pendulum swinging sometimes towards intergovernmental solutions and sometimes towards supranational solutions, but not always in equal measure. EU law

By whatever means policy decisions emerge, when they are made they are in many cases then turned into law. EU law accounts for approximately half of all the legislation enacted within the member states.

There are two categories of law in the European Union:

• • Primary legislation involves the body of law established by the founding treaties of the Communities, together with all later amendments and protocols attached to those treaties.
• • Secondary legislation encompasses all laws passed by the institutions of the Communities in order to fulfill the aims and purposes of the treaties.

Primary legislation

Community law in this respect is provided by the three treaties, with the various annexes and protocols attached to them, and their later additions and amendments: these are the founding acts . . . Because the law contained in the treaties was created directly by the Member States themselves; it is known as primary Community legislation. This founding charter is mainly confined to setting out the objectives of the Community, establishing its mechanisms and setting up institutions with the task of filling out the constitutional skeleton and conferring on them legislative and administrative powers to do so.

Primary law is therefore constitutional law, dealing largely with the relationship of the member states, both with Community institutions and with each other. It is the basis on which the European Court of Justice makes its judgments and, as in any legal system, the decisions made by judges and the precedents set by them form the basis for case law. And case law can apply to individual citizens, firms and organisations.

EU law v. national law

Over the forty years or so that the European Communities have been in existence there have been a succession of judgments, by both the European Court of Justice and the various national courts, that have helped to build up a formidable corpus of case law concerning the relationship between Community and national law. It is now established that:

• • Member states have transferred sovereign rights to a Community created by them. They cannot reverse this process by means of unilateral measures inconsistent with the general interests of the Community.
• • No member state may call into question the status of Community law as being a system uniformly and generally applicable throughout the Community.
• • Community law, enacted in accordance with the treaties, has priority over any conflicting law of the member states. Community law is not only stronger than earlier national law but has a limiting effect on laws adopted subsequently.

The primacy of Community law over national law has long been established. But it was the Factortame judgment that most clearly set out the position should there be any conflict between Community law and national law: ‘Under the terms of the 1972 Act, it has always been clear that it was the duty of a United Kingdom Court to override any rule of national law found to be in conflict with any directly enforceable rule of European law.’

The Factortame case

The subordination of national law in member states to Brussels was underlined in an important legal judgment involving the United Kingdom in 1991. The European Court of Justice gave its verdict in Factortame v. Secretary of State for Transport.

In 1988, the Thatcher government passed the Merchant Shipping Act, designed to deal with the problem of quota-hopping by Spanish and other fishermen who were registering their vessels under the British flag and using the UK’s fishing quotas, much to the dismay of British trawler men. The Act provided that UK-registered boats must be 75 per cent British owned and have 75 per cent of their crew resident in Britain.

In the Factortame judgment, the Merchant Shipping Act of 1988 was ruled invalid and therefore effectively quashed by the Court of Justice. The position was made very clear. The Act contradicted EC law because it was discriminatory in a Community committed to freedom of movement. It was therefore invalid. In the words of one journal, ‘this is a historic judgement . . . it overturns the English ruling that no injunction can be granted against the Crown . . . the Europeans are rewriting our constitution’.

At the time, senior judge Lord Bridges7 observed that the verdict was only a reaffirmation of the supremacy of Community law, as had been recognised since 1973. But it has come to be seen as a major test of the constitutional position. In the Maastricht debates, Margaret Thatcher invoked it as evidence that ‘European law will prevail more and more’.

Even more important for the individual are the judgments referring to what is called ‘direct applicability’. This means that the rules laid down in the foundation treaties are not only applicable to the member states and institutions of the Community but directly impose obligations and confer rights on the citizens of the member countries – without those rules having to be adopted and amended by national law.

The first important judgment on this issue concerned Article 12 of the Treaty of Rome, limiting the ability of states belonging to the Common Market to impose or raise customs duties on goods circulating between members of the Common Market. Van Gend and Loos, a Dutch transport firm that imported chemical products from West Germany, went to court in the Netherlands in 1962 protesting that Dutch customs had increased customs duties on the goods they handled, in clear breach of Article 12 of the EEC Treaty. At that time it was believed that laws contained in the Treaty applied only to states and institutions, and could apply to firms and individuals only if adopted by national law. Now the Dutch court was being asked to rule that the Treaty of Rome conferred rights on individuals within member states.

Feeling that it was not competent to rule on Community law, the Dutch court referred the case to the Court of Justice. Naturally, any such decision had major implications for national sovereignty and many member states made representations to the Court. However, judgment was given in favour of the firm, the judges stating: ‘Community law not only imposes obligations on individuals but is also intended to confer upon them rights’. This judgment was taken as the criterion for direct applicability and the case law thus established set a precedent for all subsequent cases of this nature.

We can therefore summarise the situation concerning the importance of primary law in the EU as follows:

• • Primary law, as established in the Treaties, has primacy over national law and, in these matters, the European Court of Justice has primacy over national courts.
• • Its provisions are as binding on the citizens of member states as they are upon the states themselves.
• • The foundation laws of the Community are to be enforced by the national courts of the member states in exactly the same way as they apply national law.

Secondary legislation

‘Secondary legislation’ refers to all those legal instruments devised and issued by the Community in order to administer policies laid down by the Community and achieve such aims and objectives of the Community as were established under primary legislation.

Decisions made by institutions of the Community are passed to national governments for acceptance and implementation in the form of one of five different classes of legal instrument: regulations, directives, decisions, recommendations and opinions.

1. Regulations Once issued, regulations become immediately effective as law within the member states without the need for any national legislation to endorse them. For the UK, the European Communities Act of 1972 gives authority for all subsequent EC regulations to have the same effect as UK domestic law approved by Parliament. Although regulations become law in the form that was agreed in Brussels, sometimes additional legislation is required in the member countries to make them more effective.

2. Directives These are not as complete and detailed as regulations, but consist more of policy objectives. The results to be achieved are communicated to national governments and those objectives are binding on the governments.

But the form and method in or by which those results are transposed is left to the discretion of the national governments. Usually, up to two years are allowed for this transposition, providing them with sufficient latitude to cater for their individual circumstances in a way that may overcome initial reservations.

3. Decisions Unlike regulations and directives, decisions are not directed at all member states but are specifically directed at one country or a firm, organization or individual within it. Because these decisions are specific they are often administrative rather than legislative acts.

4. and 5. Recommendations and opinions These are little more than suggestions or tentative proposals put out by the Council or Commission and are not binding on the member states in any way. Strictly speaking, they do not constitute Community legislation but are included here under secondary legislation because they may be taken into consideration by the Court of Justice when making a judgment about some other matter. In addition, the Commission may also state its views via official Communications, the Council may proclaim Declarations and Parliament can issue Resolutions.

In any one year, several thousand legal instruments are issued. The number has declined in recent years given the completion of the drive towards the single market and an attempt to simplify and streamline EU procedures. The majority of these instruments are non-political, being routine administration and dealing with matters such as price levels in the CAP. Of those instruments that could be considered legislative, Commission figures indicate that of those enacted in 2004 822 were regulations, 512 decisions and 107 directives. There were also 49 recommendations.

There are basically two sources of Community legislation:

1. Commission legislation is made directly by the Commission and enacted under powers delegated by the Council. This legislation is largely made up of technical, trivial or routine administrative detail arising from legislation already agreed by the Council. However, the Commission can legislate without reference to the Council in certain areas, such as the granting of financial support from public funds.

2. Council legislation is described more fully below and involves consideration and consultation by the Council and European Parliament of proposals formulated by the Commission.

Legislative process within the Union

Broadly, this has been the general pattern of what happens, although there are significant variations at stages 2 and 3:

1. The Commission proposes new legislation.

2. The Council consults on the proposal with the Parliament which scrutinizes (and may suggest amendments) and with the Economic and Social Committee which advises.

3. The Council decides whether to go ahead.

4. The Commission implements the proposal.

5. The Court of Justice arbitrates on any infringement of the law and resolves any disputes.

In 1970, Lindberg and Scheingold9 wrote of policy-making in the following terms:

It is no exaggeration to view the whole policy-making process in the Community as a dialogue between the Council, representing national cabinets, and the Commission, appointed originally by the governments but acting autonomously in terms of its own view of the ‘interests’ of the Community as a whole.

Since then, the policy-making process has moved on. The Commission remains the starting point of the decision-making process. However, with the passage of the SEA, the TEU and subsequent treaties, the powers of the Parliament have been increased, so that what was a dialogue between two institutions has become more of a partnership between three of them. Finally, the use of qualified majority voting in the Council has been extended into new areas.

Most administrative or regulatory legislation coming from Brussels takes the form of Commission legislation, drafted by the relevant directorate general with the assistance of an advisory or management committee. With such routine measures there is little need for scrutiny of decisions by ministers, commissioners or national officials. On the other hand, when the regulations or directives to be issued are felt to be important or are likely to set a precedent or establish principles, then they are thought to need examination through the full Council legislative process.

There are four main procedures, other than that for handling budgetary matters.

Consultation procedure

The consultation procedure involves Parliament giving an opinion on Commission proposals. Use of this method of policy-making has gradually been reduced with the introduction of the cooperation and co-decision procedures, but it still covers important fields such as the CAP, taxation and certain aspects of economic and monetary union.

How a proposal develops

Much of the work of the Commission is concerned with the implementation of policies approved by the Council, but new initiatives are continually being suggested by the Commission. These may derive from suggestions of one or more of the member states, or from the discussions which are regularly held with leading interest groups with which the Commission has a strong association. They may result from thinking within the Commission itself.

Once conceived, the idea will be formulated into a draft proposal by the appropriate directorates general which may be in the form of a Green Paper, a consultative document setting out possible ways forward. This early version will be sent to any organization which might be thought to have a valid input to make. Such outlets include national governments, interest groups, and committees of the Parliament, the Economic and Social Committee and– depending on its relevance – the Committee of the Regions. Once any suggestions have been considered (and rejected, incorporated or refined), then a White Paper is published. It is sent to the Council and other institutions, perhaps including the Committee. At this stage, the pressure groups will be involved in active lobbying of the institutions and their personnel.

The Council will refer the proposal to one of its study groups which comprise civil servants from the various states. These officials will consult with national parliaments and groups, and then send an analysis of their findings and views to COREPER. COREPER will seek to establish common ground on the proposal, via consultation with the member states and with the Commission. At this stage, procedure varies, depending on the article in the various treaties from which the legislation derives, but usually the Council then discusses the proposal and the advice it has received – having taken into consideration the views of the EP, ESC and, maybe, of the COR. It makes a decision, which it is then the task of the Commission to implement.

Cooperative procedure

The passage of the Single European Act extended the role of the Parliament although the Council still has the final say. In the TEU, cooperation was taken further, and now only covers some limited aspects of EMU.

Again, the Commission initiates a proposal, as described in the section above. However, under this procedure, rather than being allowed merely consultation (the first reading), it acquired more of a legislative role; it was given a second opportunity to examine any proposal. The agreed position of the Council was to be submitted to it for scrutiny during a second ‘reading’. For up to three months – or four if the period is extended by the Council – Parliament can discuss the proposal.

Parliament has a number of options. It can:

1. Accept the proposal, or do nothing about it. In this case, the Council can go ahead and adopt it without further delay.

2. Amend it. If the Parliament decides (on a majority basis) to modify the proposal, then within three months the Council must either accept Parliament’s modifications, accept the amended version of the Commission, or amend the revised version from the Commission.

3. Reject it. If this happens, the Council can override the objection of the Parliament, but only on the basis of a unanimous vote.

Assent procedure

The SEA also introduced another device: the assent procedure. On any proposed enlargement of the EC or on any association agreements, the assent of Parliament is needed.

Parliament may give or withhold its agreement on the proposal laid before it, but it has no power to amend it. Assent covers any international agreements as already mentioned, but in the TEU (Article 228) it now covers other items such as policies with important budgetary implications for the Union as a whole, and matters connected with citizenship or reform of the structural or cohesion funds.

In its analysis of the workings of the TEU (May 1995), the Commission identified thirty-two proposals which had been adopted under the assent procedure,  twenty of which were before the ratification of the Maastricht Treaty. In seven cases, the procedure had been completed, five concerning international agreements, one the accession of a new member and the other on a piece of legislation concerned with the Cohesion Fund.

This is not a legislative procedure but is nevertheless an important part of EU decision-making. The requirement that the assent of the EP was needed for any proposed enlargement of the Union was extended under Article 228 of the Maastricht Treaty to include such other constitutional matters as association agreements with third world countries, the organisation and objectives of the Structural and Cohesion Funds and the tasks and powers of the European Central Bank.

Co-decision procedure

Article 189b of the Maastricht Treaty introduced a further legislative procedure, that of co-decision. This covers some matters previously dealt with under the cooperation procedure and certain issues concerned with the workings of the single market.

Under the co-decision procedure, Parliament and the Council adopt legislative initiatives on the basis of joint agreement. Parliament has an absolute right of veto if it rejects the approved position of the Council, though in a conciliation stage a committee made up of representatives from the Parliament and the Commission can look for a compromise satisfactory to both institutions. The conciliation procedure can also be utilised if Parliament wishes to amend a Council proposal covered by co-decision in a way which 

2. Amend it. If the Parliament decides (on a majority basis) to modify the proposal, then within three months the Council must either accept Parliament’s modifications, accept the amended version of the Commission, or amend the revised version from the Commission.

3. Reject it. If this happens, the Council can override the objection of the Parliament, but only on the basis of a unanimous vote.

Assent procedure

The SEA also introduced another device: the assent procedure. On any proposed enlargement of the EC or on any association agreements, the assent of Parliament is needed.

Parliament may give or withhold its agreement on the proposal laid before it, but it has no power to amend it. Assent covers any international agreements as already mentioned, but in the TEU (Article 228) it now covers other items such as policies with important budgetary implications for the Union as a whole, and matters connected with citizenship or reform of the structural or cohesion funds. In its analysis of the workings of the TEU (May 1995), the Commission identified thirty-two proposals which had been adopted under the assent procedure, twenty of which were before the ratification of the Maastricht Treaty. In seven cases, the procedure had been completed, five concerning international agreements, one the accession of a new member and the other on a piece of legislation concerned with the Cohesion Fund.

This is not a legislative procedure but is nevertheless an important part of EU decision-making. The requirement that the assent of the EP was needed for any proposed enlargement of the Union was extended under Article 228 of the Maastricht Treaty to include such other constitutional matters as association agreements with third world countries, the organisation and objectives of the Structural and Cohesion Funds and the tasks and powers of the European Central Bank.

Co-decision procedure

Article 189b of the Maastricht Treaty introduced a further legislative procedure, that of co-decision. This covers some matters previously dealt with under the cooperation procedure and certain issues concerned with the workings of the single market.

Under the co-decision procedure, Parliament and the Council adopt legislative initiatives on the basis of joint agreement. Parliament has an absolute right of veto if it rejects the approved position of the Council, though in a conciliation stage a committee made up of representatives from the Parliament and the Commission can look for a compromise satisfactory to both institutions. The conciliation procedure can also be utilised if Parliament wishes to amend a Council proposal covered by co-decision in a way which the Council cannot accept. In the absence of agreement, the policy initiative fails.

Although there were fears about the likely time and complexity of codecision-making, it has worked well and enabled decisions to be taken reasonably quickly on a number of issues. The Commission document referred to above suggests that the average time involved in the procedure is less than 300 days, although as to whether this will remain true is difficult to say for there is as yet little evidence to go on. It only identified two occasions where the procedure failed to produce a decision.

Much EU legislation falls within the co-decision procedure. Originally, the procedure was used in decision-making on consumer protection, culture, education, free movement of workers, health, freedom to provide services, the single market and the adoption of guidelines or programmes covering trans-European network, research and the environment. At Amsterdam, its use was extended to cover such items as discrimination on grounds of nationality, environment policy and the fight against fraud. At Nice, further extensions covered asylum and immigration, economic and social cohesion and judicial cooperation on civil matters. Had the Constitutional Treaty been ratified, co-decision would have become the usual legislative procedure, covering most aspects of EU law.

When the proposal has been approved under whichever of the four procedures is relevant, it is then introduced in the form of a regulation, directive or decision.

Comment on the decision-making procedure

In preparation for the Intergovernmental Conference prior to Maastricht, the Commission10 itself concluded that there were three main deficiencies in the decision-making process:

1. Continuing divergence between legislative procedure and budget procedure Parliament tends to push through measures under the budgetary procedure which more appropriately come under the auspices of the legislative procedure. The converse is that the Council tends to use the legislative procedure to introduce its financial plans when they should really come under the budgetary procedure, on which Parliament has greater power.

2. Complexity of the legislative procedure There was a time when decision-making followed a simple pattern but this has not been the case since the introduction of changes in the budget procedure in the 1970s. The introduction of cooperation, assent and co-decision, as well as special arrangements for EMU, CFSP and JHA at Maastricht all added to the confusion.

The addition of new layers of responsibility since then has led to a growth in procedures and there are many variations in existence. Sometimes there is delay while discussion occurs as to which procedures should be employed. Some procedures are particularly complex and this only adds to the difficulty of understanding. Procedures need to be clearer and more precise for those not actively involved in the process; this would provide for greater openness and transparency.

3. Lack of logic in the application of procedures Different procedures apply in three equally important sectors: agriculture (consultation), transport (cooperation) and the internal market (co-decision). Sometimes, several procedures may apply in one area such as cohesion and the environment.

Decision-making is now unacceptably complex. This suggests the need for a radical transformation of the legislative processes, so that there is a clear hierarchy of issues, and an appropriate procedure to deal with each layer. The range of procedures in use at present could be reduced. At the IGC, the Commission itself envisaged only three main forms in the future: the assent procedure, a simplified co-decision procedure and consultation. Simplification of decision-making in budgetary matters was also seen as desirable, to ensure that the institutions cooperate in a more genuinely interinstitutional manner.

Criticism also focuses on other aspects of the policy-making process, however.

Search for agreement in the Council

It remains the fact that one of the major barriers to any reform is the sturdy (some would say stubborn) defence of national interests offered by some member states which are unwilling to compromise. Agricultural reform is an area where the French are particularly unwilling to make any concessions, for fear of the outcry which it will provoke in the national agricultural lobby. As a way of getting round this problem, the Commission has favoured an extension of qualified majority voting, seeing it as an ‘effective tool’ in the decision-making process.

Since Maastricht, QMV now covers new fields of activity, including consumer protection, public health, visas and vocational training, among other things. It also applies to some areas of EMU and to the environment and social policy. Where it is difficult to reach agreement, an extra push can sometimes be provided by a meeting of the European Council. This may then enable agreement to be reached within the Council of Ministers.

The decision-making process is not only concerned to achieve agreement between representatives of the national governments. The procedure in all cases is designed to achieve consensus – agreement between the institutions involved. Of course, this may result in an ineffective policy, for compromise may be on the basis of the lowest common denominator. Pleasing everybody may mean actually doing very little, and in the area of common transport policy or especially reform of the Common Agricultural Policy it has been particularly difficult to achieve substantial change.

Implementation

Even where the policy is agreed, much depends on the political will to implement it. Some countries have a notably poor record at doing so. In many areas, Britain has a good rate of compliance, though less so on environmental matters including water safety. In some countries, EU regulations and directives are regularly flouted. Implementing measures is the responsibility of the Commission, in partnership with national government departments, and, where the law is concerned, of the Court. Lack of transparency and democracy

The Union’s decision-making rules and procedures should also serve to make the institutions more democratic and help them to operate effectively. Central to the criticisms which are often made of the way the Union operates is the lack of transparency and democracy in its working arrangements.

ECB and the Eurosystem explained in 3 min.

COMMITTEE OF THE REGIONS

EUROPEAN OMBUDSMAN

EUROPEAN CENTRAL BANK

FOREIGN & SECURITY POLICY

EUROPEAN UNION LISBON TREATY

INSTITUTIONS

Committee of the Regions

The Committee of the Regions (COR) is one of the newer Community institutions, set up in the aftermath of Maastricht in order to facilitate the doctrine of subsidiarity; it met for the first time in March 1994. It was established as part of an attempt to bridge the gap between Brussels and citizens of the Union, although anti-federalists claimed that its creation was part of a Brussels plan to undermine the nation state.

The existence of the Committee reflects the growing importance of the regions in many member countries and, indeed, of the new relationships encouraged by cross-border regions such as the Rhine–Meuse (created from parts of Belgium, Germany and the Netherlands) and the Atlantic Islands Council (created by the UK, Republic of Ireland, Scottish Parliament, Welsh Assembly and the Isle of Man). The COR must be consulted during the legislative process on any matter which it is felt has regional implications, the key issues being identified as trans-European networks, health, education, culture and economic and social cohesion. There are those who would like to see the COR become a directly elected body and form a second chamber in an enlarged and strengthened European Parliament.

Like the ESC, the COR also has 344 members, provided by member states in exactly the same proportions and appointed for a four-year term. The criteria for appointment to the COR differ between member states, largely depending on their degree of decentralisation. As a federal state, Germany is represented by members of the Länder governments. Belgium is also virtually a federation of the Flemish and Walloon communities. Other countries such as Italy and Spain are highly regionalised into semi-autonomous regional administrations and these countries draw most of their COR members from the regional governments. More centralised states such as Britain have traditionally appointed COR members from the ranks of mayors of cities or chairmen of county councils. However, the devolved legislatures (the Scottish Parliament, and the Northern Irish and Welsh Assemblies) are also represented.

The COR meets in Brussels for five plenary sessions a year. Again, much of  its work is done through a structure of seven standing committees, covering areas such as:

• • Regional policy, structural funds, cross-border and inter-regional cooperation
• • Agriculture, rural development, fisheries
• • Urban issues, energy, environment.

As with the ESC, members are keen to belong to it, but often lament its lack of influence. Its internal divisions and the nature of its membership (deriving, as it does, from large, autonomous bodies but also smaller local councils) combine to mean that as yet it has not fulfilled all of the high hopes of those who devised it.

But it remains a useful channel of communication between the various units of government across the Union.

Ombudsman

The idea of appointing an ombudsman for the EU was first mooted at Maastricht but, because of ‘procedural delays’, no appointment was made until 1995. The ombudsman’s purpose is to reconcile the interests of EU citizens and EU institutions by providing for a thorough investigation of any accusation of maladministration on the part of any EU institution other than the Court of Justice. The appointee has wide-ranging powers of inquiry, the Community institutions being required to hand over all the documents and other evidence that he or she might demand of them. If maladministration is discovered the ombudsman:

• • Reports in full to the institution concerned and makes recommendations for correcting the fault
• • Can also refer the case to the European Parliament for further action.

In the first year of operation the ombudsman and his staff dealt with nearly 700 complaints, the largest number of which came from Britain. Most, however, were ruled to be inadmissible. The number of complaints received has increased steadily year by year since the office was established. In 2004, the total was 3,726, 195 of them from the United Kingdom. Spain has the highest proportion of complaints (482), although on a complaints to population basis Malta has the highest percentage, the UK the lowest.

European Central Bank

The European Central Bank (ECB) was instituted as of July 1998, at a meeting of the Ecofin council in Brussels. Prior to that date work on monetary union had been carried out by the European Monetary Institute (EMI) supported by the combined forces of the central banks of all Community members, the European System of Central Banks (ESCB).

Based in Frankfurt, the ECB is intended to serve as a normal central bank for those countries able and willing to participate in monetary union. As such the bank has three main areas of responsibility:

• • The printing, minting, issue and administration of the new euro notes and coins, together with the ultimate withdrawal of the old currencies after the transition to a single currency, which came about in July 2002
• • The determination of fiscal policy, including the setting of interest rates, for all countries in the ‘euro zone’
• • Maintaining a watching brief on the suitability for entry of countries currently outside EMU.

The ECB has an executive board and governing council that should be composed solely of representatives from those member states participating in stage three of EMU. But the European Council can give special associate membership to non-participating states, the UK being keen to maintain observer status. At the head of the ECB is a president who is appointed for eight years.

Foreign affairs, defence and internal security

The institutions described in this chapter have all been first and foremost institutions of the European Community, which is only one of the three pillars of the European Union, the other two pillars being a common foreign and security policy and a common policy relating to justice, home affairs and internal security. The only institution common to all pillars of the EU is the European Council. For the two created at Maastricht, the TEU had to create new institutions, or rather to rationalise existing ad hoc institutions within a framework of intergovernmental cooperation.

Institutions may seem dull and complex, but they are important to an understanding of the EU, providing the starting point for any understanding of how the Union operates, its policy processes and the direction in which it is moving. By achieving a clear idea of how they function and the way in which power is shared between them, we can better comprehend that the EU is an international body that is distinctive, still evolving and seeking to adjust to its enlarged membership.

Opinions vary as to where power lies within the Union. Supranationalists argue that the supranational institutions, the Commission, Parliament and Court of Justice, are a driving force behind the process of integration, for they are autonomous, being able to take decisions that are binding on member states. Intergovernmentalists stress the role of national governments (via the European Council and Council of Ministers) in making key decisions, leaving them in control of the direction of Union affairs.

Supranationalists can show that the introduction of QMV and co-decision, along with the growing importance of the European Parliament, all point to a loss in the influence of member states over decision-making. Intergovernmentalists can point to the ability of individual countries to opt out of policies they cannot accept as evidence that supranationalism is being held in check. Moreover, the ability of the European Council to shape the future direction of Europe reflects a broader trend in which the role of member states has been increasing in recent years, at the expense of the supranational Commission. The Council has played a leading role in the shaping of European integration and the resolution of contentious issues.

The way in which the Union moves forward is not on the basis of conflict between the various institutions, but via an attempt to achieve consensus which ensures that decisions are acceptable to as many countries as possible.

Glossary

Co-decision - A procedure introduced by the Maastricht Treaty that enhances the role of Parliament in the legislative process. Ultimately, parliament can in many areas veto a measure put forward by the Council of Ministers.

G8 – Group of Eight - An international forum for the governments of the original G7 advanced industrial countries (Canada, France, Germany, Italy, Japan, the United Kingdom and the United States), plus Russia, which achieved full status in 2002.

Together, the eight countries represent about 65 per cent of the world economy. The G7/8 Summit deals with macroeconomic management, international trade and relations with developing countries. The group’s activities include year-round conferences and policy research, culminating in the annual gathering attended by the heads of government of the member states.