Tuesday, 3 February 2009

EU Law: Urgent financial assistance to third countries

Assistance delayed, is assistance denied, especially in the midst of the global financial crisis and economic recession.

If a country outside the European Union needs urgent financial help, the EU Council has to resort to the so called flexibility clause, which means haggling until every member state is on board, and achieving effective results only to that extent.


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Draft Constitution

For these urgent and politically important cases the European Convention proposed to narrow the scope of the cumbersome flexibility clause (Article 308 of the Treaty establishing the European Community) by a specific legal base for urgent financial assistance to third countries:


Article III-222 Draft Constitution

When the situation in a third country requires urgent financial aid from the Union, the Council of Ministers shall adopt the necessary European decisions on a proposal from the Commission.


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Constitutional Treaty

The intergovernmental conference (IGC 2004) accepted the proposal by the Convention in the Treaty establishing a Constitution for Europe, signed by all the member states on 29 October 2004:


Article III-320 Constitution

When the situation in a third country requires urgent financial assistance from the Union, the Council shall adopt the necessary European decisions on a proposal from the Commission.


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Original Lisbon Treaty

On this basis the intergovernmental conference (IGC 2007) agreed on the following amendment in Article 2, point 167 of the original Treaty of Lisbon:


167) The following new Article 188 I shall be inserted:

‘Article 188 I

When the situation in a third country requires urgent financial assistance from the Union, the Council shall adopt the necessary decisions on a proposal from the Commission.’.


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Consolidated Lisbon Treaty

In the consolidated version of the Lisbon Treaty, the new Article 188i was renumbered Article 213 of the Treaty on the Functioning of the European Union (TFEU), OJEU 9.5.2008 C 115/143:


Article 213 TFEU

When the situation in a third country requires urgent financial assistance from the Union, the Council shall adopt the necessary decisions on a proposal from the Commission.


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Comment on Article 213 TFEU

The context of the provision is Chapter 2 on economic, financial and technical cooperation with third countries. The preceding provision deals with long term measures. Previously we have seen that there are Chapter 1 provisions on development cooperation and soon we will take a look at Chapter 3 on humanitarian aid (ad hoc assistance), often urgent in nature.

The new Article 213 TFEU fills a gap.

The Lisbon Treaty would allow the European Union to take more effective action sooner based on qualified majority voting (QMV). The European Parliament is out of the loop when it comes to the concrete aid decisions, but it can influence the legal and budgetary framework for these urgent decisions.

Naturally, the European Union’s decisions to help are not totally altruistic. At least two institutions consider the EU’s own external relations interests when deciding on urgent financial assistance to countries outside the union.


Ralf Grahn