There is an emerging body of EU law for Europeans who travel, move, live, love, work, parent, retire or divorce across borders within the European Union. There are still lacunae, but the application, the realities on the ground, are the main focus of the report Alain Lamassoure MEP has prepared for president Nicolas Sarkozy.
‘Le citoyen et l’application du droit communautaire – Rapport au Président de la République’ (8 June 2008; 188 pages) looks at the problems of EU citizens face outside their country of origin, but inside the European Union. Cross-border families are one example.
The report is posted on a number of web pages. One of them is Toute l’Europe:
http://www.touteleurope.fr/fileadmin/CIEV2/entretiens/Rapport_definitif_8_juin_2008.pdf
The perspective is French: EU citizens living in France and French citizens in other EU countries. But Lamassoure uses materials of general applicability, and he suggests that France uses its Council presidency to propose concrete measures to ameliorate the situation of cross-border persons and to inspire other EU member states to take a closer look at their laws and practices.
Taking into account how much corporations are at the centre of textbooks on European Community law, Lamassoure’s report is a valuable source for students and researchers of European law and politics, as well as migrant EU citizens.
Lamassoure looks at the human side of European integration.
Ralf Grahn
Monday, 30 June 2008
Lisbon Treaty: If conciliation fails
The striking thing about the interview with Valéry Giscard d’Estaing, as reported in my 28 June 2008 blog post ‘EU: Unable to make decisions’, was his conciliatory tone. The Irish should not be bullied. Failing ratification, negotiations are needed to solve the crisis for both Ireland and the European Union.
But there is always the risk of failure. Different alternatives need careful thought. Financial Times columnist Wolfgang Münchau has been looking at various scenarios in his articles, with the latest addition ‘The options for a Europe without a script’, published 29 June 2008 on FT.com:
http://www.ft.com/cms/s/0/f24b5eda-45eb-11dd-9009-0000779fd2ac.html
It is natural that political leaders are loath to discuss unpleasant truths as long as there is some hope of avoiding trouble, but it is necessary that free-thinking spirits offer the public realistic options.
According to Münchau we are not at breakdown point yet, but we have to consider the possibility that the Irish may not ratify the Lisbon Treaty in the end.
To continue with the Nice Treaty is out of the question, so Münchau supposes that the ratifiers find a way to enforce the Lisbon Treaty without some. He mentions the options of offering the non-ratifiers a chance to quit, various forms of intensified cooperation among integrationist countries and a regrouping under a new organisation.
***
If negotiations fail, Europe faces the stark choice between immobility and action by a narrower membership. Here I agree with Münchau.
But a more effective union would further lessen the democratic legitimacy and accountability of the European project and harden the popular resistance, if not coupled with profound democratic reform. It is time for the European leaders to face up to the democratic requirements of the 21st century.
Europe cannot preach to the world what it doesn’t practice itself.
Ralf Grahn
But there is always the risk of failure. Different alternatives need careful thought. Financial Times columnist Wolfgang Münchau has been looking at various scenarios in his articles, with the latest addition ‘The options for a Europe without a script’, published 29 June 2008 on FT.com:
http://www.ft.com/cms/s/0/f24b5eda-45eb-11dd-9009-0000779fd2ac.html
It is natural that political leaders are loath to discuss unpleasant truths as long as there is some hope of avoiding trouble, but it is necessary that free-thinking spirits offer the public realistic options.
According to Münchau we are not at breakdown point yet, but we have to consider the possibility that the Irish may not ratify the Lisbon Treaty in the end.
To continue with the Nice Treaty is out of the question, so Münchau supposes that the ratifiers find a way to enforce the Lisbon Treaty without some. He mentions the options of offering the non-ratifiers a chance to quit, various forms of intensified cooperation among integrationist countries and a regrouping under a new organisation.
***
If negotiations fail, Europe faces the stark choice between immobility and action by a narrower membership. Here I agree with Münchau.
But a more effective union would further lessen the democratic legitimacy and accountability of the European project and harden the popular resistance, if not coupled with profound democratic reform. It is time for the European leaders to face up to the democratic requirements of the 21st century.
Europe cannot preach to the world what it doesn’t practice itself.
Ralf Grahn
European integration: Re-birth without democracy?
Constantinos Simitis, the former prime minister of Greece, takes a long view on European integration in his Project Syndicate article ‘The Inevitable Re-Birth of European Integration’:
http://www.project-syndicate.org/commentary/simitis1
Since the Project Syndicate demands permission to reprint, I am going to assume that the reader turns to the original article and I move straight to my commentary.
Simitis convincingly lays out the weaknesses of the EU to formulate and to advance policies as well as to define itself in the international system. His long term view that the dimension of political problems will require solid forms of cooperation, seems well founded.
I agree with his view on the need for the Lisbon Treaty reforms as means to improve the European Union.
When the member of the Action Committee on European Democracy (ACED) sees the insufficient democratic legitimacy as an obstacle to change, I agree.
But when Simitis alleges off-hand that democracy in the EU cannot be guaranteed by the models that apply in the member states, and when he offers the Lisbon Treaty provisions on democracy plus national forums for debate as substitutes for EU level democracy, I am saddened by his lack of vision and his willingness to perpetuate the chasm between EU citizens and political leaders.
Shouldn’t the Action Committee on European Democracy be a force for democracy at the European level?
Ralf Grahn
http://www.project-syndicate.org/commentary/simitis1
Since the Project Syndicate demands permission to reprint, I am going to assume that the reader turns to the original article and I move straight to my commentary.
Simitis convincingly lays out the weaknesses of the EU to formulate and to advance policies as well as to define itself in the international system. His long term view that the dimension of political problems will require solid forms of cooperation, seems well founded.
I agree with his view on the need for the Lisbon Treaty reforms as means to improve the European Union.
When the member of the Action Committee on European Democracy (ACED) sees the insufficient democratic legitimacy as an obstacle to change, I agree.
But when Simitis alleges off-hand that democracy in the EU cannot be guaranteed by the models that apply in the member states, and when he offers the Lisbon Treaty provisions on democracy plus national forums for debate as substitutes for EU level democracy, I am saddened by his lack of vision and his willingness to perpetuate the chasm between EU citizens and political leaders.
Shouldn’t the Action Committee on European Democracy be a force for democracy at the European level?
Ralf Grahn
Sunday, 29 June 2008
Lisbon Treaty implementation
According to a memorandum the Finnish government’s EU Committee dealt with 22 February 2008, ’Lissabonin sopimuksen täytäntöönpanon valmistelu’ (Preparatory work on the implementation of the Lisbon Treaty), the Slovenian Council presidency had presented a memorandum on the work programme concerning Lisbon Treaty implementation at the Coreper (permanent representatives) meeting 17 January 2008.
Later the Finnish government’s EU Committee has dealt with the implementation of institutional questions pertaining to the Lisbon Treaty 9 May 2008, ‘Suomen kantoja Lissabonin sopimuksen täytäntöönpanoon liittyvistä keskeisistä toimielinkysymyksistä’ (Finnish positions on main institutional questions relating to the implementation of the Lisbon Treaty).
These memoranda, 18 pages in all, have been in the public domain, both times with accompanying press releases in three languages for the general public.
***
This can be contrasted with my e-mail to the Slovenian presidency requesting the already leaked first presidency memorandum listing the matters to discuss. I received neither answer nor paper.
It would have been convenient to work with the English version, instead of comparing the Finnish memoranda it with the latest presidency update in English.
***
The latest Council update (and perhaps the only one in English in the public domain) I know of is the following:
The Slovenian presidency of the EU Council presented the ’Progress report from the Presidency to the European Council – Preparatory work in view of the entry into force of the Lisbon Treaty’, dated 13 June 2008, to the European Council (document 10650/08):
http://register.consilium.europa.eu/pdf/en/08/st10/st10650.en08.pdf
Whereas the original presidency paper listed 33 discussion points, the 12 plus 2 pages on the state of play summarise 14 substantive points.
I am just going to signal the questions mentioned to interested readers:
1 Citizens’ initiative
2 Data protection
3 Advocates-General
4 Consultative panel for nomination of judges
5 Delegated and implementing acts
6 Transition to co-decision
7 Committee structure in the area of justice and home affairs
8 Budget for 2009
9 Budget procedure
10 Programming (Council and presidencies)
11 Rules of procedure of European Council and Council
12 European External Action Service
13 Chairmanship of preparatory bodies in the area of external relations
14 Issues relating to the General Affairs Council
Roughly, the questions could be sorted into two groups. There are questions, where transitional arrangements are needed, and there are questions in need of more exact implementing measures.
Students and researchers interested in the questions listed above may find a few titbits, but generally the comments can be described as oblique, in true Council fashion.
From the outset the Slovenian presidency was intent on doing a bit of technical groundwork, with the political decisions to be taken during the French Council presidency starting 1 July 2008. Now it is unclear if and when the Lisbon Treaty enters into force and for how long the Nice Treaty remains in force. These factors complicate life for the European Union and especially France at the head of the Council.
Ralf Grahn
Later the Finnish government’s EU Committee has dealt with the implementation of institutional questions pertaining to the Lisbon Treaty 9 May 2008, ‘Suomen kantoja Lissabonin sopimuksen täytäntöönpanoon liittyvistä keskeisistä toimielinkysymyksistä’ (Finnish positions on main institutional questions relating to the implementation of the Lisbon Treaty).
These memoranda, 18 pages in all, have been in the public domain, both times with accompanying press releases in three languages for the general public.
***
This can be contrasted with my e-mail to the Slovenian presidency requesting the already leaked first presidency memorandum listing the matters to discuss. I received neither answer nor paper.
It would have been convenient to work with the English version, instead of comparing the Finnish memoranda it with the latest presidency update in English.
***
The latest Council update (and perhaps the only one in English in the public domain) I know of is the following:
The Slovenian presidency of the EU Council presented the ’Progress report from the Presidency to the European Council – Preparatory work in view of the entry into force of the Lisbon Treaty’, dated 13 June 2008, to the European Council (document 10650/08):
http://register.consilium.europa.eu/pdf/en/08/st10/st10650.en08.pdf
Whereas the original presidency paper listed 33 discussion points, the 12 plus 2 pages on the state of play summarise 14 substantive points.
I am just going to signal the questions mentioned to interested readers:
1 Citizens’ initiative
2 Data protection
3 Advocates-General
4 Consultative panel for nomination of judges
5 Delegated and implementing acts
6 Transition to co-decision
7 Committee structure in the area of justice and home affairs
8 Budget for 2009
9 Budget procedure
10 Programming (Council and presidencies)
11 Rules of procedure of European Council and Council
12 European External Action Service
13 Chairmanship of preparatory bodies in the area of external relations
14 Issues relating to the General Affairs Council
Roughly, the questions could be sorted into two groups. There are questions, where transitional arrangements are needed, and there are questions in need of more exact implementing measures.
Students and researchers interested in the questions listed above may find a few titbits, but generally the comments can be described as oblique, in true Council fashion.
From the outset the Slovenian presidency was intent on doing a bit of technical groundwork, with the political decisions to be taken during the French Council presidency starting 1 July 2008. Now it is unclear if and when the Lisbon Treaty enters into force and for how long the Nice Treaty remains in force. These factors complicate life for the European Union and especially France at the head of the Council.
Ralf Grahn
EU elites – Who are they?
All the masters of strategy from Sun Tzu onwards have underlined the crucial importance of knowing your enemy. In my continuing effort to guide anti-EU campaigners towards less nebulous and more stringent thinking, the time has come to look at their favourite enemy, the ‘EU elite(s)’.
First, we have to deconstruct the concept. Who are the ‘EU elites’?
Here is my attempt:
1) We have the national heads of state or government (meeting in the European Council).
2) Then we have the national government ministers (who convene in different Council configurations) and the Council machinery with its different functions (negotiating, legislating, executing, administering, monitoring).
3) The national parliaments, elected by the citizens, each hold their own government accountable for its share in EU dealings and they hold the keys to ratification of the ground rules (treaties), constituting the dominant part of the (in my view contrived) double legitimacy of the European Union.
4) The European Parliament, directly elected by the EU citizens, at the present time co-legislator, along with the Council in most of the matters pertaining to the ‘Community pillar, but effectively excluded from the crucial decisions (setting the ground rules, electing the government, setting the main course of policies, levying taxes, deciding on the long term budget, making the fundamental decisions on foreign, security and defence policy, as well as parts of justice and home affairs and agricultural policy to name a few significant sectoral deficiencies).
5) The European Commission, with rights to propose legislation in ‘Community’ matters and with powers to execute and administer these (civil service), subject to varying degrees of Council and EP monitoring. The Commission is excluded from roughly the same policy areas as the European Parliament, with the notable exception that it executes the common agricultural policy, as defined by the Council (member states).
6) The European Court of Justice, which interprets the Treaty establishing the European Community and the secondary legislation based on it (since the Court is excluded from much of the Treaty on European Union).
***
The Court of Justice has undoubtedly advanced the aims of the treaties by landmark rulings on voids and interpretative difficulties, but it has also set limits to community action. On balance, the Court has acted according to the objectives of the treaties, sometimes beyond a literal interpretation.
The Lisbon Treaty proposes measures concerning the appointment of judges, who at the present time are effectively appointed by their respective governments, but I fail to see the merits of the anti-EU critique of ‘unelected judges’ or any constructive alternatives.
If ‘unelected judges’ are bad, how should the judges be elected? It is not enough to smear; clean-up measures should be offered.
***
The Commission has the (near) monopoly of proposals in its given fields of activity, and it executes the policies delegated to it under the watchful eye of the Council (and the European Parliament), but the Commission does not rule Europe.
From reading some of the more uneducated blogs, one could get the impression that the Commission is the lawmaker of the European Union.
Is there a viable alternative to a fairly objective guardian of the treaty provisions on the internal market, competition, external trade and other common policy areas? What would it be?
***
The directly elected European Parliament is part equal legislator, part minor partner, in community matters. The Lisbon Treaty would extend the ordinary legislative procedure (co-decision), but stil leave crucial areas of EU matters outside effective parliamentary scrutiny.
As I see it, the problem is not overwhelming EP power, but its severe limitations. EU level democratic legitimacy and accountability require profound reform to give the citizens of the European Union the decisive powers: to elect and to replace the officeholders and to set the course for the EU in all matters within its competence.
This means that the EU would get a real executive (government), responsible to the European Parliament (ultimately with two chambers).
The new European Union would be approved by a pan-EU referendum, requiring a double majority, of citizens and states.
The states where the populations vote against their own electoral powers and a more effective union, would remain outside the new structures, at their own level of comfort and factual incompetence (dressed up as sovereignty).
***
But today, the dominant EU players are the first three, mentioned above: the national leaders, the national governments and the national parliaments, as well as their creatures, the European Council and the Council.
Are these really ‘EU elites’, when in reality they are national or intergovernmental (at the expense of citizens’ more direct influence)?
The concept, as in use by anti-EU propagandists, seems to be either a fallacy or an exercise in disinformation.
The modest Treaty of Lisbon would do little to change that. More reform is needed, not less.
Ralf Grahn
First, we have to deconstruct the concept. Who are the ‘EU elites’?
Here is my attempt:
1) We have the national heads of state or government (meeting in the European Council).
2) Then we have the national government ministers (who convene in different Council configurations) and the Council machinery with its different functions (negotiating, legislating, executing, administering, monitoring).
3) The national parliaments, elected by the citizens, each hold their own government accountable for its share in EU dealings and they hold the keys to ratification of the ground rules (treaties), constituting the dominant part of the (in my view contrived) double legitimacy of the European Union.
4) The European Parliament, directly elected by the EU citizens, at the present time co-legislator, along with the Council in most of the matters pertaining to the ‘Community pillar, but effectively excluded from the crucial decisions (setting the ground rules, electing the government, setting the main course of policies, levying taxes, deciding on the long term budget, making the fundamental decisions on foreign, security and defence policy, as well as parts of justice and home affairs and agricultural policy to name a few significant sectoral deficiencies).
5) The European Commission, with rights to propose legislation in ‘Community’ matters and with powers to execute and administer these (civil service), subject to varying degrees of Council and EP monitoring. The Commission is excluded from roughly the same policy areas as the European Parliament, with the notable exception that it executes the common agricultural policy, as defined by the Council (member states).
6) The European Court of Justice, which interprets the Treaty establishing the European Community and the secondary legislation based on it (since the Court is excluded from much of the Treaty on European Union).
***
The Court of Justice has undoubtedly advanced the aims of the treaties by landmark rulings on voids and interpretative difficulties, but it has also set limits to community action. On balance, the Court has acted according to the objectives of the treaties, sometimes beyond a literal interpretation.
The Lisbon Treaty proposes measures concerning the appointment of judges, who at the present time are effectively appointed by their respective governments, but I fail to see the merits of the anti-EU critique of ‘unelected judges’ or any constructive alternatives.
If ‘unelected judges’ are bad, how should the judges be elected? It is not enough to smear; clean-up measures should be offered.
***
The Commission has the (near) monopoly of proposals in its given fields of activity, and it executes the policies delegated to it under the watchful eye of the Council (and the European Parliament), but the Commission does not rule Europe.
From reading some of the more uneducated blogs, one could get the impression that the Commission is the lawmaker of the European Union.
Is there a viable alternative to a fairly objective guardian of the treaty provisions on the internal market, competition, external trade and other common policy areas? What would it be?
***
The directly elected European Parliament is part equal legislator, part minor partner, in community matters. The Lisbon Treaty would extend the ordinary legislative procedure (co-decision), but stil leave crucial areas of EU matters outside effective parliamentary scrutiny.
As I see it, the problem is not overwhelming EP power, but its severe limitations. EU level democratic legitimacy and accountability require profound reform to give the citizens of the European Union the decisive powers: to elect and to replace the officeholders and to set the course for the EU in all matters within its competence.
This means that the EU would get a real executive (government), responsible to the European Parliament (ultimately with two chambers).
The new European Union would be approved by a pan-EU referendum, requiring a double majority, of citizens and states.
The states where the populations vote against their own electoral powers and a more effective union, would remain outside the new structures, at their own level of comfort and factual incompetence (dressed up as sovereignty).
***
But today, the dominant EU players are the first three, mentioned above: the national leaders, the national governments and the national parliaments, as well as their creatures, the European Council and the Council.
Are these really ‘EU elites’, when in reality they are national or intergovernmental (at the expense of citizens’ more direct influence)?
The concept, as in use by anti-EU propagandists, seems to be either a fallacy or an exercise in disinformation.
The modest Treaty of Lisbon would do little to change that. More reform is needed, not less.
Ralf Grahn
Saturday, 28 June 2008
Anti-EU by any other name
By the way, I have wondered at the widespread acceptance of the ‘Euroscepticism’ as the label people use, whose attitude reveals nothing sceptic. No doubts, no uncertainty, no open minds. After reading a lot of these outpourings, I am beginning to think that the ‘Eurosceptic’ in search of truths has yet to be born.
Thus, the label is woolly and misleading. Let’s call a spade a spade.
The early constitutional history of the United States saw the debate between Federalists and anti-Federalists. Let people who identify with Europe be called Europeans, pro-Europeans or pro-EU, and let the people who want to wreck the European Union be called by the most objective term available: anti-EU.
(Some of them, for reasons yet to be verified, deny that they are anti-Europeans. They are only vehemently against Europe’s common institutions and manifestations)
***
Another healthy distinction would be to see EU detractors clearly define what they are against (if a viable programme for anything proves too demanding).
Do they want to dismember the European Union completely, or would they be content to see their own country secede from the EU?
If they have nothing against the vast majority of Europeans deepening European integration, these campaigners could redirect their energies towards secession. With a sharper focus they could perhaps improve their chances of success.
Actually, if their ideals are the ‘free nations of Europe’, why not let the other free nations decide for themselves on cooperation and common action, without insult or injury?
Traders (and nations of shopkeepers) want to keep their customers happy and engage in profitable relations with their providers, don’t they?
Why cause a lot of aggravation, if they only want to live happily ever after behind their moat?
Ralf Grahn
Thus, the label is woolly and misleading. Let’s call a spade a spade.
The early constitutional history of the United States saw the debate between Federalists and anti-Federalists. Let people who identify with Europe be called Europeans, pro-Europeans or pro-EU, and let the people who want to wreck the European Union be called by the most objective term available: anti-EU.
(Some of them, for reasons yet to be verified, deny that they are anti-Europeans. They are only vehemently against Europe’s common institutions and manifestations)
***
Another healthy distinction would be to see EU detractors clearly define what they are against (if a viable programme for anything proves too demanding).
Do they want to dismember the European Union completely, or would they be content to see their own country secede from the EU?
If they have nothing against the vast majority of Europeans deepening European integration, these campaigners could redirect their energies towards secession. With a sharper focus they could perhaps improve their chances of success.
Actually, if their ideals are the ‘free nations of Europe’, why not let the other free nations decide for themselves on cooperation and common action, without insult or injury?
Traders (and nations of shopkeepers) want to keep their customers happy and engage in profitable relations with their providers, don’t they?
Why cause a lot of aggravation, if they only want to live happily ever after behind their moat?
Ralf Grahn
Populist Euroscepticism
Fabian Guy Neuner has started a blog, Embracing the Union, with the aim to face up to the destructive power of populist Euroscepticism. The address of Embracing the Union is:
http://embracingtheunion.blogactiv.eu/
Neuner’s first post ‘Now is the time! Lessons from Dublin and Vienna’ (26 June 2008) discusses the Irish rejection of the Lisbon Treaty. Neuner sees the ‘no’ vote in Ireland as a victory for targeted misinformation which uses people’s fears to mobilise the masses.
On the same day as the first post, the Social Democratic Party of Austria (SPÖ) leadership caved in to populist pressure by proclaiming that they would put further treaty ratifications to a plebiscite. In Neuner’s view, populism nurtured by Euroscepticism has the power to make leaders drop their commitment to European integration in order to remain in power (or at least increase their chances of doing so).
Neuner sets himself the objective of critically discussing the EU’s democratic credentials and discrediting the myths that permeate the debate on Europe.
***
It is always a pleasure to see a new critical and constructive Euroblog in English. I wish Neuner good luck in his endeavour and I look forward to his following posts.
Ralf Grahn
http://embracingtheunion.blogactiv.eu/
Neuner’s first post ‘Now is the time! Lessons from Dublin and Vienna’ (26 June 2008) discusses the Irish rejection of the Lisbon Treaty. Neuner sees the ‘no’ vote in Ireland as a victory for targeted misinformation which uses people’s fears to mobilise the masses.
On the same day as the first post, the Social Democratic Party of Austria (SPÖ) leadership caved in to populist pressure by proclaiming that they would put further treaty ratifications to a plebiscite. In Neuner’s view, populism nurtured by Euroscepticism has the power to make leaders drop their commitment to European integration in order to remain in power (or at least increase their chances of doing so).
Neuner sets himself the objective of critically discussing the EU’s democratic credentials and discrediting the myths that permeate the debate on Europe.
***
It is always a pleasure to see a new critical and constructive Euroblog in English. I wish Neuner good luck in his endeavour and I look forward to his following posts.
Ralf Grahn
EU: Unable to make decisions
The English blogosphere has addressed the latest public statements by Valéry Giscard d’Estaing with its customary narrow outlook, missing both his analysis and his suggestions for the future of the European Union.
Here are a few missing links from the L’Express interview with the former chairman of the European Convention (26 June 2008), but first a link to the whole interview, Valéry Giscard d’Estaing : « Il faut adopter le traité de Lisbonne »
http://www.lexpress.fr/actualite/politique/giscard-il-faut-adopter-le-traite-de-lisbonne_516403.html
Giscard d’Estaing’s analysis is that the institutional life has paralysed Europe for a long time. The problem is not what the European Union decides, but the fact that it does not reach decisions. Europe lacks true leadership, although Angela Merkel appears to be a genuine political leader in Europe.
The 27 leaders who convene four times annually are incapable of making real decisions.
According to Giscard d’Estaing the key to change is democratic. There is a need for responsible actors and the great decisions have to be taken democratically. Evidently this means qualified majority voting instead of unanimity.
The Lisbon Treaty has been ratified by 19 states, which represent 70 per cent of the population of the European Union.
One can deplore the decision of the Irish, who have said that the Lisbon Treaty does not suit them, although it responds to many of their demands.
Europe should handle only the questions for which our countries are too small. International trade, the money, competition, the great environmental problems, the defence of the European continent, these are for Europe. The rest is not!
It is up to the Irish government to think about a possible re-vote. The Irish are uneasy pro-Europeans. They should be reassured, not bullied. (If the Ireland does not ratify the Lisbon Treaty) negotiations are needed with the aim to let the other countries approve the treaty and give Ireland a special status, if that is what they want. It would be a British style development.
The situation has to be solved. The Irish can refuse to apply the Lisbon Treaty, but they can not take the rest of the Europeans hostage.
The coming European elections should look to the future. Should the European Union be a political entity defined by its institutions? Should enlargement continue, or is a pause called for? Should the powers of the EU be extended or (the present ones) respected? I hope that the citizens vote in June on these questions, because the future of 500 million people can not be built on diplomatic negotiations. We do not live in the times of the Holy Alliance anymore.
***
Readers of English anti-EU blogs tend to get a skewed picture of continental discourse on European integration. Learning languages and finding original sources offer independent means of understanding the real European Union better, both its merits and its shortcomings.
Enlightened citizens make for better politics.
Ralf Grahn
Here are a few missing links from the L’Express interview with the former chairman of the European Convention (26 June 2008), but first a link to the whole interview, Valéry Giscard d’Estaing : « Il faut adopter le traité de Lisbonne »
http://www.lexpress.fr/actualite/politique/giscard-il-faut-adopter-le-traite-de-lisbonne_516403.html
Giscard d’Estaing’s analysis is that the institutional life has paralysed Europe for a long time. The problem is not what the European Union decides, but the fact that it does not reach decisions. Europe lacks true leadership, although Angela Merkel appears to be a genuine political leader in Europe.
The 27 leaders who convene four times annually are incapable of making real decisions.
According to Giscard d’Estaing the key to change is democratic. There is a need for responsible actors and the great decisions have to be taken democratically. Evidently this means qualified majority voting instead of unanimity.
The Lisbon Treaty has been ratified by 19 states, which represent 70 per cent of the population of the European Union.
One can deplore the decision of the Irish, who have said that the Lisbon Treaty does not suit them, although it responds to many of their demands.
Europe should handle only the questions for which our countries are too small. International trade, the money, competition, the great environmental problems, the defence of the European continent, these are for Europe. The rest is not!
It is up to the Irish government to think about a possible re-vote. The Irish are uneasy pro-Europeans. They should be reassured, not bullied. (If the Ireland does not ratify the Lisbon Treaty) negotiations are needed with the aim to let the other countries approve the treaty and give Ireland a special status, if that is what they want. It would be a British style development.
The situation has to be solved. The Irish can refuse to apply the Lisbon Treaty, but they can not take the rest of the Europeans hostage.
The coming European elections should look to the future. Should the European Union be a political entity defined by its institutions? Should enlargement continue, or is a pause called for? Should the powers of the EU be extended or (the present ones) respected? I hope that the citizens vote in June on these questions, because the future of 500 million people can not be built on diplomatic negotiations. We do not live in the times of the Holy Alliance anymore.
***
Readers of English anti-EU blogs tend to get a skewed picture of continental discourse on European integration. Learning languages and finding original sources offer independent means of understanding the real European Union better, both its merits and its shortcomings.
Enlightened citizens make for better politics.
Ralf Grahn
Lisbon Treaty: Rejection and impotence
Renaud Dehousse offers a French view on the Irish ’no’ vote concerning the Treaty of Lisbon. The Telos article « Europe : un non de trop » (Telos, 17 June 2008) analyses the Irish referendum result, comments on the suitability of referenda, states that Europe has reached the limits of reform under unanimity rules and concludes that the willing states have to find the means to realise their projects without being held back by the partisans of ‘status quo’:
http://www.telos-eu.com/fr/article/europe_un_non_de_trop
Since Telos shows its free academic spirit by prohibiting all reprinting, I will leave the rest to the readers.
Ralf Grahn
http://www.telos-eu.com/fr/article/europe_un_non_de_trop
Since Telos shows its free academic spirit by prohibiting all reprinting, I will leave the rest to the readers.
Ralf Grahn
Lisbon Treaty: Reasons for ratification
Bartolus of the excellent EU Law Blog commented on the European Council conclusions after the Irish ’no’ vote:
‘As you can see from the “conclusions”, the result was well, err, inconclusive.’
Go to the post ‘Lisbon Treaty and European Council’ (21 June 2008), with the conclusions:
http://eulaw.typepad.com/eulawblog/2008/06/lisbon-treaty-and-european-council.html
‘Students, academics, practitioners and anyone else who may be interested’ in the European Union is often left to find out the thinking behind and assessments of Council outcomes from independent sources.
Carl Fredrik Bergström, from Sieps (the Swedish Institute for European Policy Studies), wrote his assessment before the European Council meeting (16 June 2008), but ‘Vad händer med Lissabonfördraget efter irländarnas nej?’ (What happens to the Lisbon Treaty after the Irish no?) sheds some light on post-referendum reasoning:
http://www.sieps.se/publ/utredningar/bilagor/Vad_hander_med_Lissabonfordraget_efter_Irlands_nej.pdf
Bergström notes the formal stipulation of Article 48 of the Treaty on European Union and the possible conclusion to scrap the Treaty of Lisbon. However, such a conclusion would probably be too hasty, on two counts.
First, all the EU member states’ governments have seen the great need for amendments and they all support the amendments agreed in the Treaty of Lisbon. The problems do not disappear even if the Irish vote ‘no’.
Second, 800,000 Irish ‘no’ voters do not prove that the solutions agreed between the governments are bad or unwanted. On the contrary, the Lisbon Treaty can probably count on the support of national parliaments representing almost 500 million citizens.
It is reasonable to expect the remaining national parliaments to continue their ratification processes. Bergström then distinguishes between the situation where Ireland alone has rejected the Lisbon Treaty (and others move ahead, in one way or another) or if others join them (domino effect).
Bergström offers a preliminary outline of alternative solutions, in three batches:
1) Amendments without a new treaty.
2) Amendments or ‘adaptations’ in the connection of the next enlargement. New Irish position needed.
3) Later amendments (including those with deferred implementation according to the Lisbon Treaty). New Irish position needed.
Bergström’s batches sketch alternatives and outline thinking. A detailed analysis of different alternatives is offered by professor Steve Peers (Statewatch), mentioned in the 27 June 2008 post ‘Lisbon Treaty: Legal analysis of ratification, implementation and impact of non-ratification’:
http://grahnlaw.blogspot.com/2008/06/lisbon-treaty-legal-analysis-of.html
***
The needs for EU reform have disappeared nowhere. States unwilling or unable to keep pace should actively search for solutions within their comfort zone and let the rest accomplish real EU reform.
Ralf Grahn
‘As you can see from the “conclusions”, the result was well, err, inconclusive.’
Go to the post ‘Lisbon Treaty and European Council’ (21 June 2008), with the conclusions:
http://eulaw.typepad.com/eulawblog/2008/06/lisbon-treaty-and-european-council.html
‘Students, academics, practitioners and anyone else who may be interested’ in the European Union is often left to find out the thinking behind and assessments of Council outcomes from independent sources.
Carl Fredrik Bergström, from Sieps (the Swedish Institute for European Policy Studies), wrote his assessment before the European Council meeting (16 June 2008), but ‘Vad händer med Lissabonfördraget efter irländarnas nej?’ (What happens to the Lisbon Treaty after the Irish no?) sheds some light on post-referendum reasoning:
http://www.sieps.se/publ/utredningar/bilagor/Vad_hander_med_Lissabonfordraget_efter_Irlands_nej.pdf
Bergström notes the formal stipulation of Article 48 of the Treaty on European Union and the possible conclusion to scrap the Treaty of Lisbon. However, such a conclusion would probably be too hasty, on two counts.
First, all the EU member states’ governments have seen the great need for amendments and they all support the amendments agreed in the Treaty of Lisbon. The problems do not disappear even if the Irish vote ‘no’.
Second, 800,000 Irish ‘no’ voters do not prove that the solutions agreed between the governments are bad or unwanted. On the contrary, the Lisbon Treaty can probably count on the support of national parliaments representing almost 500 million citizens.
It is reasonable to expect the remaining national parliaments to continue their ratification processes. Bergström then distinguishes between the situation where Ireland alone has rejected the Lisbon Treaty (and others move ahead, in one way or another) or if others join them (domino effect).
Bergström offers a preliminary outline of alternative solutions, in three batches:
1) Amendments without a new treaty.
2) Amendments or ‘adaptations’ in the connection of the next enlargement. New Irish position needed.
3) Later amendments (including those with deferred implementation according to the Lisbon Treaty). New Irish position needed.
Bergström’s batches sketch alternatives and outline thinking. A detailed analysis of different alternatives is offered by professor Steve Peers (Statewatch), mentioned in the 27 June 2008 post ‘Lisbon Treaty: Legal analysis of ratification, implementation and impact of non-ratification’:
http://grahnlaw.blogspot.com/2008/06/lisbon-treaty-legal-analysis-of.html
***
The needs for EU reform have disappeared nowhere. States unwilling or unable to keep pace should actively search for solutions within their comfort zone and let the rest accomplish real EU reform.
Ralf Grahn
Friday, 27 June 2008
Lisbon Treaty: Legal analysis of ratification, implementation and impact of non-ratification
Professor Steve Peers, of the University of Essex, has written a legal analysis of the situation following the Irish ‘no’ vote on the EU Treaty of Lisbon.
The paper looks, in great clarity, at three main questions, with detailed potential variations:
1) Can the Treaty of Lisbon still be ratified?
2) Can the Lisbon treaty be implemented in practice, if it is not ratified?
3) What would be the impact of non-ratification of the Lisbon Treaty upon the European Union?
The analysis is recommended for everyone interested in the various options discussed in earnest since the outcome of the referendum in Ireland. ‘Can the Treaty of Lisbon be ratified or implemented? A legal analysis’, by Steve Peers (19 June 2008; 15 pages, pdf), can be accessed at the Statewatch web pages:
http://www.statewatch.org/news/2008/jun/analysis-lisbon-june-sp-2008.pdf
***
The conclusions are legal, not political, but they form the basis for coming political decisions.
The details are best left to the reader, so I will make just a few short remarks.
Roughly, the new offices and improved decision-making procedures are stalled in the event of non-ratification of the Treaty of Lisbon.
If push came to shove, the member states can be seen to have an implied right to withdraw from the union (in order to establish a new one). Here, an additional discussion of the main theme of EU integration, ever closer union, with regard to the ‘clausula rebus sic stantibus’ would have been welcome, with regard to member states frustrated in their attempts to advance.
Legally, the European Union could expand (but is it feasible politically?).
If there is no new treaty in time (for the European elections 2009), two old ghosts of the Treaty of Nice are worthy of notice. The number of Commission members has to be cut and the number of MEPs would be 732, instead of 751. In both cases, time is running (out).
An interesting promise to look forward to: A detailed Statewatch analysis with Proposals for greater openness, transparency and democracy in the EU (forthcoming).
Ralf Grahn
The paper looks, in great clarity, at three main questions, with detailed potential variations:
1) Can the Treaty of Lisbon still be ratified?
2) Can the Lisbon treaty be implemented in practice, if it is not ratified?
3) What would be the impact of non-ratification of the Lisbon Treaty upon the European Union?
The analysis is recommended for everyone interested in the various options discussed in earnest since the outcome of the referendum in Ireland. ‘Can the Treaty of Lisbon be ratified or implemented? A legal analysis’, by Steve Peers (19 June 2008; 15 pages, pdf), can be accessed at the Statewatch web pages:
http://www.statewatch.org/news/2008/jun/analysis-lisbon-june-sp-2008.pdf
***
The conclusions are legal, not political, but they form the basis for coming political decisions.
The details are best left to the reader, so I will make just a few short remarks.
Roughly, the new offices and improved decision-making procedures are stalled in the event of non-ratification of the Treaty of Lisbon.
If push came to shove, the member states can be seen to have an implied right to withdraw from the union (in order to establish a new one). Here, an additional discussion of the main theme of EU integration, ever closer union, with regard to the ‘clausula rebus sic stantibus’ would have been welcome, with regard to member states frustrated in their attempts to advance.
Legally, the European Union could expand (but is it feasible politically?).
If there is no new treaty in time (for the European elections 2009), two old ghosts of the Treaty of Nice are worthy of notice. The number of Commission members has to be cut and the number of MEPs would be 732, instead of 751. In both cases, time is running (out).
An interesting promise to look forward to: A detailed Statewatch analysis with Proposals for greater openness, transparency and democracy in the EU (forthcoming).
Ralf Grahn
EU: Unanimity curse – The road ahead
Carlos Closa analyses the crucial unanimity rule concerning the ratification of EU treaties in an article called ‘Tras Irlanda: referendum y unanimidad’ (After Ireland: referendum and unanimity). The article (16 June 2008) is available on the web pages of the Real Instituto Elcano:
http://www.realinstitutoelcano.org/wps/portal/rielcano/contenido?WCM_GLOBAL_CONTEXT=/Elcano_es/Zonas_es/ARI62-2008
The Irish referendum result means the start of a new period of uncertainty with regard to European integration. Even more questionable than the referendum is the requirement of unanimous ratification by all member states of every treaty reform in a union as large and heterogeneous as the existing one.
Closa’s critique is founded on four reasons against unanimity:
1) It violates the equality of the parties.
2) The chances of any success diminish enormously.
3) The democratic principle is perverted.
4) The decision of one saddle the rest with the costs (externalisation).
Closa’s conclusion is that unanimity is an inadequate procedure for treaty reform. He acknowledges the taboo character of the subject, but he suggests an isolated reform of Article 48 of the Treaty on European Union.
***
Closa’s critique of the unanimity rule is well founded. Since the publication of the article, the Irish referendum has precipitated tendencies to unravel the Treaty of Lisbon, unanimously agreed by all member states’ governments as late as last December.
By now, revisionist voices have been heard in Austria, Cyprus, the Czech Republic and Poland, not to mention Ireland. The United Kingdom seems to have tied its ratification to ultimate approval by Ireland (and thus, all 27 member states). Further dismantling can not be excluded.
Even more than at the time of Closa’s writing, the European Union stands at a crossroads. Institutional and democratic reform is achievable only among some of the member states. A choice has to be made between the quality of integration and the quantity of participants.
A two union solution seems to be the only alternative to gridlock. The advanced, political union would be based on democratic ground rules and effective decision-making. The old union would have to be accommodated somewhere along the lines of the European Economic Area, the European Community or the EU mark Nice.
One-speed Europe is none-speed Europe.
It is time to move ahead to give “old Europe” and “new Europe” a new connotation.
Ralf Grahn
http://www.realinstitutoelcano.org/wps/portal/rielcano/contenido?WCM_GLOBAL_CONTEXT=/Elcano_es/Zonas_es/ARI62-2008
The Irish referendum result means the start of a new period of uncertainty with regard to European integration. Even more questionable than the referendum is the requirement of unanimous ratification by all member states of every treaty reform in a union as large and heterogeneous as the existing one.
Closa’s critique is founded on four reasons against unanimity:
1) It violates the equality of the parties.
2) The chances of any success diminish enormously.
3) The democratic principle is perverted.
4) The decision of one saddle the rest with the costs (externalisation).
Closa’s conclusion is that unanimity is an inadequate procedure for treaty reform. He acknowledges the taboo character of the subject, but he suggests an isolated reform of Article 48 of the Treaty on European Union.
***
Closa’s critique of the unanimity rule is well founded. Since the publication of the article, the Irish referendum has precipitated tendencies to unravel the Treaty of Lisbon, unanimously agreed by all member states’ governments as late as last December.
By now, revisionist voices have been heard in Austria, Cyprus, the Czech Republic and Poland, not to mention Ireland. The United Kingdom seems to have tied its ratification to ultimate approval by Ireland (and thus, all 27 member states). Further dismantling can not be excluded.
Even more than at the time of Closa’s writing, the European Union stands at a crossroads. Institutional and democratic reform is achievable only among some of the member states. A choice has to be made between the quality of integration and the quantity of participants.
A two union solution seems to be the only alternative to gridlock. The advanced, political union would be based on democratic ground rules and effective decision-making. The old union would have to be accommodated somewhere along the lines of the European Economic Area, the European Community or the EU mark Nice.
One-speed Europe is none-speed Europe.
It is time to move ahead to give “old Europe” and “new Europe” a new connotation.
Ralf Grahn
EU: Let the people speak!
After the Irish ’no’ vote, Jean Dominique Giuliani acknowledges that the European Union has a problem with its population. The chairman of the Robert Schuman Foundation puts forward his proposal to avoid the crisis in a web article titled ‘If the people say no – let the people speak!’:
http://www.jd-giuliani.eu/en/article/cat-2/91_If-the-people-say-no-–-let-the-people-speak-.html
The European Union must now show that it is possible to respect national identity and yet build a supranational democracy. Giuliani proposes allied national lists to put forward their candidates for the Commission president in the European elections 2009 and a simultaneous referendum on the choice of a president for the European Council.
***
I have supposed, even without the Treaty of Lisbon in force, that the main European level parties are going to put forward their candidates for president of the European Commission. Even under the Treaty of Nice, nothing prevents the European Council to act in accordance with the election result.
The president of the European Council is, in my view, a trickier proposition.
First of all, the semi-permanent president of the meetings of heads of state or government is a creation of the Lisbon Treaty. If the amending treaty is still in tatters ahead of the European Parliament elections, there is no post to fill (immediately).
Second, even with the Lisbon Treaty in force, every move to strengthen the role of the intergovernmental branch of the European Union tends to overshadow the role of the European Parliament and the European Commission, potentially closer to reforms for democratic legitimacy and accountability. Thus, the best option would be to let the Commission president chair the meetings of the European Council, as proposed by the ‘Who do I call?’ campaign:
http://www.whodoicall.eu/
If the member states refuse to combine the posts, they should at least see to fair and transparent procedures, with open nominations, public debate and transparent decision-making.
***
The merit of Giuliani’s analysis is the acknowledgement that the EU needs some democratic reform.
Sadly lacking in Giuliani’s editorial is the wholehearted endorsement of EU level democracy. Instead, his proposals are selective sops aimed at appeasing an increasingly hostile population.
Far from enough, Giuliani’s Europe would still have a problem with its population.
Only wholesale EU level democracy can give the necessary European project the legitimacy and accountability it needs.
Ralf Grahn
http://www.jd-giuliani.eu/en/article/cat-2/91_If-the-people-say-no-–-let-the-people-speak-.html
The European Union must now show that it is possible to respect national identity and yet build a supranational democracy. Giuliani proposes allied national lists to put forward their candidates for the Commission president in the European elections 2009 and a simultaneous referendum on the choice of a president for the European Council.
***
I have supposed, even without the Treaty of Lisbon in force, that the main European level parties are going to put forward their candidates for president of the European Commission. Even under the Treaty of Nice, nothing prevents the European Council to act in accordance with the election result.
The president of the European Council is, in my view, a trickier proposition.
First of all, the semi-permanent president of the meetings of heads of state or government is a creation of the Lisbon Treaty. If the amending treaty is still in tatters ahead of the European Parliament elections, there is no post to fill (immediately).
Second, even with the Lisbon Treaty in force, every move to strengthen the role of the intergovernmental branch of the European Union tends to overshadow the role of the European Parliament and the European Commission, potentially closer to reforms for democratic legitimacy and accountability. Thus, the best option would be to let the Commission president chair the meetings of the European Council, as proposed by the ‘Who do I call?’ campaign:
http://www.whodoicall.eu/
If the member states refuse to combine the posts, they should at least see to fair and transparent procedures, with open nominations, public debate and transparent decision-making.
***
The merit of Giuliani’s analysis is the acknowledgement that the EU needs some democratic reform.
Sadly lacking in Giuliani’s editorial is the wholehearted endorsement of EU level democracy. Instead, his proposals are selective sops aimed at appeasing an increasingly hostile population.
Far from enough, Giuliani’s Europe would still have a problem with its population.
Only wholesale EU level democracy can give the necessary European project the legitimacy and accountability it needs.
Ralf Grahn
Thursday, 26 June 2008
European Political Union
Instead of the outdated model, where national interests take the common good hostage, Stefan Collignon and Christian Paul suggest addressing the core problem of democracy by creating a European Political Union.
Their article ‘It’s democracy, stupid!’ (17 June 2008) proposes that the next European Parliament, elected in 2009, elaborates a Constitution for the European Political Union to set up a government for the administration of European common goods.
It would be a limited government, in charge of only those public goods that affect all European citizens together. This government, democratically elected by and accountable to the European Parliament, would mean that citizens obtain the right to choose policy directions when they elect their representatives.
The existing economic union would be maintained for member states not willing to participate in political deepening. The European Political Union would be a coalition of the willing.
The article can be found at:
http://www.eurointelligence.com/article.581+M548c6346b78.0.html
***
Collignon and Paul assess the needs and set out their proposals in line with what this blog argues.
They want to make the next European Parliament into a constituent assembly. This is one way to achieve the package this blog has proposed: to combine the Lisbon Treaty with a pledge by the European Council to institute democratic legitimacy and accountability at the EU level, among a coalition of willing states.
Read and reflect.
Ralf Grahn
Their article ‘It’s democracy, stupid!’ (17 June 2008) proposes that the next European Parliament, elected in 2009, elaborates a Constitution for the European Political Union to set up a government for the administration of European common goods.
It would be a limited government, in charge of only those public goods that affect all European citizens together. This government, democratically elected by and accountable to the European Parliament, would mean that citizens obtain the right to choose policy directions when they elect their representatives.
The existing economic union would be maintained for member states not willing to participate in political deepening. The European Political Union would be a coalition of the willing.
The article can be found at:
http://www.eurointelligence.com/article.581+M548c6346b78.0.html
***
Collignon and Paul assess the needs and set out their proposals in line with what this blog argues.
They want to make the next European Parliament into a constituent assembly. This is one way to achieve the package this blog has proposed: to combine the Lisbon Treaty with a pledge by the European Council to institute democratic legitimacy and accountability at the EU level, among a coalition of willing states.
Read and reflect.
Ralf Grahn
EU: How many humiliations?
Our interlocutor, the Tap Blog, has made a first venture into the world after the imagined European Union collapse. Their vision is a Europe of Nations, in ‘The World Needs Europe’s Nations, Not The EU’ (26 June 2008):
http://the-tap.blogspot.com/2008/06/world-needs-europes-nations-not-eu.html
***
It sounds nice and cosy, but how on earth are the European nation states going to prosper on their own in a harsh world, when they fail to get their act together under the current (and proposed) veto-enabling rules?
Russia has been picking of the EU countries at will, to the extent that it seems to be sorry for their present state of disarray. On the other hand, the EU’s possibilities to negotiate have been blocked by repeated national vetoes.
For a realistic assessment of the EU countries’ predicament, read the summary on EU–Russia relations by Robert Amsterdam ‘A Broken Europe Can’t Negotiate with Moscow’ (25 June 2008):
http://www.robertamsterdam.com/2008/06/a_broken_europe_cant_negotiate.htm
For a realist assessment of the challenges for Europe, I repeat my recommendation to read the blog by James Rogers, Global Power Europe:
http://www.globalpowereurope.eu/
***
Squabbling with each other and vetoing away their future, the EU member states are in for a lot of humiliations on the international scene.
Most of the time, they can, of course, cobble together a statement deploring the situation …
The Lisbon Treaty would improve the internal efficiency of the European Union’s common foreign and security policy, but the real world effectiveness of its policies would still be hostage to the ‘liberum veto’.
In other words, the proposed improvements are too little, too late.
The European leaders will the good outcomes, but they refuse the means to achieve them.
***
But to propose a Europe of Nations – cosy as it sounds – is taking the wrong turn altogether, as long as there is no convincing explanation of how these proud nations would do better completely on their own or with an added dose of intergovernmental inefficiency.
The Tap Blog, in my humble opinion, suffers from one fundamental flaw. Its object of worship is the nation state.
My yardstick is the interest of the EU citizen. From two main angles: security and prosperity.
We already have our nations, and they are not going to disappear. But we need the team effort called the European Union, indeed a much improved EU, not only willing, but able to defend our common interests.
How many humiliations have to be endured before we get what we need?
Ralf Grahn
http://the-tap.blogspot.com/2008/06/world-needs-europes-nations-not-eu.html
***
It sounds nice and cosy, but how on earth are the European nation states going to prosper on their own in a harsh world, when they fail to get their act together under the current (and proposed) veto-enabling rules?
Russia has been picking of the EU countries at will, to the extent that it seems to be sorry for their present state of disarray. On the other hand, the EU’s possibilities to negotiate have been blocked by repeated national vetoes.
For a realistic assessment of the EU countries’ predicament, read the summary on EU–Russia relations by Robert Amsterdam ‘A Broken Europe Can’t Negotiate with Moscow’ (25 June 2008):
http://www.robertamsterdam.com/2008/06/a_broken_europe_cant_negotiate.htm
For a realist assessment of the challenges for Europe, I repeat my recommendation to read the blog by James Rogers, Global Power Europe:
http://www.globalpowereurope.eu/
***
Squabbling with each other and vetoing away their future, the EU member states are in for a lot of humiliations on the international scene.
Most of the time, they can, of course, cobble together a statement deploring the situation …
The Lisbon Treaty would improve the internal efficiency of the European Union’s common foreign and security policy, but the real world effectiveness of its policies would still be hostage to the ‘liberum veto’.
In other words, the proposed improvements are too little, too late.
The European leaders will the good outcomes, but they refuse the means to achieve them.
***
But to propose a Europe of Nations – cosy as it sounds – is taking the wrong turn altogether, as long as there is no convincing explanation of how these proud nations would do better completely on their own or with an added dose of intergovernmental inefficiency.
The Tap Blog, in my humble opinion, suffers from one fundamental flaw. Its object of worship is the nation state.
My yardstick is the interest of the EU citizen. From two main angles: security and prosperity.
We already have our nations, and they are not going to disappear. But we need the team effort called the European Union, indeed a much improved EU, not only willing, but able to defend our common interests.
How many humiliations have to be endured before we get what we need?
Ralf Grahn
Vote and advance!
The chairman of the think-tank Notre Europe, Tommaso Padoa-Schioppa, makes an interesting – and true – observation of the history of European integration. France has been the determining factor. When France has put the brakes on, to preserve its veto, the European communities have stalled, often leading to severe crises. When France has agreed to effective decision-making, the European project has advanced and the common good has been given a firmer footing.
In other words, France has effectively regulated progress.
Padoa-Schioppas article ‘Président Sarkozy, faites voter !’ can be found in Le Monde (26 June 2008) :
http://www.lemonde.fr/opinions/article/2008/06/25/president-sarkozy-faites-voter-par-tommaso-padoa-schioppa_1062635_3232.html
In addition to his interesting analysis, the chairman of the think-tank founded by Jacques Delors issues an impassioned plea to France to use the six months of its Council presidency to become, once again, the engine of the European Union. Key to this is not to accept blocking vetoes, but to vote, to decide and to progress. The gist of Padoa-Schioppa’s plea can be read in the concluding paragraph of the article:
« La France a entre ses mains les clés pour libérer l'horizon. La présidence de l'Union représente une occasion unique qu'elle ne doit pas rater. Les débats sur le bilan de santé de la PAC, la politique d'immigration et l'énergie s'y prêteraient à merveille. Dès lors, ma recommandation centrale à la future présidence française tient en deux mots : n'acceptez pas le blocage par le veto, n'acceptez pas de retarder une décision pour attendre tout le monde, "faites voter !" La France démontrera ainsi sa capacité à redevenir le moteur d'une Europe en mouvement. »
***
Padoa-Schioppa is right in his long term analysis of France’s often contradictory role as perceived engine of the European project, but persistently intergovernmentalist in practice, the phenomenon I have branded the “French paradox”.
He is also correct in pointing out the crucial factor between unanimity leading to minimalist solutions and qualified majority voting opening up vistas for the common good of the citizens of the European Union.
President Nicolas Sarkozy seems to have the requisite amount of ambition. But has he the courage needed to act?
Ralf Grahn
In other words, France has effectively regulated progress.
Padoa-Schioppas article ‘Président Sarkozy, faites voter !’ can be found in Le Monde (26 June 2008) :
http://www.lemonde.fr/opinions/article/2008/06/25/president-sarkozy-faites-voter-par-tommaso-padoa-schioppa_1062635_3232.html
In addition to his interesting analysis, the chairman of the think-tank founded by Jacques Delors issues an impassioned plea to France to use the six months of its Council presidency to become, once again, the engine of the European Union. Key to this is not to accept blocking vetoes, but to vote, to decide and to progress. The gist of Padoa-Schioppa’s plea can be read in the concluding paragraph of the article:
« La France a entre ses mains les clés pour libérer l'horizon. La présidence de l'Union représente une occasion unique qu'elle ne doit pas rater. Les débats sur le bilan de santé de la PAC, la politique d'immigration et l'énergie s'y prêteraient à merveille. Dès lors, ma recommandation centrale à la future présidence française tient en deux mots : n'acceptez pas le blocage par le veto, n'acceptez pas de retarder une décision pour attendre tout le monde, "faites voter !" La France démontrera ainsi sa capacité à redevenir le moteur d'une Europe en mouvement. »
***
Padoa-Schioppa is right in his long term analysis of France’s often contradictory role as perceived engine of the European project, but persistently intergovernmentalist in practice, the phenomenon I have branded the “French paradox”.
He is also correct in pointing out the crucial factor between unanimity leading to minimalist solutions and qualified majority voting opening up vistas for the common good of the citizens of the European Union.
President Nicolas Sarkozy seems to have the requisite amount of ambition. But has he the courage needed to act?
Ralf Grahn
The Tap Blog plans future after EU crash
The Tap Blog, which persists in calling anti-EU forces eurosceptics, is mulling over a positive programme after the European Union crashes.
Read ‘What Will Replace The EU?’ (25 June 2008):
http://the-tap.blogspot.com/2008/06/what-will-replace-eu.html
Possibly, a crash of the EU is as much of a pipe-dream as a democratic union, but in my opinion it would be a good thing if there were clear visions of the future in both camps.
Too many of the anti-EU blogs are way too careless with facts and generous with distortions, whereas the Tap Blog distinguishes itself by better writing and something that looks like a real quest for alternatives.
As I see it, the main challenge for the ones who hope for an era after the European Union is to envision how it would enhance the security and prosperity of Europeans in a globalising world.
***
Traditional international organisations, built on intergovernmental cooperation, have usually shown little ability to achieve results.
On their own, even the bigger European nations are becoming small fry among the emerging powers.
NATO is an important transatlantic link, but it is primarily an alliance for military defence. Security is a much wider concept, and somehow interests like negotiating clout and energy security would require credible arrangements.
Even free trade needs common rules and enforcement, more closely knit than possible under WTO agreements.
***
I hope that the Tap Blog and its friends rise to the challenge. Like Libertas said, it is easy to oppose. The hard part is to create a better future, or even a vision of one.
Ralf Grahn
Read ‘What Will Replace The EU?’ (25 June 2008):
http://the-tap.blogspot.com/2008/06/what-will-replace-eu.html
Possibly, a crash of the EU is as much of a pipe-dream as a democratic union, but in my opinion it would be a good thing if there were clear visions of the future in both camps.
Too many of the anti-EU blogs are way too careless with facts and generous with distortions, whereas the Tap Blog distinguishes itself by better writing and something that looks like a real quest for alternatives.
As I see it, the main challenge for the ones who hope for an era after the European Union is to envision how it would enhance the security and prosperity of Europeans in a globalising world.
***
Traditional international organisations, built on intergovernmental cooperation, have usually shown little ability to achieve results.
On their own, even the bigger European nations are becoming small fry among the emerging powers.
NATO is an important transatlantic link, but it is primarily an alliance for military defence. Security is a much wider concept, and somehow interests like negotiating clout and energy security would require credible arrangements.
Even free trade needs common rules and enforcement, more closely knit than possible under WTO agreements.
***
I hope that the Tap Blog and its friends rise to the challenge. Like Libertas said, it is easy to oppose. The hard part is to create a better future, or even a vision of one.
Ralf Grahn
Wednesday, 25 June 2008
Sweden continues Lisbon Treaty ratification preparation
The EU information of the Swedish parliament (Riksdagen) confirms that the preparation for Lisbon Treaty ratification continues in other member states (including Sweden). The press release with the headline ‘Irländskt nej stoppar inte svensk riksdagsbehandling’ (Irish no does not stop Swedish parliamentary procedure) was issued 25 June 2008 following a meeting where prime minister Fredrik Reinfeldt reported on the European Council meeting to the EU committee of the parliament.
As yet, the Swedish government has not sent its ratification bill to the parliament, although the Council on Legislation (Lagrådet) gave the draft a green light regarding constitutional issues.
According to the same press release, Reinfeldt sees the EU treaty and enlargement as two separate issues.
Ralf Grahn
Source:
Sveriges riksdag, EU-upplysningen: Irländskt nej stoppar inte svensk riksdagsbehandling (2008-06-25)
http://www.eu-upplysningen.se/Aktuellt/Nyheter/Irlandskt-nej-stoppar-inte-svensk-riksdagsbehandling/
As yet, the Swedish government has not sent its ratification bill to the parliament, although the Council on Legislation (Lagrådet) gave the draft a green light regarding constitutional issues.
According to the same press release, Reinfeldt sees the EU treaty and enlargement as two separate issues.
Ralf Grahn
Source:
Sveriges riksdag, EU-upplysningen: Irländskt nej stoppar inte svensk riksdagsbehandling (2008-06-25)
http://www.eu-upplysningen.se/Aktuellt/Nyheter/Irlandskt-nej-stoppar-inte-svensk-riksdagsbehandling/
Lisbon Treaty: Summit analysis
The European Policy Centre (EPC) has given its assessment of the June 2008 European Council. ‘Post-Summit Analysis: A time to heal’, dated 23 June 2008, is available at:
http://www.epc.eu/en/pub.asp?TYP=TEWN&LV=187&see=y&t=&PG=TEWN/EN/detailpub&l=12&AI=936
Much of the compact four pages are dedicated to the Treaty of Lisbon, because the Irish referendum No overshadowed many important subjects at the European Council.
Here are few of the observations:
The EPC paper notes that 76 per cent of the Irish No voters thought that rejecting the Lisbon Treaty would allow Ireland to renegotiate it from scratch and from a stronger position “an option now explicitly excluded by its EU partners”.
The EPC remarks that the referendum result has highlighted once again a fundamental problem for the EU: while policies must increasingly be adopted above the national level (by the Union itself, as well as other multilateral bodies) to be effective, politics still operates at the national (or even sub-national) level – thus creating recurrent short-circuits and feedback effects.
Therefore the EPC draws the conclusion that if a pragmatic solution is found to ‘fix’ Lisbon, it will then probably be necessary to consider how to involve the citizens in both EU politics and policies more credibly, starting with the forthcoming elections to the European Parliament. Otherwise, anti-EU populism is likely to take root all over the Union and increasingly affect the functioning of institutions and policies – with unpredictable consequences.
***
The EPC’s endorsement of democratic EU reform concurs with the position of this blog, although it would be better to pledge the reform essentials during the ratification of the substance of the Lisbon Treaty and in time for the second referendum, should Ireland want to arrange one.
EU citizens choosing their leaders and setting the course, these are the needed reforms, more important than the Lisbon Treaty.
Ralf Grahn
http://www.epc.eu/en/pub.asp?TYP=TEWN&LV=187&see=y&t=&PG=TEWN/EN/detailpub&l=12&AI=936
Much of the compact four pages are dedicated to the Treaty of Lisbon, because the Irish referendum No overshadowed many important subjects at the European Council.
Here are few of the observations:
The EPC paper notes that 76 per cent of the Irish No voters thought that rejecting the Lisbon Treaty would allow Ireland to renegotiate it from scratch and from a stronger position “an option now explicitly excluded by its EU partners”.
The EPC remarks that the referendum result has highlighted once again a fundamental problem for the EU: while policies must increasingly be adopted above the national level (by the Union itself, as well as other multilateral bodies) to be effective, politics still operates at the national (or even sub-national) level – thus creating recurrent short-circuits and feedback effects.
Therefore the EPC draws the conclusion that if a pragmatic solution is found to ‘fix’ Lisbon, it will then probably be necessary to consider how to involve the citizens in both EU politics and policies more credibly, starting with the forthcoming elections to the European Parliament. Otherwise, anti-EU populism is likely to take root all over the Union and increasingly affect the functioning of institutions and policies – with unpredictable consequences.
***
The EPC’s endorsement of democratic EU reform concurs with the position of this blog, although it would be better to pledge the reform essentials during the ratification of the substance of the Lisbon Treaty and in time for the second referendum, should Ireland want to arrange one.
EU citizens choosing their leaders and setting the course, these are the needed reforms, more important than the Lisbon Treaty.
Ralf Grahn
Lisbon Treaty rescue operation
Daniel Gros and Sebastian Kurpas of the Centre for European Policy Studies (CEPS) have looked at the options for Europe after the Irish No vote. CEPS Policy brief No. 163 (June 2008) is available at:
http://shop.ceps.eu/BookDetail.php?item_id=1675
‘What next? How to save the Treaty of Lisbon’ starts with an assessment of different options under debate. These are:
1. Abandon the Treaty of Lisbon and continue with the Treaty of Nice
2. Reopening negotiations on a new Treaty
3. Increased efforts on flexible integration
4. Implementation of those elements in the Treaty of Lisbon that do not require ratification
5. Temporary withdrawal of Ireland from the EU
6. Continuing the ratification process followed by a second Irish referendum on the Treaty of Lisbon
Gros and Kurpas then present what they call a feasible, legal and fair way ahead. Their Plan B proposes ratifying the consolidated treaties as amended by the Treaty of Lisbon. This would entail a speedy re-ratification by the member states that already have ratified the original Lisbon Treaty.
The second Irish referendum would be about a different question: Does Ireland wish to join the EU with the Lisbon Treaty in force?
***
The essentials of the CEPS proposal are the same as put forward by this blog, namely to save the substance of the Treaty of Lisbon within a new European Union among the ratifying states.
Given the potential unravelling of the Lisbon Treaty in a number of countries (the Czech Republic, Cyprus, Poland) and the possibility that some might balk at the abandonment of the ‘liberum veto’, the authors are perhaps unduly optimistic in proposing mandatory ratification by 26 states.
In my view, the basic criteria should be that the ratifying states continue, but the treaty is open for later accessions, a customary procedure regarding international treaties.
Another difference is that Gros and Kurpas, focusing on the rescue of the Lisbon Treaty, do not enter into a discussion of the growing popular resistance against the European Union and the profound disillusionment spreading among pro-Europeans.
Without a solemn pledge to institute EU level democratic legitimacy and accountability, the European project is headed for failure. This blog argues that the European Council has to set a new course towards fundamental democratic reform if it wishes to avert a worse catastrophe than the ship-wreck of the Lisbon Treaty.
The missing link between governing and governed must be established in a manner suited to the 21st century.
Ralf Grahn
http://shop.ceps.eu/BookDetail.php?item_id=1675
‘What next? How to save the Treaty of Lisbon’ starts with an assessment of different options under debate. These are:
1. Abandon the Treaty of Lisbon and continue with the Treaty of Nice
2. Reopening negotiations on a new Treaty
3. Increased efforts on flexible integration
4. Implementation of those elements in the Treaty of Lisbon that do not require ratification
5. Temporary withdrawal of Ireland from the EU
6. Continuing the ratification process followed by a second Irish referendum on the Treaty of Lisbon
Gros and Kurpas then present what they call a feasible, legal and fair way ahead. Their Plan B proposes ratifying the consolidated treaties as amended by the Treaty of Lisbon. This would entail a speedy re-ratification by the member states that already have ratified the original Lisbon Treaty.
The second Irish referendum would be about a different question: Does Ireland wish to join the EU with the Lisbon Treaty in force?
***
The essentials of the CEPS proposal are the same as put forward by this blog, namely to save the substance of the Treaty of Lisbon within a new European Union among the ratifying states.
Given the potential unravelling of the Lisbon Treaty in a number of countries (the Czech Republic, Cyprus, Poland) and the possibility that some might balk at the abandonment of the ‘liberum veto’, the authors are perhaps unduly optimistic in proposing mandatory ratification by 26 states.
In my view, the basic criteria should be that the ratifying states continue, but the treaty is open for later accessions, a customary procedure regarding international treaties.
Another difference is that Gros and Kurpas, focusing on the rescue of the Lisbon Treaty, do not enter into a discussion of the growing popular resistance against the European Union and the profound disillusionment spreading among pro-Europeans.
Without a solemn pledge to institute EU level democratic legitimacy and accountability, the European project is headed for failure. This blog argues that the European Council has to set a new course towards fundamental democratic reform if it wishes to avert a worse catastrophe than the ship-wreck of the Lisbon Treaty.
The missing link between governing and governed must be established in a manner suited to the 21st century.
Ralf Grahn
EUvangelist credo
EUvangelist is a new blog to discover, its credo a more perfect Union. The two first substantive posts ‘So much for bringing Europe closer to the people’ and ‘Who’s afraid of a 2-speed Europe?’ are clearly argued and written.
Recommended reading at:
http://euvangelist.blogactiv.eu/
Ralf Grahn
Recommended reading at:
http://euvangelist.blogactiv.eu/
Ralf Grahn
Tuesday, 24 June 2008
European demos
For the anti-EU crowd it is standard fare to deny the existence of a European demos or people, and even the prospect of one. Some even deny the existence of EU citizenship. Hasn’t the allegation that the Constitutional Treaty and the Lisbon Treaty would ‘enforce’ an EU citizenship been one of the popular myths surrounding treaty reform?
Their concept is more akin to ‘Blut und Boden’ myths than to reasoning based on citizenship and political rights.
Since the Maastricht Treaty entered into force, 1 November 1993, every citizen of an EU member state is a citizen of the European Union.
But the political rights are underdeveloped.
Granting the citizens of the union the main political rights – to vote the officeholders into and out of office and to set the course for the EU – would create the European demos.
It is as simple as that, but until now the governments of the member states have preferred to cashier the meaningful ballot.
Crudely put, the current European demos consists of 27 persons at a time.
Ralf Grahn
Their concept is more akin to ‘Blut und Boden’ myths than to reasoning based on citizenship and political rights.
Since the Maastricht Treaty entered into force, 1 November 1993, every citizen of an EU member state is a citizen of the European Union.
But the political rights are underdeveloped.
Granting the citizens of the union the main political rights – to vote the officeholders into and out of office and to set the course for the EU – would create the European demos.
It is as simple as that, but until now the governments of the member states have preferred to cashier the meaningful ballot.
Crudely put, the current European demos consists of 27 persons at a time.
Ralf Grahn
Reforming EU institutions and democracy
What to do if the size and the rules of the European Union prevent reform? The Italian president Giorgio Napolitano has called for a more firm and coherent engagement between integrationist states. The European Union needs a new democratic surge.
Napolitano’s speech can be found on the web pages of Notre Europe in Italian and French:
http://www.notre-europe.eu
Here is an extract from the French language version:
La Communauté, et puis l’Union, se sont au fur et à mesure élargies jusqu’à atteindre 27 Etats
membres. Mais le moment de la preuve est venu : si, dans cette dimension et avec les règles
actuelles, l’Union montre qu’elle ne peut pas fonctionner et qu’elle ne peut pas non plus
changer ses règles, il faut alors trouver les formes d’un engagement plus ferme et plus
cohérent entre ces pays qui se sont reconnus dans les choix d’intégration et de cohésion plus
avancés, comme celui de la monnaie unique, celui de l’Euro et de la zone Euro.
Et il faut comprendre que le vote en Irlande a plus que jamais radicalement posé un problème.
Le problème des rapports entre gouvernants et gouvernés dans l’Europe unie, le problème de
la participation et du consensus des citoyens.
L’Union européenne – si souvent accusée de manquer de « capacity to deliver » - ne pourra
pas augmenter son efficacité sans réformes et moyens adéquats, et sans un nouvel élan
démocratique.
***
The maturity test of the European Council is going to be if it succeeds in achieving both institutional and democratic reform.
Ralf Grahn
Napolitano’s speech can be found on the web pages of Notre Europe in Italian and French:
http://www.notre-europe.eu
Here is an extract from the French language version:
La Communauté, et puis l’Union, se sont au fur et à mesure élargies jusqu’à atteindre 27 Etats
membres. Mais le moment de la preuve est venu : si, dans cette dimension et avec les règles
actuelles, l’Union montre qu’elle ne peut pas fonctionner et qu’elle ne peut pas non plus
changer ses règles, il faut alors trouver les formes d’un engagement plus ferme et plus
cohérent entre ces pays qui se sont reconnus dans les choix d’intégration et de cohésion plus
avancés, comme celui de la monnaie unique, celui de l’Euro et de la zone Euro.
Et il faut comprendre que le vote en Irlande a plus que jamais radicalement posé un problème.
Le problème des rapports entre gouvernants et gouvernés dans l’Europe unie, le problème de
la participation et du consensus des citoyens.
L’Union européenne – si souvent accusée de manquer de « capacity to deliver » - ne pourra
pas augmenter son efficacité sans réformes et moyens adéquats, et sans un nouvel élan
démocratique.
***
The maturity test of the European Council is going to be if it succeeds in achieving both institutional and democratic reform.
Ralf Grahn
Monday, 23 June 2008
EU’s Irish future - The Libertas model
At the European Council meeting, the defeated Irish government understandably asked for more time to come to a conclusion after Ireland’s rejection of the Lisbon Treaty.
The victorious No campaigner Libertas seems to be as clueless at the moment. The latest on the Libertas web page, dated 17 June 2008, is a ‘thank you’ to those who voted no.
Then comes a truism or admission, however it should be understood: In politics, it is easy to simply oppose.
This is followed by the post-referendum programme: We in Libertas will now reflect on the message from the Irish people, and begin the process of looking to build a positive alternative to the direction Europe is taking.
***
Begin the process of looking to build.
Ten days on, not much to go on, is there?
It almost defies imagination as results and political campaigns go.
Ralf Grahn
Update 25 June 2008: Still no update on the Libertas web page.
Update 27 June 2008: Nothing new on the Libertas web page. (I don't understand the Lisbon Treaty, so I vote no. I don't like the Lisbon Treaty, so I vote no. I want a better deal, so I vote no. I want a better deal, but I don't know what it is. What do I do now?)
Update 30 June 2008: A new day has dawned, but Libertas still greets us with its old 17 June 2008 truism that it is easy to oppose. Where is the promised better deal for Ireland and Europe?
Update 1 July 2008: A new month has begun, the Slovenian presidency of the EU Council has
ended and the presidency of France has started, but Libertas is still in 17 June 2008 mode, without a whisper about a positive programme either for Ireland or for Europe - the better deal for all of us , you know.
The victorious No campaigner Libertas seems to be as clueless at the moment. The latest on the Libertas web page, dated 17 June 2008, is a ‘thank you’ to those who voted no.
Then comes a truism or admission, however it should be understood: In politics, it is easy to simply oppose.
This is followed by the post-referendum programme: We in Libertas will now reflect on the message from the Irish people, and begin the process of looking to build a positive alternative to the direction Europe is taking.
***
Begin the process of looking to build.
Ten days on, not much to go on, is there?
It almost defies imagination as results and political campaigns go.
Ralf Grahn
Update 25 June 2008: Still no update on the Libertas web page.
Update 27 June 2008: Nothing new on the Libertas web page. (I don't understand the Lisbon Treaty, so I vote no. I don't like the Lisbon Treaty, so I vote no. I want a better deal, so I vote no. I want a better deal, but I don't know what it is. What do I do now?)
Update 30 June 2008: A new day has dawned, but Libertas still greets us with its old 17 June 2008 truism that it is easy to oppose. Where is the promised better deal for Ireland and Europe?
Update 1 July 2008: A new month has begun, the Slovenian presidency of the EU Council has
ended and the presidency of France has started, but Libertas is still in 17 June 2008 mode, without a whisper about a positive programme either for Ireland or for Europe - the better deal for all of us , you know.
EU democracy and US Bill of Rights
James Madison penned the Bill of Rights, approved by the First United States Congress in 1791. When proposed, the first ten amendments (additions) to the US Constitution aimed to secure the ratification of the Constitution, still a bone of contention between Federalists and anti-Federalists.
The birth and life of the US Constitution is a recommended reading subject for anyone interested in a Europe able to protect its citizens in a changing world.
A glimpse at the ‘United States Bill of Rights’ development is offered by the Wikipedia article:
http://en.wikipedia.org/wiki/United_States_Bill_of_Rights
***
My present fascination with the subject stems from another ratification process, the one concerning the EU Treaty of Lisbon.
Built on the sand of unanimous ratification, I had long ago labelled the passage of the Lisbon Treaty (and future treaties on the same premises) a ‘mission impossible’. Today we know for sure that the number of ratifications will fall short of 27. What we don’t know is, by how much.
It would be surprising if the Irish changed their minds within six months or a year, if asked the same question again.
***
Despite the unanimous agreement between member states’ governments and the crushing voting records of most ratifying national parliaments, something is rotten in the state of the union, despite the legally binding ratifications.
Popular opinion is headed in a negative direction, fluctuating between cynicism and outright hostility. Pro-European intellectuals, free to speak their mind, are disillusioned to the core.
Hard of hearing, the European Council has only procrastinated and indicated a re-run in Ireland.
This is deliberately avoiding the root causes.
Even if the substance of the Lisbon Treaty could be salvaged, by most member states, the holes below the water-line put the whole European project at risk.
The European ‘Bill of Rights’ is radical democratic reform to re-establish the necessary ties between the governing and the governed.
There is time enough to devise the essentials of democratic EU reform and to make the European elections 2009 a turning-point in setting the course for the European Union.
Where is Europe’s James Madison?
Ralf Grahn
The birth and life of the US Constitution is a recommended reading subject for anyone interested in a Europe able to protect its citizens in a changing world.
A glimpse at the ‘United States Bill of Rights’ development is offered by the Wikipedia article:
http://en.wikipedia.org/wiki/United_States_Bill_of_Rights
***
My present fascination with the subject stems from another ratification process, the one concerning the EU Treaty of Lisbon.
Built on the sand of unanimous ratification, I had long ago labelled the passage of the Lisbon Treaty (and future treaties on the same premises) a ‘mission impossible’. Today we know for sure that the number of ratifications will fall short of 27. What we don’t know is, by how much.
It would be surprising if the Irish changed their minds within six months or a year, if asked the same question again.
***
Despite the unanimous agreement between member states’ governments and the crushing voting records of most ratifying national parliaments, something is rotten in the state of the union, despite the legally binding ratifications.
Popular opinion is headed in a negative direction, fluctuating between cynicism and outright hostility. Pro-European intellectuals, free to speak their mind, are disillusioned to the core.
Hard of hearing, the European Council has only procrastinated and indicated a re-run in Ireland.
This is deliberately avoiding the root causes.
Even if the substance of the Lisbon Treaty could be salvaged, by most member states, the holes below the water-line put the whole European project at risk.
The European ‘Bill of Rights’ is radical democratic reform to re-establish the necessary ties between the governing and the governed.
There is time enough to devise the essentials of democratic EU reform and to make the European elections 2009 a turning-point in setting the course for the European Union.
Where is Europe’s James Madison?
Ralf Grahn
More on EU democracy
How long can ’Versailles’ continue oblivious of the fact that it has lost the love of the people and the respect of the intellectuals?
Roughly half of EU citizens may dream of the halcyon days of all-encompassing national level democracy, an illusion given voice and credence by anti-EU campaigners. Yes, an illusion, because the world has changed, and the European nation states are not up to the task of enhancing citizens’ security and prosperity on their own.
This, at least, should be acknowledged on the basis of the crushing pro-Lisbon votes of the ratifying parliaments after thorough deliberation.
But in addition to large segments of the populations, the European Council has managed to disillusion increasing numbers of pro-Europeans, who are free to speak their mind. Six decades of resistance against democratic legitimacy and accountability are taking their toll.
The ‘double legitimacy’ of the European Union suffers from the same flaw as other artificial qualifiers like ‘people’s democracy’, which was anything but democratic.
The only sustainable strategy to recover support and respect is to take the qualitative jump to real EU level democracy, giving the citizens the choice of changing their leaders and setting the basic course for the European Union.
***
Incidentally, if I counted correctly, this is my 27th post following and somehow related to the Irish referendum, the same as the number of member states.
I still believe that the substance of the Treaty of Lisbon would go some way towards an improved European Union, which is in the interest of the citizens of the EU.
But I now think that more fundamental values are at stake. Hardening resistance and growing disenchantment lead towards ultimate failure, if our leaders fail to heed the calls. Therefore the metaphor of 18th century Versailles.
***
The Federal Trust report by professor Vernon Bogdanor, mentioned in the preceding post, is worth careful thought. If my reading is correct, it has taken the member states and their creatures, the Council and the European Council, as inescapable, and then looked at what else can be done to improve democratic legitimacy and accountability in the European Union.
The proposed improvements would be real, although the structure of the EU would remain lopsided; perhaps not wholly unlike some early stage in Britain, when the powers of the House of Commons grew, but the Sovereign or the House of Lords remained the strong or even dominant players.
A lopsided but real democracy may be the most the citizens of the European Union can hope for in a near (or far) future, given six decades of fierce resistance from the member states' governments against any truly democratic system of European governance.
***
My proposal is that the (willing) governments of the European Union decide to introduce a European ‘Bill of Rights’ in conjunction with but above the Treaty of Lisbon. This means a solemn undertaking to introduce real democratic reform at the EU level. The pledge would contain the core reforms and a commitment to enact them at the earliest opportunity.
(In the United States the Constitution already laid the democratic and republican foundations of government, so the first amendment package had to address concerns about citizens’ liberties. Here Europe is behind the curve, not only by two centuries, but also qualitatively.)
***
Since many EU citizens still imagine that national democracy or safeguards against the general interest are viable options, the reasons for real EU level democracy would have to be thoroughly explained as well as enacted.
Possibly, this would happen in a pan-European referendum, and it would require a double majority of population and states.
In Ireland, a second referendum is possible only if the question is different, and elsewhere the prospect of real democracy would have to be understood and embraced.
***
In my book, the fundamental reasons for the European Union are: security and prosperity.
What is more political than security?
In other words, a future European Union able to employ all the soft and hard means of international politics is needed.
(The purpose and functioning of NATO do not cover this, although NATO remains an important transatlantic alliance. Therefore, a European Union reverting to become an economic community is not a desirable outcome for EU citizens as a whole, although some governments and electorates may not be ready for a union effective on the international stage.)
Such a fundamental European interest has to find working expressions even if some state governments and populations act as if oblivious of the fact. For them suitable arrangements have to be found, such as the European Economic Area (perhaps with some policy areas added) or a second tier EU membership.
A second split looks inevitable, too. I am afraid that the ingrained hostility of some member states to a democratic European Union is such that the only way forward is to leave them behind and institute a new citizens' union based on democratic legitimacy and accountability.
***
If one or two vessels belonging to a convoy cut their engines on purpose, are the rest to do likewise?
None-speed Europe lacking popular support and democratic legitimacy is not in the interest of the EU citizens.
Standing on its own, the Treaty of Lisbon is as much a problem as a solution with regard to the real issues of Europe.
Ralf Grahn
Roughly half of EU citizens may dream of the halcyon days of all-encompassing national level democracy, an illusion given voice and credence by anti-EU campaigners. Yes, an illusion, because the world has changed, and the European nation states are not up to the task of enhancing citizens’ security and prosperity on their own.
This, at least, should be acknowledged on the basis of the crushing pro-Lisbon votes of the ratifying parliaments after thorough deliberation.
But in addition to large segments of the populations, the European Council has managed to disillusion increasing numbers of pro-Europeans, who are free to speak their mind. Six decades of resistance against democratic legitimacy and accountability are taking their toll.
The ‘double legitimacy’ of the European Union suffers from the same flaw as other artificial qualifiers like ‘people’s democracy’, which was anything but democratic.
The only sustainable strategy to recover support and respect is to take the qualitative jump to real EU level democracy, giving the citizens the choice of changing their leaders and setting the basic course for the European Union.
***
Incidentally, if I counted correctly, this is my 27th post following and somehow related to the Irish referendum, the same as the number of member states.
I still believe that the substance of the Treaty of Lisbon would go some way towards an improved European Union, which is in the interest of the citizens of the EU.
But I now think that more fundamental values are at stake. Hardening resistance and growing disenchantment lead towards ultimate failure, if our leaders fail to heed the calls. Therefore the metaphor of 18th century Versailles.
***
The Federal Trust report by professor Vernon Bogdanor, mentioned in the preceding post, is worth careful thought. If my reading is correct, it has taken the member states and their creatures, the Council and the European Council, as inescapable, and then looked at what else can be done to improve democratic legitimacy and accountability in the European Union.
The proposed improvements would be real, although the structure of the EU would remain lopsided; perhaps not wholly unlike some early stage in Britain, when the powers of the House of Commons grew, but the Sovereign or the House of Lords remained the strong or even dominant players.
A lopsided but real democracy may be the most the citizens of the European Union can hope for in a near (or far) future, given six decades of fierce resistance from the member states' governments against any truly democratic system of European governance.
***
My proposal is that the (willing) governments of the European Union decide to introduce a European ‘Bill of Rights’ in conjunction with but above the Treaty of Lisbon. This means a solemn undertaking to introduce real democratic reform at the EU level. The pledge would contain the core reforms and a commitment to enact them at the earliest opportunity.
(In the United States the Constitution already laid the democratic and republican foundations of government, so the first amendment package had to address concerns about citizens’ liberties. Here Europe is behind the curve, not only by two centuries, but also qualitatively.)
***
Since many EU citizens still imagine that national democracy or safeguards against the general interest are viable options, the reasons for real EU level democracy would have to be thoroughly explained as well as enacted.
Possibly, this would happen in a pan-European referendum, and it would require a double majority of population and states.
In Ireland, a second referendum is possible only if the question is different, and elsewhere the prospect of real democracy would have to be understood and embraced.
***
In my book, the fundamental reasons for the European Union are: security and prosperity.
What is more political than security?
In other words, a future European Union able to employ all the soft and hard means of international politics is needed.
(The purpose and functioning of NATO do not cover this, although NATO remains an important transatlantic alliance. Therefore, a European Union reverting to become an economic community is not a desirable outcome for EU citizens as a whole, although some governments and electorates may not be ready for a union effective on the international stage.)
Such a fundamental European interest has to find working expressions even if some state governments and populations act as if oblivious of the fact. For them suitable arrangements have to be found, such as the European Economic Area (perhaps with some policy areas added) or a second tier EU membership.
A second split looks inevitable, too. I am afraid that the ingrained hostility of some member states to a democratic European Union is such that the only way forward is to leave them behind and institute a new citizens' union based on democratic legitimacy and accountability.
***
If one or two vessels belonging to a convoy cut their engines on purpose, are the rest to do likewise?
None-speed Europe lacking popular support and democratic legitimacy is not in the interest of the EU citizens.
Standing on its own, the Treaty of Lisbon is as much a problem as a solution with regard to the real issues of Europe.
Ralf Grahn
Sunday, 22 June 2008
European Union: Legitimacy, accountability and democracy
How to bring the institutional forms of the European Union into line with the democratic forces?
Since the Irish referendum on the Treaty of Lisbon, a number of posts on this blog have looked at various deep flaws of the European Union from a democratic perspective. European voices have mixed with American experiences and my own views.
Now could be a suitable time to look at these questions as a whole. The Federal Trust Report by professor Vernon Bogdanor ‘Legitimacy, Accountability and Democracy in the European Union’ (January 2007) is a reasoned attempt to discuss the improvement of the EU institutions within the existing structures, in order to arrive at a more democratic Europe.
The 20 page report is available at:
http://www.fedtrust.co.uk/admin/uploads/FedT_LAD.pdf
The report is evolutionary in character, in that it does not propose a re-establishment of the European Union with new structures, but suggests improvements to the existing ones.
My suggestion is for every concerned EU citizen to read the report, so I will present only a few short annotations of the proposals:
* The nomination of the European Commission directly on the basis of the result of the European elections.
* European Parliament power to hold individual European Commissioners to account for mismanagement, and to secure, if necessary, their dismissal.
* Referendums, preferably Europe-wide with a double and qualified majority of states and population on treaty change.
The report brings forward weighty remarks on the de-legitimising effects of the Council, but stops short of proposing effective remedies.
***
After an era of public indifference, the European project encountered increasing hostility. The time has come to work with the citizens of the EU.
Ralf Grahn
European Union: Choice of leaders
”What kind of democracy is this, when citizens have no say in the choice of their leaders?”
“European citizens would not be so cynical if they were regularly invited to choose the people who run European affairs. We need real campaigns, dealing with European issues, just as in national elections.”
These and a number of other interesting thoughts are put forward by Charles Wyplosz in a comment on FT.com (18 June 2008): What dream will Europe dream now?
http://www.ft.com/cms/s/0/7238e13e-3d46-11dd-bbb5-0000779fd2ac.html
***
An increasing number of pro-Europeans voice their concerns over the plans to circumvent the Irish rejection of the Treaty of Lisbon, ignoring the demands for EU level democracy and accountability.
Regardless of the fate of the Lisbon Treaty, the leaders of the European Union seem set on a course towards ultimate failure.
Since the referendum in Ireland, my own thoughts have shifted in one aspect: Democratic accountability is more important than the technical merits of the proposed treaty.
Ralf Grahn
“European citizens would not be so cynical if they were regularly invited to choose the people who run European affairs. We need real campaigns, dealing with European issues, just as in national elections.”
These and a number of other interesting thoughts are put forward by Charles Wyplosz in a comment on FT.com (18 June 2008): What dream will Europe dream now?
http://www.ft.com/cms/s/0/7238e13e-3d46-11dd-bbb5-0000779fd2ac.html
***
An increasing number of pro-Europeans voice their concerns over the plans to circumvent the Irish rejection of the Treaty of Lisbon, ignoring the demands for EU level democracy and accountability.
Regardless of the fate of the Lisbon Treaty, the leaders of the European Union seem set on a course towards ultimate failure.
Since the referendum in Ireland, my own thoughts have shifted in one aspect: Democratic accountability is more important than the technical merits of the proposed treaty.
Ralf Grahn
EU governance and consent
In a letter to the Guardian, Paul Hunt lays out a few basic facts about the European Union:
“The proportion of national legislation and the extent of governance originating at the EU level require the exercise of representative parliamentary democracy broadly similar to, but separate from, the exercise of parliamentary democracy at the national level.”
“The EU will lurch from crisis to crisis, undermine its considerable achievements to date, and destroy its international credibility if the EU elite continue to avoid seeking the consent of its citizens to be governed.”
See Guardian.co.uk. Letters, 19 June 2008: EU elites need their citizens’ consent
http://www.guardian.co.uk/world/2008/jun/19/ireland.eu
***
The main challenge for the heads of state or government is not to circumvent the Irish referendum ‘no’, but to overcome their own resistance against EU level democracy.
Ralf Grahn
“The proportion of national legislation and the extent of governance originating at the EU level require the exercise of representative parliamentary democracy broadly similar to, but separate from, the exercise of parliamentary democracy at the national level.”
“The EU will lurch from crisis to crisis, undermine its considerable achievements to date, and destroy its international credibility if the EU elite continue to avoid seeking the consent of its citizens to be governed.”
See Guardian.co.uk. Letters, 19 June 2008: EU elites need their citizens’ consent
http://www.guardian.co.uk/world/2008/jun/19/ireland.eu
***
The main challenge for the heads of state or government is not to circumvent the Irish referendum ‘no’, but to overcome their own resistance against EU level democracy.
Ralf Grahn
EU democracy
The European Union has rolled out a plethora of ’democratic’ measures towards its citizens, such as information, communication, listening, dialogue, debate, some voting rights, NGO financing and participatory exercises, with the citizens’ initiative promised as a Lisbon Treaty sweetener.
Only one thing seems to be missing: real democracy.
***
“It is not just a matter of communicating the content of European politics better. The basic problem with the EU is a lack of democracy. Citizens cannot see how they can influence European decisions”, said Rev. Thomas Wipf, the president of the Community of Protestant Churches in Europe.
See Ecumenical News International: Irish vote exposes EU democracy challenge says churches’ leader (16 June 2008):
http://www.eni.ch/featured/article.php?id=1997
***
There is a huge difference between ‘more democratic’ and plain democratic, which no amount of sweet-talking is going to erase.
The essential requirement is the ability to vote the responsible people into and out of office.
Only then do the electors carry the moral responsibility to live by their choices, good and bad.
***
I have started to doubt if the Lisbon Treaty is worth having with sham democracy at the European Union level.
I have begun to feel that further alienating about half of the EU citizens is too high a price to pay for institutional reform.
Institutional EU reform is necessary, and so is continuing progress, but if they come without democracy, accountability and legitimacy, they are not worth having.
Ralf Grahn
Only one thing seems to be missing: real democracy.
***
“It is not just a matter of communicating the content of European politics better. The basic problem with the EU is a lack of democracy. Citizens cannot see how they can influence European decisions”, said Rev. Thomas Wipf, the president of the Community of Protestant Churches in Europe.
See Ecumenical News International: Irish vote exposes EU democracy challenge says churches’ leader (16 June 2008):
http://www.eni.ch/featured/article.php?id=1997
***
There is a huge difference between ‘more democratic’ and plain democratic, which no amount of sweet-talking is going to erase.
The essential requirement is the ability to vote the responsible people into and out of office.
Only then do the electors carry the moral responsibility to live by their choices, good and bad.
***
I have started to doubt if the Lisbon Treaty is worth having with sham democracy at the European Union level.
I have begun to feel that further alienating about half of the EU citizens is too high a price to pay for institutional reform.
Institutional EU reform is necessary, and so is continuing progress, but if they come without democracy, accountability and legitimacy, they are not worth having.
Ralf Grahn
Saturday, 21 June 2008
Lisbon Treaty: European voices
The Treaty of Lisbon has returned. It is not only a matter of ratification and implementation, but after the Irish referendum the question about the direction of the European Union has regained force.
Here are a few European voices on the choices facing our continent.
***
Christoph Leitl finds that a strong and united Europe is vital. The time has come for a courageous step by those who want to go for a more integrated European Union. We need a coalition of the willing to get Europe back on track.
On EUobserver [Comment] A coalition of the willing has to bring Europe back on track:
http://euobserver.com/9/26359
***
Peter Sain ley Berry says that the problem of democracy in the European Union needs to be addressed. All that is required is that we should have a chance to dismiss, or to confirm, probably through the European Parliament, those currently in charge. As for Lisbon itself, a period of humility is called for. But many who have some familiarity with the way the EU works recognise that much of Lisbon is essential to deliver the common interest – to keep the lights switched on as it were.
On EUobserver [Comment] Democracy may be the price for securing a Lisbon agreement:
http://euobserver.com/9/26355
***
According to Richard Laming a second Irish referendum is not a neat and tidy solution to the problem facing the EU. There are still democratic challenges ahead waiting to be solved.
On EUobserver [Comment] What would a second Irish referendum solve?
http://euobserver.com/7/26344
***
In an interview Peter Ludlow says that the key figure in this is always Ms. Merkel. She has already said – we need to take the Irish problem seriously, but we must have the Lisbon Treaty. How we reconcile these two assertions is the character of the story for the next six months or so. Referenda are, historically, a very unreliable way of arriving at political decisions. The 25 or the 26 will have to take steps to assure that at least they can go ahead based on the Treaty of Lisbon.
On EurActiv interview with Peter Ludlow: Merkel can lead the EU out of crisis
http://www.euractiv.com/en/future-eu/peter-ludlow-merkel-lead-eu-crisis/article-173515
***
In the electronic edition of Süddeutsche Zeitung Jürgen Habermas concludes that a Europe advancing at the pace of the slowest member is the wrong answer from now on. He proposes a pan-European referendum on the future direction of Europe at the same time as the elections to the European Parliament. This referendum should be clear enough to allow for a decision on the course to follow, and it might lead to some countries deepening their cooperation in the areas of foreign and security policy as well as economic and social policies.
On Sueddeutsche.de Jürgen Habermas: Ein Lob den Iren:
http://www.sueddeutsche.de/ausland/artikel/310/180753/
***
A sample of Europeans have voiced their opinions, with variations on the main themes. EU reform is needed to achieve more effective common action, but without democratic foundations the best intentions will come to naught.
Is this a fair summary?
Ralf Grahn
Here are a few European voices on the choices facing our continent.
***
Christoph Leitl finds that a strong and united Europe is vital. The time has come for a courageous step by those who want to go for a more integrated European Union. We need a coalition of the willing to get Europe back on track.
On EUobserver [Comment] A coalition of the willing has to bring Europe back on track:
http://euobserver.com/9/26359
***
Peter Sain ley Berry says that the problem of democracy in the European Union needs to be addressed. All that is required is that we should have a chance to dismiss, or to confirm, probably through the European Parliament, those currently in charge. As for Lisbon itself, a period of humility is called for. But many who have some familiarity with the way the EU works recognise that much of Lisbon is essential to deliver the common interest – to keep the lights switched on as it were.
On EUobserver [Comment] Democracy may be the price for securing a Lisbon agreement:
http://euobserver.com/9/26355
***
According to Richard Laming a second Irish referendum is not a neat and tidy solution to the problem facing the EU. There are still democratic challenges ahead waiting to be solved.
On EUobserver [Comment] What would a second Irish referendum solve?
http://euobserver.com/7/26344
***
In an interview Peter Ludlow says that the key figure in this is always Ms. Merkel. She has already said – we need to take the Irish problem seriously, but we must have the Lisbon Treaty. How we reconcile these two assertions is the character of the story for the next six months or so. Referenda are, historically, a very unreliable way of arriving at political decisions. The 25 or the 26 will have to take steps to assure that at least they can go ahead based on the Treaty of Lisbon.
On EurActiv interview with Peter Ludlow: Merkel can lead the EU out of crisis
http://www.euractiv.com/en/future-eu/peter-ludlow-merkel-lead-eu-crisis/article-173515
***
In the electronic edition of Süddeutsche Zeitung Jürgen Habermas concludes that a Europe advancing at the pace of the slowest member is the wrong answer from now on. He proposes a pan-European referendum on the future direction of Europe at the same time as the elections to the European Parliament. This referendum should be clear enough to allow for a decision on the course to follow, and it might lead to some countries deepening their cooperation in the areas of foreign and security policy as well as economic and social policies.
On Sueddeutsche.de Jürgen Habermas: Ein Lob den Iren:
http://www.sueddeutsche.de/ausland/artikel/310/180753/
***
A sample of Europeans have voiced their opinions, with variations on the main themes. EU reform is needed to achieve more effective common action, but without democratic foundations the best intentions will come to naught.
Is this a fair summary?
Ralf Grahn
EU for US on legitimacy
The heads of state of government who make up the European Council have a few months to think before they are confronted with the ratification of the Lisbon Treaty again. Besides listening to each other and not listening to Europeans, how about lending their ears to an American?
On the EU for US blog, Linda Margaret filters the European Union. In her 19 June 2008 post ‘Referendums, efficiency, and legitimacy’ this quiet American offers food for thought on EU reform:
http://euforus.blogspot.com/2008/06/referendums-efficiency-and-legitimacy.html
Read and reflect.
Ralf Grahn
On the EU for US blog, Linda Margaret filters the European Union. In her 19 June 2008 post ‘Referendums, efficiency, and legitimacy’ this quiet American offers food for thought on EU reform:
http://euforus.blogspot.com/2008/06/referendums-efficiency-and-legitimacy.html
Read and reflect.
Ralf Grahn
Lisbon Treaty and democratic reform
Even if the EU Treaty of Lisbon is an improvement on the current Treaty of Nice for anyone who cares about a European Union working better, we can ask if ‘getting around’ the Irish rejection is the right remedy.
The referendum outcome may be both deplorable and unwise, but the Irish voters should be treated as adults. They live with their decision, until they are ready to make a new one, without being force-fed.
At this moment I think that it is improbable that the voters in Ireland would endorse any conceivable add-ons in the form of declarations. The attitudes might even harden, resulting in embarrassment for the government, the European Council and the European Union in general.
Failing that, an amicable solution may be found. Ireland, perhaps the Czech Republic and some others, might be persuaded to let the willing states proceed on the basis of substance of the Lisbon Treaty. But can we bet on such an outcome, and could it be done without an amending treaty? In the end, the countries wanting to move ahead could establish a new union, if they have to and if they have the will.
***
The parliamentary ratifications show a strong voting record in favour of the Lisbon Treaty. In my view, representative democracy is clearly superior to plebiscites in scrutinising and approving international treaties, including the EU ones.
At the same time, the anti-EU sentiments are gathering force because of the methods used and contemplated to enact EU treaty reform.
Strong as the sentiments are, the motives behind them are misguided. The main idea seems to be to wreck the process and to debilitate the European Union.
A feeble European Union is less able to enhance the security and prosperity of EU citizens. It is an illusion to imagine that global challenges and European level questions could effectively be handled by re-exporting them to the national governments and parliaments.
Therefore, it lies in our collective interest that the substance of the Treaty of Lisbon, with its modest reforms, is allowed to enter into force.
***
But the handling of the ratification processes is damaging for the relationship between the national leaders, the European Council and the European Union on the one hand and large swathes of EU citizens on the other hand.
This does not augur well for the future of the European project. Legitimacy is a core problem, and it is not being addressed adequately within the present parameters.
***
During the ratification process of the US Constitution, the Bill of Rights was introduced and put in place as soon as the new union commenced work.
Europe needs something of the kind.
Democratic accountability in EU affairs can not be achieved by the present dual character of the European Union, and the national level is not an effective answer.
Therefore, the substance of the Lisbon Treaty as an initial foundation, needs the additional change of the European Union into a democratic polity.
The European “Bill of Rights” would be this qualitative jump, as a solemn undertaking by the member states.
They need to understand that all EU affairs have to emanate from the EU’s citizens, to be exercised by their elected representatives and with a politically responsible government.
This is the crucial reform principle to prepare during the coming months, jointly with the efforts to bring the Lisbon Treaty reforms into force.
The democratic principle is not only a groundbreaking novelty. It goes against the intergovernmentalist credo of a number of member states.
Therefore, putting it into practice would require some member states to embrace democracy as the only viable option for the 21st century, knowing that they would have to leave a number of recalcitrant members behind.
In other words, two major shifts are needed: The full adoption of the principle of EU level representative democracy and the sacrifice of EU unity (one-speed Europe) in favour of a legitimate union.
But what is the alternative? Growing popular disillusionment, hardening resistance, blocked future reform and ultimate failure. The writing is on the wall.
The democratic European Union is worth the sacrifice of two current principles of lesser value.
In short, we need the substance of the Lisbon Treaty, but not without a ground-breaking democratic reform.
Ralf Grahn
,
The referendum outcome may be both deplorable and unwise, but the Irish voters should be treated as adults. They live with their decision, until they are ready to make a new one, without being force-fed.
At this moment I think that it is improbable that the voters in Ireland would endorse any conceivable add-ons in the form of declarations. The attitudes might even harden, resulting in embarrassment for the government, the European Council and the European Union in general.
Failing that, an amicable solution may be found. Ireland, perhaps the Czech Republic and some others, might be persuaded to let the willing states proceed on the basis of substance of the Lisbon Treaty. But can we bet on such an outcome, and could it be done without an amending treaty? In the end, the countries wanting to move ahead could establish a new union, if they have to and if they have the will.
***
The parliamentary ratifications show a strong voting record in favour of the Lisbon Treaty. In my view, representative democracy is clearly superior to plebiscites in scrutinising and approving international treaties, including the EU ones.
At the same time, the anti-EU sentiments are gathering force because of the methods used and contemplated to enact EU treaty reform.
Strong as the sentiments are, the motives behind them are misguided. The main idea seems to be to wreck the process and to debilitate the European Union.
A feeble European Union is less able to enhance the security and prosperity of EU citizens. It is an illusion to imagine that global challenges and European level questions could effectively be handled by re-exporting them to the national governments and parliaments.
Therefore, it lies in our collective interest that the substance of the Treaty of Lisbon, with its modest reforms, is allowed to enter into force.
***
But the handling of the ratification processes is damaging for the relationship between the national leaders, the European Council and the European Union on the one hand and large swathes of EU citizens on the other hand.
This does not augur well for the future of the European project. Legitimacy is a core problem, and it is not being addressed adequately within the present parameters.
***
During the ratification process of the US Constitution, the Bill of Rights was introduced and put in place as soon as the new union commenced work.
Europe needs something of the kind.
Democratic accountability in EU affairs can not be achieved by the present dual character of the European Union, and the national level is not an effective answer.
Therefore, the substance of the Lisbon Treaty as an initial foundation, needs the additional change of the European Union into a democratic polity.
The European “Bill of Rights” would be this qualitative jump, as a solemn undertaking by the member states.
They need to understand that all EU affairs have to emanate from the EU’s citizens, to be exercised by their elected representatives and with a politically responsible government.
This is the crucial reform principle to prepare during the coming months, jointly with the efforts to bring the Lisbon Treaty reforms into force.
The democratic principle is not only a groundbreaking novelty. It goes against the intergovernmentalist credo of a number of member states.
Therefore, putting it into practice would require some member states to embrace democracy as the only viable option for the 21st century, knowing that they would have to leave a number of recalcitrant members behind.
In other words, two major shifts are needed: The full adoption of the principle of EU level representative democracy and the sacrifice of EU unity (one-speed Europe) in favour of a legitimate union.
But what is the alternative? Growing popular disillusionment, hardening resistance, blocked future reform and ultimate failure. The writing is on the wall.
The democratic European Union is worth the sacrifice of two current principles of lesser value.
In short, we need the substance of the Lisbon Treaty, but not without a ground-breaking democratic reform.
Ralf Grahn
,
Friday, 20 June 2008
Achilles’ heels of Europe
The aftermath of the Irish referendum is potentially a fertile moment for Europe.
The Irish government seems to be clueless about how to proceed, reduced to pleading for extra time even beyond October 2008. But the referendum Catch 22 is set to remain, and nothing indicates that the ‘pro-European’ voters are going to become pro EU reform.
The vast majority of the EU member states is set to ratify the Treaty of Lisbon, which can be seen as a political statement on the necessity of reform.
But if the Irish want themselves and the rest of the EU stuck with the Treaty of Nice, as the crowning achievement of European integration, there is very little the other European leaders can do, presuming that they stick to the ‘liberum veto’.
We have an Irish Catch 22 and a European Catch 22.
What can be fertile about stalemate?
***
If political leaders have let their rules paint them into a corner with no or only limited room for manoeuvre, there are still people free to think and to speak.
Researchers, students, editorialists, columnists, bloggers and concerned EU citizens can discuss the challenges of European integration and the needed remedies against irrelevance, without pussyfooting.
Even if there seems to be little hope for effective cures in the short term, those interested in Europe’s place in the world can use the deep flaws exposed by the Irish referendum as a starting point for serious thought and discussion.
Here are some suggestions for further discussion:
1) National referendums on European level questions, and more generally the merits of representative vs. direct democracy.
2) The effects of EU’s treaty base and unanimous ratification.
3) Unanimous decision-making and the consequences of ‘liberum veto’.
4) The lack of democratic foundations and democratic legitimacy of the EU.
5) American and European experiences compared.
***
I wouldn’t go as far as to say that a weak European Union is in nobody’s interest. But it is not in the interest of us EU citizens.
One important reminder of that is James Rogers on Global Power Europe:
http://www.globalpowereurope.eu/
Read and reflect.
Ralf Grahn
The Irish government seems to be clueless about how to proceed, reduced to pleading for extra time even beyond October 2008. But the referendum Catch 22 is set to remain, and nothing indicates that the ‘pro-European’ voters are going to become pro EU reform.
The vast majority of the EU member states is set to ratify the Treaty of Lisbon, which can be seen as a political statement on the necessity of reform.
But if the Irish want themselves and the rest of the EU stuck with the Treaty of Nice, as the crowning achievement of European integration, there is very little the other European leaders can do, presuming that they stick to the ‘liberum veto’.
We have an Irish Catch 22 and a European Catch 22.
What can be fertile about stalemate?
***
If political leaders have let their rules paint them into a corner with no or only limited room for manoeuvre, there are still people free to think and to speak.
Researchers, students, editorialists, columnists, bloggers and concerned EU citizens can discuss the challenges of European integration and the needed remedies against irrelevance, without pussyfooting.
Even if there seems to be little hope for effective cures in the short term, those interested in Europe’s place in the world can use the deep flaws exposed by the Irish referendum as a starting point for serious thought and discussion.
Here are some suggestions for further discussion:
1) National referendums on European level questions, and more generally the merits of representative vs. direct democracy.
2) The effects of EU’s treaty base and unanimous ratification.
3) Unanimous decision-making and the consequences of ‘liberum veto’.
4) The lack of democratic foundations and democratic legitimacy of the EU.
5) American and European experiences compared.
***
I wouldn’t go as far as to say that a weak European Union is in nobody’s interest. But it is not in the interest of us EU citizens.
One important reminder of that is James Rogers on Global Power Europe:
http://www.globalpowereurope.eu/
Read and reflect.
Ralf Grahn
Continental vision vs liberum veto
The Philadelphia Convention had continental vision and it acted accordingly.
The European powers have been able to patch together a European Union of sorts, but as yet they have effectively restricted its potential for international action and internal reform by imitating the Polish-Lithuanian Commonwealth.
Here is an excerpt of what the Wikipedia article Liberum veto tells us about the effects of the unanimity rule:
“In the first half of the 18th century, it became increasingly common for Sejm sessions to be broken up by liberum veto, as the Commonwealth's neighbours — chiefly Russia and Prussia — found this a useful tool to frustrate attempts at reforming and strengthening the Commonwealth. The latter deteriorated from a European power into a state of anarchy.”
The Wikipedia article is available at:
http://en.wikipedia.org/wiki/Liberum_Veto
Is this the way we want it to be? Is this how we should want it to be?
Ralf Grahn
The European powers have been able to patch together a European Union of sorts, but as yet they have effectively restricted its potential for international action and internal reform by imitating the Polish-Lithuanian Commonwealth.
Here is an excerpt of what the Wikipedia article Liberum veto tells us about the effects of the unanimity rule:
“In the first half of the 18th century, it became increasingly common for Sejm sessions to be broken up by liberum veto, as the Commonwealth's neighbours — chiefly Russia and Prussia — found this a useful tool to frustrate attempts at reforming and strengthening the Commonwealth. The latter deteriorated from a European power into a state of anarchy.”
The Wikipedia article is available at:
http://en.wikipedia.org/wiki/Liberum_Veto
Is this the way we want it to be? Is this how we should want it to be?
Ralf Grahn
Thursday, 19 June 2008
Lisbon Treaty ratification tally
For or against the EU Treaty of Lisbon? It does not matter, but facts on the ratification processes do.
One of the best sources is the Ratification section of the Wikipedia web page Treaty of Lisbon:
http://en.wikipedia.org/wiki/Treaty_of_Lisbon#Ratification
Quickly updated, with brief but sufficient remarks and exact parliamentary votes, Wikipedia serves an important information need.
Although parliamentary ratification is the essential requirement in political EU discourse, formally many member states provide for presidential signature, and the ratification instrument has to be deposited in Rome with the Italian government.
A short while ago the tally was: ratified 19 member states, not ratified 7 member states, rejected 1 member state. – The ratification instrument had been deposited by ten members.
***
Readers interested in EU politics may care to study the outcomes of the parliamentary votes. If the national heads of state or government or even the national governments can somehow be contrived to be a mysterious ‘EU elite’, what can be said about the national parliamentarians, who in almost devastating numbers have voted in favour of the Lisbon Treaty?
Do the perceptions tally with the facts?
Ralf Grahn
Update 19 June 2008: European Union Law Blog is an excellent source of Lisbon Treaty ratification news and commentary in German. Plus there is a handy ratification list in chronological order at:
http://www.law-europe.eu/ratifikationsstand/
Especially during the last days I have noticed that EUbusiness.com has been very alert with news stories on the ratification process of the Lisbon Treaty in English. Go to:
http://www.eubusiness.com/
One of the best sources is the Ratification section of the Wikipedia web page Treaty of Lisbon:
http://en.wikipedia.org/wiki/Treaty_of_Lisbon#Ratification
Quickly updated, with brief but sufficient remarks and exact parliamentary votes, Wikipedia serves an important information need.
Although parliamentary ratification is the essential requirement in political EU discourse, formally many member states provide for presidential signature, and the ratification instrument has to be deposited in Rome with the Italian government.
A short while ago the tally was: ratified 19 member states, not ratified 7 member states, rejected 1 member state. – The ratification instrument had been deposited by ten members.
***
Readers interested in EU politics may care to study the outcomes of the parliamentary votes. If the national heads of state or government or even the national governments can somehow be contrived to be a mysterious ‘EU elite’, what can be said about the national parliamentarians, who in almost devastating numbers have voted in favour of the Lisbon Treaty?
Do the perceptions tally with the facts?
Ralf Grahn
Update 19 June 2008: European Union Law Blog is an excellent source of Lisbon Treaty ratification news and commentary in German. Plus there is a handy ratification list in chronological order at:
http://www.law-europe.eu/ratifikationsstand/
Especially during the last days I have noticed that EUbusiness.com has been very alert with news stories on the ratification process of the Lisbon Treaty in English. Go to:
http://www.eubusiness.com/
Vox populi
The jubilation among the anti-EU crowd is wild each time progress is halted. Parliamentary non-ratification is naturally fine, but nothing beats a No vote by the people.
It does not seem to matter if EU level questions are decided at the national level, if the outcome is based on fears and fantasies unconnected with the actual contents of the treaty, or if statesman-like vision is railroaded by almost total ignorance – as long as the result is No.
The prize seems to have been taken by one commentator signing off with the proverbial: Vox populi, vox dei.
***
I find that referendums are incredibly blunt instruments for complex questions. Legislative drafting, parliamentary debate, committee scrutiny, expert witnesses, plenary debate and final vote are incomparably superior to catchy but distortive slogans.
Still, I would respect principled arguments for referenda, based on their perceived benefits compared to representative democracy,
But I have seen few tenable principles for referenda, at least of the kind conducive to good governance.
Principled as the opposite of opportunistic. Meaning that the rules of representative democracy shall be set aside on certain, objective grounds in like cases.
The louder the praise of popular wisdom, the less safeguards against the use of referendums the proponents want, I presume.
One of the few merits of referendums, in my view, is the responsibility of the population to live with the consequences of its poor collective choices.
***
If there are thinking individuals among the referendum campaigners, they could read the article on Open Democracy by George Schöpflin: The referendum: populism vs democracy
available at:
http://www.opendemocracy.net/article/the-referendum-populism-vs-democracy
***
Back to our ‘Vox populi’ commentator, seemingly unaware of the full proverb, as presented by the Wikipedia article Vox populi:
http://en.wikipedia.org/wiki/Vox_populi
Nec audiendi qui solent dicere, Vox populi, vox Dei, quum tumultuositas vulgi semper insaniae proxima sit.
English translation:
And those people should not be listened to who keep saying the voice of the people is the voice of God, since the riotousness of the crowd is always very close to madness.
***
Representative democracy is far from God’s voice, but thankfully less prone to delusions than our Vox populi.
Ralf Grahn
It does not seem to matter if EU level questions are decided at the national level, if the outcome is based on fears and fantasies unconnected with the actual contents of the treaty, or if statesman-like vision is railroaded by almost total ignorance – as long as the result is No.
The prize seems to have been taken by one commentator signing off with the proverbial: Vox populi, vox dei.
***
I find that referendums are incredibly blunt instruments for complex questions. Legislative drafting, parliamentary debate, committee scrutiny, expert witnesses, plenary debate and final vote are incomparably superior to catchy but distortive slogans.
Still, I would respect principled arguments for referenda, based on their perceived benefits compared to representative democracy,
But I have seen few tenable principles for referenda, at least of the kind conducive to good governance.
Principled as the opposite of opportunistic. Meaning that the rules of representative democracy shall be set aside on certain, objective grounds in like cases.
The louder the praise of popular wisdom, the less safeguards against the use of referendums the proponents want, I presume.
One of the few merits of referendums, in my view, is the responsibility of the population to live with the consequences of its poor collective choices.
***
If there are thinking individuals among the referendum campaigners, they could read the article on Open Democracy by George Schöpflin: The referendum: populism vs democracy
available at:
http://www.opendemocracy.net/article/the-referendum-populism-vs-democracy
***
Back to our ‘Vox populi’ commentator, seemingly unaware of the full proverb, as presented by the Wikipedia article Vox populi:
http://en.wikipedia.org/wiki/Vox_populi
Nec audiendi qui solent dicere, Vox populi, vox Dei, quum tumultuositas vulgi semper insaniae proxima sit.
English translation:
And those people should not be listened to who keep saying the voice of the people is the voice of God, since the riotousness of the crowd is always very close to madness.
***
Representative democracy is far from God’s voice, but thankfully less prone to delusions than our Vox populi.
Ralf Grahn
Ireland after Lisbon Treaty vote
Most of the Irish web discussions I have seen after the no vote on the Lisbon Treaty have, understandably, centred of internal reasons for no and yes ballots, or on the roles of different players on the national scene.
In Jurist, the alert web publication of the University of Pittsburgh’s School of Law, Dr Laurent Pech of the National University of Ireland, Galway, offers a summary and an evaluation of the three most influential reasons for rejection put forward by Irish critics of the Treaty of Lisbon.
The guest column is called ‘After Ireland’s ‘No’: Long Live the EU Lisbon Treaty?’, and it is available at:
http://jurist.law.pitt.edu/forumy/2008/06/after-irelands-no-long-live-lisbon.php
But Pech offers enough of a European perspective to give food for thought concerning Ireland’s position in the real or outside world. He goes on to analyse the potential consequences for Ireland after the no vote, based on various options left to the other European states: limited reforms based on the Treaty of Nice, starting from scratch to negotiate a new treaty and continuing the ratification process.
***
Has Ireland played itself off-side? Does Ireland want to re-enter the play? How could it be done?
Ralf Grahn
In Jurist, the alert web publication of the University of Pittsburgh’s School of Law, Dr Laurent Pech of the National University of Ireland, Galway, offers a summary and an evaluation of the three most influential reasons for rejection put forward by Irish critics of the Treaty of Lisbon.
The guest column is called ‘After Ireland’s ‘No’: Long Live the EU Lisbon Treaty?’, and it is available at:
http://jurist.law.pitt.edu/forumy/2008/06/after-irelands-no-long-live-lisbon.php
But Pech offers enough of a European perspective to give food for thought concerning Ireland’s position in the real or outside world. He goes on to analyse the potential consequences for Ireland after the no vote, based on various options left to the other European states: limited reforms based on the Treaty of Nice, starting from scratch to negotiate a new treaty and continuing the ratification process.
***
Has Ireland played itself off-side? Does Ireland want to re-enter the play? How could it be done?
Ralf Grahn
Lisbon Treaty: Double edge of UK ratification
The UK House of Lords resisted the temptation to postpone ratification of the Treaty of Lisbon and approved the government bill. This puts the number of ratifying member states at 19 out of 27.
See, for instance, the BBC report:
http://news.bbc.co.uk/2/hi/uk_news/politics/7461918.stm
Prime minister Gordon Brown can participate in the European Council discussions strengthened by the decision. UK ratification sends a signal to the seven member states, where the ratification process is still open. British anti-EU and pro-referendum campaigners will of course do their utmost to stir up emotions against the government and the European Union, both unpopular in the realm.
But the situation is far from a resounding victory for people who believe in the necessity of EU reform.
In its present form, the Treaty of Lisbon is legally dead. Ireland would have to change its opinion in a new referendum either to approve the Lisbon Treaty or to scrap the need for referendums. Neither looks likely, since the reasons for popular rejection have left the government clueless as to the potential remedies. There is no effective prescription for malaise, at least in the realm of treaties.
Ideas have been floated about soothing declarations, but the effect might be the opposite, hardening opposition. The Irish constitutional setting surrounding referendums simply makes the country ungovernable in certain respects, and without a real voice in European affairs.
This means that the United Kingdom retains the option to scrap the Lisbon Treaty at any given moment, but it has, at least temporarily, put a dampener on aspirations to build a more effective European Union. In spite of popular illusions of a looming European super-state, British governments have effectively managed to reduce the scope of reform at each stage during and since the European Convention.
As long as it remains on the inside track, Britain can more effectively defend a political union in name, but built on intergovernmental sand. On the outside or on an outer track, tenacious UK obstructionism might fail, strengthening French and German resolve to move ahead, possibly leading to a two-speed Europe, leaving the UK outside the core.
Crudely put: The British strategy is pissing in on the inside.
As long as soul-searching and salvage operations continue, the Treaty of Nice remains in force, hardly a catastrophe for Gordon Brown. The risk, from his point of view, is if the frustration of integrationist countries turns into decisive action to remedy the fatal flaws of the existing European Union, if necessary by creating a new one, more effective but with fewer members.
Until now, inertia and fudge have served British governments well, but to have the cake and eat it too, a vigilant watch is needed. The UK Parliament has handed Gordon Brown a passport to the inner circles.
Ralf Grahn
See, for instance, the BBC report:
http://news.bbc.co.uk/2/hi/uk_news/politics/7461918.stm
Prime minister Gordon Brown can participate in the European Council discussions strengthened by the decision. UK ratification sends a signal to the seven member states, where the ratification process is still open. British anti-EU and pro-referendum campaigners will of course do their utmost to stir up emotions against the government and the European Union, both unpopular in the realm.
But the situation is far from a resounding victory for people who believe in the necessity of EU reform.
In its present form, the Treaty of Lisbon is legally dead. Ireland would have to change its opinion in a new referendum either to approve the Lisbon Treaty or to scrap the need for referendums. Neither looks likely, since the reasons for popular rejection have left the government clueless as to the potential remedies. There is no effective prescription for malaise, at least in the realm of treaties.
Ideas have been floated about soothing declarations, but the effect might be the opposite, hardening opposition. The Irish constitutional setting surrounding referendums simply makes the country ungovernable in certain respects, and without a real voice in European affairs.
This means that the United Kingdom retains the option to scrap the Lisbon Treaty at any given moment, but it has, at least temporarily, put a dampener on aspirations to build a more effective European Union. In spite of popular illusions of a looming European super-state, British governments have effectively managed to reduce the scope of reform at each stage during and since the European Convention.
As long as it remains on the inside track, Britain can more effectively defend a political union in name, but built on intergovernmental sand. On the outside or on an outer track, tenacious UK obstructionism might fail, strengthening French and German resolve to move ahead, possibly leading to a two-speed Europe, leaving the UK outside the core.
Crudely put: The British strategy is pissing in on the inside.
As long as soul-searching and salvage operations continue, the Treaty of Nice remains in force, hardly a catastrophe for Gordon Brown. The risk, from his point of view, is if the frustration of integrationist countries turns into decisive action to remedy the fatal flaws of the existing European Union, if necessary by creating a new one, more effective but with fewer members.
Until now, inertia and fudge have served British governments well, but to have the cake and eat it too, a vigilant watch is needed. The UK Parliament has handed Gordon Brown a passport to the inner circles.
Ralf Grahn
Wednesday, 18 June 2008
Who stands up for Europe?
Who is more to blame? The so called EU elites, who have built the European Union on intergovernmental sand? Or moody populations resisting every move to improve the common structures even marginally?
***
There is a tide in the affairs of men,
Which taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
***
Soon we have dithered and demurred Europe into oblivion and irrelevance on the world stage.
Who stands up for Europe, if Europeans don’t? Benign outside forces?
Time to launch the European Union Epitaph Competition?
Ralf Grahn
***
There is a tide in the affairs of men,
Which taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
***
Soon we have dithered and demurred Europe into oblivion and irrelevance on the world stage.
Who stands up for Europe, if Europeans don’t? Benign outside forces?
Time to launch the European Union Epitaph Competition?
Ralf Grahn
Lisbon Treaty in Sweden: Legal opinion
The Swedish Council on Legislation (Lagrådet) has given its expert opinion on the government’s draft ratification bill concerning the EU Treaty of Lisbon. The legal opinion, dated 13 June 2008, draws on the earlier statement on the Constitutional Treaty to conclude that the proposed ratification does not require amendments to the Swedish Constitution.
The legal opinion can be accessed at:
http://www.lagradet.se/yttranden/Lissabonfordraget.pdf
This means that the government of Sweden can send the bill to parliament without constitutional complications.
***
On the political side, foreign minister Carl Bildt has reiterated his mantra that Irelend decides for Ireland, and Sweden decides for Sweden.
Ralf Grahn
The legal opinion can be accessed at:
http://www.lagradet.se/yttranden/Lissabonfordraget.pdf
This means that the government of Sweden can send the bill to parliament without constitutional complications.
***
On the political side, foreign minister Carl Bildt has reiterated his mantra that Irelend decides for Ireland, and Sweden decides for Sweden.
Ralf Grahn
Tuesday, 17 June 2008
Time to give the EU credibility
My posts on the Irish referendum on the Lisbon Treaty and its exposure of the fatal weaknesses of the European Union have gained both readers and valuable comment.
Now there are new voices demanding decisive action to end EU impotence, conveniently linked by Kosmopolit in Kosmolinks #16:
http://kosmopolit.wordpress.com/2008/06/16/kosmolinks-16/
They include Daniel Gros, Daniel Korski, Joschka Fischer, Wolfgang Munchau, Robert Kagan, Will Hutton and DJ Nozem.
Read and reflect.
Ralf Grahn
Now there are new voices demanding decisive action to end EU impotence, conveniently linked by Kosmopolit in Kosmolinks #16:
http://kosmopolit.wordpress.com/2008/06/16/kosmolinks-16/
They include Daniel Gros, Daniel Korski, Joschka Fischer, Wolfgang Munchau, Robert Kagan, Will Hutton and DJ Nozem.
Read and reflect.
Ralf Grahn
More on: Why Europe?
Let the specialists explore vote-weighting, fish quotas, phytosanitary regulations and the like. What people in general need are a few home truths about why the European Union is necessary and why we actually need ‘more Europe’ in some crucial respects, while renouncing regulation overload at the European level.
***
In the United States, more than 200 years ago, the main purposes of that Union were succinctly put by Alexander Hamilton in the Federalist, number XXIII:
“The necessity of a Constitution, at least equally energetic with the one proposed, to the preservation of the Union is the point at the examination of which we are now arrived.
The principal purposes to be answered by the union are these – the common defense of the members; the preservation of the public peace, as well against internal convulsions as external attacks; the regulation of commerce with other nations and between the States; the superintendence of our intercourse, political and commercial, with foreign countries.”
***
There are two fundamental needs: security and prosperity.
The fundamental challenges remain the same, but in today’s globalising world they are even more real and demanding, while the European nation-states are ever less able to deliver on their own.
Sovereignty is an empty shell, if it means that we reject ‘outside interference’, but are unable to offer working solutions.
The European countries have started to come to grips with this dilemma, by joining forces selectively and often timidly.
***
There are two fundamental challenges:
1. We need modes for more effective European action.
2. Europeans need to understand why.
Our political leaders have invested little in explaining the necessities to their electors. A few cursory remarks and an occasional speech is not enough to shape a needed new vision of the world for whole populations.
The basic challenges need constant repetition. Where mass media do little to educate people – preferring scandal, entertainment or even their own disruptive political agendas – the politicians’ task becomes not only demanding, but almost impossible.
But the political leaders have to make the effort, because enlightening the bewildered populations is a necessary condition for effective action.
One more thing: Blaming politicians is not enough. Our common European heritage tells us that we have the freedom and the responsibility to educate ourselves.
Democracy is, in essence, our responsibility to bear the consequences of our collective wrong choices. But with better choices life can be worth living.
Ralf Grahn
***
In the United States, more than 200 years ago, the main purposes of that Union were succinctly put by Alexander Hamilton in the Federalist, number XXIII:
“The necessity of a Constitution, at least equally energetic with the one proposed, to the preservation of the Union is the point at the examination of which we are now arrived.
The principal purposes to be answered by the union are these – the common defense of the members; the preservation of the public peace, as well against internal convulsions as external attacks; the regulation of commerce with other nations and between the States; the superintendence of our intercourse, political and commercial, with foreign countries.”
***
There are two fundamental needs: security and prosperity.
The fundamental challenges remain the same, but in today’s globalising world they are even more real and demanding, while the European nation-states are ever less able to deliver on their own.
Sovereignty is an empty shell, if it means that we reject ‘outside interference’, but are unable to offer working solutions.
The European countries have started to come to grips with this dilemma, by joining forces selectively and often timidly.
***
There are two fundamental challenges:
1. We need modes for more effective European action.
2. Europeans need to understand why.
Our political leaders have invested little in explaining the necessities to their electors. A few cursory remarks and an occasional speech is not enough to shape a needed new vision of the world for whole populations.
The basic challenges need constant repetition. Where mass media do little to educate people – preferring scandal, entertainment or even their own disruptive political agendas – the politicians’ task becomes not only demanding, but almost impossible.
But the political leaders have to make the effort, because enlightening the bewildered populations is a necessary condition for effective action.
One more thing: Blaming politicians is not enough. Our common European heritage tells us that we have the freedom and the responsibility to educate ourselves.
Democracy is, in essence, our responsibility to bear the consequences of our collective wrong choices. But with better choices life can be worth living.
Ralf Grahn
Why Europe?
There are fairly small groups of vehement and vocal anti-EU campaigners, but they resonate with varying proportions of national electorates hostile to or suspicious of ‘Brussels’, although profound indifference towards the European Union is probably the prevalent mood, equally frustrating for the anti-EU crowd as for Europhiles.
My attempt to sum up the European malaise is: Distant and meddling.
Distant bureaucrats fine-tuning standards for different products in the internal market, incomprehensible treaties and tons of secondary legislation, unclear responsibilities and poor accountability, almost faceless politicians ushered in from black cars to do, what?
At the same time, a pervasive feeling that these tentacles reach into every nook and cranny, somehow threatening our daily lives and comforts, as well as our jobs and futures.
Thus far, the feelings are common to large swathes of the peoples, but more prevalent among the poor, the uneducated, the old and the rural populations, in short, those who live precariously.
The causes of discontent vary wildly, too, from accusations of an ‘ultra-liberalist’ conspiracy trampling workers’ rights to ‘socialist’ over-regulation choking free enterprise.
***
There is no magic cure. ‘Washington’ is as much of a swearword in US politicking as ‘Brussels’ in Europe, and there is a guaranteed market for various shades of populist hopefuls nationally, regionally and locally.
Although the division of labour between the EU and the member states is far from perfect, the questions decided at the European level tend to be far from the daily concerns of individuals, unless they happen to be directly affected like farmers or fishermen.
***
But something needs to be done. Something could be done.
The European Convention, the Constitutional Treaty and the Lisbon Treaty (in the consolidated version) made some gestures towards presenting the basic rules of the European Union in a readable form, but they all carried with them the luggage of previous treaties.
Their improved aims and principles are admirable. In the long run they strengthen the foundations for progress towards a citizens’ Europe, although the process may be a long one.
But the basic principles and necessary institutions would have to be presented in an even shorter document than the proposed Treaty on European Union. If, despite its intergovernmental character, the common foreign and security policy, including the common security and defence policy, was moved to the proposed Treaty on the Functioning of the European Union, we would be near a readable basic document for EU citizens (as legal texts go).
The constitutional document could be fairly neutral, leaving it to the various political parties to try to convince the EU citizens of the merits of their programmes.
***
Every home in the EU would receive this fundamental document and it would have to be produced in a form which would make people voluntarily place it in their bookshelf for further reference.
The objectives and principles of the European Union tell us something about what the EU has been established for and how it is supposed to work, but more is needed as to why.
More about that in a coming post.
Ralf Grahn
My attempt to sum up the European malaise is: Distant and meddling.
Distant bureaucrats fine-tuning standards for different products in the internal market, incomprehensible treaties and tons of secondary legislation, unclear responsibilities and poor accountability, almost faceless politicians ushered in from black cars to do, what?
At the same time, a pervasive feeling that these tentacles reach into every nook and cranny, somehow threatening our daily lives and comforts, as well as our jobs and futures.
Thus far, the feelings are common to large swathes of the peoples, but more prevalent among the poor, the uneducated, the old and the rural populations, in short, those who live precariously.
The causes of discontent vary wildly, too, from accusations of an ‘ultra-liberalist’ conspiracy trampling workers’ rights to ‘socialist’ over-regulation choking free enterprise.
***
There is no magic cure. ‘Washington’ is as much of a swearword in US politicking as ‘Brussels’ in Europe, and there is a guaranteed market for various shades of populist hopefuls nationally, regionally and locally.
Although the division of labour between the EU and the member states is far from perfect, the questions decided at the European level tend to be far from the daily concerns of individuals, unless they happen to be directly affected like farmers or fishermen.
***
But something needs to be done. Something could be done.
The European Convention, the Constitutional Treaty and the Lisbon Treaty (in the consolidated version) made some gestures towards presenting the basic rules of the European Union in a readable form, but they all carried with them the luggage of previous treaties.
Their improved aims and principles are admirable. In the long run they strengthen the foundations for progress towards a citizens’ Europe, although the process may be a long one.
But the basic principles and necessary institutions would have to be presented in an even shorter document than the proposed Treaty on European Union. If, despite its intergovernmental character, the common foreign and security policy, including the common security and defence policy, was moved to the proposed Treaty on the Functioning of the European Union, we would be near a readable basic document for EU citizens (as legal texts go).
The constitutional document could be fairly neutral, leaving it to the various political parties to try to convince the EU citizens of the merits of their programmes.
***
Every home in the EU would receive this fundamental document and it would have to be produced in a form which would make people voluntarily place it in their bookshelf for further reference.
The objectives and principles of the European Union tell us something about what the EU has been established for and how it is supposed to work, but more is needed as to why.
More about that in a coming post.
Ralf Grahn
Constitutions: USA versus Europe
The Philadelphia Convention drafted the short and readable Constitution of the United States of America (1787), with little in the way of democratic (Britain, Holland) and republican precedents to follow, and their ability to construct a federal system was revolutionary.
Still, by getting it right the first time and by using broad brush-strokes, the Convention left little to be tinkered with later, although the Bill of Rights was added almost immediately to ensure ratification, and the abolition of slavery, election procedures and civil rights have caused some amendments during more than 200 years of existence.
In spite of being almost perfect at birth, the US Constitution avoided the dangers of petrification by providing for future amendments. Changing the Constitution was made difficult, but not impossible, as laid out in Article V:
The Congress, whenever two-thirds of both Houses shall deem it necessary, shall propose Amendments to this Constitution, or, on the Application of the Legislatures of two-thirds of the several States, shall call a Convention for proposing Amendments, which, in either Case, shall be valid to all Intents and Purposes, as part of this Constitution, when ratified by the Legislatures of three-fourths thereof, as the one or the other Mode of Ratification may be proposed by the Congress; ---
***
The European experience has been different: The texts have been long and unwieldy. Detailed provisions and laborious compromises have been enshrined at the ‘constitutional’ level. Both treaty negotiations and later ratifications have required unanimity.
All this has led to the constant need for treaty revision in order to avoid ossification.
The Irish referendum has, once again, shown how feeble the general interest is in the European context.
***
In an earlier post we saw that the Treaty of Lisbon has to be ratified by 27 member states to enter into force in its present form.
The preceding phase, making the needed amendments, is another source of relative impotence. It does not need a special provision, because it follows from the application of principles of traditional international law and from the requirement that each participating government has to be willing to propose and able to get ratification from its national parliament (as a rule).
The current rule on treaty change is Article 48 of the Treaty on European Union:
Article 48 TEU
The government of any Member State or the Commission may submit to the Council proposals for the amendment of the Treaties on which the Union is founded.
If the Council, after consulting the European Parliament and, where appropriate, the Commission, delivers an opinion in favour of calling a conference of representatives of the governments of the Member States, the conference shall be convened by the President of the Council for the purpose of determining by common accord the amendments to be made to those Treaties. The European Central Bank shall also be consulted in the case of institutional changes in the monetary area.
The amendments shall enter into force after being ratified by all the Member States in accordance with their respective constitutional requirements.
***
Constant tinkering, frequent intergovernmental conferences, proposed half-measures, protracted ratifications, unreadable texts, alienated electorates …
If the European Union is in a hole, it is one it has dug itself.
Ralf Grahn
Still, by getting it right the first time and by using broad brush-strokes, the Convention left little to be tinkered with later, although the Bill of Rights was added almost immediately to ensure ratification, and the abolition of slavery, election procedures and civil rights have caused some amendments during more than 200 years of existence.
In spite of being almost perfect at birth, the US Constitution avoided the dangers of petrification by providing for future amendments. Changing the Constitution was made difficult, but not impossible, as laid out in Article V:
The Congress, whenever two-thirds of both Houses shall deem it necessary, shall propose Amendments to this Constitution, or, on the Application of the Legislatures of two-thirds of the several States, shall call a Convention for proposing Amendments, which, in either Case, shall be valid to all Intents and Purposes, as part of this Constitution, when ratified by the Legislatures of three-fourths thereof, as the one or the other Mode of Ratification may be proposed by the Congress; ---
***
The European experience has been different: The texts have been long and unwieldy. Detailed provisions and laborious compromises have been enshrined at the ‘constitutional’ level. Both treaty negotiations and later ratifications have required unanimity.
All this has led to the constant need for treaty revision in order to avoid ossification.
The Irish referendum has, once again, shown how feeble the general interest is in the European context.
***
In an earlier post we saw that the Treaty of Lisbon has to be ratified by 27 member states to enter into force in its present form.
The preceding phase, making the needed amendments, is another source of relative impotence. It does not need a special provision, because it follows from the application of principles of traditional international law and from the requirement that each participating government has to be willing to propose and able to get ratification from its national parliament (as a rule).
The current rule on treaty change is Article 48 of the Treaty on European Union:
Article 48 TEU
The government of any Member State or the Commission may submit to the Council proposals for the amendment of the Treaties on which the Union is founded.
If the Council, after consulting the European Parliament and, where appropriate, the Commission, delivers an opinion in favour of calling a conference of representatives of the governments of the Member States, the conference shall be convened by the President of the Council for the purpose of determining by common accord the amendments to be made to those Treaties. The European Central Bank shall also be consulted in the case of institutional changes in the monetary area.
The amendments shall enter into force after being ratified by all the Member States in accordance with their respective constitutional requirements.
***
Constant tinkering, frequent intergovernmental conferences, proposed half-measures, protracted ratifications, unreadable texts, alienated electorates …
If the European Union is in a hole, it is one it has dug itself.
Ralf Grahn
Defining moments
Strictly speaking, the Philadelphia Convention lacked the mandate to draft a Constitution to replace the inadequate Articles of Confederation. Urged on, by vision and necessity, the Convention not only drafted a new federal and democratic Constitution setting up the United States of America, but it included a crucial provision on its entry into force.
The Constitution of the United States of America, as agreed upon by the Convention, September 17, 1787, Article VII:
The Ratification of the Conventions of nine States shall be sufficient for the Establishment of this Constitution between the States so ratifying the Same.
***
Just a few words and a few defining moments make the difference between success and failure of global proportions.
Ralf Grahn
The Constitution of the United States of America, as agreed upon by the Convention, September 17, 1787, Article VII:
The Ratification of the Conventions of nine States shall be sufficient for the Establishment of this Constitution between the States so ratifying the Same.
***
Just a few words and a few defining moments make the difference between success and failure of global proportions.
Ralf Grahn
Monday, 16 June 2008
None-speed Europe
In a few days the Irish rejection has turned the dull Treaty of Lisbon into explosive stuff. The treaty, as it stands, can not enter into force without 27 ratifications.
On the other hand, an end to treaty reform is a fundamental change of circumstances, since it contravenes the founding principles on which the European Union is built.
France and Germany have declared that the Lisbon Treaty is necessary to make the European Union more democratic and effective. They expect the remaining states to proceed with ratification.
In practice this means that the Lisbon Treaty would have to be suitably amended to serve initially and a new European Union would have to be established, at least if the unwilling want to make things difficult on the inside rather than to seek alternative arrangements.
If Great Britain decides to pull the plug on ratification, the group of non-ratifiers grows to at least two. This is a clear strategic shift from obstructionism to petrification. If we believe foreign minister David Miliband, Great Britain will throw its weight but also its fate into the ring.
In that case the Franco-German will have a stark choice: to accept the UK’s age old quest for a none-speed Europe or be ready to embark on the 21st century road towards an evolving European Union with less participants.
While fudge and immobility have been the traditional answers to difficult questions, France and Germany just might be resolved enough to do what it takes.
Ralf Grahn
On the other hand, an end to treaty reform is a fundamental change of circumstances, since it contravenes the founding principles on which the European Union is built.
France and Germany have declared that the Lisbon Treaty is necessary to make the European Union more democratic and effective. They expect the remaining states to proceed with ratification.
In practice this means that the Lisbon Treaty would have to be suitably amended to serve initially and a new European Union would have to be established, at least if the unwilling want to make things difficult on the inside rather than to seek alternative arrangements.
If Great Britain decides to pull the plug on ratification, the group of non-ratifiers grows to at least two. This is a clear strategic shift from obstructionism to petrification. If we believe foreign minister David Miliband, Great Britain will throw its weight but also its fate into the ring.
In that case the Franco-German will have a stark choice: to accept the UK’s age old quest for a none-speed Europe or be ready to embark on the 21st century road towards an evolving European Union with less participants.
While fudge and immobility have been the traditional answers to difficult questions, France and Germany just might be resolved enough to do what it takes.
Ralf Grahn
Lisbon Treaty: Irish legal concerns
There are few legal instruments available to dispel disenchantment, myths or various individual worries, especially when many of them are outside the scope of the treaty (or any conceivable replacement).
In spite of this conclusion in my previous post, I believe that there is a need for deliberation if we want our societies to prosper. Therefore, Irish concerns pertaining to questions common to the Constitutional Treaty and the Lisbon Treaty merit study despite the referendum outcome. Some are peculiar to Ireland or more prominent there than elsewhere, but many of them have a bearing on Europeans in general, not least because of common themes and borderless misconceptions diffused by electronic means.
Laurent Pech has written the National Report for Ireland on the subject: Preparing the European Union for the Future? Necessary Revisions of Primary Law after the non-ratification of the Treaty establishing a Constitution for Europe. (23rd FIDE Congress in Linz, 28–31 May 2008)
People interested in politics and law can be recommended to read the clearly written 24 page report. It has been published as a working paper, which can be downloaded from:
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1123935#PaperDownload.
At the time of writing, the author expected to produce a final version in June 2008.
Laurent Pech has written a newly published book with a long perspective on the evolving European treaties:
The European Union and its Constitution: From Rome to Lisbon (Clarus Press, March 2008; 45 €).
For more information, see:
http://www.claruspress.ie
Ralf Grahn
In spite of this conclusion in my previous post, I believe that there is a need for deliberation if we want our societies to prosper. Therefore, Irish concerns pertaining to questions common to the Constitutional Treaty and the Lisbon Treaty merit study despite the referendum outcome. Some are peculiar to Ireland or more prominent there than elsewhere, but many of them have a bearing on Europeans in general, not least because of common themes and borderless misconceptions diffused by electronic means.
Laurent Pech has written the National Report for Ireland on the subject: Preparing the European Union for the Future? Necessary Revisions of Primary Law after the non-ratification of the Treaty establishing a Constitution for Europe. (23rd FIDE Congress in Linz, 28–31 May 2008)
People interested in politics and law can be recommended to read the clearly written 24 page report. It has been published as a working paper, which can be downloaded from:
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1123935#PaperDownload.
At the time of writing, the author expected to produce a final version in June 2008.
Laurent Pech has written a newly published book with a long perspective on the evolving European treaties:
The European Union and its Constitution: From Rome to Lisbon (Clarus Press, March 2008; 45 €).
For more information, see:
http://www.claruspress.ie
Ralf Grahn
Lisbon Treaty: Entry into force
Is the EU Treaty of Lisbon dead after the Irish referendum and possible later drop-outs? This is what Article 6 of the Lisbon Treaty says (OJ 17.12.2007 C 306/134):
Article 6 Treaty of Lisbon
1. This Treaty shall be ratified by the High Contracting Parties in accordance with their respective constitutional requirements. The instruments of ratification shall be deposited with the Government of the Italian Republic.
2. This Treaty shall enter into force on 1 January 2009, provided that all the instruments of ratification have been deposited, or, failing that, on the first day of the month following the deposit of the instrument of ratification by the last signatory State to take this step.
***
The words ‘all’ and ‘last’ speak for themselves. The original Lisbon Treaty is not going to enter into force, because the number of ratifying states (in practice 18 already) is going to be 26 or less.
In its present form, the Treaty of Lisbon is legally dead.
The automatic consequence is that the current treaties are in force, as amended by the Treaty of Nice and the Accession Treaties.
***
Ireland has spoken. Since the referendum genie is out of the bottle, only the Irish voters can either approve a different arrangement or (improbably) relinquish the use of referendums by amending the Constitution.
The matter is complicated by the fact that there is scant evidence of Irish concerns, which are a factual part of the Lisbon Treaty or could be assuaged by palliative measures. There are few legal instruments available to dispel disenchantment, myths or various individual worries, especially when many of them are outside the scope of the treaty (or any conceivable replacement).
In these circumstances it would be futile to serve the Irish electorate a second helping of the same dish.
Stalemate on the Irish front.
***
Is Europe paralysed, too, doomed to petrify within the constraints of the Treaty of Nice?
Ralf Grahn
Article 6 Treaty of Lisbon
1. This Treaty shall be ratified by the High Contracting Parties in accordance with their respective constitutional requirements. The instruments of ratification shall be deposited with the Government of the Italian Republic.
2. This Treaty shall enter into force on 1 January 2009, provided that all the instruments of ratification have been deposited, or, failing that, on the first day of the month following the deposit of the instrument of ratification by the last signatory State to take this step.
***
The words ‘all’ and ‘last’ speak for themselves. The original Lisbon Treaty is not going to enter into force, because the number of ratifying states (in practice 18 already) is going to be 26 or less.
In its present form, the Treaty of Lisbon is legally dead.
The automatic consequence is that the current treaties are in force, as amended by the Treaty of Nice and the Accession Treaties.
***
Ireland has spoken. Since the referendum genie is out of the bottle, only the Irish voters can either approve a different arrangement or (improbably) relinquish the use of referendums by amending the Constitution.
The matter is complicated by the fact that there is scant evidence of Irish concerns, which are a factual part of the Lisbon Treaty or could be assuaged by palliative measures. There are few legal instruments available to dispel disenchantment, myths or various individual worries, especially when many of them are outside the scope of the treaty (or any conceivable replacement).
In these circumstances it would be futile to serve the Irish electorate a second helping of the same dish.
Stalemate on the Irish front.
***
Is Europe paralysed, too, doomed to petrify within the constraints of the Treaty of Nice?
Ralf Grahn
Sunday, 15 June 2008
EU TFEU European intellectual property rights
In the best case the substance of the Treaty of Lisbon can form the initial basis for the new European Union established between most of the present member states. In the worst case, the ideas for and the history of treaty reform are not going to disappear, and anyway the current treaty provisions are laid out.
The Lisbon Treaty posts continue in the usual manner.
***
Article 118 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/96:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 118 TFEU
In the context of the establishment and functioning of the internal market, the European Parliament and the Council, acting in accordance with the ordinary legislative procedure, shall establish measures for the creation of European intellectual property rights to provide uniform protection of intellectual property rights throughout the Union and for the setting up of centralised Union-wide authorisation, coordination and supervision arrangements.
The Council, acting in accordance with a special legislative procedure, shall by means of regulations establish language arrangements for the European intellectual property rights. The Council shall act unanimously after consulting the European Parliament.
***
In Article 2, point 84 of the Treaty of Lisbon (ToL) the IGC 2007 inserted a new Article 97a on intellectual property rights into the Treaty on the Functioning of the European Union (ToL) (OJ 17.12.2007 C 306/70).
***
The TFEU table of equivalences confirms that the new Article 97a TFEU (ToL) in the original Treaty of Lisbon was later renumbered Article 118 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
Consequently, there is no corresponding Article in the current treaties.
***
We have to look further back to see if the Article has antecedents.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-68 of the draft Treaty establishing a Constitution for Europe proposed a legal base for the introduction of European instruments to provide intellectual-property rights. See OJ 18.7.2003 C 169/39.
Article III-68 Draft Constitution
In establishing an internal market, measures for the introduction of European instruments to provide uniform intellectual-property rights protection throughout the Union and for the setting up of centralised Union-wide authorisation, coordination and supervision arrangements shall be established in European laws or framework laws.
A European law of the Council of Ministers shall establish language arrangements for the European instruments. The Council of Ministers shall act unanimously after consulting the European Parliament.
***
The differences between the draft Constitution and the TFEU seem to concern choices of wording and treaty terminology only. The substance was already in place.
***
In the Treaty establishing a Constitution for Europe, ‘ratified’ by 18 member states, the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
The IGC 2004 adopted the substance of the draft Constitution, while applying some touches to the words and terminology.
Article III-176 is found in OJ 16.12.2004 C 310/75:
Article III-176 Constitution
In the context of the establishment and functioning of the internal market, European laws or framework laws shall establish measures for the creation of European intellectual property rights to provide uniform intellectual property rights protection throughout the Union and for the setting up of centralised Union‑wide authorisation, coordination and supervision arrangements.
A European law of the Council shall establish language arrangements for the European intellectual property rights. The Council shall act unanimously after consulting the European Parliament.
***
We can see that the Treaty of Lisbon text is essentially the same as that of the Constitutional Treaty. The main differences concern the legislative procedures, while the rest are small.
***
What has been said about Article 118 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers presented the text and numbering of Article 97a TFEU (ToL), to be renumbered Article 118 TFEU in the consolidated version, with the following comment (pages 31–32):
“This is a new legal base providing for the adoption of legislation concerning EU-wide intellectual property rights. This legal base would largely be subject to QMV and co-decision, with an exception for language arrangements (consultation of the EP and unanimity in the Council). At present, such legislation (in particular concerning the Community trademark and Community design right) is adopted by using the ‘residual powers’ clause of Article 308 TEC (consultation of the EP and unanimity in the Council).
It should be noted that EC legislation harmonising national laws relating to intellectual property, as distinct from legislation establishing EC-wide intellectual property rights, is currently adopted using the ‘legal base’ of Article 95 TEC (QMV and co-decision). This would not change. Such legislation has already harmonised, in particular, significant aspects of trademark law, copyright and related rights and design rights, along with limited aspects of patent law as well as procedural aspects of IP law.”
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 118 TFEU, Article 97a TFEU (ToL) in the original Lisbon Treaty (page 12):
“New. Establishes a new legal basis for EU-wide intellectual property rights. Co-decision for measures, except regulations on language arrangements, which require unanimity.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the new Article 97a TFEU (ToL) on page 61 (under the heading ‘2. Taxation’):
“A new Article 97(a)(Constitution Article III-176) has been inserted which deals with setting “uniform intellectual property rights protection” throughout the Union. The Council and EP will adopt laws to establish this and central Union-wide authorisation, coordination and supervision arrangements. The Council will make the language arrangements for the instruments, acting by unanimity.
Some of these aims have already been achieved by the “European Copyright Directive”. Directive 2001/29/EC on the “harmonisation of certain aspects of copyright and related rights in the information society” was adopted on 22 June 2001 and was supposed to be implemented in Member States by 22 December 2002. The UK, in common with almost every other Member State, was late in implementing the Directive. It was brought into force by Statutory Instrument on 31 October 2003. The Directive harmonises the basic rights relevant to uses of copyright material in the information society and e-commerce, namely the rights of reproduction (copying) and communication to the public (electronic transmission, including digital broadcasting and “on-demand” services). It also limits the type and scope of permitted exceptions to these rights and provides legal protection for technological measures used to safeguard rights and identify and manage copyright material. The Copyright, Designs and Patents Act 1988 already provides protection similar to many of the obligations contained in the Directive. However, the 2003 Regulations amend the Act “insofar as its provisions do not conform or comply with the Directive and regarding matters that are related to or consequential upon these obligations”.”
(I have deleted the footnote, to be found in the original document.)
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon. It discussed Intellectual Property and especially the new Article 118 TFEU (Article 97a TFEU ToL) on pages 219 and 220, ending with the following conclusion:
“9.24. The new Article 118 of the TFEU is a restatement of existing powers. Although the Treaty of Lisbon would not confer addition IP powers on the EU, it marks a statement of political intent and a commitment to achieving the Community patent. The move to QMV, in itself, is not significant.”
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
However, my standard reference is currently the Swedish government’s fresh draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Intellectual property rights (Immaterialrätt) are presented on pages 179 and 180. The government welcomes the new legal base, but it would have preferred qualified majority voting on the language arrangements too.
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), explains the Article.
Under the heading Approximation of laws (Lainsäädännön lähentäminen), the bill states that Article 97a TFEU (ToL), renumbered Article 118 TFEU, is substantially the same as Article III-176 of the Constitutional Treaty (page 209):
”97 a artiklassa (uusi 118 artikla) määrätään unionin toimivallasta teollis- ja tekijänoikeuksien unionin tasolla toteutettavan suojan osalta, jota koskevista toimenpiteistä voidaan säätää tavallisessa lainsäätämisjärjestyksessä. Määräys vastaa sisällöltään perustuslakisopimuksen III-176 artiklaa.
Artiklan 1 kohdan nojalla voidaan säätää toimenpiteistä, joilla luodaan eurooppalainen suoja teollis- ja tekijänoikeuksien yhdenmukaisen suojan varmistamiseksi unionissa ja joilla muodostetaan keskitetyt luvananto-, yhteensovittamis- ja valvontajärjestelmät unionin tasolla. Nykyiseen EY-sopimukseen ei sisälly vastaavaa oikeusperustaa, mutta kyseisiä toimenpiteitä on toteutettu SEY 308 artiklan nojalla. SEUT 97 a artikla ei koske teollis- ja tekijänoikeuksia koskevan jäsenvaltioiden lainsäädännön lähentämistä tarkoittavia toimenpiteitä, joita voidaan jatkossakin antaa SEUT 94 ja 95 artiklan nojalla, jotka vastaavat nykyisiä SEY 95 ja 94 artiklaa.
Artiklan 2 kohdassa määrätään eurooppalaista suojaa koskevista kielijärjestelyistä, joita koskevia asetuksia neuvosto säätää erityistä lainsäätämisjärjestystä noudattaen. Neuvosto tekee kielijärjestelyjä koskevan ratkaisunsa yksimielisesti Euroopan parlamenttia kuultuaan.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Tillnärmning av lagstiftning’ on Article 97a TFEU (ToL), the future Article 118 TFEU, on page 212 :
”Artikel 97 (blivande artikel 117), där det föreskrivs om medlemsstaternas befogenheter efter det att harmoniseringsåtgärder vidtagits, ändras inte. I artikel 97a (blivande artikel 118) bestäms om unionens befogenheter i fråga om skyddet för immateriella rättigheter i unionen och i fråga om vilka åtgärder om skydd kan antas enligt det ordinarie lagstiftningsförfarandet. Innehållet i bestämmelsen motsvarar artikel III-176 i det konstitutionella fördraget.
Med stöd av artikel 97a första stycket ska det föreskrivas åtgärder för att skapa europeiska rättigheter som säkerställer ett enhetligt skydd för immateriella rättigheter i unionen och för att upprätta centraliserade system för beviljande av tillstånd, samordning och kontroll på unionsnivå. Nuvarande EG-fördrag innehåller ingen motsvarande rättsgrund, men åtgärderna i fråga har vidtagits med stöd av artikel 308 i EG-fördraget. Artikel 97a gäller inte åtgärder som avser en tillnärmning av medlemsstaternas lagstiftning om immateriella rättigheter och som även i fortsättningen kan antas med stöd av artiklarna 94 och 95 i EUF-fördraget och som motsvarar de nuvarande artiklarna 95 och 94 i EGfördraget.
I artikel 97a andra stycket bestäms om språkanvändningen i samband med detta europeiska skydd, och förordningar som gäller den kan antas av rådet i enlighet med ett särskilt lagstiftningsförfarande. Rådet ska besluta om språkanvändningen med enhällighet efter att ha hört Europaparlamentet.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
The Lisbon Treaty posts continue in the usual manner.
***
Article 118 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/96:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 118 TFEU
In the context of the establishment and functioning of the internal market, the European Parliament and the Council, acting in accordance with the ordinary legislative procedure, shall establish measures for the creation of European intellectual property rights to provide uniform protection of intellectual property rights throughout the Union and for the setting up of centralised Union-wide authorisation, coordination and supervision arrangements.
The Council, acting in accordance with a special legislative procedure, shall by means of regulations establish language arrangements for the European intellectual property rights. The Council shall act unanimously after consulting the European Parliament.
***
In Article 2, point 84 of the Treaty of Lisbon (ToL) the IGC 2007 inserted a new Article 97a on intellectual property rights into the Treaty on the Functioning of the European Union (ToL) (OJ 17.12.2007 C 306/70).
***
The TFEU table of equivalences confirms that the new Article 97a TFEU (ToL) in the original Treaty of Lisbon was later renumbered Article 118 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
Consequently, there is no corresponding Article in the current treaties.
***
We have to look further back to see if the Article has antecedents.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-68 of the draft Treaty establishing a Constitution for Europe proposed a legal base for the introduction of European instruments to provide intellectual-property rights. See OJ 18.7.2003 C 169/39.
Article III-68 Draft Constitution
In establishing an internal market, measures for the introduction of European instruments to provide uniform intellectual-property rights protection throughout the Union and for the setting up of centralised Union-wide authorisation, coordination and supervision arrangements shall be established in European laws or framework laws.
A European law of the Council of Ministers shall establish language arrangements for the European instruments. The Council of Ministers shall act unanimously after consulting the European Parliament.
***
The differences between the draft Constitution and the TFEU seem to concern choices of wording and treaty terminology only. The substance was already in place.
***
In the Treaty establishing a Constitution for Europe, ‘ratified’ by 18 member states, the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
The IGC 2004 adopted the substance of the draft Constitution, while applying some touches to the words and terminology.
Article III-176 is found in OJ 16.12.2004 C 310/75:
Article III-176 Constitution
In the context of the establishment and functioning of the internal market, European laws or framework laws shall establish measures for the creation of European intellectual property rights to provide uniform intellectual property rights protection throughout the Union and for the setting up of centralised Union‑wide authorisation, coordination and supervision arrangements.
A European law of the Council shall establish language arrangements for the European intellectual property rights. The Council shall act unanimously after consulting the European Parliament.
***
We can see that the Treaty of Lisbon text is essentially the same as that of the Constitutional Treaty. The main differences concern the legislative procedures, while the rest are small.
***
What has been said about Article 118 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers presented the text and numbering of Article 97a TFEU (ToL), to be renumbered Article 118 TFEU in the consolidated version, with the following comment (pages 31–32):
“This is a new legal base providing for the adoption of legislation concerning EU-wide intellectual property rights. This legal base would largely be subject to QMV and co-decision, with an exception for language arrangements (consultation of the EP and unanimity in the Council). At present, such legislation (in particular concerning the Community trademark and Community design right) is adopted by using the ‘residual powers’ clause of Article 308 TEC (consultation of the EP and unanimity in the Council).
It should be noted that EC legislation harmonising national laws relating to intellectual property, as distinct from legislation establishing EC-wide intellectual property rights, is currently adopted using the ‘legal base’ of Article 95 TEC (QMV and co-decision). This would not change. Such legislation has already harmonised, in particular, significant aspects of trademark law, copyright and related rights and design rights, along with limited aspects of patent law as well as procedural aspects of IP law.”
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 118 TFEU, Article 97a TFEU (ToL) in the original Lisbon Treaty (page 12):
“New. Establishes a new legal basis for EU-wide intellectual property rights. Co-decision for measures, except regulations on language arrangements, which require unanimity.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the new Article 97a TFEU (ToL) on page 61 (under the heading ‘2. Taxation’):
“A new Article 97(a)(Constitution Article III-176) has been inserted which deals with setting “uniform intellectual property rights protection” throughout the Union. The Council and EP will adopt laws to establish this and central Union-wide authorisation, coordination and supervision arrangements. The Council will make the language arrangements for the instruments, acting by unanimity.
Some of these aims have already been achieved by the “European Copyright Directive”. Directive 2001/29/EC on the “harmonisation of certain aspects of copyright and related rights in the information society” was adopted on 22 June 2001 and was supposed to be implemented in Member States by 22 December 2002. The UK, in common with almost every other Member State, was late in implementing the Directive. It was brought into force by Statutory Instrument on 31 October 2003. The Directive harmonises the basic rights relevant to uses of copyright material in the information society and e-commerce, namely the rights of reproduction (copying) and communication to the public (electronic transmission, including digital broadcasting and “on-demand” services). It also limits the type and scope of permitted exceptions to these rights and provides legal protection for technological measures used to safeguard rights and identify and manage copyright material. The Copyright, Designs and Patents Act 1988 already provides protection similar to many of the obligations contained in the Directive. However, the 2003 Regulations amend the Act “insofar as its provisions do not conform or comply with the Directive and regarding matters that are related to or consequential upon these obligations”.”
(I have deleted the footnote, to be found in the original document.)
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon. It discussed Intellectual Property and especially the new Article 118 TFEU (Article 97a TFEU ToL) on pages 219 and 220, ending with the following conclusion:
“9.24. The new Article 118 of the TFEU is a restatement of existing powers. Although the Treaty of Lisbon would not confer addition IP powers on the EU, it marks a statement of political intent and a commitment to achieving the Community patent. The move to QMV, in itself, is not significant.”
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
However, my standard reference is currently the Swedish government’s fresh draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Intellectual property rights (Immaterialrätt) are presented on pages 179 and 180. The government welcomes the new legal base, but it would have preferred qualified majority voting on the language arrangements too.
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), explains the Article.
Under the heading Approximation of laws (Lainsäädännön lähentäminen), the bill states that Article 97a TFEU (ToL), renumbered Article 118 TFEU, is substantially the same as Article III-176 of the Constitutional Treaty (page 209):
”97 a artiklassa (uusi 118 artikla) määrätään unionin toimivallasta teollis- ja tekijänoikeuksien unionin tasolla toteutettavan suojan osalta, jota koskevista toimenpiteistä voidaan säätää tavallisessa lainsäätämisjärjestyksessä. Määräys vastaa sisällöltään perustuslakisopimuksen III-176 artiklaa.
Artiklan 1 kohdan nojalla voidaan säätää toimenpiteistä, joilla luodaan eurooppalainen suoja teollis- ja tekijänoikeuksien yhdenmukaisen suojan varmistamiseksi unionissa ja joilla muodostetaan keskitetyt luvananto-, yhteensovittamis- ja valvontajärjestelmät unionin tasolla. Nykyiseen EY-sopimukseen ei sisälly vastaavaa oikeusperustaa, mutta kyseisiä toimenpiteitä on toteutettu SEY 308 artiklan nojalla. SEUT 97 a artikla ei koske teollis- ja tekijänoikeuksia koskevan jäsenvaltioiden lainsäädännön lähentämistä tarkoittavia toimenpiteitä, joita voidaan jatkossakin antaa SEUT 94 ja 95 artiklan nojalla, jotka vastaavat nykyisiä SEY 95 ja 94 artiklaa.
Artiklan 2 kohdassa määrätään eurooppalaista suojaa koskevista kielijärjestelyistä, joita koskevia asetuksia neuvosto säätää erityistä lainsäätämisjärjestystä noudattaen. Neuvosto tekee kielijärjestelyjä koskevan ratkaisunsa yksimielisesti Euroopan parlamenttia kuultuaan.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Tillnärmning av lagstiftning’ on Article 97a TFEU (ToL), the future Article 118 TFEU, on page 212 :
”Artikel 97 (blivande artikel 117), där det föreskrivs om medlemsstaternas befogenheter efter det att harmoniseringsåtgärder vidtagits, ändras inte. I artikel 97a (blivande artikel 118) bestäms om unionens befogenheter i fråga om skyddet för immateriella rättigheter i unionen och i fråga om vilka åtgärder om skydd kan antas enligt det ordinarie lagstiftningsförfarandet. Innehållet i bestämmelsen motsvarar artikel III-176 i det konstitutionella fördraget.
Med stöd av artikel 97a första stycket ska det föreskrivas åtgärder för att skapa europeiska rättigheter som säkerställer ett enhetligt skydd för immateriella rättigheter i unionen och för att upprätta centraliserade system för beviljande av tillstånd, samordning och kontroll på unionsnivå. Nuvarande EG-fördrag innehåller ingen motsvarande rättsgrund, men åtgärderna i fråga har vidtagits med stöd av artikel 308 i EG-fördraget. Artikel 97a gäller inte åtgärder som avser en tillnärmning av medlemsstaternas lagstiftning om immateriella rättigheter och som även i fortsättningen kan antas med stöd av artiklarna 94 och 95 i EUF-fördraget och som motsvarar de nuvarande artiklarna 95 och 94 i EGfördraget.
I artikel 97a andra stycket bestäms om språkanvändningen i samband med detta europeiska skydd, och förordningar som gäller den kan antas av rådet i enlighet med ett särskilt lagstiftningsförfarande. Rådet ska besluta om språkanvändningen med enhällighet efter att ha hört Europaparlamentet.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
Nine lives of Lisbon Treaty
Forget it. The EU Treaty of Lisbon is not a cat-o’-nine-tails to whip the citizens of the European Union into submission. The Lisbon Treaty, or in a wider sense the aim of treaty reform, bears more resemblance to a cat with nine lives.
If the European leaders unanimously and national parliamentarians in the ratifying member states overwhelmingly have supported various versions of the amending treaties, might they not have good cause? Would it go totally astray to suspect a hint of the ‘vision thing’?
Thinking about it, are not the national leaders and parliamentarians the main victims of a more powerful European Union?
Are they not the ones with the most to lose – much more than their populations – if their cosy satrapies are emasculated by control and command from Brussels?
Would they ‘sign away’ their prerogatives, if it was merely an act of self-flagellation?
Why on earth would politicians, dependent on popular votes, alienate their electorates?
***
Would it be amiss if citizens in Europe made the effort to think about the challenges of our globalising world and then tried to reach some answers on how to meet them?
Would people then understand the efforts of European politicians to join forces through the European Union and their (timid) attempts to improve the workings of our shared institutions?
Already twice an amending treaty has reached ratification by 18 member states, but thrice plebiscites during the last leg of treaty reform have contemptuously rejected the offered cure.
But if there really is a need to reform the EU institutions?
Is the chasm between the ‘elites’ and the citizens really the fault of the elected politicians?
Is the wall of popular distrust and incomprehension too thick to penetrate by any means humanely possible?
Is the temptation to ‘Bite the nose to spite the face’ too great to be resisted, even if people end up flogging their own best interests?
***
I have to admit that I feel a tinge of respect, even admiration, when I see Nicolas Sarkozy running for the presidency and promising to bring about EU reform, despite the recent rejection by French voters of the Constitutional Treaty.
Or when chancellor Angela Merkel crafts a deal with the rest of the EU governments to rescue the essential reforms, including fundamental principles enhancing openness, transparency and citizens’ rights, well knowing that the only option is to deal behind closed doors to achieve (a modicum of) its opposite in the long run.
Or when France’s foreign minister Bernard Kouchner is accused of bullying the Irish voters by stating that they will bear the consequences of their possible rejection, when he was plainly stating a fact, based on the unpalatable experience of president Jacques Chirac and France having become lame ducks within the European Union for two years as a result of the French ‘non’.
Would they – and their fellow leaders – take the abuse out of sheer masochistic pleasure, if they did not believe that they were doing the right thing?
***
If people show both disrespect and distrust to their elected leaders, do all the faults lie with the latter?
***
If I understand correctly, the Irish voters did not bury the Lisbon Treaty. They resurrected it, whipping their own leadership and marginalising their country.
If the voters in Ireland and elsewhere imagine that the leaders of France and Germany lack spunk, they should read the joint statement issued Friday evening on the outcome of the referendum. Chancellor Merkel and president Sarkozy met the result with respect and regret, but they expected that the remaining states proceed with ratification.
The leaders were convinced that the Treaty of Lisbon is necessary to make the European Union more democratic and effective.
Treaty reform has nine lives, because the needs are there. Where there’s a will, there’s a way.
Ralf Grahn
Sources:
Déclaration franco-allemende suite au résultat du référendum irlandais (13-06-08 à 18 :28)
www.elysee.fr
Gemeinsame Presseerklärung von Bundeskanzlerin Angela Merkel und dem französischen Staatspräsidenten Nicolas Sarkozy zum Ausgang des irischen Referendums über den Vertrag von Lissabon vom 12. Juni 2008 (13.06.2008)
www.bundesregierung.de
If the European leaders unanimously and national parliamentarians in the ratifying member states overwhelmingly have supported various versions of the amending treaties, might they not have good cause? Would it go totally astray to suspect a hint of the ‘vision thing’?
Thinking about it, are not the national leaders and parliamentarians the main victims of a more powerful European Union?
Are they not the ones with the most to lose – much more than their populations – if their cosy satrapies are emasculated by control and command from Brussels?
Would they ‘sign away’ their prerogatives, if it was merely an act of self-flagellation?
Why on earth would politicians, dependent on popular votes, alienate their electorates?
***
Would it be amiss if citizens in Europe made the effort to think about the challenges of our globalising world and then tried to reach some answers on how to meet them?
Would people then understand the efforts of European politicians to join forces through the European Union and their (timid) attempts to improve the workings of our shared institutions?
Already twice an amending treaty has reached ratification by 18 member states, but thrice plebiscites during the last leg of treaty reform have contemptuously rejected the offered cure.
But if there really is a need to reform the EU institutions?
Is the chasm between the ‘elites’ and the citizens really the fault of the elected politicians?
Is the wall of popular distrust and incomprehension too thick to penetrate by any means humanely possible?
Is the temptation to ‘Bite the nose to spite the face’ too great to be resisted, even if people end up flogging their own best interests?
***
I have to admit that I feel a tinge of respect, even admiration, when I see Nicolas Sarkozy running for the presidency and promising to bring about EU reform, despite the recent rejection by French voters of the Constitutional Treaty.
Or when chancellor Angela Merkel crafts a deal with the rest of the EU governments to rescue the essential reforms, including fundamental principles enhancing openness, transparency and citizens’ rights, well knowing that the only option is to deal behind closed doors to achieve (a modicum of) its opposite in the long run.
Or when France’s foreign minister Bernard Kouchner is accused of bullying the Irish voters by stating that they will bear the consequences of their possible rejection, when he was plainly stating a fact, based on the unpalatable experience of president Jacques Chirac and France having become lame ducks within the European Union for two years as a result of the French ‘non’.
Would they – and their fellow leaders – take the abuse out of sheer masochistic pleasure, if they did not believe that they were doing the right thing?
***
If people show both disrespect and distrust to their elected leaders, do all the faults lie with the latter?
***
If I understand correctly, the Irish voters did not bury the Lisbon Treaty. They resurrected it, whipping their own leadership and marginalising their country.
If the voters in Ireland and elsewhere imagine that the leaders of France and Germany lack spunk, they should read the joint statement issued Friday evening on the outcome of the referendum. Chancellor Merkel and president Sarkozy met the result with respect and regret, but they expected that the remaining states proceed with ratification.
The leaders were convinced that the Treaty of Lisbon is necessary to make the European Union more democratic and effective.
Treaty reform has nine lives, because the needs are there. Where there’s a will, there’s a way.
Ralf Grahn
Sources:
Déclaration franco-allemende suite au résultat du référendum irlandais (13-06-08 à 18 :28)
www.elysee.fr
Gemeinsame Presseerklärung von Bundeskanzlerin Angela Merkel und dem französischen Staatspräsidenten Nicolas Sarkozy zum Ausgang des irischen Referendums über den Vertrag von Lissabon vom 12. Juni 2008 (13.06.2008)
www.bundesregierung.de
Saturday, 14 June 2008
Derailed by Irish Lisbon Treaty vote
I have to admit that I was derailed by the Irish vote on the Treaty of Lisbon. I would have placed no bets on the outcome, but I had not expected such a clear rejection of the amending treaty. Being a fan of Ireland and the Irish, I surely wanted to see them as companions on the road to an improved European Union, but it was not for me to decide.
Ireland has its own constitutional requirements. If a referendum is deemed to be called for each time the European Union needs to update its treaties, who am I to argue that it is an exceedingly blunt instrument to handle complex questions?
We parted company amicably, they in adventurous search of new and uncharted territory, I stolidly continuing along the road to EU reform.
***
Nobody should ram an unwanted treaty, once rejected, down their throats. But sooner or later the focus will shift from referendum counts and causes to the future. For the Irish people and government a novel expedition commences: to define their collective aspirations with regard to Europe after opting out of treaty reform.
The first chances at the European level come next week, when the foreign ministers meet Monday and the heads of state or government a few days later. Does the Irish government know what to propose, or will it require more analysis of the reasons for rejection?
Anyway, it is heartening to know that Ireland is not going to obstruct progress for the EU member states willing and able to move ahead. It is important for the other EU countries, but it will make them more receptive to Ireland’s concerns.
***
Two thirds or 18 of the EU members have already completed the essential requirements for ratification of the Lisbon Treaty. Eight have yet to ratify the treaty in accordance with their constitutional requirements. Possibly Ireland will be joined by one or a few countries belonging to that group.
The circumstances surrounding the Lisbon Treaty have changed as a result of the Irish rejection. This means that the ratifying states have to take a new position on the entry into force of the Treaty of Lisbon.
While the ratifying member states should respect the outcome in Ireland, they are entitled to the same amount of respect for their own aspirations to bring an almost decade long reform cycle to a conclusion.
This means that the Lisbon Treaty, initially requiring ratification by all member states, has to be adjusted to the changed circumstances. The main requirement is that the treaty has to enter into force between the ratifying states. Additionally a number of technical adaptations are needed, without altering the substance of the treaty.
The shift from the present European Union to the new one may call for the re-establishment of the EU, leaving the relationship with the relative outsider(s) to be determined separately.
Clear signals from the EU foreign ministers and the heads of state or government should be forthcoming next week.
***
Yes, I was derailed by the outcome of the Irish referendum. Instead of the customary post on the following Article of the Treaty on the Functioning of the European Union (TFEU), I strayed. For an evening and a day I fell for the temptation to respond to comments and to read and to comment on blogs discussing the referendum in Ireland.
Formally, the Irish voters had derailed the Treaty of Lisbon for the whole European Union. In practice, it appears, they had only opted out of a process set to continue. Even in the worst case, the reform process needs recording, since the underlying aspirations are not going to disappear.
Therefore, the service on this blog will continue in a short while, in boring detail.
Ralf Grahn
Ireland has its own constitutional requirements. If a referendum is deemed to be called for each time the European Union needs to update its treaties, who am I to argue that it is an exceedingly blunt instrument to handle complex questions?
We parted company amicably, they in adventurous search of new and uncharted territory, I stolidly continuing along the road to EU reform.
***
Nobody should ram an unwanted treaty, once rejected, down their throats. But sooner or later the focus will shift from referendum counts and causes to the future. For the Irish people and government a novel expedition commences: to define their collective aspirations with regard to Europe after opting out of treaty reform.
The first chances at the European level come next week, when the foreign ministers meet Monday and the heads of state or government a few days later. Does the Irish government know what to propose, or will it require more analysis of the reasons for rejection?
Anyway, it is heartening to know that Ireland is not going to obstruct progress for the EU member states willing and able to move ahead. It is important for the other EU countries, but it will make them more receptive to Ireland’s concerns.
***
Two thirds or 18 of the EU members have already completed the essential requirements for ratification of the Lisbon Treaty. Eight have yet to ratify the treaty in accordance with their constitutional requirements. Possibly Ireland will be joined by one or a few countries belonging to that group.
The circumstances surrounding the Lisbon Treaty have changed as a result of the Irish rejection. This means that the ratifying states have to take a new position on the entry into force of the Treaty of Lisbon.
While the ratifying member states should respect the outcome in Ireland, they are entitled to the same amount of respect for their own aspirations to bring an almost decade long reform cycle to a conclusion.
This means that the Lisbon Treaty, initially requiring ratification by all member states, has to be adjusted to the changed circumstances. The main requirement is that the treaty has to enter into force between the ratifying states. Additionally a number of technical adaptations are needed, without altering the substance of the treaty.
The shift from the present European Union to the new one may call for the re-establishment of the EU, leaving the relationship with the relative outsider(s) to be determined separately.
Clear signals from the EU foreign ministers and the heads of state or government should be forthcoming next week.
***
Yes, I was derailed by the outcome of the Irish referendum. Instead of the customary post on the following Article of the Treaty on the Functioning of the European Union (TFEU), I strayed. For an evening and a day I fell for the temptation to respond to comments and to read and to comment on blogs discussing the referendum in Ireland.
Formally, the Irish voters had derailed the Treaty of Lisbon for the whole European Union. In practice, it appears, they had only opted out of a process set to continue. Even in the worst case, the reform process needs recording, since the underlying aspirations are not going to disappear.
Therefore, the service on this blog will continue in a short while, in boring detail.
Ralf Grahn
Friday, 13 June 2008
Europe after Ireland’s NO
The early results of Ireland’s referendum on the Treaty of Lisbon look solid enough: The Irish voters have clearly rejected the EU reform treaty by a wide margin.
This means that the Lisbon Treaty, as it now stands, fails to become binding for Ireland, but also for the 26 other member states.
The default option is that the European Union continues to be governed by the Treaty of Nice (2001), admitted to be inadequate by the very signatories the moment it was born, as attested by the Nice declaration.
The high point of the reform process was the Laeken declaration, which led to the European Convention, more closely resembling a constituent assembly than anything we have had on offer as EU citizens.
If a quirk of Ireland’s Constitution demands a referendum each time the EU needs to reform its treaties, it is their system. If the Irish vote to block progress, it is their legitimate choice.
After this resounding No, it would be distasteful to tinker with the treaty and to offer the Irish voters a second vote on more or less the same contents. It is hard to imagine the present or any Irish government in the near future willing even to try.
Unacceptable, however, is that the rest of the European Union should suffer more than necessary as a result. In about half a year since the signing of the Lisbon Treaty, 18 member states have fulfilled the essential requirements to ratify the amending treaty.
Most of them were ready to approve the Constitutional Treaty, but had to accept the diluted Lisbon Treaty in an effort to get all the member states on board.
But enough is enough. Something has to give, because the Nice Treaty is not fit for Europe’s future challenges.
Although the European Union would need more, rather than less democratic reform offered by the Lisbon Treaty, ambitious new reforms may be too much in the immediate future.
With regard to the substance, there are two options: The new European Union could be based on the Constitutional Treaty or the Lisbon Treaty. In the short run, the Constitutional Treaty would probably encounter more problems in some member states than the Lisbon Treaty freshly ratified or undergoing ratification.
As a technical improvement, the contents of the new treaty could be based on the consolidated version of the Lisbon Treaty, to give everybody the chance to read the text from the outset.
Only the provisions on entry into force would have to be reformed in a real sense, and some technical modifications made with regard to signatories, territory, member states, languages etc., mostly in the final provisions.
These additions to the Lisbon Treaty would not require too much work, if the political will is there. This and future treaties would essentially enter into force between the ratifying states, as most international treaties. These limited changes could be ratified separately and in short order.
If this is the way forward for Europe, it leaves the question of the state or states staying outside the new European Union. Here it would be best to wait to see what they propose. If these suggestions are reasonable, like participation in the European Economic Area (EEA) and possibly some other policy fields, these matters could be negotiated in a constructive atmosphere.
After the first flurry of activity, the EU leaders would have to discuss the future of the European Union and its democratic legitimacy more seriously.
The countries outside the Union or its core could contemplate their future relations without rush, until the next referendum.
Ralf Grahn
This means that the Lisbon Treaty, as it now stands, fails to become binding for Ireland, but also for the 26 other member states.
The default option is that the European Union continues to be governed by the Treaty of Nice (2001), admitted to be inadequate by the very signatories the moment it was born, as attested by the Nice declaration.
The high point of the reform process was the Laeken declaration, which led to the European Convention, more closely resembling a constituent assembly than anything we have had on offer as EU citizens.
If a quirk of Ireland’s Constitution demands a referendum each time the EU needs to reform its treaties, it is their system. If the Irish vote to block progress, it is their legitimate choice.
After this resounding No, it would be distasteful to tinker with the treaty and to offer the Irish voters a second vote on more or less the same contents. It is hard to imagine the present or any Irish government in the near future willing even to try.
Unacceptable, however, is that the rest of the European Union should suffer more than necessary as a result. In about half a year since the signing of the Lisbon Treaty, 18 member states have fulfilled the essential requirements to ratify the amending treaty.
Most of them were ready to approve the Constitutional Treaty, but had to accept the diluted Lisbon Treaty in an effort to get all the member states on board.
But enough is enough. Something has to give, because the Nice Treaty is not fit for Europe’s future challenges.
Although the European Union would need more, rather than less democratic reform offered by the Lisbon Treaty, ambitious new reforms may be too much in the immediate future.
With regard to the substance, there are two options: The new European Union could be based on the Constitutional Treaty or the Lisbon Treaty. In the short run, the Constitutional Treaty would probably encounter more problems in some member states than the Lisbon Treaty freshly ratified or undergoing ratification.
As a technical improvement, the contents of the new treaty could be based on the consolidated version of the Lisbon Treaty, to give everybody the chance to read the text from the outset.
Only the provisions on entry into force would have to be reformed in a real sense, and some technical modifications made with regard to signatories, territory, member states, languages etc., mostly in the final provisions.
These additions to the Lisbon Treaty would not require too much work, if the political will is there. This and future treaties would essentially enter into force between the ratifying states, as most international treaties. These limited changes could be ratified separately and in short order.
If this is the way forward for Europe, it leaves the question of the state or states staying outside the new European Union. Here it would be best to wait to see what they propose. If these suggestions are reasonable, like participation in the European Economic Area (EEA) and possibly some other policy fields, these matters could be negotiated in a constructive atmosphere.
After the first flurry of activity, the EU leaders would have to discuss the future of the European Union and its democratic legitimacy more seriously.
The countries outside the Union or its core could contemplate their future relations without rush, until the next referendum.
Ralf Grahn
EU TFEU: Avoiding new distortions in the internal market
The Irish polling stations have closed, but the counting of the referendum votes has not yet started, and the results of the Lisbon Treaty referendum in Ireland are not expected before early evening.
With the verdict formulated, but as yet unannounced, it feels strange to dissect yet another Article of the EU Treaty of Lisbon, but the treaty reform process needs to be recorded, at least for the sake of the 18 EU member states that already have fulfilled the essential requirements of ratification.
Article 117 of the Treaty on the Functioning of the European Union (TFEU) aims to prevent new distortions in the internal market.
***
Article 117 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/96:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 117 TFEU
(ex Article 97 TEC)
1. Where there is a reason to fear that the adoption or amendment of a provision laid down by law, regulation or administrative action may cause distortion within the meaning of Article 116, a Member State desiring to proceed therewith shall consult the Commission. After consulting the Member States, the Commission shall recommend to the States concerned such measures as may be appropriate to avoid the distortion in question.
2. If a State desiring to introduce or amend its own provisions does not comply with the recommendation addressed to it by the Commission, other Member States shall not be required, pursuant to Article 116, to amend their own provisions in order to eliminate such distortion. If the Member State which has ignored the recommendation of the Commission causes distortion detrimental only to itself, the provisions of Article 116 shall not apply.
***
In Article 2, point 83 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 96 of the Treaty establishing the European Community (TEC), and in point 84 it inserted a new Article 97a on intellectual property rights. Thus, no specific amendments were made to Article 97 (OJ 17.12.2007 C 306/70).
***
The TFEU table of equivalences confirms that Article 97 TEC first became Article 97 TFEU (ToL) in the original Treaty of Lisbon, and it tells us that it was later renumbered Article 117 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 97 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 3 ‘Approximation of laws’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/81).
Here is the current Article 97 TEC:
Article 97 TEC
1. Where there is a reason to fear that the adoption or amendment of a provision laid down by law, regulation or administrative action may cause distortion within the meaning of Article 96, a Member State desiring to proceed therewith shall consult the Commission. After consulting the Member States, the Commission shall recommend to the States concerned such measures as may be appropriate to avoid the distortion in question.
2. If a State desiring to introduce or amend its own provisions does not comply with the recommendation addressed to it by the Commission, other Member States shall not be required, pursuant to Article 96, to amend their own provisions in order to eliminate such distortion. If the Member State which has ignored the recommendation of the Commission causes distortion detrimental only to itself, the provisions of Article 96 shall not apply.
***
We have seen that the only difference between Article 97 TEC in force and Article 117 TFEU is the numbering of the Article itself and the preceding Article it refers to.
***
For the sake of systematic comparison, we look at the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-67 of the draft Treaty establishing a Constitution for Europe inserted the word ‘national’ before provision in the first sentence, which makes the meaning clearer at one go. The other differences were minimal. See OJ 18.7.2003 C 169/39.
Article III-67 Draft Constitution
1. Where there is a reason to fear that the adoption or amendment of a national provision laid down by law, regulation or administrative action may cause distortion within the meaning of Article III-66, a Member State desiring to proceed therewith shall consult the Commission. After consulting the Member States, the Commission shall address to the Member States concerned a recommendation on such measures as may be appropriate to avoid the distortion in question.
2. If a Member State desiring to introduce or amend its own provisions does not comply with the recommendation addressed to it by the Commission, other Member States shall not be required, pursuant to Article III-66, to amend their own provisions in order to eliminate such distortion. If the Member State which has ignored the recommendation of the Commission causes distortion detrimental only to itself, Article III-66 shall not apply.
***
In the Treaty establishing a Constitution for Europe, ‘ratified’ by 18 member states, the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
The IGC 2004 replaced ‘a national provision’ by ‘a provision … of a Member State’ without changing the meaning.
Article III-175 is found in OJ 16.12.2004 C 310/75:
Article III-175 Constitution
1. Where there is reason to fear that the adoption or amendment of a provision laid down by law, regulation or administrative action of a Member State may cause distortion within the meaning of Article III-174, a Member State desiring to proceed therewith shall consult the Commission. After consulting the Member States, the Commission shall address to the Member States concerned a recommendation on such measures as may be appropriate to avoid the distortion in question.
2. If a Member State desiring to introduce or amend its own provisions does not comply with the recommendation addressed to it by the Commission, other Member States shall not be required, pursuant to Article III-174, to amend their own provisions in order to eliminate such distortion. If the Member State which has ignored the recommendation of the Commission causes distortion detrimental only to itself, Article III-174 shall not apply.
***
The IGC 2007 avoided adding to the size of the Lisbon Treaty by retaining the text of the current Article 97 TEC.
***
What has been said about Article 117 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers presented the text and numbering of Article 97 TEC and TFEU (ToL), to be renumbered Article 117 TFEU in the consolidated version, without comment (page 31).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 117 TFEU, Article 97 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 97 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the approximation of internal market laws on page 60 (under the heading ‘2. Taxation’).
The Research Paper commented briefly on the harmonisation of internal market laws, before moving on to tax harmonisation:
“Articles 94–97 (Constitution Articles III-172 – III-176) are on the approximation of internal market laws. The general aims are unchanged and the Council will adopt measures for the approximation of laws, regulations or administrative provisions of the Member States that directly affect the internal market. The out-dated term “common market” is removed and replaced with “internal market”.”
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 117 TFEU (Article 97 TEC and TFEU ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
However, my standard reference is currently the Swedish government’s fresh draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
The Swedish government presents a short background paragraph on the harmonisation of laws in the internal market (page 176):
”Artiklarna 94–97 i EG-fördraget återger möjligheten att harmonisera lagstiftningen på den inre marknaden. Det finns en stor volym sekundärrätt med utgångspunkt i artikel 95 i EG-fördraget samt en omfattande praxis på området. Möjligheten till harmonisering av medlemsstaternas lagar och författningar är en förutsättning för den inre marknadens bibehållande och fortsatta funktion.”
The government later remarks on the essentially unchanged nature of most internal market provisions (e.g. page 176).
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
Even the systematic Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), is brief in its explanation.
Under the heading Approximation of laws (Lainsäädännön lähentäminen), the bill states that Article 97 TFEU (ToL), renumbered Article 117 TFEU is unchanged (page 209):
”97 artiklaa (uusi 117 artikla), jossa määrätään jäsenvaltioiden toimivallasta yhdenmukaistamistoimenpiteiden toteuttamisen jälkeen, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Tillnärmning av lagstiftning’ on Article 97 TFEU (ToL), the future Article 117 TFEU, on page 212 :
”Artikel 97 (blivande artikel 117), där det föreskrivs om medlemsstaternas befogenheter efter det att harmoniseringsåtgärder vidtagits, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
Article 116 TFEU addresses existing distortions of the conditions of competition in the internal market. Article 117 TFEU aims at preventing the member states from introducing new distortions.
Article 117 TFEU has the objective of a standstill clause, but the chosen instrument is interesting. According to Article 288 TFEU (ex Article 249 TEC) the institutions shall adopt regulations, directives, decisions, recommendations and opinions. Recommendations and opinions shall have no binding force.
The member state concerned has a treaty obligation to inform (consult) the Commission, but after the consultation, the Commission issues a recommendation without binding force to avoid a new distortion in the internal market.
In spite of the special procedure set out in Article 117 TFEU, the principle of loyal or sincere cooperation applies to the member states, as set out in Article 4(3) TEU (OJ 9.5.2008 C 115/18):
“3. Pursuant to the principle of sincere cooperation, the Union and the Member States shall, in full mutual respect, assist each other in carrying out tasks which flow from the Treaties.
The Member States shall take any appropriate measure, general or particular, to ensure fulfilment of the obligations arising out of the Treaties or resulting from the acts of the institutions of the Union.
The Member States shall facilitate the achievement of the Union's tasks and refrain from any measure which could jeopardise the attainment of the Union's objectives.”
Ralf Grahn
With the verdict formulated, but as yet unannounced, it feels strange to dissect yet another Article of the EU Treaty of Lisbon, but the treaty reform process needs to be recorded, at least for the sake of the 18 EU member states that already have fulfilled the essential requirements of ratification.
Article 117 of the Treaty on the Functioning of the European Union (TFEU) aims to prevent new distortions in the internal market.
***
Article 117 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/96:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 117 TFEU
(ex Article 97 TEC)
1. Where there is a reason to fear that the adoption or amendment of a provision laid down by law, regulation or administrative action may cause distortion within the meaning of Article 116, a Member State desiring to proceed therewith shall consult the Commission. After consulting the Member States, the Commission shall recommend to the States concerned such measures as may be appropriate to avoid the distortion in question.
2. If a State desiring to introduce or amend its own provisions does not comply with the recommendation addressed to it by the Commission, other Member States shall not be required, pursuant to Article 116, to amend their own provisions in order to eliminate such distortion. If the Member State which has ignored the recommendation of the Commission causes distortion detrimental only to itself, the provisions of Article 116 shall not apply.
***
In Article 2, point 83 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 96 of the Treaty establishing the European Community (TEC), and in point 84 it inserted a new Article 97a on intellectual property rights. Thus, no specific amendments were made to Article 97 (OJ 17.12.2007 C 306/70).
***
The TFEU table of equivalences confirms that Article 97 TEC first became Article 97 TFEU (ToL) in the original Treaty of Lisbon, and it tells us that it was later renumbered Article 117 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 97 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 3 ‘Approximation of laws’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/81).
Here is the current Article 97 TEC:
Article 97 TEC
1. Where there is a reason to fear that the adoption or amendment of a provision laid down by law, regulation or administrative action may cause distortion within the meaning of Article 96, a Member State desiring to proceed therewith shall consult the Commission. After consulting the Member States, the Commission shall recommend to the States concerned such measures as may be appropriate to avoid the distortion in question.
2. If a State desiring to introduce or amend its own provisions does not comply with the recommendation addressed to it by the Commission, other Member States shall not be required, pursuant to Article 96, to amend their own provisions in order to eliminate such distortion. If the Member State which has ignored the recommendation of the Commission causes distortion detrimental only to itself, the provisions of Article 96 shall not apply.
***
We have seen that the only difference between Article 97 TEC in force and Article 117 TFEU is the numbering of the Article itself and the preceding Article it refers to.
***
For the sake of systematic comparison, we look at the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-67 of the draft Treaty establishing a Constitution for Europe inserted the word ‘national’ before provision in the first sentence, which makes the meaning clearer at one go. The other differences were minimal. See OJ 18.7.2003 C 169/39.
Article III-67 Draft Constitution
1. Where there is a reason to fear that the adoption or amendment of a national provision laid down by law, regulation or administrative action may cause distortion within the meaning of Article III-66, a Member State desiring to proceed therewith shall consult the Commission. After consulting the Member States, the Commission shall address to the Member States concerned a recommendation on such measures as may be appropriate to avoid the distortion in question.
2. If a Member State desiring to introduce or amend its own provisions does not comply with the recommendation addressed to it by the Commission, other Member States shall not be required, pursuant to Article III-66, to amend their own provisions in order to eliminate such distortion. If the Member State which has ignored the recommendation of the Commission causes distortion detrimental only to itself, Article III-66 shall not apply.
***
In the Treaty establishing a Constitution for Europe, ‘ratified’ by 18 member states, the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
The IGC 2004 replaced ‘a national provision’ by ‘a provision … of a Member State’ without changing the meaning.
Article III-175 is found in OJ 16.12.2004 C 310/75:
Article III-175 Constitution
1. Where there is reason to fear that the adoption or amendment of a provision laid down by law, regulation or administrative action of a Member State may cause distortion within the meaning of Article III-174, a Member State desiring to proceed therewith shall consult the Commission. After consulting the Member States, the Commission shall address to the Member States concerned a recommendation on such measures as may be appropriate to avoid the distortion in question.
2. If a Member State desiring to introduce or amend its own provisions does not comply with the recommendation addressed to it by the Commission, other Member States shall not be required, pursuant to Article III-174, to amend their own provisions in order to eliminate such distortion. If the Member State which has ignored the recommendation of the Commission causes distortion detrimental only to itself, Article III-174 shall not apply.
***
The IGC 2007 avoided adding to the size of the Lisbon Treaty by retaining the text of the current Article 97 TEC.
***
What has been said about Article 117 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers presented the text and numbering of Article 97 TEC and TFEU (ToL), to be renumbered Article 117 TFEU in the consolidated version, without comment (page 31).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 117 TFEU, Article 97 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 97 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the approximation of internal market laws on page 60 (under the heading ‘2. Taxation’).
The Research Paper commented briefly on the harmonisation of internal market laws, before moving on to tax harmonisation:
“Articles 94–97 (Constitution Articles III-172 – III-176) are on the approximation of internal market laws. The general aims are unchanged and the Council will adopt measures for the approximation of laws, regulations or administrative provisions of the Member States that directly affect the internal market. The out-dated term “common market” is removed and replaced with “internal market”.”
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 117 TFEU (Article 97 TEC and TFEU ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
However, my standard reference is currently the Swedish government’s fresh draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
The Swedish government presents a short background paragraph on the harmonisation of laws in the internal market (page 176):
”Artiklarna 94–97 i EG-fördraget återger möjligheten att harmonisera lagstiftningen på den inre marknaden. Det finns en stor volym sekundärrätt med utgångspunkt i artikel 95 i EG-fördraget samt en omfattande praxis på området. Möjligheten till harmonisering av medlemsstaternas lagar och författningar är en förutsättning för den inre marknadens bibehållande och fortsatta funktion.”
The government later remarks on the essentially unchanged nature of most internal market provisions (e.g. page 176).
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
Even the systematic Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), is brief in its explanation.
Under the heading Approximation of laws (Lainsäädännön lähentäminen), the bill states that Article 97 TFEU (ToL), renumbered Article 117 TFEU is unchanged (page 209):
”97 artiklaa (uusi 117 artikla), jossa määrätään jäsenvaltioiden toimivallasta yhdenmukaistamistoimenpiteiden toteuttamisen jälkeen, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Tillnärmning av lagstiftning’ on Article 97 TFEU (ToL), the future Article 117 TFEU, on page 212 :
”Artikel 97 (blivande artikel 117), där det föreskrivs om medlemsstaternas befogenheter efter det att harmoniseringsåtgärder vidtagits, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
Article 116 TFEU addresses existing distortions of the conditions of competition in the internal market. Article 117 TFEU aims at preventing the member states from introducing new distortions.
Article 117 TFEU has the objective of a standstill clause, but the chosen instrument is interesting. According to Article 288 TFEU (ex Article 249 TEC) the institutions shall adopt regulations, directives, decisions, recommendations and opinions. Recommendations and opinions shall have no binding force.
The member state concerned has a treaty obligation to inform (consult) the Commission, but after the consultation, the Commission issues a recommendation without binding force to avoid a new distortion in the internal market.
In spite of the special procedure set out in Article 117 TFEU, the principle of loyal or sincere cooperation applies to the member states, as set out in Article 4(3) TEU (OJ 9.5.2008 C 115/18):
“3. Pursuant to the principle of sincere cooperation, the Union and the Member States shall, in full mutual respect, assist each other in carrying out tasks which flow from the Treaties.
The Member States shall take any appropriate measure, general or particular, to ensure fulfilment of the obligations arising out of the Treaties or resulting from the acts of the institutions of the Union.
The Member States shall facilitate the achievement of the Union's tasks and refrain from any measure which could jeopardise the attainment of the Union's objectives.”
Ralf Grahn
Thursday, 12 June 2008
EU TFEU: Directives against distortion in the internal market
The EU Treaty of Lisbon retains the stages of the procedures to eliminate distortions of the conditions of competition in the internal market. First, the Commission finds that there is a distortion in one or more member states. Second, the Commission negotiates with (consults) these member states.
Third, if the negotiations fail, directives can be issued to eliminate the distortion. While the existing EC Treaty allows the Council to enact the directive alone, by qualified majority, the Lisbon Treaty empowers the European Parliament to act as co-legislator, in accordance with the ordinary legislative procedure.
***
Article 116 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/95–96:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 116 TFEU
(ex Article 96 TEC)
Where the Commission finds that a difference between the provisions laid down by law, regulation or administrative action in Member States is distorting the conditions of competition in the internal market and that the resultant distortion needs to be eliminated, it shall consult the Member States concerned.
If such consultation does not result in an agreement eliminating the distortion in question, the European, Parliament and the Council, acting in accordance with the ordinary legislative procedure, shall issue the necessary directives. Any other appropriate measures provided for in the Treaties may be adopted.
***
In Article 2, point 83 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 96 of the Treaty establishing the European Community (TEC) (OJ 17.12.2007 C 306/70):
83) In Article 96, second paragraph, first sentence, the words ‘, the Council shall, on a proposal from the Commission, acting by a qualified majority, issue’ shall be replaced by ‘, the European Parliament and the Council, acting in accordance with the ordinary legislative procedure, shall issue’. The second sentence shall be replaced by ‘Any other appropriate measures provided for in the Treaties may be adopted.’.
***
The TFEU table of equivalences confirms that Article 96 TEC first became Article 96 TFEU (ToL) in the original Treaty of Lisbon, and it tells us that it was later renumbered Article 116 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 96 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 3 ‘Approximation of laws’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/81).
Here is the current Article 94 TEC:
Article 96 TEC
Where the Commission finds that a difference between the provisions laid down by law, regulation or administrative action in Member States is distorting the conditions of competition in the common market and that the resultant distortion needs to be eliminated, it shall consult the Member States concerned.
If such consultation does not result in an agreement eliminating the distortion in question, the Council shall, on a proposal from the Commission, acting by a qualified majority, issue the necessary directives. The Commission and the Council may take any other appropriate measures provided for in this Treaty.
***
We have seen the differences between Article 96 TEC in force and Article 116 TFEU. The European Parliament and the ordinary legislative procedure (co-decision) are introduced in the second paragraph.
In addition to the specific amendments, one of the horizontal amendments apply, namely the term ‘common market’ is scrapped by the Treaty of Lisbon and replaced by the consistent use of ‘internal market’.
***
For the sake of systematic comparison, we look at the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-66 of the draft Treaty establishing a Constitution for Europe continued the operation of mopping up the use of ‘common market’ in older provisions, by the consistent use of ‘internal market’. European framework laws, in substance directives based on co-decision, were introduced. See OJ 18.7.2003 C 169/39.
Article III-66 Draft Constitution
Where the Commission finds that a difference between the provisions laid down by law, regulation or administrative action in Member States is distorting the conditions of competition in the internal market and that the resultant distortion needs to be eliminated, it shall consult the Member States concerned.
If such consultation does not result in agreement, European framework laws shall eliminate the distortion in question. Any other appropriate measures provided for in the Constitution may be adopted.
***
In the Treaty establishing a Constitution for Europe, ‘ratified’ by 18 member states, the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
Article III-174 is found in OJ 16.12.2004 C 310/75:
Article III-174 Constitution
Where the Commission finds that a difference between the provisions laid down by law, regulation or administrative action in Member States is distorting the conditions of competition in the internal market and that the resultant distortion needs to be eliminated, it shall consult the Member States concerned.
If such consultation does not result in agreement, European framework laws shall establish the measures necessary to eliminate the distortion in question. Any other appropriate measures provided for in the Constitution may be adopted.
***
In the second paragraph, the words ‘establish the measures necessary to’ before eliminate did not alter the substance of Article III-174.
***
What has been said about Article 116 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers highlighted the changes made to Article 96 TEC and TFEU (ToL), to be renumbered Article 116 TFEU in the consolidated version, and he added the following comment (page 31):
“The co-decision procedure has been extended to this Article.”
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 116 TFEU, Article 96 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Draws on Article 96 TEC. QMV already applies, decision-making moves to co-decision.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the approximation of internal market laws on page 60 (under the heading ‘2. Taxation’).
The Research Paper commented briefly on the harmonisation of internal market laws, before moving on to tax harmonisation:
“Articles 94–97 (Constitution Articles III-172 – III-176) are on the approximation of internal market laws. The general aims are unchanged and the Council will adopt measures for the approximation of laws, regulations or administrative provisions of the Member States that directly affect the internal market. The out-dated term “common market” is removed and replaced with “internal market”.”
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 116 TFEU (Article 96 TEC and TFEU ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
However, my standard reference is currently the Swedish government’s fresh draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
The Swedish government presents a short background paragraph on the harmonisation of laws in the internal market (page 176):
”Artiklarna 94–97 i EG-fördraget återger möjligheten att harmonisera lagstiftningen på den inre marknaden. Det finns en stor volym sekundärrätt med utgångspunkt i artikel 95 i EG-fördraget samt en omfattande praxis på området. Möjligheten till harmonisering av medlemsstaternas lagar och författningar är en förutsättning för den inre marknadens bibehållande och fortsatta funktion.”
The government later remarks on the essentially unchanged nature of most internal market provisions (e.g. page 176). On page 181, the government remarks on the introduction of the ordinary legislative procedure with regard to distortions of competition, whereas the Council currently decides alone by qualified majority voting. The draft mentions the elimination of the words about the Commission and the Council in the last sentence in favour of a general referral to the adoption of any other appropriate measures:
”Även artikel 96 i EUF-fördraget ändras så att åtgärder för att eliminera snedvridning av konkurrensvillkor ska antas av Europaparlamentet och rådet enligt det ordinarie lagstiftningsförfarandet. Idag fattar rådet ensamt beslut med kvalificerad majoritet. Genom en ändring i artikel 96.2 i EUF-fördraget tas skrivningen om att kommissionen och rådet får vidta åtgärder bort och det anges enbart att alla övriga lämpliga åtgärder enligt fördragen får vidtas.”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), is the most systematic analysis of the Lisbon Treaty I have encountered.
Under the heading Approximation of laws (Lainsäädännön lähentäminen), the bill offers a description of Article 96 TFEU (ToL), renumbered Article 116 TFEU. The government explains the procedures to eliminate a distortion of the conditions of competition in the internal market. If the negotiations between the Commission and the Member do not lead to results, the ordinary legislative procedure kicks in. The existing Article 96 TEC provides for directives issued by the Council on its own. The contents correspond to Article III-174 of the Constitutional Treaty (page 209):
”96 artiklassa (uusi 116 artikla) määrätään menettelystä, jota noudatetaan, jos komissio toteaa, että jäsenvaltioiden lakien, asetusten tai hallinnollisten määräysten välillä oleva eroavuus vääristää kilpailun edellytyksiä sisämarkkinoilla ja johtaa vääristymään, joka on poistettava. Jollei vääristymän poistamisesta päästä sopimukseen asiaa koskevien jäsenvaltioiden välillä, toteutettavien toimenpiteiden osalta siirrytään tavalliseen lainsäätämisjärjestykseen. SEY 96 artiklan nojalla neuvosto toteuttaa toimenpiteet yksin antamalla direktiivejä. Määräys vastaa sisällöltään perustuslakisopimuksen III-174 artiklaa.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remarks under ’Tillnärmning av lagstiftning’ on Article 96 TFEU (ToL), the future Article 116 TFEU, on page 212 :
”I artikel 96 (blivande artikel 116) bestäms om det förfarande som ska iakttas om kommissionen finner att en skillnad mellan bestämmelserna i medlemsstaternas lagar eller andra författningar framkallar en snedvridning av konkurrensvillkoren på den inre marknaden som behöver elimineras. Om man inte når något avtal mellan de berörda medlemsstaterna om eliminering av snedvridningen ska nödvändiga åtgärder föreskrivas i enlighet med det ordinarie lagstiftningsförfarandet. Med stöd av artikel 96 i EG-fördraget vidtar rådet åtgärderna ensamt genom att anta direktiv. Innehållet i bestämmelsen motsvarar artikel III-174 i det konstitutionella fördraget.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
Let me add a few thoughts, outside the scope of treaty reform stages.
By and large, people prefer fair competition to unfair practices and legitimate competitive advantages over distortive actions.
The words of Article 116 TFEU are value-laden enough to gain almost universal recognition. The devil is, of course, in the details.
The European Union (still the European Community, if we want to be more exact) offers a unique machinery to deal with and to resolve conflicts of interest. Member states tend to focus on their own perceived interests, but in the wider world they have to address problems relating to ‘unfair competition’ bilaterally or through less developed multilateral mechanisms such as the WTO.
Within the EU the members have the institutional framework in place for both continuing dialogue and binding decisions. Mere self-interest does not carry the day, in that decision-making in the Council requires a high rate of approval among the member states (qualified majority).
In the ‘Community pillar’ the Commission generally has the monopoly to make proposals, which means that the bones of contention are studied with the general European interest in mind (naturally with a dose of unavoidable organisational self-interest). In other words, a dissatisfied member state has to win the approval of the Commission.
The institutional setting forces the players to present their arguments and to address those of their partners. This inevitably leads to evolving arguments and sometimes to concrete decisions. In one instance, sufficient condemnation leads to the abolishment of unfair practices. In another matter, the envious partners realise that they had better upgrade their own practices to stay competitive.
None of this happens in a platonic ideal state, but with all its deficiency, the European Union is the world’s greatest learning organisation. In the end, European competitiveness gains, although the processes are often slow and laborious and the results fall short of ‘best practices’.
When the European Parliament becomes co-legislator at least part of the legislative procedure becomes more transparent, as it does when the Council deliberates in public on legislative proposals (although real debate and a clear ‘paper trail’ may by long in coming).
By today, as many member states have already fulfilled the essential requirements for ratification as reached by the Constitutional Treaty. Today, in the Irish referendum three million voters decide for 500 million Europeans between the Treaty of Nice and the modest but real gains of the Treaty of Lisbon.
Ralf Grahn
Third, if the negotiations fail, directives can be issued to eliminate the distortion. While the existing EC Treaty allows the Council to enact the directive alone, by qualified majority, the Lisbon Treaty empowers the European Parliament to act as co-legislator, in accordance with the ordinary legislative procedure.
***
Article 116 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/95–96:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 116 TFEU
(ex Article 96 TEC)
Where the Commission finds that a difference between the provisions laid down by law, regulation or administrative action in Member States is distorting the conditions of competition in the internal market and that the resultant distortion needs to be eliminated, it shall consult the Member States concerned.
If such consultation does not result in an agreement eliminating the distortion in question, the European, Parliament and the Council, acting in accordance with the ordinary legislative procedure, shall issue the necessary directives. Any other appropriate measures provided for in the Treaties may be adopted.
***
In Article 2, point 83 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 96 of the Treaty establishing the European Community (TEC) (OJ 17.12.2007 C 306/70):
83) In Article 96, second paragraph, first sentence, the words ‘, the Council shall, on a proposal from the Commission, acting by a qualified majority, issue’ shall be replaced by ‘, the European Parliament and the Council, acting in accordance with the ordinary legislative procedure, shall issue’. The second sentence shall be replaced by ‘Any other appropriate measures provided for in the Treaties may be adopted.’.
***
The TFEU table of equivalences confirms that Article 96 TEC first became Article 96 TFEU (ToL) in the original Treaty of Lisbon, and it tells us that it was later renumbered Article 116 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 96 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 3 ‘Approximation of laws’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/81).
Here is the current Article 94 TEC:
Article 96 TEC
Where the Commission finds that a difference between the provisions laid down by law, regulation or administrative action in Member States is distorting the conditions of competition in the common market and that the resultant distortion needs to be eliminated, it shall consult the Member States concerned.
If such consultation does not result in an agreement eliminating the distortion in question, the Council shall, on a proposal from the Commission, acting by a qualified majority, issue the necessary directives. The Commission and the Council may take any other appropriate measures provided for in this Treaty.
***
We have seen the differences between Article 96 TEC in force and Article 116 TFEU. The European Parliament and the ordinary legislative procedure (co-decision) are introduced in the second paragraph.
In addition to the specific amendments, one of the horizontal amendments apply, namely the term ‘common market’ is scrapped by the Treaty of Lisbon and replaced by the consistent use of ‘internal market’.
***
For the sake of systematic comparison, we look at the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-66 of the draft Treaty establishing a Constitution for Europe continued the operation of mopping up the use of ‘common market’ in older provisions, by the consistent use of ‘internal market’. European framework laws, in substance directives based on co-decision, were introduced. See OJ 18.7.2003 C 169/39.
Article III-66 Draft Constitution
Where the Commission finds that a difference between the provisions laid down by law, regulation or administrative action in Member States is distorting the conditions of competition in the internal market and that the resultant distortion needs to be eliminated, it shall consult the Member States concerned.
If such consultation does not result in agreement, European framework laws shall eliminate the distortion in question. Any other appropriate measures provided for in the Constitution may be adopted.
***
In the Treaty establishing a Constitution for Europe, ‘ratified’ by 18 member states, the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
Article III-174 is found in OJ 16.12.2004 C 310/75:
Article III-174 Constitution
Where the Commission finds that a difference between the provisions laid down by law, regulation or administrative action in Member States is distorting the conditions of competition in the internal market and that the resultant distortion needs to be eliminated, it shall consult the Member States concerned.
If such consultation does not result in agreement, European framework laws shall establish the measures necessary to eliminate the distortion in question. Any other appropriate measures provided for in the Constitution may be adopted.
***
In the second paragraph, the words ‘establish the measures necessary to’ before eliminate did not alter the substance of Article III-174.
***
What has been said about Article 116 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers highlighted the changes made to Article 96 TEC and TFEU (ToL), to be renumbered Article 116 TFEU in the consolidated version, and he added the following comment (page 31):
“The co-decision procedure has been extended to this Article.”
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 116 TFEU, Article 96 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Draws on Article 96 TEC. QMV already applies, decision-making moves to co-decision.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the approximation of internal market laws on page 60 (under the heading ‘2. Taxation’).
The Research Paper commented briefly on the harmonisation of internal market laws, before moving on to tax harmonisation:
“Articles 94–97 (Constitution Articles III-172 – III-176) are on the approximation of internal market laws. The general aims are unchanged and the Council will adopt measures for the approximation of laws, regulations or administrative provisions of the Member States that directly affect the internal market. The out-dated term “common market” is removed and replaced with “internal market”.”
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 116 TFEU (Article 96 TEC and TFEU ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
However, my standard reference is currently the Swedish government’s fresh draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
The Swedish government presents a short background paragraph on the harmonisation of laws in the internal market (page 176):
”Artiklarna 94–97 i EG-fördraget återger möjligheten att harmonisera lagstiftningen på den inre marknaden. Det finns en stor volym sekundärrätt med utgångspunkt i artikel 95 i EG-fördraget samt en omfattande praxis på området. Möjligheten till harmonisering av medlemsstaternas lagar och författningar är en förutsättning för den inre marknadens bibehållande och fortsatta funktion.”
The government later remarks on the essentially unchanged nature of most internal market provisions (e.g. page 176). On page 181, the government remarks on the introduction of the ordinary legislative procedure with regard to distortions of competition, whereas the Council currently decides alone by qualified majority voting. The draft mentions the elimination of the words about the Commission and the Council in the last sentence in favour of a general referral to the adoption of any other appropriate measures:
”Även artikel 96 i EUF-fördraget ändras så att åtgärder för att eliminera snedvridning av konkurrensvillkor ska antas av Europaparlamentet och rådet enligt det ordinarie lagstiftningsförfarandet. Idag fattar rådet ensamt beslut med kvalificerad majoritet. Genom en ändring i artikel 96.2 i EUF-fördraget tas skrivningen om att kommissionen och rådet får vidta åtgärder bort och det anges enbart att alla övriga lämpliga åtgärder enligt fördragen får vidtas.”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), is the most systematic analysis of the Lisbon Treaty I have encountered.
Under the heading Approximation of laws (Lainsäädännön lähentäminen), the bill offers a description of Article 96 TFEU (ToL), renumbered Article 116 TFEU. The government explains the procedures to eliminate a distortion of the conditions of competition in the internal market. If the negotiations between the Commission and the Member do not lead to results, the ordinary legislative procedure kicks in. The existing Article 96 TEC provides for directives issued by the Council on its own. The contents correspond to Article III-174 of the Constitutional Treaty (page 209):
”96 artiklassa (uusi 116 artikla) määrätään menettelystä, jota noudatetaan, jos komissio toteaa, että jäsenvaltioiden lakien, asetusten tai hallinnollisten määräysten välillä oleva eroavuus vääristää kilpailun edellytyksiä sisämarkkinoilla ja johtaa vääristymään, joka on poistettava. Jollei vääristymän poistamisesta päästä sopimukseen asiaa koskevien jäsenvaltioiden välillä, toteutettavien toimenpiteiden osalta siirrytään tavalliseen lainsäätämisjärjestykseen. SEY 96 artiklan nojalla neuvosto toteuttaa toimenpiteet yksin antamalla direktiivejä. Määräys vastaa sisällöltään perustuslakisopimuksen III-174 artiklaa.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remarks under ’Tillnärmning av lagstiftning’ on Article 96 TFEU (ToL), the future Article 116 TFEU, on page 212 :
”I artikel 96 (blivande artikel 116) bestäms om det förfarande som ska iakttas om kommissionen finner att en skillnad mellan bestämmelserna i medlemsstaternas lagar eller andra författningar framkallar en snedvridning av konkurrensvillkoren på den inre marknaden som behöver elimineras. Om man inte når något avtal mellan de berörda medlemsstaterna om eliminering av snedvridningen ska nödvändiga åtgärder föreskrivas i enlighet med det ordinarie lagstiftningsförfarandet. Med stöd av artikel 96 i EG-fördraget vidtar rådet åtgärderna ensamt genom att anta direktiv. Innehållet i bestämmelsen motsvarar artikel III-174 i det konstitutionella fördraget.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
Let me add a few thoughts, outside the scope of treaty reform stages.
By and large, people prefer fair competition to unfair practices and legitimate competitive advantages over distortive actions.
The words of Article 116 TFEU are value-laden enough to gain almost universal recognition. The devil is, of course, in the details.
The European Union (still the European Community, if we want to be more exact) offers a unique machinery to deal with and to resolve conflicts of interest. Member states tend to focus on their own perceived interests, but in the wider world they have to address problems relating to ‘unfair competition’ bilaterally or through less developed multilateral mechanisms such as the WTO.
Within the EU the members have the institutional framework in place for both continuing dialogue and binding decisions. Mere self-interest does not carry the day, in that decision-making in the Council requires a high rate of approval among the member states (qualified majority).
In the ‘Community pillar’ the Commission generally has the monopoly to make proposals, which means that the bones of contention are studied with the general European interest in mind (naturally with a dose of unavoidable organisational self-interest). In other words, a dissatisfied member state has to win the approval of the Commission.
The institutional setting forces the players to present their arguments and to address those of their partners. This inevitably leads to evolving arguments and sometimes to concrete decisions. In one instance, sufficient condemnation leads to the abolishment of unfair practices. In another matter, the envious partners realise that they had better upgrade their own practices to stay competitive.
None of this happens in a platonic ideal state, but with all its deficiency, the European Union is the world’s greatest learning organisation. In the end, European competitiveness gains, although the processes are often slow and laborious and the results fall short of ‘best practices’.
When the European Parliament becomes co-legislator at least part of the legislative procedure becomes more transparent, as it does when the Council deliberates in public on legislative proposals (although real debate and a clear ‘paper trail’ may by long in coming).
By today, as many member states have already fulfilled the essential requirements for ratification as reached by the Constitutional Treaty. Today, in the Irish referendum three million voters decide for 500 million Europeans between the Treaty of Nice and the modest but real gains of the Treaty of Lisbon.
Ralf Grahn
Wednesday, 11 June 2008
EU TFEU: Approximation of internal market laws in sensitive areas
Approximation or harmonisation of internal market laws in sensitive areas, such as company taxes, is subject to unanimous decision making by the EU Council. The Treaty of Lisbon does not change the unanimity rule, although the reform treaty tries to make the relationship between ordinary and special legislative procedures clearer.
***
Article 115 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/95:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 115 TFEU
(ex Article 94 TEC)
Without prejudice to Article 114, the Council shall, acting unanimously in accordance with a special legislative procedure and after consulting the European Parliament and the Economic and Social Committee, issue directives for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market.
***
In Article 2, point 80 of the Treaty of Lisbon (ToL) the IGC 2007 renumbered and amended Article 94 of the Treaty establishing the European Community (TEC), and in point 82 it amended the new Article 95 TFEU (ToL) (OJ 17.12.2007 C 306/69):
APPROXIMATION OF LAWS
80) The order of Articles 94 and 95 shall be reversed. Article 94 shall be renumbered 95 and Article 95 shall be renumbered 94.
---
82) In Article 94, renumbered 95, the words ‘Without prejudice to Article 94,’ shall be inserted at
the beginning.
***
The TFEU table of equivalences confirms that Article 94 TEC first became Article 95 TFEU (ToL) in the original Treaty of Lisbon, and it tells us that it was later renumbered Article 115 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 94 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 3 ‘Approximation of laws’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
When the proposed TFEU Article 114 (the current Article 95 TEC) with the normal or ordinary procedures for approximation (harmonisation) of laws was lifted to the beginning of the Chapter 3, the sensitive areas, mentioned in the second paragraph, requiring unanimity, were left to be dealt with in Article 115 TFEU (the current Article 94 TEC) of the amending treaty.
The new order feels like an improvement, but in spite of the words added at the beginning of Article 115 TFEU, plain language to express the scope of the provision would not have been amiss.
The only specific amendment by the Treaty of Lisbon was to add the words ‘Without prejudice to Article 94,’ (renumbered Article 114 TFEU) at the beginning. The words ‘acting unanimously on a proposal from the Commission’ were replaced by ‘acting unanimously in accordance with a special legislative procedure’ according to horizontal amendment 3 of Article 2 of the Treaty of Lisbon (OJ 17.12.2007 C 306/42), and the words ‘common market’ at the end were replaced by ‘internal market’ in line with horizontal amendment 2(g) (OJ 17.12.2007 C 306/41).
Here is the current Article 94 TEC:
Article 94 TEC
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, issue directives for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the common market.
***
We have seen the minor differences between Article 94 TEC in force and Article 115 TFEU.
For the sake of systematic comparison, we look at the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-64 of the draft Treaty establishing a Constitution for Europe was still the first Article of Section 7. The terminology of the draft Constitution differed from the TEC and there were some changes in wording, including the words ‘Without prejudice to Article III-65’ added at the beginning. But the substance remained unchanged. See OJ 18.7.2003 C 169/38.
Article III-64 Draft Constitution
Without prejudice to Article III-65, a European framework law of the Council of Ministers shall establish measures for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market. The Council of Ministers shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
***
In the Treaty establishing a Constitution for Europe, approved by 18 member states, the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
The IGC 2004 lifted Article III-172 (the current Article 95 TEC) as the new ‘high road’ to the top of Section 7, and Article III-173 (the current Article 94 TEC) sank to become the ‘low road’ for areas requiring unanimity.
Consequently, the referral at the beginning changed. The ‘Council of Ministers’ became the ‘Council’ in the Constitutional Treaty, but otherwise the IGC 2004 took over the wording of the draft Constitution.
Article III-173 is found in OJ 16.12.2004 C 310/75:
Article III-173 Constitution
Without prejudice to Article III-172, a European framework law of the Council shall establish measures for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market. The Council shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
***
What has been said about Article 115 TFEU, with the shifted position, but substantially unchanged from the current Article 94 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 94 TEC, 95 TFEU (ToL), to be renumbered Article 115 TFEU in the consolidated version, and highlighted the changes, and he added the following comment (pages 30–31):
“The draft Reform Treaty attempts to clarify the relationship between Articles 94 and 95.”
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 115 TFEU, Article 95 TFEU (ToL) in the original Lisbon Treaty (page 12):
“In substance the same as Article 94 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the approximation of internal market laws on page 60 (under the heading ‘2. Taxation’).
The Research Paper commented briefly on the harmonisation of internal market laws, before moving on to tax harmonisation:
“Articles 94–97 (Constitution Articles III-172 – III-176) are on the approximation of internal market laws. The general aims are unchanged and the Council will adopt measures for the approximation of laws, regulations or administrative provisions of the Member States that directly affect the internal market. The out-dated term “common market” is removed and replaced with “internal market”.”
The Reasearch Paper then proceeded to discuss the approximation (harmonisation) of tax law and the British official position (pages 60–61):
“Harmonisation in the sphere of direct taxes under Article 94 TEC is much more limited than in that of indirect taxes. Although directives introduced under Article 94 TEC may be approved under the co-decision procedure, this does not apply to fiscal provisions. The TFEU, like the Constitution, maintains the requirement for unanimity in Article 95 on any fiscal measure introduced under this Treaty base. The wording of Articles 94 and 95(2) (Constitution Articles III-173 and III-172) is fundamentally unchanged.
The possibility that all taxation measures might be subject to unanimity [sic] at some point in the future has been a controversial issue for some time. The Government’s position on the issue has been stated many times. In June 2003 the then Paymaster General, Dawn Primarolo, said the British Government would “not accept any changes that move away from unanimity on tax matters. When the then Prime Minister, Tony Blair, made a statement to the House following agreement on the Constitution in June 2004, he underlined the point that “this treaty … keeps unanimity for the most important decisions … in particular for tax, social security, foreign policy, defence and decisions on the financing of the Union affecting the British budget contribution.” Tony Blair told the Liaison Committee on 18 June 2007 shortly before the June European Council which agreed the IGC Mandate: “we will not agree to anything that moves to qualified majority voting, something that can have a big say in our own tax and benefit system”.”
(I have deleted the footnotes, but they can be found in the original document.)
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 115 TFEU (Article 94 TEC or Article 95 ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
But my standard reference is currently the Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
The Swedish government presents a short background paragraph on the harmonisation of laws in the internal market (page 176):
”Artiklarna 94–97 i EG-fördraget återger möjligheten att harmonisera lagstiftningen på den inre marknaden. Det finns en stor volym sekundärrätt med utgångspunkt i artikel 95 i EG-fördraget samt en omfattande praxis på området. Möjligheten till harmonisering av medlemsstaternas lagar och författningar är en förutsättning för den inre marknadens bibehållande och fortsatta funktion.”
The government later remarks on the essentially unchanged nature of most internal market provisions (e.g. page 176), but on the following page it adds a comment on the changing position of Articles 94 and 95, with the remark that the purpose is to clarify the relationship between the Articles and it mentions the words added at the beginning of Article 95 TFEU (ToL):
“Vad avser tillnärmning av lagstiftning, byter artiklarna 94 och 95 plats. Syftet med omnumreringen är att klargöra förhållandet mellan de båda artiklarna. I inledningen till artikel 95 i EUF-fördraget görs ett tillägg om att artikeln inte ska påverka tillämpningen av artikel 94 i EUF-fördraget.”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), is the most systematic analysis of the Lisbon Treaty I have encountered.
Under the heading Approximation of laws (Lainsäädännön lähentäminen), the bill offers a description of Article 95 TFEU (ToL), renumbered Article 115 TFEU. The government explains the subsidiary nature of Article 95 TFEU (ToL) in relation to Article 94. The added words reflect the current interpretation of the relationship between the Articles (page 209):
”95 artiklassa (uusi 115 artikla) määrätään neuvoston mahdollisuudesta antaa komission ehdotuksesta yksimielisesti Euroopan parlamenttia kuultuaan direktiivejä sisämarkkinoiden vaatimaksi jäsenvaltioiden lainsäädäntöjen yhdenmukaistamiseksi. Artikla vastaa perustuslakisopimuksen III-173 artiklaa ja korvaa SEY 94 artiklan seuraavin muutoksin. SEUT 95 artiklassa on uusi määräys, jonka mukaan SEUT 95 artikla ei rajoita SEUT 94 artiklan soveltamista. Tämä tarkoittaa, että SEUT 94 artikla on ensisijainen SEUT 95 artiklaan nähden. Vastaavaa määräystä ei sisälly nykyiseen SEY 94 artiklaan, mutta määräys vastaa nykyistä oikeustilaa. Käytännössä SEY 95 artiklaa ja SEY 94 artiklaa on tulkittu siten, että SEY 95 artikla on ensisijainen SEY 94 artiklaan nähden.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remarks under ’Tillnärmning av lagstiftning’ on Article 95 TFEU (ToL), the future Article 115 TFEU, on pages 211–212:
”I artikel 95 (blivande artikel 115) föreskrivs om rådets möjlighet att på förslag av kommissionen enhälligt och efter att ha hört Europaparlamentet utfärda direktiv om tillnärmning av sådan lagstiftning i medlemsstaterna som krävs för den inre marknaden. Artikeln motsvarar artikel III-173 i det konstitutionella fördraget och ersätter artikel 94 i EG-fördraget med följande ändringar. I artikel 95 i EUF-fördraget ingår en ny bestämmelse enligt vilken artikel 95 i EUFfördraget inte begränsar tillämpningen av artikel 94 i EUF-fördraget. Detta betyder att artikel 94 i EUF-fördraget är primär i förhållande till artikel 95 i EUF-fördraget. Någon motsvarande bestämmelse ingår inte i nuvarande artikel 94 i EG-fördraget, men bestämmelsen motsvarar rådande rättsläge. I praktiken har artiklarna 95 och 94 i EG fördraget tolkats så att artikel 95 är primär i förhållande till artikel 94.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
Both Article 114 TFEU and Article 115 TFEU are general in the sense that they provide legal bases for harmonising measures, when the treaties have not catered for special grounds for internal market legislation.
In the absence of a special base, Article 114 TFEU applies, with the ordinary legislative procedure, for internal market objectives.
When fiscal (tax) provisions, those relating to the free movement of persons and those relating to the rights and interests of employed persons, expressly excluded by Article 114(2) TFEU, directly affect the establishment or functioning of the internal market, Article 115 TFEU enters the picture. These sensitive areas are subject to unanimous decision making by the Council, and the European Parliament is only consulted.
Ralf Grahn
***
Article 115 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/95:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 115 TFEU
(ex Article 94 TEC)
Without prejudice to Article 114, the Council shall, acting unanimously in accordance with a special legislative procedure and after consulting the European Parliament and the Economic and Social Committee, issue directives for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market.
***
In Article 2, point 80 of the Treaty of Lisbon (ToL) the IGC 2007 renumbered and amended Article 94 of the Treaty establishing the European Community (TEC), and in point 82 it amended the new Article 95 TFEU (ToL) (OJ 17.12.2007 C 306/69):
APPROXIMATION OF LAWS
80) The order of Articles 94 and 95 shall be reversed. Article 94 shall be renumbered 95 and Article 95 shall be renumbered 94.
---
82) In Article 94, renumbered 95, the words ‘Without prejudice to Article 94,’ shall be inserted at
the beginning.
***
The TFEU table of equivalences confirms that Article 94 TEC first became Article 95 TFEU (ToL) in the original Treaty of Lisbon, and it tells us that it was later renumbered Article 115 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 94 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 3 ‘Approximation of laws’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
When the proposed TFEU Article 114 (the current Article 95 TEC) with the normal or ordinary procedures for approximation (harmonisation) of laws was lifted to the beginning of the Chapter 3, the sensitive areas, mentioned in the second paragraph, requiring unanimity, were left to be dealt with in Article 115 TFEU (the current Article 94 TEC) of the amending treaty.
The new order feels like an improvement, but in spite of the words added at the beginning of Article 115 TFEU, plain language to express the scope of the provision would not have been amiss.
The only specific amendment by the Treaty of Lisbon was to add the words ‘Without prejudice to Article 94,’ (renumbered Article 114 TFEU) at the beginning. The words ‘acting unanimously on a proposal from the Commission’ were replaced by ‘acting unanimously in accordance with a special legislative procedure’ according to horizontal amendment 3 of Article 2 of the Treaty of Lisbon (OJ 17.12.2007 C 306/42), and the words ‘common market’ at the end were replaced by ‘internal market’ in line with horizontal amendment 2(g) (OJ 17.12.2007 C 306/41).
Here is the current Article 94 TEC:
Article 94 TEC
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, issue directives for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the common market.
***
We have seen the minor differences between Article 94 TEC in force and Article 115 TFEU.
For the sake of systematic comparison, we look at the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-64 of the draft Treaty establishing a Constitution for Europe was still the first Article of Section 7. The terminology of the draft Constitution differed from the TEC and there were some changes in wording, including the words ‘Without prejudice to Article III-65’ added at the beginning. But the substance remained unchanged. See OJ 18.7.2003 C 169/38.
Article III-64 Draft Constitution
Without prejudice to Article III-65, a European framework law of the Council of Ministers shall establish measures for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market. The Council of Ministers shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
***
In the Treaty establishing a Constitution for Europe, approved by 18 member states, the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
The IGC 2004 lifted Article III-172 (the current Article 95 TEC) as the new ‘high road’ to the top of Section 7, and Article III-173 (the current Article 94 TEC) sank to become the ‘low road’ for areas requiring unanimity.
Consequently, the referral at the beginning changed. The ‘Council of Ministers’ became the ‘Council’ in the Constitutional Treaty, but otherwise the IGC 2004 took over the wording of the draft Constitution.
Article III-173 is found in OJ 16.12.2004 C 310/75:
Article III-173 Constitution
Without prejudice to Article III-172, a European framework law of the Council shall establish measures for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market. The Council shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
***
What has been said about Article 115 TFEU, with the shifted position, but substantially unchanged from the current Article 94 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 94 TEC, 95 TFEU (ToL), to be renumbered Article 115 TFEU in the consolidated version, and highlighted the changes, and he added the following comment (pages 30–31):
“The draft Reform Treaty attempts to clarify the relationship between Articles 94 and 95.”
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 115 TFEU, Article 95 TFEU (ToL) in the original Lisbon Treaty (page 12):
“In substance the same as Article 94 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the approximation of internal market laws on page 60 (under the heading ‘2. Taxation’).
The Research Paper commented briefly on the harmonisation of internal market laws, before moving on to tax harmonisation:
“Articles 94–97 (Constitution Articles III-172 – III-176) are on the approximation of internal market laws. The general aims are unchanged and the Council will adopt measures for the approximation of laws, regulations or administrative provisions of the Member States that directly affect the internal market. The out-dated term “common market” is removed and replaced with “internal market”.”
The Reasearch Paper then proceeded to discuss the approximation (harmonisation) of tax law and the British official position (pages 60–61):
“Harmonisation in the sphere of direct taxes under Article 94 TEC is much more limited than in that of indirect taxes. Although directives introduced under Article 94 TEC may be approved under the co-decision procedure, this does not apply to fiscal provisions. The TFEU, like the Constitution, maintains the requirement for unanimity in Article 95 on any fiscal measure introduced under this Treaty base. The wording of Articles 94 and 95(2) (Constitution Articles III-173 and III-172) is fundamentally unchanged.
The possibility that all taxation measures might be subject to unanimity [sic] at some point in the future has been a controversial issue for some time. The Government’s position on the issue has been stated many times. In June 2003 the then Paymaster General, Dawn Primarolo, said the British Government would “not accept any changes that move away from unanimity on tax matters. When the then Prime Minister, Tony Blair, made a statement to the House following agreement on the Constitution in June 2004, he underlined the point that “this treaty … keeps unanimity for the most important decisions … in particular for tax, social security, foreign policy, defence and decisions on the financing of the Union affecting the British budget contribution.” Tony Blair told the Liaison Committee on 18 June 2007 shortly before the June European Council which agreed the IGC Mandate: “we will not agree to anything that moves to qualified majority voting, something that can have a big say in our own tax and benefit system”.”
(I have deleted the footnotes, but they can be found in the original document.)
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 115 TFEU (Article 94 TEC or Article 95 ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
But my standard reference is currently the Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
The Swedish government presents a short background paragraph on the harmonisation of laws in the internal market (page 176):
”Artiklarna 94–97 i EG-fördraget återger möjligheten att harmonisera lagstiftningen på den inre marknaden. Det finns en stor volym sekundärrätt med utgångspunkt i artikel 95 i EG-fördraget samt en omfattande praxis på området. Möjligheten till harmonisering av medlemsstaternas lagar och författningar är en förutsättning för den inre marknadens bibehållande och fortsatta funktion.”
The government later remarks on the essentially unchanged nature of most internal market provisions (e.g. page 176), but on the following page it adds a comment on the changing position of Articles 94 and 95, with the remark that the purpose is to clarify the relationship between the Articles and it mentions the words added at the beginning of Article 95 TFEU (ToL):
“Vad avser tillnärmning av lagstiftning, byter artiklarna 94 och 95 plats. Syftet med omnumreringen är att klargöra förhållandet mellan de båda artiklarna. I inledningen till artikel 95 i EUF-fördraget görs ett tillägg om att artikeln inte ska påverka tillämpningen av artikel 94 i EUF-fördraget.”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), is the most systematic analysis of the Lisbon Treaty I have encountered.
Under the heading Approximation of laws (Lainsäädännön lähentäminen), the bill offers a description of Article 95 TFEU (ToL), renumbered Article 115 TFEU. The government explains the subsidiary nature of Article 95 TFEU (ToL) in relation to Article 94. The added words reflect the current interpretation of the relationship between the Articles (page 209):
”95 artiklassa (uusi 115 artikla) määrätään neuvoston mahdollisuudesta antaa komission ehdotuksesta yksimielisesti Euroopan parlamenttia kuultuaan direktiivejä sisämarkkinoiden vaatimaksi jäsenvaltioiden lainsäädäntöjen yhdenmukaistamiseksi. Artikla vastaa perustuslakisopimuksen III-173 artiklaa ja korvaa SEY 94 artiklan seuraavin muutoksin. SEUT 95 artiklassa on uusi määräys, jonka mukaan SEUT 95 artikla ei rajoita SEUT 94 artiklan soveltamista. Tämä tarkoittaa, että SEUT 94 artikla on ensisijainen SEUT 95 artiklaan nähden. Vastaavaa määräystä ei sisälly nykyiseen SEY 94 artiklaan, mutta määräys vastaa nykyistä oikeustilaa. Käytännössä SEY 95 artiklaa ja SEY 94 artiklaa on tulkittu siten, että SEY 95 artikla on ensisijainen SEY 94 artiklaan nähden.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remarks under ’Tillnärmning av lagstiftning’ on Article 95 TFEU (ToL), the future Article 115 TFEU, on pages 211–212:
”I artikel 95 (blivande artikel 115) föreskrivs om rådets möjlighet att på förslag av kommissionen enhälligt och efter att ha hört Europaparlamentet utfärda direktiv om tillnärmning av sådan lagstiftning i medlemsstaterna som krävs för den inre marknaden. Artikeln motsvarar artikel III-173 i det konstitutionella fördraget och ersätter artikel 94 i EG-fördraget med följande ändringar. I artikel 95 i EUF-fördraget ingår en ny bestämmelse enligt vilken artikel 95 i EUFfördraget inte begränsar tillämpningen av artikel 94 i EUF-fördraget. Detta betyder att artikel 94 i EUF-fördraget är primär i förhållande till artikel 95 i EUF-fördraget. Någon motsvarande bestämmelse ingår inte i nuvarande artikel 94 i EG-fördraget, men bestämmelsen motsvarar rådande rättsläge. I praktiken har artiklarna 95 och 94 i EG fördraget tolkats så att artikel 95 är primär i förhållande till artikel 94.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
Both Article 114 TFEU and Article 115 TFEU are general in the sense that they provide legal bases for harmonising measures, when the treaties have not catered for special grounds for internal market legislation.
In the absence of a special base, Article 114 TFEU applies, with the ordinary legislative procedure, for internal market objectives.
When fiscal (tax) provisions, those relating to the free movement of persons and those relating to the rights and interests of employed persons, expressly excluded by Article 114(2) TFEU, directly affect the establishment or functioning of the internal market, Article 115 TFEU enters the picture. These sensitive areas are subject to unanimous decision making by the Council, and the European Parliament is only consulted.
Ralf Grahn
Tuesday, 10 June 2008
EU TFEU: Approximation of laws
Article 26 of the Treaty on the Functioning of the European Union (TFEU) sets out the aim to establish and to ensure the functioning of the internal market. The approximation or harmonisation of member states’ laws is one of the methods used to achieve this aim.
We look at internal market approximation of laws in the light of the EU Treaty of Lisbon, by comparing Article 114 TFEU with the current provision and the previous treaty reform stages.
***
Article 114 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/94–95:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 114 TFEU
(ex Article 95 TEC)
1. Save where otherwise provided in the Treaties, the following provisions shall apply for the achievement of the objectives set out in Article 26. The European Parliament and the Council shall, acting in accordance with the ordinary legislative procedure and after consulting the Economic and Social Committee, adopt the measures for the approximation of the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment and functioning of the internal market.
2. Paragraph 1 shall not apply to fiscal provisions, to those relating to the free movement of persons nor to those relating to the rights and interests of employed persons.
3. The Commission, in its proposals envisaged in paragraph 1 concerning health, safety, environmental protection and consumer protection, will take as a base a high level of protection, taking account in particular of any new development based on scientific facts. Within their respective powers, the European Parliament and the Council will also seek to achieve this objective.
4. If, after the adoption of a harmonisation measure by the European Parliament and the Council, by the Council or by the Commission, a Member State deems it necessary to maintain national provisions on grounds of major needs referred to in Article 36, or relating to the protection of the environment or the working environment, it shall notify the Commission of these provisions as well as the grounds for maintaining them.
5. Moreover, without prejudice to paragraph 4, if, after the adoption of a harmonisation measure by the European Parliament and the Council, by the Council or by the Commission, a Member State deems it necessary to introduce national provisions based on new scientific evidence relating to the protection of the environment or the working environment on grounds of a problem specific to that Member State arising after the adoption of the harmonisation measure, it shall notify the Commission of the envisaged provisions as well as the grounds for introducing them.
6. The Commission shall, within six months of the notifications as referred to in paragraphs 4 and 5, approve or reject the national provisions involved after having verified whether or not they are a means of arbitrary discrimination or a disguised restriction on trade between Member States and whether or not they shall constitute an obstacle to the functioning of the internal market.
In the absence of a decision by the Commission within this period the national provisions referred to in paragraphs 4 and 5 shall be deemed to have been approved.
When justified by the complexity of the matter and in the absence of danger for human health, the Commission may notify the Member State concerned that the period referred to in this paragraph may be extended for a further period of up to six months.
7. When, pursuant to paragraph 6, a Member State is authorised to maintain or introduce national provisions derogating from a harmonisation measure, the Commission shall immediately examine whether to propose an adaptation to that measure.
8. When a Member State raises a specific problem on public health in a field which has been the subject of prior harmonisation measures, it shall bring it to the attention of the Commission which shall immediately examine whether to propose appropriate measures to the Council.
9. By way of derogation from the procedure laid down in Articles 258 and 259, the Commission and any Member State may bring the matter directly before the Court of Justice of the European Union if it considers that another Member State is making improper use of the powers provided for in this Article.
10. The harmonisation measures referred to above shall, in appropriate cases, include a safeguard clause authorising the Member States to take, for one or more of the non-economic reasons referred to in Article 36, provisional measures subject to a Union control procedure.
***
In Article 2, point 80 and point 81 of the Treaty of Lisbon (ToL) the IGC 2007 renumbered and amended Article 95 of the Treaty establishing the European Community (TEC). Here are the specific amendments (OJ 17.12.2007 C 306/69):
APPROXIMATION OF LAWS
80) The order of Articles 94 and 95 shall be reversed. Article 94 shall be renumbered 95 and Article 95 shall be renumbered 94.
81) Article 95, renumbered 94, shall be amended as follows:
(a) at the beginning of paragraph 1, the words ‘By way of derogation from Article 94 and’ shall be deleted;
(b) at the beginning of paragraph 4, the words ‘If, after the adoption by the Council or by the Commission of a harmonisation measure,’ shall be replaced by ‘If, after the adoption of a harmonisation measure by the European Parliament and the Council, by the Council or by the Commission,’;
(c) at the beginning of paragraph 5, the words ‘Moreover, without prejudice to paragraph 4, if, after the adoption by the Council or by the Commission of a harmonisation measure,’ shall be replaced by ‘Moreover, without prejudice to paragraph 4, if, after the adoption of a harmonisation measure by the European Parliament and the Council, by the Council or by the Commission,’;
d) in paragraph 10, the words ‘Community control procedure’ shall be replaced by ‘Union
control procedure’.
***
The TFEU table of equivalences confirms that Article 95 TEC first became Article 94 TFEU (ToL) in the original Treaty of Lisbon, and it tells us that it was later renumbered Article 114 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 95 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 3 ‘Approximation of laws’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79–81).
The main difference between the proposed TFEU Article 114 and the current Article 95 TEC is that the normal or ordinary procedures for approximation (harmonisation) of laws have been lifted on top, to stand at the beginning of Chapter 3. The sensitive areas, mentioned in the second paragraph, requiring unanimity, are dealt with in the following provision, Article 115 TFEU, of the amending treaty.
Although Article 114 is long-winded, the new order feels like an improvement.
The other differences, specific and horizontal, are technical or terminological. In addition, the monster size of the Article made me refrain from reproducing it here for comparison, but the interested reader can look up the current Article 95 TEC in the consolidated version.
***
We have seen that 95 TEC in force and 114 TFEU are the same, in substance, with minor differences in wording.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-65 of the draft Treaty establishing a Constitution for Europe was still the second Article of Section 7. The terminology of the draft Constitution differed from the TEC, the draft Article III-65 naturally referred to Articles differently numbered, and it was sprinkled with small changes in wording. But the substance remained unchanged. See OJ 18.7.2003 C 169/38–39.
***
In the Treaty establishing a Constitution for Europe the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
The IGC 2004 lifted Article III-172 to the top of Section 7, renumbered the referrals to other provisions, and made some minimal adjustments to the draft text.
In the third paragraph the IGC 2004 showed concern for EU citizens by strengthening the wording on a high level of protection. ‘Will take’ and ‘will also seek’ became ‘shall take’ and ‘shall also seek’, but this potentially tougher standard and only substantial change lapsed when the Lisbon Treaty let the current TEC wording stand.
In the fourth and the fifth paragraph the IGC 2004 wanted to clarify the wording with regard to the legal instruments, so they were expressed with a few words added: ‘a European law or framework law or by means of a European regulation of the Commission’, but since the Treaty of Lisbon rejected the more developed terminology concerning legal acts as part of the ‘constitutional concept’, the IGC 2007 used its own, adapted wording.
Article III-172 is found in OJ 16.12.2004 C 310/73–75.
***
What has been said about Article 114 TFEU, with shifted position, but the wording practically unchanged from the current Article 95 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 95 TEC, 94 TFEU (ToL), to be renumbered Article 114 TFEU in the consolidated version, and highlighted the changes, but he added no comment (pages 29–30).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 114 TFEU, Article 94 TFEU (ToL) in the original Lisbon Treaty (page 12):
“In substance the same as Article 95 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the approximation of internal market laws on page 60 (under the heading ‘2. Taxation’).
The Research Paper commented briefly on the harmonisation of internal market laws, before moving on to tax harmonisation:
“Articles 94–97 (Constitution Articles III-172 – III-176) are on the approximation of internal market laws. The general aims are unchanged and the Council will adopt measures for the approximation of laws, regulations or administrative provisions of the Member States that directly affect the internal market. The out-dated term “common market” is removed and replaced with “internal market”.”
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 114 TFEU (Article 95 TEC or Article 94 ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
The Swedish government presents a short background paragraph on the harmonisation of laws in the internal market (page 176):
”Artiklarna 94–97 i EG-fördraget återger möjligheten att harmonisera lagstiftningen på den inre marknaden. Det finns en stor volym sekundärrätt med utgångspunkt i artikel 95 i EG-fördraget samt en omfattande praxis på området. Möjligheten till harmonisering av medlemsstaternas lagar och författningar är en förutsättning för den inre marknadens bibehållande och fortsatta funktion.”
The government later remarks on the essentially unchanged nature of most internal market provisions.
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Approximation of laws (Lainsäädännön lähentäminen), offers a brief description of Chapter 3 and of Article 94 TFEU (ToL), renumbered Article 114 TFEU (page 208):
”Luku sisältää määräykset unionin toimivallasta sisämarkkinoita toteutettaessa sekä yhdenmukaistamistoimenpiteisiin sovellettavasta päätöksentekomenettelystä. Luvussa määrätään myös jäsenvaltioiden toimivallasta yhdenmukaistamistoimenpiteiden toteuttamisen jälkeen. Määräykset vastaavat pääpiirteissään nykyisen EY-sopimuksen kolmannen osan VI osaston 3 luvun määräyksiä. Määräyksiin on tehty eräitä muutoksia päätöksentekomenettelyiden osalta sekä eräitä
sanamuotoja koskevia ja teknisiä tarkistuksia.
94 artiklassa (uusi 114 artikla) määrätään sisämarkkinoiden toteuttamista ja toimintaa koskevista toimenpiteistä jäsenvaltioiden lainsäädäntöjen yhdenmukaistamiseksi. Artikla vastaa säädösinstrumenttien yksilöintiä lukuun ottamatta perustuslakisopimuksen III-172 artiklaa ja korvaa SEY 95 artiklan seuraavasti muutettuna. SEUT 94 artiklan 4 ja 5 kohtaan lisätään viittaukset Euroopan parlamenttiin yhtenä lainsäätäjänä.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remarks under ’Tillnärmning av lagstiftning’ on Chapter 3 and Article 94 TFEU (ToL), the future Article 114 TFEU, on page 211:
”Kapitlet innehåller bestämmelser om unionens befogenheter när den inre marknaden upprättas samt om det beslutsförfarande som ska tillämpas på harmoniseringsåtgärder. I kapitlet anges också medlemsstaternas befogenheter efter vidtagandet av harmoniseringsåtgärder. Bestämmelserna motsvarar i stora drag avdelning VI kapitel 3 i det nuvarande EG-fördragets tredje del. I bestämmelserna har företagits vissa ändringar i fråga om beslutsförfarandena samt vissa tekniska ändringar som gäller ordalydelser.
I artikel 94 (blivande artikel 114) bestäms om åtgärder för upprättande av den inre marknaden och för dess funktion för att harmonisera lagstiftningen i medlemsstaterna. Artikeln motsvarar med undantag av individualiseringen av rättsaktsinstrumenten artikel III-172 i det konstitutionella fördraget och ersätter artikel 95 i EG-fördraget med följande ändringar. Till artikel 94.4 och 94.5 i EUF-fördraget fogas hänvisningar till Europaparlamentet som en lagstiftare.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
Before I leave the reader to study the substance of Article 114 TFEU, to say nothing about the substantive harmonisation measures, I would like to point out the scope of the Article.
First, the objectives mentioned at the beginning of this article merit a glance at Article 26 TFEU (OJ 9.5.2008 C 115/59, the consolidated version):
TITLE I
THE INTERNAL MARKET
Article 26 TFEU
(ex Article 14 TEC)
1. The Union shall adopt measures with the aim of establishing or ensuring the functioning of the internal market, in accordance with the relevant provisions of the Treaties.
2. The internal market shall comprise an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured in accordance with the provisions of the Treaties.
3. The Council, on a proposal from the Commission, shall determine the guidelines and conditions necessary to ensure balanced progress in all the sectors concerned.
***
The second important feature is the delimitation of the scope, in paragraph 2. Fiscal (tax) provisions, those relating to the free movement of persons and those relating to the rights and interests of employed persons are expressly excluded.
Ralf Grahn
We look at internal market approximation of laws in the light of the EU Treaty of Lisbon, by comparing Article 114 TFEU with the current provision and the previous treaty reform stages.
***
Article 114 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/94–95:
Part Three Union policies and internal actions
Title VII Common rules on competition, taxation and approximation of laws
Chapter 3 Approximation of laws
Article 114 TFEU
(ex Article 95 TEC)
1. Save where otherwise provided in the Treaties, the following provisions shall apply for the achievement of the objectives set out in Article 26. The European Parliament and the Council shall, acting in accordance with the ordinary legislative procedure and after consulting the Economic and Social Committee, adopt the measures for the approximation of the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment and functioning of the internal market.
2. Paragraph 1 shall not apply to fiscal provisions, to those relating to the free movement of persons nor to those relating to the rights and interests of employed persons.
3. The Commission, in its proposals envisaged in paragraph 1 concerning health, safety, environmental protection and consumer protection, will take as a base a high level of protection, taking account in particular of any new development based on scientific facts. Within their respective powers, the European Parliament and the Council will also seek to achieve this objective.
4. If, after the adoption of a harmonisation measure by the European Parliament and the Council, by the Council or by the Commission, a Member State deems it necessary to maintain national provisions on grounds of major needs referred to in Article 36, or relating to the protection of the environment or the working environment, it shall notify the Commission of these provisions as well as the grounds for maintaining them.
5. Moreover, without prejudice to paragraph 4, if, after the adoption of a harmonisation measure by the European Parliament and the Council, by the Council or by the Commission, a Member State deems it necessary to introduce national provisions based on new scientific evidence relating to the protection of the environment or the working environment on grounds of a problem specific to that Member State arising after the adoption of the harmonisation measure, it shall notify the Commission of the envisaged provisions as well as the grounds for introducing them.
6. The Commission shall, within six months of the notifications as referred to in paragraphs 4 and 5, approve or reject the national provisions involved after having verified whether or not they are a means of arbitrary discrimination or a disguised restriction on trade between Member States and whether or not they shall constitute an obstacle to the functioning of the internal market.
In the absence of a decision by the Commission within this period the national provisions referred to in paragraphs 4 and 5 shall be deemed to have been approved.
When justified by the complexity of the matter and in the absence of danger for human health, the Commission may notify the Member State concerned that the period referred to in this paragraph may be extended for a further period of up to six months.
7. When, pursuant to paragraph 6, a Member State is authorised to maintain or introduce national provisions derogating from a harmonisation measure, the Commission shall immediately examine whether to propose an adaptation to that measure.
8. When a Member State raises a specific problem on public health in a field which has been the subject of prior harmonisation measures, it shall bring it to the attention of the Commission which shall immediately examine whether to propose appropriate measures to the Council.
9. By way of derogation from the procedure laid down in Articles 258 and 259, the Commission and any Member State may bring the matter directly before the Court of Justice of the European Union if it considers that another Member State is making improper use of the powers provided for in this Article.
10. The harmonisation measures referred to above shall, in appropriate cases, include a safeguard clause authorising the Member States to take, for one or more of the non-economic reasons referred to in Article 36, provisional measures subject to a Union control procedure.
***
In Article 2, point 80 and point 81 of the Treaty of Lisbon (ToL) the IGC 2007 renumbered and amended Article 95 of the Treaty establishing the European Community (TEC). Here are the specific amendments (OJ 17.12.2007 C 306/69):
APPROXIMATION OF LAWS
80) The order of Articles 94 and 95 shall be reversed. Article 94 shall be renumbered 95 and Article 95 shall be renumbered 94.
81) Article 95, renumbered 94, shall be amended as follows:
(a) at the beginning of paragraph 1, the words ‘By way of derogation from Article 94 and’ shall be deleted;
(b) at the beginning of paragraph 4, the words ‘If, after the adoption by the Council or by the Commission of a harmonisation measure,’ shall be replaced by ‘If, after the adoption of a harmonisation measure by the European Parliament and the Council, by the Council or by the Commission,’;
(c) at the beginning of paragraph 5, the words ‘Moreover, without prejudice to paragraph 4, if, after the adoption by the Council or by the Commission of a harmonisation measure,’ shall be replaced by ‘Moreover, without prejudice to paragraph 4, if, after the adoption of a harmonisation measure by the European Parliament and the Council, by the Council or by the Commission,’;
d) in paragraph 10, the words ‘Community control procedure’ shall be replaced by ‘Union
control procedure’.
***
The TFEU table of equivalences confirms that Article 95 TEC first became Article 94 TFEU (ToL) in the original Treaty of Lisbon, and it tells us that it was later renumbered Article 114 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 95 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 3 ‘Approximation of laws’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79–81).
The main difference between the proposed TFEU Article 114 and the current Article 95 TEC is that the normal or ordinary procedures for approximation (harmonisation) of laws have been lifted on top, to stand at the beginning of Chapter 3. The sensitive areas, mentioned in the second paragraph, requiring unanimity, are dealt with in the following provision, Article 115 TFEU, of the amending treaty.
Although Article 114 is long-winded, the new order feels like an improvement.
The other differences, specific and horizontal, are technical or terminological. In addition, the monster size of the Article made me refrain from reproducing it here for comparison, but the interested reader can look up the current Article 95 TEC in the consolidated version.
***
We have seen that 95 TEC in force and 114 TFEU are the same, in substance, with minor differences in wording.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Approximation of legislation’.
Article III-65 of the draft Treaty establishing a Constitution for Europe was still the second Article of Section 7. The terminology of the draft Constitution differed from the TEC, the draft Article III-65 naturally referred to Articles differently numbered, and it was sprinkled with small changes in wording. But the substance remained unchanged. See OJ 18.7.2003 C 169/38–39.
***
In the Treaty establishing a Constitution for Europe the provisions on approximation (harmonisation) were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 7 ‘Common provisions’.
The IGC 2004 lifted Article III-172 to the top of Section 7, renumbered the referrals to other provisions, and made some minimal adjustments to the draft text.
In the third paragraph the IGC 2004 showed concern for EU citizens by strengthening the wording on a high level of protection. ‘Will take’ and ‘will also seek’ became ‘shall take’ and ‘shall also seek’, but this potentially tougher standard and only substantial change lapsed when the Lisbon Treaty let the current TEC wording stand.
In the fourth and the fifth paragraph the IGC 2004 wanted to clarify the wording with regard to the legal instruments, so they were expressed with a few words added: ‘a European law or framework law or by means of a European regulation of the Commission’, but since the Treaty of Lisbon rejected the more developed terminology concerning legal acts as part of the ‘constitutional concept’, the IGC 2007 used its own, adapted wording.
Article III-172 is found in OJ 16.12.2004 C 310/73–75.
***
What has been said about Article 114 TFEU, with shifted position, but the wording practically unchanged from the current Article 95 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 95 TEC, 94 TFEU (ToL), to be renumbered Article 114 TFEU in the consolidated version, and highlighted the changes, but he added no comment (pages 29–30).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 114 TFEU, Article 94 TFEU (ToL) in the original Lisbon Treaty (page 12):
“In substance the same as Article 95 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed the approximation of internal market laws on page 60 (under the heading ‘2. Taxation’).
The Research Paper commented briefly on the harmonisation of internal market laws, before moving on to tax harmonisation:
“Articles 94–97 (Constitution Articles III-172 – III-176) are on the approximation of internal market laws. The general aims are unchanged and the Council will adopt measures for the approximation of laws, regulations or administrative provisions of the Member States that directly affect the internal market. The out-dated term “common market” is removed and replaced with “internal market”.”
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 114 TFEU (Article 95 TEC or Article 94 ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
The Swedish government presents a short background paragraph on the harmonisation of laws in the internal market (page 176):
”Artiklarna 94–97 i EG-fördraget återger möjligheten att harmonisera lagstiftningen på den inre marknaden. Det finns en stor volym sekundärrätt med utgångspunkt i artikel 95 i EG-fördraget samt en omfattande praxis på området. Möjligheten till harmonisering av medlemsstaternas lagar och författningar är en förutsättning för den inre marknadens bibehållande och fortsatta funktion.”
The government later remarks on the essentially unchanged nature of most internal market provisions.
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Approximation of laws (Lainsäädännön lähentäminen), offers a brief description of Chapter 3 and of Article 94 TFEU (ToL), renumbered Article 114 TFEU (page 208):
”Luku sisältää määräykset unionin toimivallasta sisämarkkinoita toteutettaessa sekä yhdenmukaistamistoimenpiteisiin sovellettavasta päätöksentekomenettelystä. Luvussa määrätään myös jäsenvaltioiden toimivallasta yhdenmukaistamistoimenpiteiden toteuttamisen jälkeen. Määräykset vastaavat pääpiirteissään nykyisen EY-sopimuksen kolmannen osan VI osaston 3 luvun määräyksiä. Määräyksiin on tehty eräitä muutoksia päätöksentekomenettelyiden osalta sekä eräitä
sanamuotoja koskevia ja teknisiä tarkistuksia.
94 artiklassa (uusi 114 artikla) määrätään sisämarkkinoiden toteuttamista ja toimintaa koskevista toimenpiteistä jäsenvaltioiden lainsäädäntöjen yhdenmukaistamiseksi. Artikla vastaa säädösinstrumenttien yksilöintiä lukuun ottamatta perustuslakisopimuksen III-172 artiklaa ja korvaa SEY 95 artiklan seuraavasti muutettuna. SEUT 94 artiklan 4 ja 5 kohtaan lisätään viittaukset Euroopan parlamenttiin yhtenä lainsäätäjänä.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remarks under ’Tillnärmning av lagstiftning’ on Chapter 3 and Article 94 TFEU (ToL), the future Article 114 TFEU, on page 211:
”Kapitlet innehåller bestämmelser om unionens befogenheter när den inre marknaden upprättas samt om det beslutsförfarande som ska tillämpas på harmoniseringsåtgärder. I kapitlet anges också medlemsstaternas befogenheter efter vidtagandet av harmoniseringsåtgärder. Bestämmelserna motsvarar i stora drag avdelning VI kapitel 3 i det nuvarande EG-fördragets tredje del. I bestämmelserna har företagits vissa ändringar i fråga om beslutsförfarandena samt vissa tekniska ändringar som gäller ordalydelser.
I artikel 94 (blivande artikel 114) bestäms om åtgärder för upprättande av den inre marknaden och för dess funktion för att harmonisera lagstiftningen i medlemsstaterna. Artikeln motsvarar med undantag av individualiseringen av rättsaktsinstrumenten artikel III-172 i det konstitutionella fördraget och ersätter artikel 95 i EG-fördraget med följande ändringar. Till artikel 94.4 och 94.5 i EUF-fördraget fogas hänvisningar till Europaparlamentet som en lagstiftare.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
***
Before I leave the reader to study the substance of Article 114 TFEU, to say nothing about the substantive harmonisation measures, I would like to point out the scope of the Article.
First, the objectives mentioned at the beginning of this article merit a glance at Article 26 TFEU (OJ 9.5.2008 C 115/59, the consolidated version):
TITLE I
THE INTERNAL MARKET
Article 26 TFEU
(ex Article 14 TEC)
1. The Union shall adopt measures with the aim of establishing or ensuring the functioning of the internal market, in accordance with the relevant provisions of the Treaties.
2. The internal market shall comprise an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured in accordance with the provisions of the Treaties.
3. The Council, on a proposal from the Commission, shall determine the guidelines and conditions necessary to ensure balanced progress in all the sectors concerned.
***
The second important feature is the delimitation of the scope, in paragraph 2. Fiscal (tax) provisions, those relating to the free movement of persons and those relating to the rights and interests of employed persons are expressly excluded.
Ralf Grahn
Monday, 9 June 2008
EU TFEU: Tax harmonisation III
On the face of it, this could look like a road less travelled, for legal historians mainly, but the Irish referendum debate has unearthed confusions all of its own.
What did the European Convention propose with regard to harmonising taxes, and what happened to these proposals during the intergovernmental conference (IGC 2004), which led to the Treaty establishing a Constitution for Europe?
This third question and post may shed some additional light on the tensions and the exertions in the field of European taxation.
***
The European Convention, the closest thing to a constituent assembly EU citizens have had, located the provisions on tax legislation in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
There are two Articles, III-62 and III-63, of relevance in the draft Treaty establishing a Constitution for Europe (OJ 18.7.2003 C 169/38):
Article III-62 Draft Constitution
1. A European law or framework law of the Council of Ministers shall lay down measures for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation provided that such harmonisation is necessary for the functioning of the internal market and to avoid distortion of competition. The Council of Ministers shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
2. Where the Council of Ministers, acting unanimously on a proposal from the Commission, finds that the measures referred to in paragraph 1 relate to administrative cooperation or to combating tax fraud and tax evasion, it shall act, notwithstanding paragraph 1, by a qualified majority when adopting the European law or framework law adopting these measures.
Article III-63 Draft Constitution
Where the Council of Ministers, acting unanimously on a proposal from the Commission, finds that measures on company taxation relate to administrative cooperation or combating tax fraud and tax evasion, it shall adopt, by a qualified majority, a European law or framework law laying down these measures, provided that they are necessary for the functioning of the internal market and to avoid distortion of competition.
That law or framework law shall be adopted after consultation of the European Parliament and the Economic and Social Committee.
***
Two contributions illustrate the forces at work at the European Convention, which changed in tenor from a constituent assembly of parliamentarians and government representatives into a preliminary intergovernmental conference during the later stages.
The French-German contribution on Economic Governance (CONV 470/02) included a section ‘3) Finalising the internal market by achieving genuine convergence of taxation’. France and Germany did not propose the wholesale scrapping of veto powers, but they presented a selective, although fairly long, list of problem areas (page 4).
They reiterated their common position on a broader use of a qualified majority vote for the tax issues directly related to the internal market, such as for the elimination of direct obstacles to the free movement of goods, persons, services or capital and, in particular, the prevention of situations involving discrimination, double taxation or double remission, for certain provisions for the harmonisation of turnover taxes and excise duties and cooperation between tax authorities, for combating fraud and tax evasion and for elimination of harmful tax competition.
Joschka Fischer and Dominique de Villepin added that it seems necessary to finalize the internal market, i.e. to limit existing divergences between taxation in the member states and to eliminate harmful tax regimes. In addition, the concluded, the most pragmatic and the most efficient medium-term approach to the creation of a single Europe is to fix a policy convergence objective focusing efforts on a number of key tax issues.
***
Through Peter Hain, Lena Hjelm-Wallen and fourteen others, the opposing view was tabled. The contribution (CONV 782/03) recognised that there could be a case for appropriate and effective European Union action in the area of administrative cooperation and in the area of tax fraud. However, measures in these areas must be decided by unanimity (page 1).
The opposing group (of member states) was ready to accept the first paragraph of the then Article III.59 of the Praesidium’s proposal, but suggested the deletion of paragraph 2 and of Article III.60.
***
The compromise or consensus view of the European Convention (above), in essence, added the words ‘and to avoid distortion of competition’ to the grounds for legislation in Article 93 TEC, in what became Article III-62(1) of the draft Constitution concerning indirect taxation.
The new Article III-62(2) incorporated something of the French and German proposal in a novel two stage procedure. First, the Council would rule by unanimity that a legislative proposal related to administrative cooperation or to combating tax fraud and tax evasion. After that, the Council could act, notwithstanding paragraph 1, by a qualified majority when adopting the European law or framework law adopting these measures.
Certain aspects of company taxation were addressed in the following Article. The new Article III-63 proposed a similar procedure for measures on company taxation relating to administrative cooperation or combating tax fraud and tax evasion. The first finding had to be unanimous, but then the measures could be decided by qualified majority, provided that they are necessary for the functioning of the internal market and to avoid distortion of competition.
***
Étienne de Poncins commented on the forces for QMV and the meagre results of the European Convention in ‘Vers une Constitution européenne’ (Éditions 10/18, 2003 ; pages 286–287):
« Commentaire : l’article 62 a été longuement débattu par la Convention. Une large majorité a plaidé pour l’application de la majorité à l’ensemble de l’article III-62. La Commission a notamment fait valoir que l’absence de règles minimales conduisait à une concurrence déloyale entre États membres en matière fiscale. De nombreux Conventionnels ont rappelé que l’unanimité conduisait à des accords minimaux à l’issue de débats et de procédures particulièrement longs se poursuivant sur de nombreuses années comme pour les directives TVA.
Aucune avancé n’a cependant été possible, les Britanniques, les Suédois et les Irlandais notamment ayant fait du statu quo un point majeur de leur position. Les tentatives et propositions de compromis pour élargir le champ d’application de la majorité qualifiée ont toutes été repoussées. À noter enfin au paragraphe 2 les mots « évasion fiscale illégale » et la procédure suivie, l’appréciation que la matière couverte entre dans le champ visé au paragraphe 2 se faisant à l’unanimité. »
***
Here are a few views on the results of the European Convention, ahead of the intergovernmental confrence (IGC 2003/2004), which led to the Constitutional Treaty.
United Kingdom
Prime Minister Tony Blair set out the UK position on the draft Constitution in the foreword to ‘A Constitutional Treaty for the EU – The British Approach to the European Union Intergovernmental Confrence 2003’ (Command Paper 5934, September), after welcoming the result (page 3):
“But the text is not perfect. Like many other Member States, there are some points in the Convention text which we will want to examine in more detail. And we could only accept a final text that made it clear that issues like tax, defence and foreign policy remain the province of the nation State.”
Point 66 on page 32 presented the view of the United Kingdom government on unanimity:
“66. But we will insist that unanimity remain for Treaty change; and in other areas of vital national interest such as tax, social security, defence, key areas of criminal procedural law and the system of own resources (the EU’s revenue-raising mechanism). Unanimity must remain the general rule for CFSP, as proposed in the final Convention text.”
***
Sweden
The government of Sweden stated that the Convention’s proposal is a good basis for the intergovernmental conference. In ‘Regeringens skrivelse 2003/04:13 Europeiska konventet om EU:s framtid’ (2 October 2003) the Swedish government added as an important point of departure that future decisions concerning taxes, defence policy and large areas of foreign policy are to be taken unanimously (page 7):
”En viktig utgångspunkt är att enhällighet i beslutsfattandet i rådet även i framtiden bör gälla beslut som rör skatter, försvarspolitik och stora delar av utrikespolitiken.”
The government later repeated the standpoint on levels of taxation, although it noted that the national tax authority (Riksskatteverket) favoured some flexibility concerning unanimity.
***
Finland
In ‘Valtioneuvoston selonteko eduskunnalle konventin tuloksista ja valmistautumisesta hallitusten väliseen konferenssiin’ (VNS 2/2003 vp), the Finnish government stated that the national participants in the Convention had proposed a move to qualified majority voting on issues regarding environment and energy taxes. The government noted that a substantial number of the delegates would have been ready to progress towards QMV in a limited way, but some member states had been totally opposed. The government found the end result acceptable (page 67):
” Sisämarkkinaluvussa on myös veroja ja maksuja koskeva jakso. Verotuksen osalta keskeisin kysymys konventissa oli siirtyminen määräenemmistöpäätöksentekoon. Suuri osa konventin jäsenistä olisi ollut valmis etenemään tässä rajatusti, esimerkiksi ympäristöverotuksen alalla, mutta muutamille jäsenvaltioille yksimielisyyden säilyttäminen verotuksessa oli täysin ehdoton vaatimus. Määräenemmistöpäätöksentekoa voidaan soveltaa ainoastaan hyväksyttäessä eurooppalakeja tai -puitelakeja jotka koskevat veronkiertoa ja veropetoksia koskevia hallinnollisia to imia. Suomen edustajat konventissa esittivät, että ympäristö- ja energiaverotuksen alalla tulisi siirtyä määräenemmistöpäätöksentekoon ministerineuvostossa.
Valtioneuvosto voi hyväksyä ehdotetut muutokset”.
***
IGC 2004
The intergovernmental conference 2003 failed, so it is more natural to speak about the IGC 2004. The Treaty establishing a Constitution for Europe was negotiated under Irish stewardship.
In essence, the Constitutional Treaty retained Article III-62(1) of the draft Constitution, but the second paragraph was deleted. Article III-171 closed the needle’s eye to QWV regarding TVA and other indirect taxes.
The IGC 2004 deleted Article III-63 on limited recourse to QWV regarding certain aspects of company tax, where the Council of Ministers, acting unanimously on a proposal from the Commission, could have found that measures on company taxation related to administrative cooperation or combating tax fraud and tax evasion, and it then could have adopted, by a qualified majority, a European law or framework law laying down these measures, provided that they were necessary for the functioning of the internal market and to avoid distortion of competition.
This left Article III-173 to cater to the needs of approximation (harmonisation) of fiscal provisions and rules relating to the free movement of persons or to those relating to the rights and interests of employed persons. These measures, including direct taxation such as company taxes, were subject to unanimous decisions by the Council.
Article III-171 Constitution
A European law or framework law of the Council shall establish measures for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation provided that such harmonisation is necessary to ensure the establishment and the functioning of the internal market and to avoid distortion of competition. The Council shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
Article III-173 Constitution
Without prejudice to Article III-172, a European framework law of the Council shall establish measures for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market. The Council shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
***
Almost a clean sweep for the no or unanimity camp, one could say. The preservation of the words ‘and to avoid distortion of competition’, in what was to become Article 113 TFEU (ex Article 93 TEC) on indirect taxes, may look like a poor consolation prize for the supporters of change.
Perhaps this background picture goes some way towards putting the Coughlan furore into perspective.
Next time, I am going to take ‘legally accurate’ with fourscore and seven pinches of salt, if I come across opinions from that quarter.
Ralf Grahn
What did the European Convention propose with regard to harmonising taxes, and what happened to these proposals during the intergovernmental conference (IGC 2004), which led to the Treaty establishing a Constitution for Europe?
This third question and post may shed some additional light on the tensions and the exertions in the field of European taxation.
***
The European Convention, the closest thing to a constituent assembly EU citizens have had, located the provisions on tax legislation in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
There are two Articles, III-62 and III-63, of relevance in the draft Treaty establishing a Constitution for Europe (OJ 18.7.2003 C 169/38):
Article III-62 Draft Constitution
1. A European law or framework law of the Council of Ministers shall lay down measures for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation provided that such harmonisation is necessary for the functioning of the internal market and to avoid distortion of competition. The Council of Ministers shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
2. Where the Council of Ministers, acting unanimously on a proposal from the Commission, finds that the measures referred to in paragraph 1 relate to administrative cooperation or to combating tax fraud and tax evasion, it shall act, notwithstanding paragraph 1, by a qualified majority when adopting the European law or framework law adopting these measures.
Article III-63 Draft Constitution
Where the Council of Ministers, acting unanimously on a proposal from the Commission, finds that measures on company taxation relate to administrative cooperation or combating tax fraud and tax evasion, it shall adopt, by a qualified majority, a European law or framework law laying down these measures, provided that they are necessary for the functioning of the internal market and to avoid distortion of competition.
That law or framework law shall be adopted after consultation of the European Parliament and the Economic and Social Committee.
***
Two contributions illustrate the forces at work at the European Convention, which changed in tenor from a constituent assembly of parliamentarians and government representatives into a preliminary intergovernmental conference during the later stages.
The French-German contribution on Economic Governance (CONV 470/02) included a section ‘3) Finalising the internal market by achieving genuine convergence of taxation’. France and Germany did not propose the wholesale scrapping of veto powers, but they presented a selective, although fairly long, list of problem areas (page 4).
They reiterated their common position on a broader use of a qualified majority vote for the tax issues directly related to the internal market, such as for the elimination of direct obstacles to the free movement of goods, persons, services or capital and, in particular, the prevention of situations involving discrimination, double taxation or double remission, for certain provisions for the harmonisation of turnover taxes and excise duties and cooperation between tax authorities, for combating fraud and tax evasion and for elimination of harmful tax competition.
Joschka Fischer and Dominique de Villepin added that it seems necessary to finalize the internal market, i.e. to limit existing divergences between taxation in the member states and to eliminate harmful tax regimes. In addition, the concluded, the most pragmatic and the most efficient medium-term approach to the creation of a single Europe is to fix a policy convergence objective focusing efforts on a number of key tax issues.
***
Through Peter Hain, Lena Hjelm-Wallen and fourteen others, the opposing view was tabled. The contribution (CONV 782/03) recognised that there could be a case for appropriate and effective European Union action in the area of administrative cooperation and in the area of tax fraud. However, measures in these areas must be decided by unanimity (page 1).
The opposing group (of member states) was ready to accept the first paragraph of the then Article III.59 of the Praesidium’s proposal, but suggested the deletion of paragraph 2 and of Article III.60.
***
The compromise or consensus view of the European Convention (above), in essence, added the words ‘and to avoid distortion of competition’ to the grounds for legislation in Article 93 TEC, in what became Article III-62(1) of the draft Constitution concerning indirect taxation.
The new Article III-62(2) incorporated something of the French and German proposal in a novel two stage procedure. First, the Council would rule by unanimity that a legislative proposal related to administrative cooperation or to combating tax fraud and tax evasion. After that, the Council could act, notwithstanding paragraph 1, by a qualified majority when adopting the European law or framework law adopting these measures.
Certain aspects of company taxation were addressed in the following Article. The new Article III-63 proposed a similar procedure for measures on company taxation relating to administrative cooperation or combating tax fraud and tax evasion. The first finding had to be unanimous, but then the measures could be decided by qualified majority, provided that they are necessary for the functioning of the internal market and to avoid distortion of competition.
***
Étienne de Poncins commented on the forces for QMV and the meagre results of the European Convention in ‘Vers une Constitution européenne’ (Éditions 10/18, 2003 ; pages 286–287):
« Commentaire : l’article 62 a été longuement débattu par la Convention. Une large majorité a plaidé pour l’application de la majorité à l’ensemble de l’article III-62. La Commission a notamment fait valoir que l’absence de règles minimales conduisait à une concurrence déloyale entre États membres en matière fiscale. De nombreux Conventionnels ont rappelé que l’unanimité conduisait à des accords minimaux à l’issue de débats et de procédures particulièrement longs se poursuivant sur de nombreuses années comme pour les directives TVA.
Aucune avancé n’a cependant été possible, les Britanniques, les Suédois et les Irlandais notamment ayant fait du statu quo un point majeur de leur position. Les tentatives et propositions de compromis pour élargir le champ d’application de la majorité qualifiée ont toutes été repoussées. À noter enfin au paragraphe 2 les mots « évasion fiscale illégale » et la procédure suivie, l’appréciation que la matière couverte entre dans le champ visé au paragraphe 2 se faisant à l’unanimité. »
***
Here are a few views on the results of the European Convention, ahead of the intergovernmental confrence (IGC 2003/2004), which led to the Constitutional Treaty.
United Kingdom
Prime Minister Tony Blair set out the UK position on the draft Constitution in the foreword to ‘A Constitutional Treaty for the EU – The British Approach to the European Union Intergovernmental Confrence 2003’ (Command Paper 5934, September), after welcoming the result (page 3):
“But the text is not perfect. Like many other Member States, there are some points in the Convention text which we will want to examine in more detail. And we could only accept a final text that made it clear that issues like tax, defence and foreign policy remain the province of the nation State.”
Point 66 on page 32 presented the view of the United Kingdom government on unanimity:
“66. But we will insist that unanimity remain for Treaty change; and in other areas of vital national interest such as tax, social security, defence, key areas of criminal procedural law and the system of own resources (the EU’s revenue-raising mechanism). Unanimity must remain the general rule for CFSP, as proposed in the final Convention text.”
***
Sweden
The government of Sweden stated that the Convention’s proposal is a good basis for the intergovernmental conference. In ‘Regeringens skrivelse 2003/04:13 Europeiska konventet om EU:s framtid’ (2 October 2003) the Swedish government added as an important point of departure that future decisions concerning taxes, defence policy and large areas of foreign policy are to be taken unanimously (page 7):
”En viktig utgångspunkt är att enhällighet i beslutsfattandet i rådet även i framtiden bör gälla beslut som rör skatter, försvarspolitik och stora delar av utrikespolitiken.”
The government later repeated the standpoint on levels of taxation, although it noted that the national tax authority (Riksskatteverket) favoured some flexibility concerning unanimity.
***
Finland
In ‘Valtioneuvoston selonteko eduskunnalle konventin tuloksista ja valmistautumisesta hallitusten väliseen konferenssiin’ (VNS 2/2003 vp), the Finnish government stated that the national participants in the Convention had proposed a move to qualified majority voting on issues regarding environment and energy taxes. The government noted that a substantial number of the delegates would have been ready to progress towards QMV in a limited way, but some member states had been totally opposed. The government found the end result acceptable (page 67):
” Sisämarkkinaluvussa on myös veroja ja maksuja koskeva jakso. Verotuksen osalta keskeisin kysymys konventissa oli siirtyminen määräenemmistöpäätöksentekoon. Suuri osa konventin jäsenistä olisi ollut valmis etenemään tässä rajatusti, esimerkiksi ympäristöverotuksen alalla, mutta muutamille jäsenvaltioille yksimielisyyden säilyttäminen verotuksessa oli täysin ehdoton vaatimus. Määräenemmistöpäätöksentekoa voidaan soveltaa ainoastaan hyväksyttäessä eurooppalakeja tai -puitelakeja jotka koskevat veronkiertoa ja veropetoksia koskevia hallinnollisia to imia. Suomen edustajat konventissa esittivät, että ympäristö- ja energiaverotuksen alalla tulisi siirtyä määräenemmistöpäätöksentekoon ministerineuvostossa.
Valtioneuvosto voi hyväksyä ehdotetut muutokset”.
***
IGC 2004
The intergovernmental conference 2003 failed, so it is more natural to speak about the IGC 2004. The Treaty establishing a Constitution for Europe was negotiated under Irish stewardship.
In essence, the Constitutional Treaty retained Article III-62(1) of the draft Constitution, but the second paragraph was deleted. Article III-171 closed the needle’s eye to QWV regarding TVA and other indirect taxes.
The IGC 2004 deleted Article III-63 on limited recourse to QWV regarding certain aspects of company tax, where the Council of Ministers, acting unanimously on a proposal from the Commission, could have found that measures on company taxation related to administrative cooperation or combating tax fraud and tax evasion, and it then could have adopted, by a qualified majority, a European law or framework law laying down these measures, provided that they were necessary for the functioning of the internal market and to avoid distortion of competition.
This left Article III-173 to cater to the needs of approximation (harmonisation) of fiscal provisions and rules relating to the free movement of persons or to those relating to the rights and interests of employed persons. These measures, including direct taxation such as company taxes, were subject to unanimous decisions by the Council.
Article III-171 Constitution
A European law or framework law of the Council shall establish measures for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation provided that such harmonisation is necessary to ensure the establishment and the functioning of the internal market and to avoid distortion of competition. The Council shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
Article III-173 Constitution
Without prejudice to Article III-172, a European framework law of the Council shall establish measures for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market. The Council shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
***
Almost a clean sweep for the no or unanimity camp, one could say. The preservation of the words ‘and to avoid distortion of competition’, in what was to become Article 113 TFEU (ex Article 93 TEC) on indirect taxes, may look like a poor consolation prize for the supporters of change.
Perhaps this background picture goes some way towards putting the Coughlan furore into perspective.
Next time, I am going to take ‘legally accurate’ with fourscore and seven pinches of salt, if I come across opinions from that quarter.
Ralf Grahn
Sunday, 8 June 2008
EU TFEU: Tax harmonisation II
Is Article 113 of the Treaty on the Functioning of the European Union (TFEU) concerned only with indirect taxation, not direct taxation like company tax or income tax?
Are the words added by the EU Treaty of Lisbon (ToL) – and to avoid distortion of competition – a fairly innocuous clarification or even an additional requirement for new tax legislation, or are the sappers at work, undermining the castle walls?
What did the European Convention propose with regard to harmonising taxes, and what happened to these proposals during the intergovernmental conference (IGC 2004), which led to the Treaty establishing a Constitution for Europe?
The first post, EU TFEU: Tax harmonisation I, mapped the road of the provisions on EU tax legislation from Article 93 on the Treaty establishing the European Community (TEC), through the draft Constitution and the Constitutional Treaty, to the Treaty of Lisbon and the consolidated version of the amended EU treaties.
We checked the Lisbon Treaty amendments against our usual sample of the best general comments on the new treaty. The selected documents gave little cause to become wrought up, but something seems to have been afoot, so there seemed to be cause to double-check.
The fate of the Convention’s proposals looked intriguing, but this may require a post of its own.
This left us with the first two questions above. Let us start on the first one.
***
Direct or indirect taxation?
My preliminary reading of Article 113 TFEU (Article 93 TEC) led me to believe that its scope was restricted to various forms of indirect taxes. That was my understanding of ‘turnover taxes, excise duties and other forms of indirect taxation’.
This was substantiated by the UK House of Commons Library Research Paper 07/86, which presented a number of examples of such indirect taxes. This was further corroborated by the draft ratification bill of the Swedish government ‘Lagrådsremiss – Lissabonfördraget’, which mentioned turnover taxes (VAT type taxes), selective purchase taxes and other indirect taxes or charges in the internal market.
The Finnish government’s ratification bill spoke of the harmonisation of indirect taxation, but had I not concluded in my 6 June 2008 post ‘EU TFEU: Prohibited remissions, repayments and countervailing charges’ that the drafters seemed to have confused direct and indirect taxes (the first direct mistake I have encountered)? Surely an additional reason to check again, in spite of the evidence at hand? So I did reread my sources.
***
In addition, flying in the face of these sober assessments, assertions to the contrary abound. Here are a few from Ireland, mainly emanating from or echoing Anthony Coughlan, and branded ‘legally accurate’:
Free Europe “Harmonizing Company taxes in the EU – The Lisbon Treaty amendment to Article 113: a significant and virtually ignored amendment affecting Ireland’s company tax”
The National Platform EU Research & Information Centre “EU Misinformation: Barroso, Bonde and Ireland’s company taxes”
The National Platform EU Research & Information Centre “Lisbon Treaty: Mandatory Tax Harmonisation”
Bruce Arnold “Yes vote would open way for Europe to outlaw our low tax” (Independent.ie)
Irish Issues . org “Treaty amendment on EU harmonized taxes”
Citizens’ European Movement Network “Tax & Investment”
***
These ‘legally accurate’ allegations, variations on the same theme, seem to require a logic of its own kind to concoct (and to follow).
Naturally, it is easy to assert that few EU leaders have been inventive enough to trumpet the consequences for company taxes (direct taxes) of an Article and an amendment concerning VAT and other indirect taxes. Because the Commission or the responsible national leaders have not discussed pears in the context of apples, it has been easy to brand this lack of communication as a conspiracy, misleading the public, not to mention the worst allegations.
Suddenly, an Article on harmonisation of indirect taxation would open the doors to force Ireland to scrap its low corporate tax (direct taxation).
This is nonsense.
***
What does the amendment mean?
The amendment – ‘and to avoid distortion of competition’ – was described by the Swedish government as a clarification and by the Finnish government as an additional requirement.
Neither sheds more light on the meaning of the added words, and I remain in some doubt about how they should be interpreted. On the face of it, joining ‘necessary to ensure’ with an additional ‘AND to avoid’ reads like an additional requirement, in other words one hurdle more.
If the drafters wanted to open up an alternative base for legislation, they should have said ‘OR to avoid distortion of competition’).
But the added words appear in the context of ‘the establishment and the functioning of the internal market’, of which undistorted competition is a fundamental aspect.
Therefore, it may be reasonable to understand the added words as an effort to underline one aspect of a functioning internal market, thereby giving it more visibility and some added weight.
In other words, this aspect may be brought to light when the Commission prepares proposals in the area of VAT, excise duties and other indirect taxes, and the Court of Justice may be called upon to interpret the provision.
But it has nothing to do with company tax or other direct taxes.
***
The texts of the detractors make for confusing reading. Shortly, the ‘truths’ first trumpeted are abandoned in favour of a new line. Even if the Article 113 TFEU is restricted to indirect taxation and the unanimity requirement is preserved, the European Commission and the Court of Justice of the European Union could possibly somehow circumvent the whole provision by applying the rules on undistorted competition in the internal market in order to erode Ireland’s low rate of corporate tax. The chain between the amendment and the allegations is broken, because all of a sudden a new set of rules is called into play.
How could the Court of Justice enter into this? Does Article 113 TFEU bear any of the hallmarks of a directly applicable treaty provision? Is the Article clear, precise and unconditional, in order to have direct effect?
The answer is no. It offers a base for secondary legislation on VAT and other indirect taxes, requiring unanimous decisions by the Council.
With or without the Lisbon Treaty, the Court of Justice will have to assess and to demarcate areas of competence described in general terms, and to find the predominant features in a specific case. Situations leading to future court cases are hard to predict, and the outcomes are going to be based on the facts of the individual cases.
***
An outside observer would expect the representative business interests of a member state threatened by erosion of its favourable company tax to be up in arms at the least hint. What does IBEC (Irish Business and Employers Confederation) say about the Lisbon Treaty?
In short, Irish business supports the Lisbon Treaty, vote yes. All EU member states remain free to determine their own policies regarding taxation and foreign direct investment. No change can be made in the area of taxation without the approval of all member states, including Ireland.
***
For reasonable people – but only for them – this should put the allegations concerning Article 113 TFEU to rest.
***
Direct taxation
Back to the difference between indirect and direct taxation. There is no explicit treaty provision on the harmonisation of legislation on direct taxes, but the current Article 94 TEC allows unanimous directives for the approximation (harmonisation) of laws, regulations and administrative practices which directly affect the establishment or functioning of the common market. With cosmetic change, this will become Article 115 TFEU, and it will continue to be the legal base for harmonising direct taxes.
Why were the allegations mentioned above based on the wrong Article?
***
Pressures
As far as I understand, the position of the member states, including Ireland, in matters of EU harmonisation of indirect taxes does not change at all or only marginally as a result of the Treaty of Lisbon.
There has been and will continue to be political pressure towards elimination of tax obstacles in the internal market and against harmful tax competition. The European Commission has tried to convince the member states to move from unanimity to qualified majority voting, at least in some fiscal matters, but it has failed to move them.
The Commission has presented reasons for a single consolidated tax base for companies with EU activities, and it may dream of future harmonised company tax rates, but very little will probably happen as long as the unanimity rule stands.
Critical voices, sometimes even strident ones, from some member states have shown the existing tensions between countries with different levels of taxes for companies and capital. Member states with high taxes tend to see low rates as unfair competition.
Harmonising taxes, especially direct taxes, has been a frustrating field of endeavour for the Commission. Little progress has been possible, but the Commission has been able to investigate and to define tax arrangements seen to be unfair or distorting. Here is an opportunity for those who want to dig deeper, preferably with a cool head.
***
The history of European integration shows how decisive the shift from unanimity rule to qualified majority voting has been in order to achieve results. To name just one example, without the Single European Act there would still be mainly the idea of a common market, not the reality of a working internal market, in spite of its shortcomings.
The general European interest would be better served by fewer areas hampered by veto powers, but the reality is that our common mansion continues to be a house of cards in the fields where unanimity rules, and the deepening of European integration is a long term project.
***
What did the European Convention propose with regard to harmonising taxes, and what happened to these proposals during the intergovernmental conference (IGC 2004), which led to the Treaty establishing a Constitution for Europe?
The third question and post may shed some additional light on the tensions and the exertions in the field of European taxation.
Ralf Grahn
Are the words added by the EU Treaty of Lisbon (ToL) – and to avoid distortion of competition – a fairly innocuous clarification or even an additional requirement for new tax legislation, or are the sappers at work, undermining the castle walls?
What did the European Convention propose with regard to harmonising taxes, and what happened to these proposals during the intergovernmental conference (IGC 2004), which led to the Treaty establishing a Constitution for Europe?
The first post, EU TFEU: Tax harmonisation I, mapped the road of the provisions on EU tax legislation from Article 93 on the Treaty establishing the European Community (TEC), through the draft Constitution and the Constitutional Treaty, to the Treaty of Lisbon and the consolidated version of the amended EU treaties.
We checked the Lisbon Treaty amendments against our usual sample of the best general comments on the new treaty. The selected documents gave little cause to become wrought up, but something seems to have been afoot, so there seemed to be cause to double-check.
The fate of the Convention’s proposals looked intriguing, but this may require a post of its own.
This left us with the first two questions above. Let us start on the first one.
***
Direct or indirect taxation?
My preliminary reading of Article 113 TFEU (Article 93 TEC) led me to believe that its scope was restricted to various forms of indirect taxes. That was my understanding of ‘turnover taxes, excise duties and other forms of indirect taxation’.
This was substantiated by the UK House of Commons Library Research Paper 07/86, which presented a number of examples of such indirect taxes. This was further corroborated by the draft ratification bill of the Swedish government ‘Lagrådsremiss – Lissabonfördraget’, which mentioned turnover taxes (VAT type taxes), selective purchase taxes and other indirect taxes or charges in the internal market.
The Finnish government’s ratification bill spoke of the harmonisation of indirect taxation, but had I not concluded in my 6 June 2008 post ‘EU TFEU: Prohibited remissions, repayments and countervailing charges’ that the drafters seemed to have confused direct and indirect taxes (the first direct mistake I have encountered)? Surely an additional reason to check again, in spite of the evidence at hand? So I did reread my sources.
***
In addition, flying in the face of these sober assessments, assertions to the contrary abound. Here are a few from Ireland, mainly emanating from or echoing Anthony Coughlan, and branded ‘legally accurate’:
Free Europe “Harmonizing Company taxes in the EU – The Lisbon Treaty amendment to Article 113: a significant and virtually ignored amendment affecting Ireland’s company tax”
The National Platform EU Research & Information Centre “EU Misinformation: Barroso, Bonde and Ireland’s company taxes”
The National Platform EU Research & Information Centre “Lisbon Treaty: Mandatory Tax Harmonisation”
Bruce Arnold “Yes vote would open way for Europe to outlaw our low tax” (Independent.ie)
Irish Issues . org “Treaty amendment on EU harmonized taxes”
Citizens’ European Movement Network “Tax & Investment”
***
These ‘legally accurate’ allegations, variations on the same theme, seem to require a logic of its own kind to concoct (and to follow).
Naturally, it is easy to assert that few EU leaders have been inventive enough to trumpet the consequences for company taxes (direct taxes) of an Article and an amendment concerning VAT and other indirect taxes. Because the Commission or the responsible national leaders have not discussed pears in the context of apples, it has been easy to brand this lack of communication as a conspiracy, misleading the public, not to mention the worst allegations.
Suddenly, an Article on harmonisation of indirect taxation would open the doors to force Ireland to scrap its low corporate tax (direct taxation).
This is nonsense.
***
What does the amendment mean?
The amendment – ‘and to avoid distortion of competition’ – was described by the Swedish government as a clarification and by the Finnish government as an additional requirement.
Neither sheds more light on the meaning of the added words, and I remain in some doubt about how they should be interpreted. On the face of it, joining ‘necessary to ensure’ with an additional ‘AND to avoid’ reads like an additional requirement, in other words one hurdle more.
If the drafters wanted to open up an alternative base for legislation, they should have said ‘OR to avoid distortion of competition’).
But the added words appear in the context of ‘the establishment and the functioning of the internal market’, of which undistorted competition is a fundamental aspect.
Therefore, it may be reasonable to understand the added words as an effort to underline one aspect of a functioning internal market, thereby giving it more visibility and some added weight.
In other words, this aspect may be brought to light when the Commission prepares proposals in the area of VAT, excise duties and other indirect taxes, and the Court of Justice may be called upon to interpret the provision.
But it has nothing to do with company tax or other direct taxes.
***
The texts of the detractors make for confusing reading. Shortly, the ‘truths’ first trumpeted are abandoned in favour of a new line. Even if the Article 113 TFEU is restricted to indirect taxation and the unanimity requirement is preserved, the European Commission and the Court of Justice of the European Union could possibly somehow circumvent the whole provision by applying the rules on undistorted competition in the internal market in order to erode Ireland’s low rate of corporate tax. The chain between the amendment and the allegations is broken, because all of a sudden a new set of rules is called into play.
How could the Court of Justice enter into this? Does Article 113 TFEU bear any of the hallmarks of a directly applicable treaty provision? Is the Article clear, precise and unconditional, in order to have direct effect?
The answer is no. It offers a base for secondary legislation on VAT and other indirect taxes, requiring unanimous decisions by the Council.
With or without the Lisbon Treaty, the Court of Justice will have to assess and to demarcate areas of competence described in general terms, and to find the predominant features in a specific case. Situations leading to future court cases are hard to predict, and the outcomes are going to be based on the facts of the individual cases.
***
An outside observer would expect the representative business interests of a member state threatened by erosion of its favourable company tax to be up in arms at the least hint. What does IBEC (Irish Business and Employers Confederation) say about the Lisbon Treaty?
In short, Irish business supports the Lisbon Treaty, vote yes. All EU member states remain free to determine their own policies regarding taxation and foreign direct investment. No change can be made in the area of taxation without the approval of all member states, including Ireland.
***
For reasonable people – but only for them – this should put the allegations concerning Article 113 TFEU to rest.
***
Direct taxation
Back to the difference between indirect and direct taxation. There is no explicit treaty provision on the harmonisation of legislation on direct taxes, but the current Article 94 TEC allows unanimous directives for the approximation (harmonisation) of laws, regulations and administrative practices which directly affect the establishment or functioning of the common market. With cosmetic change, this will become Article 115 TFEU, and it will continue to be the legal base for harmonising direct taxes.
Why were the allegations mentioned above based on the wrong Article?
***
Pressures
As far as I understand, the position of the member states, including Ireland, in matters of EU harmonisation of indirect taxes does not change at all or only marginally as a result of the Treaty of Lisbon.
There has been and will continue to be political pressure towards elimination of tax obstacles in the internal market and against harmful tax competition. The European Commission has tried to convince the member states to move from unanimity to qualified majority voting, at least in some fiscal matters, but it has failed to move them.
The Commission has presented reasons for a single consolidated tax base for companies with EU activities, and it may dream of future harmonised company tax rates, but very little will probably happen as long as the unanimity rule stands.
Critical voices, sometimes even strident ones, from some member states have shown the existing tensions between countries with different levels of taxes for companies and capital. Member states with high taxes tend to see low rates as unfair competition.
Harmonising taxes, especially direct taxes, has been a frustrating field of endeavour for the Commission. Little progress has been possible, but the Commission has been able to investigate and to define tax arrangements seen to be unfair or distorting. Here is an opportunity for those who want to dig deeper, preferably with a cool head.
***
The history of European integration shows how decisive the shift from unanimity rule to qualified majority voting has been in order to achieve results. To name just one example, without the Single European Act there would still be mainly the idea of a common market, not the reality of a working internal market, in spite of its shortcomings.
The general European interest would be better served by fewer areas hampered by veto powers, but the reality is that our common mansion continues to be a house of cards in the fields where unanimity rules, and the deepening of European integration is a long term project.
***
What did the European Convention propose with regard to harmonising taxes, and what happened to these proposals during the intergovernmental conference (IGC 2004), which led to the Treaty establishing a Constitution for Europe?
The third question and post may shed some additional light on the tensions and the exertions in the field of European taxation.
Ralf Grahn
Saturday, 7 June 2008
EU TFEU: Tax harmonisation I
What does the EU Treaty of Lisbon say about harmonisation of tax law? This post looks at the various stages of the treaty reform process and it refers to a sample of the best available general descriptions of the amending treaties.
After this factual exploration, a second post will take a closer look at what to some seem to be unclear points. At the same time, we will take a peek at some wider issues of tax harmonisation, brought to (relative) light during the long reform process.
***
Article 113 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/94:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 113 TFEU
(ex Article 93 TEC)
The Council shall, acting unanimously in accordance with a special legislative procedure and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market and to avoid distortion of competition.
***
In Article 2, point 79 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 93 of the Treaty establishing the European Community (TEC). See OJ 17.12.2007 C 306/69, which says:
TAX PROVISIONS
79) At the end of Article 93, the words ‘within the time limit laid down in Article 14’ shall be
replaced by ‘and to avoid distortion of competition.’.
***
The TFEU table of equivalences tells us that Article 93 TEC first became Article 93 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 113 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 93 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
When we compare the current Article 93 TEC with the proposed Article 113 TFEU, we notice two specific amendments, which follow directly from the Treaty of Lisbon (above).
The first specific amendment: the disappearance of the words ‘within the time limit laid down in Article 14’, redundant because it refers to the progressive establishment of the internal market by 31 December 1992.
The second specific Lisbon Treaty amendment to the current TEC is the addition of the words ‘and to avoid distortion of competition’ in the liberated slot at the end of the sentence.
The third difference between the TFEU and the TEC follows from the general choices of terminology for the Lisbon Treaty. Horizontal amendment 3 says that in a number of Articles, among these Article 93 TEC, the words ‘acting unanimously on a proposal from the Commission’ shall be replaced by ‘acting unanimously in accordance with a special legislative procedure’ (OJ 17.12.2007 C 306/42).
These are things we can keep in mind, when we look at the wording of Article 93 TEC, currently in force:
Article 93 TEC
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14.
***
We have now seen the small differences between Article 93 TEC in force and Article 113 TFUE .
For the sake of systematic comparison, we look at the provisions on tax harmonisation during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The provisions on tax legislation are located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
There are two Articles, III-62 and III-63, of relevance in the draft Treaty establishing a Constitution for Europe. For now, let the contents speak for themselves (OJ 18.7.2003 C 169/38):
Article III-62 Draft Constitution
1. A European law or framework law of the Council of Ministers shall lay down measures for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation provided that such harmonisation is necessary for the functioning of the internal market and to avoid distortion of competition. The Council of Ministers shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
2. Where the Council of Ministers, acting unanimously on a proposal from the Commission, finds that the measures referred to in paragraph 1 relate to administrative cooperation or to combating tax fraud and tax evasion, it shall act, notwithstanding paragraph 1, by a qualified majority when adopting the European law or framework law adopting these measures.
Article III-63 Draft Constitution
Where the Council of Ministers, acting unanimously on a proposal from the Commission, finds that measures on company taxation relate to administrative cooperation or combating tax fraud and tax evasion, it shall adopt, by a qualified majority, a European law or framework law laying down these measures, provided that they are necessary for the functioning of the internal market and to avoid distortion of competition.
That law or framework law shall be adopted after consultation of the European Parliament and the Economic and Social Committee.
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
As compared with the draft Constitution, the IGC 2004 shortened the end of the section with fiscal provisions by leaving just an Article III-171 at the end (OJ 16.12.2004 C 310/73):
Article III-171 Constitution
A European law or framework law of the Council shall establish measures for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation provided that such harmonisation is necessary to ensure the establishment and the functioning of the internal market and to avoid distortion of competition. The Council shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
***
This far, we have been able to see real aspirations to change the provisions on the harmonisation of taxes during the European Convention and the return to the narrower view from the Constitutional Treaty onwards.
This opens up an interesting second level of inquiry, but let us first follow our standard mode of operation, which is based upon a sample of more or less official documents focused on the similarities and differences between the existing treaties and the proposed Lisbon Treaty.
What has been said about Article 113 TFEU, with regard to the current Article 93 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers highlighted the changes to Article 93 TEC and TFEU (ToL), to be renumbered Article 113 TFEU in the consolidated version, without comment (page 29).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 113 TFEU, Article 93 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Draws on Article 93 TEC. The explicit reference to distortion of competition is new, and the reference to the 1992 deadline is removed.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Here is the introductory text on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 113 TFEU (Article 93 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments for anyone interested, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. It has since become my standard reference.
The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL), with the added words presented within quotation marks, but with no comment other than the description as a ‘clarification’ (förtydligande):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Provisions on taxes and charges (Veroja ja maksuja koskevat määräykset), offers a statement on Article 93 TFEU (ToL), the future Article 113 TFEU. The essential concordance of this provision on indirect taxation with the current TEC and the Constitutional Treaty is noted. Deleting the deadline and the added requirement to avoid distortion of competition are presented as the only changes (page 208):
”93 artikla (uusi 113 artikla), joka koskee neuvoston toimivaltaa antaa säännöksiä välillistä verotusta koskevan lainsäädännön yhdenmukaistamiseksi, vastaa SEY 93 artiklaa ja perustuslakisopimuksen III-171 artiklaa. Ainoina muutoksina nykyiseen verrattuna on SEY 14 artiklan mukaisen määräajan poistaminen ja se, että lauseeseen, jonka mukaan säännöksiä annetaan tarvittaessa sisämarkkinoiden toimivuuden takaamiseksi, lisätään lisäedellytykseksi myös kilpailun vääristymisen välttäminen.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remarks under ’Bestämmelser om skatter och avgifter’ on Article 93 TFEU (ToL), the future Article 113 TFEU, on page 211:
”Artikel 93 (blivande artikel 113), som gäller rådets befogenheter att anta bestämmelser om harmonisering av lagstiftningen om indirekta skatter, motsvarar artikel 93 i EGfördraget och artikel III-171 i det konstitutionella fördraget. Den enda ändringen jämfört med nuläget är att tidsfristen enligt artikel 14 i EG-fördraget stryks och att till satsen, enligt vilken bestämmelser vid behov kan antas för att säkerställa att den inre marknaden fungerar, fogas som tilläggsvillkor även för att undvika snedvridning av konkurrensen.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
My comment: At this stage, take notice of two things. First, Article 113 TFEU has been charaterised as a provision on different forms of indirect (not direct) taxation. The added words ‘and to avoid distortion of competition’ have been described as a clarification or as an added requirement.
But I have understood that Article 113 TFEU has been a fountain for much debate (more or less factual). In a wider context, the proposals of the European Convention and their fate during the IGC 2004 are intriguing. Both seem to call for a second posting on the subject of EU tax harmonisation.
Ralf Grahn
After this factual exploration, a second post will take a closer look at what to some seem to be unclear points. At the same time, we will take a peek at some wider issues of tax harmonisation, brought to (relative) light during the long reform process.
***
Article 113 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/94:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 113 TFEU
(ex Article 93 TEC)
The Council shall, acting unanimously in accordance with a special legislative procedure and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market and to avoid distortion of competition.
***
In Article 2, point 79 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 93 of the Treaty establishing the European Community (TEC). See OJ 17.12.2007 C 306/69, which says:
TAX PROVISIONS
79) At the end of Article 93, the words ‘within the time limit laid down in Article 14’ shall be
replaced by ‘and to avoid distortion of competition.’.
***
The TFEU table of equivalences tells us that Article 93 TEC first became Article 93 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 113 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 93 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
When we compare the current Article 93 TEC with the proposed Article 113 TFEU, we notice two specific amendments, which follow directly from the Treaty of Lisbon (above).
The first specific amendment: the disappearance of the words ‘within the time limit laid down in Article 14’, redundant because it refers to the progressive establishment of the internal market by 31 December 1992.
The second specific Lisbon Treaty amendment to the current TEC is the addition of the words ‘and to avoid distortion of competition’ in the liberated slot at the end of the sentence.
The third difference between the TFEU and the TEC follows from the general choices of terminology for the Lisbon Treaty. Horizontal amendment 3 says that in a number of Articles, among these Article 93 TEC, the words ‘acting unanimously on a proposal from the Commission’ shall be replaced by ‘acting unanimously in accordance with a special legislative procedure’ (OJ 17.12.2007 C 306/42).
These are things we can keep in mind, when we look at the wording of Article 93 TEC, currently in force:
Article 93 TEC
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14.
***
We have now seen the small differences between Article 93 TEC in force and Article 113 TFUE .
For the sake of systematic comparison, we look at the provisions on tax harmonisation during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The provisions on tax legislation are located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
There are two Articles, III-62 and III-63, of relevance in the draft Treaty establishing a Constitution for Europe. For now, let the contents speak for themselves (OJ 18.7.2003 C 169/38):
Article III-62 Draft Constitution
1. A European law or framework law of the Council of Ministers shall lay down measures for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation provided that such harmonisation is necessary for the functioning of the internal market and to avoid distortion of competition. The Council of Ministers shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
2. Where the Council of Ministers, acting unanimously on a proposal from the Commission, finds that the measures referred to in paragraph 1 relate to administrative cooperation or to combating tax fraud and tax evasion, it shall act, notwithstanding paragraph 1, by a qualified majority when adopting the European law or framework law adopting these measures.
Article III-63 Draft Constitution
Where the Council of Ministers, acting unanimously on a proposal from the Commission, finds that measures on company taxation relate to administrative cooperation or combating tax fraud and tax evasion, it shall adopt, by a qualified majority, a European law or framework law laying down these measures, provided that they are necessary for the functioning of the internal market and to avoid distortion of competition.
That law or framework law shall be adopted after consultation of the European Parliament and the Economic and Social Committee.
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
As compared with the draft Constitution, the IGC 2004 shortened the end of the section with fiscal provisions by leaving just an Article III-171 at the end (OJ 16.12.2004 C 310/73):
Article III-171 Constitution
A European law or framework law of the Council shall establish measures for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation provided that such harmonisation is necessary to ensure the establishment and the functioning of the internal market and to avoid distortion of competition. The Council shall act unanimously after consulting the European Parliament and the Economic and Social Committee.
***
This far, we have been able to see real aspirations to change the provisions on the harmonisation of taxes during the European Convention and the return to the narrower view from the Constitutional Treaty onwards.
This opens up an interesting second level of inquiry, but let us first follow our standard mode of operation, which is based upon a sample of more or less official documents focused on the similarities and differences between the existing treaties and the proposed Lisbon Treaty.
What has been said about Article 113 TFEU, with regard to the current Article 93 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers highlighted the changes to Article 93 TEC and TFEU (ToL), to be renumbered Article 113 TFEU in the consolidated version, without comment (page 29).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 113 TFEU, Article 93 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Draws on Article 93 TEC. The explicit reference to distortion of competition is new, and the reference to the 1992 deadline is removed.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Here is the introductory text on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 113 TFEU (Article 93 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments for anyone interested, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. It has since become my standard reference.
The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL), with the added words presented within quotation marks, but with no comment other than the description as a ‘clarification’ (förtydligande):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Provisions on taxes and charges (Veroja ja maksuja koskevat määräykset), offers a statement on Article 93 TFEU (ToL), the future Article 113 TFEU. The essential concordance of this provision on indirect taxation with the current TEC and the Constitutional Treaty is noted. Deleting the deadline and the added requirement to avoid distortion of competition are presented as the only changes (page 208):
”93 artikla (uusi 113 artikla), joka koskee neuvoston toimivaltaa antaa säännöksiä välillistä verotusta koskevan lainsäädännön yhdenmukaistamiseksi, vastaa SEY 93 artiklaa ja perustuslakisopimuksen III-171 artiklaa. Ainoina muutoksina nykyiseen verrattuna on SEY 14 artiklan mukaisen määräajan poistaminen ja se, että lauseeseen, jonka mukaan säännöksiä annetaan tarvittaessa sisämarkkinoiden toimivuuden takaamiseksi, lisätään lisäedellytykseksi myös kilpailun vääristymisen välttäminen.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remarks under ’Bestämmelser om skatter och avgifter’ on Article 93 TFEU (ToL), the future Article 113 TFEU, on page 211:
”Artikel 93 (blivande artikel 113), som gäller rådets befogenheter att anta bestämmelser om harmonisering av lagstiftningen om indirekta skatter, motsvarar artikel 93 i EGfördraget och artikel III-171 i det konstitutionella fördraget. Den enda ändringen jämfört med nuläget är att tidsfristen enligt artikel 14 i EG-fördraget stryks och att till satsen, enligt vilken bestämmelser vid behov kan antas för att säkerställa att den inre marknaden fungerar, fogas som tilläggsvillkor även för att undvika snedvridning av konkurrensen.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
My comment: At this stage, take notice of two things. First, Article 113 TFEU has been charaterised as a provision on different forms of indirect (not direct) taxation. The added words ‘and to avoid distortion of competition’ have been described as a clarification or as an added requirement.
But I have understood that Article 113 TFEU has been a fountain for much debate (more or less factual). In a wider context, the proposals of the European Convention and their fate during the IGC 2004 are intriguing. Both seem to call for a second posting on the subject of EU tax harmonisation.
Ralf Grahn
Friday, 6 June 2008
EU TFEU: Prohibited remissions, repayments and countervailing charges
According to Article 112 of the EU Treaty on the Functioning of the European Union (TFEU), the Council could, for a limited period, approve remissions and repayments in respect of exports to other member states or countervailing charges in respect of imports from member states. Otherwise they are prohibited.
As far as I know, exceptions concerning these forms of direct taxes on the basis of current Article 92 of the Treaty establishing the European Community (TEC) have never been granted, so the prohibition has stood unassailed.
***
Article 112 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 112 TFEU
(ex Article 92 TEC)
In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the measures contemplated have been previously approved for a limited period by the Council on a proposal from the Commission.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 92 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 92 TEC first became Article 92 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 112 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 92 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
Although thee was no specific amendment, we notice the disappearance of the words ‘acting by a qualified majority’ from Article 112 TFEU according to horizontal amendment 2(d) of Article 2 of the Treaty of Lisbon (OJ 17.12.2007 C 306/41), when we look at the wording of Article 92 TEC:
Article 92 TEC
In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the measures contemplated have been previously approved for a limited period by the Council acting by a qualified majority on a proposal from the Commission.
***
We have now seen that 92 TEC in force and 112 TFUE are the same, except for one horizontal amendment. .
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-61 of the draft Treaty establishing a Constitution for Europe differed from Article 92 TEC slightly, without altering the substance. The word ‘measures’ was replaced by ‘provisions’, the act of approval was categorised as ‘by a European decision’ and the draft Constitution consistently used ‘Council of Ministers’ instead of ‘Council’ (OJ 18.7.2003 C 169/38):
Article III-61 Draft Constitution
In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council of Ministers on a proposal from the Commission.
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
The IGC 2004 created Article III-170 with three paragraphs by housing Articles III-59, III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38).
Article III-170(3) of the Constitutional Treaty was the same as Article III-61 of the draft Constitution, except for the ‘Council’ reappearing in shorter form:
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about Article 112 TFEU, with the wording practically unchanged from the current Article 92 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 92 TEC and TFEU (ToL), to be renumbered Article 112 TFEU in the consolidated version, without comment (page 29).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 112 TFEU, Article 92 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 92 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Having found at least one general comment in English, we gratefully reproduce the text on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 112 TFEU (Article 92 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Provisions on taxes and charges (Veroja ja maksuja koskevat määräykset), offers a brief statement on the unchanged nature of Article 92 TFEU (ToL), renumbered Article 112 TFEU (page 208):
”92 artiklaa (uusi 112 artikla), jonka mukaan välillisistä veroista ei vapauteta tai niitä ei palauteta jäsenvaltiosta toiseen tapahtuvan maastaviennin yhteydessä ilman neuvoston määräaikaisia toimenpiteitä koskevaa päätöstä, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Bestämmelser om skatter och avgifter’ on the unchanged nature of Article 92 TFEU (ToL), the future Article 112 TFEU, on page 211:
”Artikel 92 (blivande artikel 112), enligt vilken befrielse och återbetalning i fråga om indirekta skatter vid export till andra medlemsstater inte får medges utan att rådet beslutar om åtgärder för en begränsad tid, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
My comment: Here the drafters of the Finnish government bill seem to have made a mistake, missing the meaning of ‘other than’ the forms of indirect taxation mentioned, which translates into charges of a direct, not an indirect, nature.
Ralf Grahn
As far as I know, exceptions concerning these forms of direct taxes on the basis of current Article 92 of the Treaty establishing the European Community (TEC) have never been granted, so the prohibition has stood unassailed.
***
Article 112 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 112 TFEU
(ex Article 92 TEC)
In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the measures contemplated have been previously approved for a limited period by the Council on a proposal from the Commission.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 92 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 92 TEC first became Article 92 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 112 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 92 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
Although thee was no specific amendment, we notice the disappearance of the words ‘acting by a qualified majority’ from Article 112 TFEU according to horizontal amendment 2(d) of Article 2 of the Treaty of Lisbon (OJ 17.12.2007 C 306/41), when we look at the wording of Article 92 TEC:
Article 92 TEC
In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the measures contemplated have been previously approved for a limited period by the Council acting by a qualified majority on a proposal from the Commission.
***
We have now seen that 92 TEC in force and 112 TFUE are the same, except for one horizontal amendment. .
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-61 of the draft Treaty establishing a Constitution for Europe differed from Article 92 TEC slightly, without altering the substance. The word ‘measures’ was replaced by ‘provisions’, the act of approval was categorised as ‘by a European decision’ and the draft Constitution consistently used ‘Council of Ministers’ instead of ‘Council’ (OJ 18.7.2003 C 169/38):
Article III-61 Draft Constitution
In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council of Ministers on a proposal from the Commission.
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
The IGC 2004 created Article III-170 with three paragraphs by housing Articles III-59, III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38).
Article III-170(3) of the Constitutional Treaty was the same as Article III-61 of the draft Constitution, except for the ‘Council’ reappearing in shorter form:
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about Article 112 TFEU, with the wording practically unchanged from the current Article 92 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 92 TEC and TFEU (ToL), to be renumbered Article 112 TFEU in the consolidated version, without comment (page 29).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 112 TFEU, Article 92 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 92 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Having found at least one general comment in English, we gratefully reproduce the text on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 112 TFEU (Article 92 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Provisions on taxes and charges (Veroja ja maksuja koskevat määräykset), offers a brief statement on the unchanged nature of Article 92 TFEU (ToL), renumbered Article 112 TFEU (page 208):
”92 artiklaa (uusi 112 artikla), jonka mukaan välillisistä veroista ei vapauteta tai niitä ei palauteta jäsenvaltiosta toiseen tapahtuvan maastaviennin yhteydessä ilman neuvoston määräaikaisia toimenpiteitä koskevaa päätöstä, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Bestämmelser om skatter och avgifter’ on the unchanged nature of Article 92 TFEU (ToL), the future Article 112 TFEU, on page 211:
”Artikel 92 (blivande artikel 112), enligt vilken befrielse och återbetalning i fråga om indirekta skatter vid export till andra medlemsstater inte får medges utan att rådet beslutar om åtgärder för en begränsad tid, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
My comment: Here the drafters of the Finnish government bill seem to have made a mistake, missing the meaning of ‘other than’ the forms of indirect taxation mentioned, which translates into charges of a direct, not an indirect, nature.
Ralf Grahn
Thursday, 5 June 2008
EU TFEU: Prohibited tax subsidies on exported goods
Article 110 of the Treaty on the Functioning of the European Union (TFEU) prohibits tax discrimination against products from other member states, and Article 111 offers a mirror view in that it forbids direct or indirect tax subsidies on products exported to another member state.
These rules apply within the internal market, but not in relation to third countries.
We look at the prohibition on tax subsidies for exports in the light of the EU Treaty of Lisbon.
***
Article 111 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 111 TFEU
(ex Article 91 TEC)
Where products are exported to the territory of any Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 91 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 91 TEC first became Article 91 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 111 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 91 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
No specific amendment and no horizontal amendment; the wording of Article 91 TEC is exactly the same as Article 111 TFEU.
***
We have now seen that 91 TEC in force and 111 TFUE are exactly the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-60 of the draft Treaty establishing a Constitution for Europe reworded Article 91 TEC slightly, without altering the substance (OJ 18.7.2003 C 169/37):
Article III-60 Draft Constitution
Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
The IGC 2004 created Article III-170 with three paragraphs by housing Articles III-59, III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38).
Article III-170(2) of the Constitutional Treaty was exactly the same as Article III-60 of the draft Constitution:
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about Article 111 TFEU, unchanged from the current Article 91 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 91 TEC and TFEU (ToL), to be renumbered Article 111 TFEU in the consolidated version, without comment (page 28).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 111 TFEU, Article 91 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 91 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Having found at least a general comment in English, we gratefully reproduce the text on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 111 TFEU (Article 91 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Provisions on taxes and charges (Veroja ja maksuja koskevat määräykset), offers a brief statement on the unchanged nature of Article 91 TFEU (ToL), renumbered Article 111 TFEU (page 208):
”91 artiklaa (uusi 111 artikla), jonka mukaan tuotteita toisen jäsenvaltion alueelle vietäessä sisäisten maksujen palautus ei saa olla sisäisesti perittyjä maksuja suurempi, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Bestämmelser om skatter och avgifter’ on the unchanged nature of Article 91 TFEU (ToL), the future Article 111 TFEU, on page 211:
”Artikel 91 (blivande artikel 111), enligt vilken återbetalning av interna avgifter för varor som exporteras till någon annan medlemsstats territorium inte får ske med belopp som överstiger de interna avgifterna, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
These rules apply within the internal market, but not in relation to third countries.
We look at the prohibition on tax subsidies for exports in the light of the EU Treaty of Lisbon.
***
Article 111 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 111 TFEU
(ex Article 91 TEC)
Where products are exported to the territory of any Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 91 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 91 TEC first became Article 91 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 111 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 91 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/79).
No specific amendment and no horizontal amendment; the wording of Article 91 TEC is exactly the same as Article 111 TFEU.
***
We have now seen that 91 TEC in force and 111 TFUE are exactly the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-60 of the draft Treaty establishing a Constitution for Europe reworded Article 91 TEC slightly, without altering the substance (OJ 18.7.2003 C 169/37):
Article III-60 Draft Constitution
Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
The IGC 2004 created Article III-170 with three paragraphs by housing Articles III-59, III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38).
Article III-170(2) of the Constitutional Treaty was exactly the same as Article III-60 of the draft Constitution:
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about Article 111 TFEU, unchanged from the current Article 91 TEC?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 91 TEC and TFEU (ToL), to be renumbered Article 111 TFEU in the consolidated version, without comment (page 28).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 111 TFEU, Article 91 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 91 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Having found at least a general comment in English, we gratefully reproduce the text on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 111 TFEU (Article 91 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), under the heading Provisions on taxes and charges (Veroja ja maksuja koskevat määräykset), offers a brief statement on the unchanged nature of Article 91 TFEU (ToL), renumbered Article 111 TFEU (page 208):
”91 artiklaa (uusi 111 artikla), jonka mukaan tuotteita toisen jäsenvaltion alueelle vietäessä sisäisten maksujen palautus ei saa olla sisäisesti perittyjä maksuja suurempi, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), makes the same remark under ’Bestämmelser om skatter och avgifter’ on the unchanged nature of Article 91 TFEU (ToL), the future Article 111 TFEU, on page 211:
”Artikel 91 (blivande artikel 111), enligt vilken återbetalning av interna avgifter för varor som exporteras till någon annan medlemsstats territorium inte får ske med belopp som överstiger de interna avgifterna, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
Wednesday, 4 June 2008
Finland: Lisbon Treaty ratification
The Finnish government’s bill to ratify the EU Treaty of Lisbon has now returned to the full house. In April the plenary session remitted the bill and accompanying draft act (23/2008 vp) to the Foreign Affairs Committee, which drafted the report (UaVM 6/2008 vp).
The Grand Committee (which acts as the parliament’s EU committee) and the Constitutional Law Committee were asked to deliver opinions to the drafting committee, and their statements are relatively detailed (SuVL 1/2008 vp and PeVL 13/2008 vp, respectively).
Most of the special committees made use of the opportunity to give statements to the Foreign Affairs Committee.
The Foreign Affairs Committee proposes that the parliament (Eduskunta) approves the Treaty of Lisbon and the Act on bringing its provisions into force. According to Section 95(2) of the Constitution of Finland (731/1999), the approval of an international treaty of constitutional relevance needs a majority of two thirds of the votes cast:
“Section 95 - Bringing into force of international obligations
The provisions of treaties and other international obligations, in so far as they are of a legislative nature, are brought into force by an Act. Otherwise, international obligations are brought into force by a Decree issued by the President of the Republic.
A Government bill for the bringing into force of an international obligation is considered in accordance with the ordinary legislative procedure pertaining to an Act. However, if the proposal concerns the Constitution or a change to the national territory, the Parliament shall adopt it, without leaving it in abeyance, by a decision supported by at least two thirds of the votes cast.
An Act may state that for the bringing into force of an international obligation its entry into force is provided by a Decree. General provisions on the publication of treaties and other international obligations are laid down by an Act.”
***
The Foreign Affairs Committee’s report endorsing ratification comes as no surprise, because Finland was one of the 18 or two thirds of the EU member states to approve the Constitutional Treaty, in the autumn 2006.
As everywhere, there have been some calls for a referendum by opponents of the Treaty of Lisbon and the European Union, but normal parliamentary ratification was chosen for the full Constitutional Treaty, so there was even less reason to submit the Constitution ‘minus’ or ‘light’ to such an extraordinary procedure.
In true ‘Man bites dog’ style European media attention has centred on the problematic member states, so Finland has appeared on the news screens only with regard to one question: the possible rejection of the Lisbon Treaty by the Åland Islands (pop. 27,000).
***
The first reading of the bill ended a short while ago, with the contents approved as proposed by the Foreign Affairs Committee.
The Lisbon Treaty returns to the plenary for a second reading, when the bill is either approved or rejected (but can not be amended). The second reading can take place, at the earliest, on the third day from the first reading.
Ralf Grahn
The Grand Committee (which acts as the parliament’s EU committee) and the Constitutional Law Committee were asked to deliver opinions to the drafting committee, and their statements are relatively detailed (SuVL 1/2008 vp and PeVL 13/2008 vp, respectively).
Most of the special committees made use of the opportunity to give statements to the Foreign Affairs Committee.
The Foreign Affairs Committee proposes that the parliament (Eduskunta) approves the Treaty of Lisbon and the Act on bringing its provisions into force. According to Section 95(2) of the Constitution of Finland (731/1999), the approval of an international treaty of constitutional relevance needs a majority of two thirds of the votes cast:
“Section 95 - Bringing into force of international obligations
The provisions of treaties and other international obligations, in so far as they are of a legislative nature, are brought into force by an Act. Otherwise, international obligations are brought into force by a Decree issued by the President of the Republic.
A Government bill for the bringing into force of an international obligation is considered in accordance with the ordinary legislative procedure pertaining to an Act. However, if the proposal concerns the Constitution or a change to the national territory, the Parliament shall adopt it, without leaving it in abeyance, by a decision supported by at least two thirds of the votes cast.
An Act may state that for the bringing into force of an international obligation its entry into force is provided by a Decree. General provisions on the publication of treaties and other international obligations are laid down by an Act.”
***
The Foreign Affairs Committee’s report endorsing ratification comes as no surprise, because Finland was one of the 18 or two thirds of the EU member states to approve the Constitutional Treaty, in the autumn 2006.
As everywhere, there have been some calls for a referendum by opponents of the Treaty of Lisbon and the European Union, but normal parliamentary ratification was chosen for the full Constitutional Treaty, so there was even less reason to submit the Constitution ‘minus’ or ‘light’ to such an extraordinary procedure.
In true ‘Man bites dog’ style European media attention has centred on the problematic member states, so Finland has appeared on the news screens only with regard to one question: the possible rejection of the Lisbon Treaty by the Åland Islands (pop. 27,000).
***
The first reading of the bill ended a short while ago, with the contents approved as proposed by the Foreign Affairs Committee.
The Lisbon Treaty returns to the plenary for a second reading, when the bill is either approved or rejected (but can not be amended). The second reading can take place, at the earliest, on the third day from the first reading.
Ralf Grahn
EU TFEU: Tax provisions
The EU Treaty of Lisbon leaves the tax provisions (fiscal provisions) of the current Treaty establishing the European Community essentially unchanged.
Article 110 of the Treaty on the Functioning of the European Union prohibits tax discrimination within the internal market and imposes a requirement of neutrality on the member states’ governments.
***
Article 110 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 110 TFEU
(ex Article 90 TEC)
No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 90 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 90 TEC first became Article 90 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 110 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 90 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/78).
No specific amendment and no horizontal amendment; the wording of Article 90 TEC is exactly the same as Article 110 TFEU.
***
We have now seen that 90 TEC in force and 110 TFUE are exactly the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-59 of the draft Treaty establishing a Constitution for Europe was exactly the same as Article 90 TEC (OJ 18.7.2003 C 169/37).
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Even if the first paragraph of Article III-170 was the same as Article III-59 proposed by the European Convention, the IGC 2004 created an Article with three paragraphs by housing Articles III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38):
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about the unchanged Article 110 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 90 TEC and TFEU (ToL), to be renumbered Article 110 TFEU in the consolidated version, without comment (page 28).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 110 TFEU, Article 90 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 90 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Because this blog post is an introduction to the tax provisions, we reproduce the comments on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 110 TFEU (Article 90 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), offers an introductury comment on taxes and charges (Veroja ja maksuja koskevat määräykset) and a brief statement on the unchanged nature of Article 90 TFEU (ToL), renumbered Article 110 TFEU (page 208):
”Määräykset koskevat veroihin ja maksuihin sovellettavia pääperiaatteita sekä neuvoston toimivaltaa niiden osalta ja ne vastaavat määräysten sanamuodon teknisiä tarkistuksia lukuun ottamatta pääasiallisesti nykyisen EYsopimuksen kolmannen osan VI osaston 2 luvun määräyksiä samoin kuin perustuslakisopimuksen III-171 ja III-172 artiklan määräyksiä.
90 artiklaa (uusi 110 artikla), joka kieltää jäsenvaltioita määräämästä muiden jäsenvaltioiden tuotteille korkeampia välillisiä tai välittömiä sisäisiä maksuja kuin kotimaisille tuotteille, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), presents the same introductory remark on fiscal provisions under ’Bestämmelser om skatter och avgifter’ and the comment on the unchanged nature of Article 90 TFEU (ToL), the future Article 110 TFEU, on page 211:
”Bestämmelserna gäller de huvudprinciper som ska tillämpas på skatter och avgifter samt rådets befogenheter i fråga om dem och de motsvarar de tekniska anpassningarna av bestämmelsernas ordalydelse med undantag i huvudsak för bestämmelserna i avdelning VI kapitel 2 i det nuvarande EG-fördragets tredje del liksom även bestämmelserna i artiklarna III-171 och III-172 i det konstitutionella fördraget.
Artikel 90 (blivande artikel 110), som förbjuder medlemsstaterna att direkt eller indirekt på varor från andra medlemsstater lägga interna skatter eller avgifter som är högre än de skatter eller avgifter som direkt eller indirekt läggs på liknande inhemska varor, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
Article 110 of the Treaty on the Functioning of the European Union prohibits tax discrimination within the internal market and imposes a requirement of neutrality on the member states’ governments.
***
Article 110 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Union policies and internal actions’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 2 Tax provisions
Article 110 TFEU
(ex Article 90 TEC)
No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 90 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 90 TEC first became Article 90 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 110 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 90 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 2 ‘Tax provisions’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/78).
No specific amendment and no horizontal amendment; the wording of Article 90 TEC is exactly the same as Article 110 TFEU.
***
We have now seen that 90 TEC in force and 110 TFUE are exactly the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Article III-59 of the draft Treaty establishing a Constitution for Europe was exactly the same as Article 90 TEC (OJ 18.7.2003 C 169/37).
***
In the Treaty establishing a Constitution for Europe the tax provisions were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 6 ‘Fiscal provisions’.
Even if the first paragraph of Article III-170 was the same as Article III-59 proposed by the European Convention, the IGC 2004 created an Article with three paragraphs by housing Articles III-60 and III-61 of the draft Constitution under the same roof (OJ 16.12.2004 C 310/73. Cf. OJ 18.7.2003 C 169/37–38):
Article III-170 Constitution
1. No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.
Furthermore, no Member State shall impose on the products of other Member States any internal taxation of such a nature as to afford indirect protection to other products.
2. Where products are exported by a Member State to the territory of another Member State, any repayment of internal taxation shall not exceed the internal taxation imposed on them whether directly or indirectly.
3. In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation, remissions and repayments in respect of exports to other Member States may not be granted and countervailing charges in respect of imports from Member States may not be imposed unless the provisions contemplated have been previously approved for a limited period by a European decision adopted by the Council on a proposal from the Commission.
***
What has anyone been able to say about the unchanged Article 110 TFEU?
United Kingdom
Professor Steve Peers covered the Treaty of Lisbon in a number of Statewatch Analyses. ‘EU Reform Treaty Analysis no. 3.3: Revised text of Part Three, Titles I to VI of the Treaty establishing the European Community (TEC): Internal Market and competition’ (Version 2, 23 October 2007) includes the current Title VI Common rules on competition, taxation and approximation of laws.
Peers indicated the changing numbering of Article 90 TEC and TFEU (ToL), to be renumbered Article 110 TFEU in the consolidated version, without comment (page 28).
The analysis 3.3 and other useful Statewatch analyses are available through:
http://www.statewatch.org/euconstitution.htm
***
The Foreign and Commonwealth Office (FCO) offers a convenient source of brief annotations on Lisbon Treaty amendments in ‘A comparative table of the current EC and EU treaties as amended by the Treaty of Lisbon’ (Command Paper 7311, published 21 January 2008). It offers the following comment on Article 110 TFEU, Article 90 TFEU (ToL) in the original Lisbon Treaty (page 12):
“Unchanged from Article 90 TEC.”
The FCO comparative table is available at:
http://www.official-documents.gov.uk/document/cm73/7311/7311.asp
***
The UK House of Commons Library Research Paper 07/86 ‘The Treaty of Lisbon: amendments to the Treaty establishing the European Community’ (published 6 December 2007) discussed taxation on page 60 (although the heading ‘2. Taxation’ continued with (tax) harmonisation from page 60 to 61).
Because this blog post is an introduction to the tax provisions, we reproduce the comments on Articles 90 to 93 TFEU (ToL), later renumbered Articles 110 to 113 TFEU in the consolidated version:
“Articles 90–93 (Constitution Articles III-170 – III-171) concern taxation. They incorporate the existing tax provisions set out in Articles 90 to 93 TEC. There is a considerable body of European law concerning the harmonisation across Member States of indirect taxes: that is, VAT and excise duties on alcoholic drinks, hydrocarbon oils and tobacco products. At present the Treaty base for this legislation is Article 93 TEC, which states:
The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market within the time limit laid down in Article 14. (122)
The new Article 93 (Constitution Article III-171) has one substantive change. Legislation for harmonising indirect taxes may be adopted (emphasis added) “provided that such harmonisation is necessary for the establishment or the functioning of the internal market and to avoid distortion of competition.” It remains the case that any such legislation must be agreed by the Council acting unanimously.”
---
Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
---
The Library Research Paper 07/86 is available at:
http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf
***
The House of Lords European Union Committee report ‘The Treaty of Lisbon: an impact assessment, Volume I: Report’ (HL Paper 62-I, published 13 March 2008) is a valuable resource on the Treaty of Lisbon, but I found no reference to Article 110 TFEU (Article 90 TEC and ToL).
The report is accessible at:
http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeucom/62/62.pdf
In case anyone wants to dig deeper, taxes, unanimity and harmonisation are discussed ‘passim’ in Volume II of the report ‘Evidence’.
***
Sweden
The consultation paper ’Lissabonfördraget’ is still valuable as a description of the Lisbon Treaty amendments, and it is available at:
http://www.regeringen.se/content/1/c6/09/49/81/107aa077.pdf
The Swedish government’s draft ratification bill ‘Lagrådsremiss – Lissabonfördraget’, was published 29 May 2008 and sent to the Council on Legislation (Lagrådet) for an expert opinion. The draft deals with the EU’s internal policy areas in Chapter 23 ‘Unionens interna åtgärder’, and section 23.1 presents the internal market (Inre marknaden), on pages 175 to 181.
Tax provisions are dealt with on page 179 in a section called ‘Bestämmelser om skatter’. The government of Sweden remarks on the essentially unchanged nature of the tax provisions in general and it then explains the clarification of Article 93 TFEU (ToL):
”Bestämmelser om skatter
Bestämmelserna om skatter är i princip oförändrade. I artikel 93 i EUF-fördraget om harmonisering av lagstiftningen om omsättningsskatter, punktskatter och andra indirekta skatter eller avgifter på den inre marknaden görs ett förtydligande. Som nödvändig förutsättning för att harmonisera lagstiftning anges som tillägg “att undvika snedvridning av konkurrensen”. Rådet ska, i likhet med nu gällande EG-fördrag, fatta beslut med enhällighet i skattefrågor efter att ha hört Europaparlamentet. (Se artikel 2.79 i Lissabonfördraget.)”
The draft bill ‘Lagrådsremiss – Lissabonfördraget’ can be downloaded through:
http://www.regeringen.se/sb/d/5676/a/106277
***
Finland
The Finnish ratification bill, ‘Hallituksen esitys Eduskunnalle Euroopan unionista tehdyn sopimuksen ja Euroopan yhteisön perustamissopimuksen muuttamisesta tehdyn Lissabonin sopimuksen hyväksymisestä ja laiksi sen lainsäädännön alaan kuuluvien määräysten voimaansaattamisesta’ (HE 23/2008 vp), offers an introductury comment on taxes and charges (Veroja ja maksuja koskevat määräykset) and a brief statement on the unchanged nature of Article 90 TFEU (ToL), renumbered Article 110 TFEU (page 208):
”Määräykset koskevat veroihin ja maksuihin sovellettavia pääperiaatteita sekä neuvoston toimivaltaa niiden osalta ja ne vastaavat määräysten sanamuodon teknisiä tarkistuksia lukuun ottamatta pääasiallisesti nykyisen EYsopimuksen kolmannen osan VI osaston 2 luvun määräyksiä samoin kuin perustuslakisopimuksen III-171 ja III-172 artiklan määräyksiä.
90 artiklaa (uusi 110 artikla), joka kieltää jäsenvaltioita määräämästä muiden jäsenvaltioiden tuotteille korkeampia välillisiä tai välittömiä sisäisiä maksuja kuin kotimaisille tuotteille, ei muuteta.”
The Finnish ratification bill is available at:
http://www.finlex.fi/fi/esitykset/he/2008/20080023.pdf
The Swedish language version of the ratification bill ‘Regeringens proposition till Riksdagen med förslag om godkännande av Lissabonfördraget om ändring av fördraget om Europeiska unionen och fördraget om upprättandet av Europeiska gemenskapen och till lag om sättande i kraft av de bestämmelser i fördraget som hör till området för lagstiftningen’ (RP 23/2008 rd), presents the same introductory remark on fiscal provisions under ’Bestämmelser om skatter och avgifter’ and the comment on the unchanged nature of Article 90 TFEU (ToL), the future Article 110 TFEU, on page 211:
”Bestämmelserna gäller de huvudprinciper som ska tillämpas på skatter och avgifter samt rådets befogenheter i fråga om dem och de motsvarar de tekniska anpassningarna av bestämmelsernas ordalydelse med undantag i huvudsak för bestämmelserna i avdelning VI kapitel 2 i det nuvarande EG-fördragets tredje del liksom även bestämmelserna i artiklarna III-171 och III-172 i det konstitutionella fördraget.
Artikel 90 (blivande artikel 110), som förbjuder medlemsstaterna att direkt eller indirekt på varor från andra medlemsstater lägga interna skatter eller avgifter som är högre än de skatter eller avgifter som direkt eller indirekt läggs på liknande inhemska varor, ändras inte.”
The ratification bill in Swedish can be accessed at:
http://www.finlex.fi/sv/esitykset/he/2008/20080023.pdf
Ralf Grahn
Tuesday, 3 June 2008
EU TFEU: State aid regulations
The EU Treaty of Lisbon allows the Council to adopt regulations on state aid, including notifications and block exemptions.
***
Article 109 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Policies and internal actions of the Union’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 1 Rules on competition
Section 2 Aids granted by states
Article 109 TFEU
(ex Article 89 TEC)
The Council, on a proposal from the Commission and after consulting the European Parliament, may make any appropriate regulations for the application of Articles 107 and 108 and may in particular determine the conditions in which Article 108(3) shall apply and the categories of aid exempted from this procedure.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 89 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 89 TEC first became Article 89 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 109 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 89 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 1 ‘Rules on competition’, Section 2 ‘Aids granted by states’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/78).
Readers, who need the current Article 88 TEC or want to compare the TEC and TFEU texts, notice that the words ‘acting by a qualified majority’ have been deleted according to horizontal amendment 2(d) mentioned in Article 2 of the Treaty of Lisbon. Cf. OJ 17.12.2007 C 306/41.
Both the current TEC and the future TFEU Article refer to other provisions, but each treaty has its own numbering.
Article 89 TEC
The Council, acting by a qualified majority on a proposal from the Commission and after consulting the European Parliament, may make any appropriate regulations for the application of Articles 87 and 88 and may in particular determine the conditions in which Article 88(3) shall apply and the categories of aid exempted from this procedure.
***
We have now seen the starting line (the TEC in force) and finishing line (contents and numbering of the TFUE when it has entered into force), which are almost the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located among the provisions on state aid in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 5 ‘Rules on competition’, within Subsection 2 ‘Aids granted by Member States’.
Some differences, such as the ‘Council of Ministers’ and ‘European regulations’ reflect the terminology of the draft Treaty establishing a Constitution for Europe and some are different choices of words in Article III-58, but none of them have material impact (OJ 18.7.2003 C 169/37):
Article III-58 Draft Constitution
The Council of Ministers, on a proposal from the Commission, may adopt European regulations for the application of Articles III-56 and III-57 and for determining in particular the conditions in which Article III-57(3) shall apply and the categories of aid exempted from this procedure. It shall act after consulting the European Parliament.
***
In the Treaty establishing a Constitution for Europe the provisions on state aid were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 5 ‘Rules on competition’, with Subsection 2 ‘Aid granted by Member States’.
In Article III-169 of the Constitutional Treaty the IGC 2004 introduced no material changes to the draft Constitution. The ‘Council of Ministers’ had contracted to ‘Council’ and ‘this procedure’ was expressed as ‘the procedure provided for in Article 168(3)’.
The referrals were, of course, renumbered.
Because the Constitutional Treaty is the preferred object of comparison for many readers, Article III-169 is presented in full, as agreed by the IGC 2004 (OJ 16.12.2004 C 310/73):
Article III-169 Constitution
The Council, on a proposal from the Commission, may adopt European regulations for the application of Articles III-167 and III-168 and for determining in particular the conditions in which Article III-168(3) shall apply and the categories of aid exempted from the procedure provided for in Art
***
Article 109 of the Treaty on the Functioning of the European Union (TFEU) is found in the consolidated version of the Treaty on European Union and the Treaty on the Functioning of the European Union, published in the Official Journal of the European Union, OJ 9.5.2008 C 115/93:
Part Three ‘Policies and internal actions of the Union’
Title VII Common rules on competition, taxation and approximation of laws
Chapter 1 Rules on competition
Section 2 Aids granted by states
Article 109 TFEU
(ex Article 89 TEC)
The Council, on a proposal from the Commission and after consulting the European Parliament, may make any appropriate regulations for the application of Articles 107 and 108 and may in particular determine the conditions in which Article 108(3) shall apply and the categories of aid exempted from this procedure.
***
In Article 2, point 78 of the Treaty of Lisbon (ToL) the IGC 2007 amended Article 88 of the Treaty establishing the European Community (TEC) and in point 79 it dealt with Article 93 TEC. This means that no specific amendments were made to Article 89 TEC. Cf. OJ 17.12.2007 C 306/69.
***
The TFEU table of equivalences tells us that Article 89 TEC first became Article 89 TFEU (ToL) in the original Treaty of Lisbon, but later renumbered Article 109 TFEU in the consolidated version (OJ 17.12.2007 C 306/211).
***
The current Article 89 of the Treaty establishing the European Community (TEC) is found under Title VI ‘Common rules on competition, taxation and approximation of laws’, Chapter 1 ‘Rules on competition’, Section 2 ‘Aids granted by states’, in the latest consolidated version of the treaties in force (OJ 29.12.2006 C 321 E/78).
Readers, who need the current Article 88 TEC or want to compare the TEC and TFEU texts, notice that the words ‘acting by a qualified majority’ have been deleted according to horizontal amendment 2(d) mentioned in Article 2 of the Treaty of Lisbon. Cf. OJ 17.12.2007 C 306/41.
Both the current TEC and the future TFEU Article refer to other provisions, but each treaty has its own numbering.
Article 89 TEC
The Council, acting by a qualified majority on a proposal from the Commission and after consulting the European Parliament, may make any appropriate regulations for the application of Articles 87 and 88 and may in particular determine the conditions in which Article 88(3) shall apply and the categories of aid exempted from this procedure.
***
We have now seen the starting line (the TEC in force) and finishing line (contents and numbering of the TFUE when it has entered into force), which are almost the same.
Still, for the sake of systematic comparison, we look at the arcana of the Article during the intervening treaty reform stages.
First, we turn to the European Convention, the closest thing to a constituent assembly EU citizens have had. The Article in question is located among the provisions on state aid in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 5 ‘Rules on competition’, within Subsection 2 ‘Aids granted by Member States’.
Some differences, such as the ‘Council of Ministers’ and ‘European regulations’ reflect the terminology of the draft Treaty establishing a Constitution for Europe and some are different choices of words in Article III-58, but none of them have material impact (OJ 18.7.2003 C 169/37):
Article III-58 Draft Constitution
The Council of Ministers, on a proposal from the Commission, may adopt European regulations for the application of Articles III-56 and III-57 and for determining in particular the conditions in which Article III-57(3) shall apply and the categories of aid exempted from this procedure. It shall act after consulting the European Parliament.
***
In the Treaty establishing a Constitution for Europe the provisions on state aid were located in Part III ‘The policies and functioning of the Union’, Title III ‘Internal policies and action’, Chapter I ‘Internal market’, Section 5 ‘Rules on competition’, with Subsection 2 ‘Aid granted by Member States’.
In Article III-169 of the Constitutional Treaty the IGC 2004 introduced no material changes to the draft Constitution. The ‘Council of Ministers’ had contracted to ‘Council’ and ‘this procedure’ was expressed as ‘the procedure provided for in Article 168(3)’.
The referrals were, of course, renumbered.
Because the Constitutional Treaty is the preferred object of comparison for many readers, Article III-169 is presented in full, as agreed by the IGC 2004 (OJ 16.12.2004 C 310/73):
Article III-169 Constitution
The Council, on a proposal from the Commission, may adopt European regulations for the application of Articles III-167 and III-168 and for determining in particular the conditions in which Article III-168(3) shall apply and the categories of aid exempted from the procedure provided for in Art