EU Lisbon Treaty: “Meaningless” Irish guarantees?

Yesterday’s blog post, EU Lisbon Treaty: Vaclav Klaus is wrong, showed that Czech President Vaclav Klaus did not quite attain the standards of "every normal human being, a first form pupil” in his understanding of the guarantees to Ireland. He can hardly have been caught unawares, because the assurances were outlined by the European Council in December 2008, and Klaus has missed few opportunities to pontificate on Lisbon Treaty matters.




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“Meaningless guarantees” to Ireland

The lobby group Open Europe has attacked the assurances given to Ireland on different grounds: Irish to vote on exactly the same text of Lisbon Treaty – EU admits that nothing has changed (19 June 2009).




The core argument of Open Europe – which seems to contradict Klaus’ statements – is that the deal makes no change whatsoever to the text of the Treaty, meaning Irish voters will be voting on exactly the same text they rejected last year.


If the Lisbon Treaty remains the same, are the guarantees meaningless?

We are in agreement with Open Europe that the European Council can retain a Commissioner from each member state and that the rest of the Treaty remains unchanged.

The Irish government has asked for the assurances based on the distorted claims of No campaigners ahead of the first referendum. Many Irish voters were confused by forceful, but erroneous assertions, and they felt that they did not understand the Lisbon Treaty.

Thus, it is only logical that the government of Ireland has sought correct interpretations on some issues, which confused the electorate. The assurances are shorter to read and easier to understand than a presentation of the whole amending treaty. The other EU member states have given these clarifications their seal of approval.


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Neutrality

Open Europe has found one expert opinion to support the assertion that Irish military neutrality is at risk.

In my view, Dr Karen Devine’s interpretation is not correct. There is no need for a specific opt-out, because the Lisbon Treaty text on both defence policy in general and the mutual assistance clause already allows for each member state to define its own policy and action. Thus, Ireland does not need an opt-out.

The Presidency Conclusions of the June 2009 European Council seem to respond adequately to the concerns of Irish citizens with regard to neutrality, including the issue of mutual assistance, by clarifying the text of the Treaty of Lisbon.

Naturally, one can discuss if the lack of solidarity by Ireland is a desirable state of affairs in a political union such as the EU, but that is another story.


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The guarantees are not meaningless, because they explain why major concerns in Ireland are groundless.

Open Europe has given No campaigners dud ammunition.



Ralf Grahn

NATO & EU: Rewarding freeloading?

Since 1 April 2009 the North Atlantic Treaty Organization (NATO) has the following 28 members: Albania, Belgium, Bulgaria, Canada, Croatia, the Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Turkey, the United Kingdom and the United States.

In part, NATO is larger than the European Union. There are seven non-EU NATO members: Albania, Canada, Croatia, Iceland, Norway, Turkey and the United States.

The remaining 21 are members of both NATO and the European Union. Double membership clearly represents the European mainstream.

Out of a total of 27 current EU member states, only six have left themselves outside NATO: Austria, Cyprus, Finland, Ireland, Malta and Sweden.

These countries represent a fringe within the EU in four respects:

1. Their total population is about 28.2 million, or 5.7 per cent of a total EU population of 495.1 million.
2. Geographically they are more or less on the outer rim of the EU (although Austria has been overtaken and embedded by later entrants).
3. Their definitions of (military) non-alignment or neutrality have kept them outside NATO.
4. Their status with regard to the security and defence aspects of the common foreign and security policy can be described as an opt-out (The policy of the Union in accordance with this Article shall not prejudice the specific character of the security and defence policy of certain Member States … ; Article 17 TEU).

To continue the discussion from my post Tony Blair new “EU President?” I ask: How could such a freeloading country (or a representative from one of them) be expected to drive forward a common defence policy and a common European defence?



This is, after all, one of the crucial areas for the European Council, and as such of its coming President.

Do the arguments look different, if we look at the double-hatted High Representative?

Am I being unreasonable or have these countries disqualified themselves from the top jobs under the Lisbon Treaty?

In my humble opinion, responsibilities and rewards should go hand in hand.


Ralf Grahn

EU Lisbon Treaty implementation and institutional relations

Preparatory work is needed to implement the Treaty of Lisbon, should it enter into force, but the previous blog post left us wondering what the French Council Presidency did during the latter half of 2008 and what the Czech Council Presidency is doing during the first six months of 2009.

What we see is our leaders’ steadily decreasing level of commitment to open dialogue.


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Initial plan

The European Council on 14 December 2007, just after signing the Treaty of Lisbon, the European Council gave the go-ahead for preparatory work, underlining its comprehensive nature and the need for a single framework, agreeing that it:

"will take stock of progress on necessary preparatory work when appropriate so as to ensure the full functioning of the Treaty as soon as it enters into force. It underlines the comprehensive nature of this exercise and the consequent need for a single framework as well as political guidance at the highest level. Technical work will start in Brussels in January on the basis of a work programme which will be presented under the authority of the incoming President of the European Council."


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Slovenian Council Presidency: Almost comprehensive

The Slovenian Council Presidency began by preparing a memorandum on the outstanding implementation issues. The memo was not published voluntarily or on my request, but leaked. The Finnish Government followed the preparatory work in public documents it forwarded to the Parliament of Finland.

The last more or less comprehensive EU report on preparatory work seems to be the ‘Progress report from the Presidency to the European Council ─ Preparatory work in view of the entry into force of the Lisbon Treaty’ from the Slovenian Council Presidency to the European Council 19 and 20 June 2008 (Council document 10650/08, 13 June 2008):

http://register.consilium.europa.eu/pdf/en/08/st10/st10650.en08.pdf

In this report a selection of unfinished items was presented with fairly bland comments.


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French Council Presidency: Far from comprehensive

As far as I have been able to ascertain, the French Council Presidency produced no comprehensive report on preparatory work to implement the Lisbon Treaty.

The way forward after the Irish referendum result was a recurring question. In the Presidency Conclusions of the Brussels European Council 11 and 12 December 2008 (Council document 17271/1/08 REV 1) the heads of government and state agreed to give the assurances required by the Irish Government in case the Lisbon Treaty enters into force:

http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/104692.pdf


This path forward was based on the concerns expressed by the Irish Prime Minister and annexed to the Conclusions:


Statement of the Concerns of the Irish People on the Treaty of Lisbon as set out by the Taoiseach

a) Ensuring that Ireland's requirements regarding maintenance of its traditional policy of neutrality are met;

b) Ensuring that the terms of the Treaty of Lisbon will not affect the continued application of the provisions of the Irish Constitution in relation to the right to life, education and the family;

c) Ensuring that in the area of taxation the Treaty of Lisbon makes no change of any kind to the extent or operation of the Union's competences;

d) Confirming that the Union attaches high importance to:

• social progress and the protection of workers' rights;

• public services, as an indispensable instrument of social and regional cohesion;

• the responsibility of Member States for the delivery of education and health services;

• the essential role and wide discretion of national, regional and local Governments in providing, commissioning and organising non-economic services of general interest which is not affected by any provision of the Treaty of Lisbon, including those relating to the common commercial policy.


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Neutrality and defence

Parenthetically we can remark that the leaders of the EU member states were willing to ensure that Ireland's requirements regarding maintenance of its traditional policy of neutrality are met (as they already are under the Lisbon Treaty), but the longer and deeper Ireland remains attached to this historical legacy, the further the conceptual and practical its distance becomes to the quasi-totality of the European Union, which moves towards common security and defence policies.


Point 30 of the Presidency Conclusions remarked:

“The European Council states its determination to give, by means of the attached declaration [Annex 2], a fresh impetus to the European Security and Defence Policy. Compliant with the principles of the United Nations Charter and the decisions of the United Nations Security Council, this policy will continue to develop in full complementarity with NATO in the agreed framework of the strategic partnership between the EU and NATO and in compliance with the decision-making autonomy and procedures of each. To this end, the European Council shares the analysis of the report on the implementation of the European Security Strategy of 2003 and endorses the declarations adopted by the Council [references in Annex 6], which agree on new goals for strengthening and optimising European capabilities in the years ahead and emphasise the EU's desire to work for the cause of international peace and security, while making a tangible contribution to the security of its citizens.”


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Interinstitutional matters



In addition, the December 2008 European Council issued three Declarations closer to the interinstitutional relations. Three questions felt to be urgent, but without public debate and far from a comprehensive framework for the implementation of the Treaty of Lisbon:




Declaration of the European Council

Treaty of Lisbon – Transitional measures concerning the Presidency of the European Council and the Presidency of the Foreign Affairs Council

In the event that the Treaty of Lisbon enters into force at a date when a six-monthly Presidency of the Council has already begun, the European Council agrees that, as a matter of transition, in order to take into account the preparatory work and ensure harmonious continuity of work:

− the competent authorities of the Member State holding the six-monthly Presidency of the Council at that time will continue to chair all the remaining meetings of the Council and the European Council, as well as third-country meetings, until the end of the period of office;

− the following six-monthly Presidency of the Council will be in charge of taking the necessary specific measures relating to the organisational and material aspects of the Presidency of the European Council and of the Foreign Affairs Council during its period of office, in conformity with the Treaty. On these issues, close consultation will be established between this Presidency and the President (elect) of the European Council and the High Representative (designate) of the Union for Foreign Affairs and Security Policy.


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Declaration of the European Council

Treaty of Lisbon – Transitional measures concerning the composition of the European Parliament

In the event that the Treaty of Lisbon enters into force after the European elections of June 2009, transitional measures will be adopted as soon as possible, in accordance with the necessary legal procedures, in order to increase, until the end of the 2009-2014 legislative period, in conformity with the numbers provided for in the framework of the IGC which approved the Treaty of Lisbon, the number of MEPs of the twelve Member States for which the number of MEPs was set to increase. Therefore, the total number of MEPs will rise from 736 to 754 until the end of the 2009-2014 legislative period. The objective is that this modification should enter into force, if possible, during the year 2010.



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Declaration of the European Council

Treaty of Lisbon – Appointment of the future Commission

The European Council agrees that the process of appointment of the future Commission, in particular the designation of its President, will be initiated without delay after the European Parliament elections of June 2009.



[Ironically, French President Nicolas Sarkozy was the first to air doubts about these principles agreed under the French Council Presidency.]


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Czech Council Presidency: No comprehension?


The Czech Republic took over the rotating EU Council Presidency at the beginning of 2009. Afraid that I have missed important developments in spite of reading and searches, I made an additional search on the Czech web pages for “Lisbon Treaty” and Treaty of Lisbon”. The result in both cases was “No matches found”.

Not only does the Czech Senate excel in inventing new pretexts to postpone the ratification vote on the Treaty of Lisbon (ad calendas graecas?), but the Government seems to have done nothing to provide the necessary impetus to the preparatory work needed to put the Lisbon Treaty into practice.


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Ever closer union among the peoples of Europe?


The reporting was not that great to begin with, but it has steadily degenerated.

Is this really the view of our national political leaders (European Council, Council) on how to create an ever closer union among the peoples of Europe, in which decisions are taken as openly as possible and as closely as possible to the citizen?

Dear Leaders, give the citizens of the European Union ownership or accept their rejection of your union.

If you want the European project and the Treaty of Lisbon to be accepted and even adopted with some enthusiasm by the citizens of the European Union, implementation and the new relations between the institutions need to be discussed openly and interactively.

Start now!


Ralf Grahn

Swedish non-alignment and EU?

Fellow blogger The European Citizen discussed ’Neutrality and Europe’ in a blog post 9 March 2009, primarily from an Irish perspective:

http://theeuropeancitizen.blogspot.com/2009/03/neutrality-and-europe.html

The post concluded that the existence of the internal market and membership of the EU has changed the political context for neutral European states. This doesn't automatically mean that military integration should be adopted, but a range of options should be discussed.

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I have nothing to object to the conclusion that rational discussion is needed in the countries outside the security policy mainstream of the European Union.

What caught my eye was a detail, the opening sentence where The European Citizen described Ireland, Sweden and Austria as both neutral and EU member states, and asked but can you really be both.

In a comment on an earlier blog post, I had noted that Finland has narrowed down its definition to “military non-alignment”, because the country sees itself as politically aligned through EU membership, including the CFSP and the CSDP.

I also commented that I was unsure of how Sweden defines itself nowadays, although it continued to use both “non-alignment” and “neutrality” when Finland had ceased to utilise these defining terms.

For this comment off the cuff, I did not take the trouble to research the Swedish position. But when Swedish neutrality cropped up in the new post, I decided to take a look.


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Sweden

Traditional Swedish non-alignment aiming at neutrality in war seems to be in a flux. In the Foreign Policy Declaration of the Government of Sweden 18 February 2009 (Regeringens deklaration vid 2009 års utrikespolitiska debatt i Riksdagen onsdagen den 18 februari 2009), Foreign Minister Carl Bildt mentioned neither non-alignment nor neutrality.

Bildt mentioned the successful foreign, security and defence policies of the European Union and the good cooperation between Sweden and NATO in crisis management. He went on to declare that the Government is going to present a position paper on NATO relations during the spring.

Bildt mentioned Swedish security policy as firm, but in addition he mentioned the proposals for improved Nordic defence cooperation made by Thorvald Stoltenberg. The Swedish Government will consider them in a positive spirit and it promises a Bill on defence policy this spring.


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In other words, by deliberate omission Sweden is neither “non-aligned” nor “neutral”, but two Government papers will further define NATO relations and (Nordic) defence policy.

I don’t expect any sudden shifts, but Swedish foreign, security and defence policy is changing, although at glacier-like speed.


Ralf Grahn

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.

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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.

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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.

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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).

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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.

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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.

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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.

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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


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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

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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.”

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Footnote 122 stated: Article 14 refers to the establishment of the single European market on 1 January 1993.
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The Library Research Paper 07/86 is available at:

http://www.parliament.uk/commons/lib/research/rp2007/rp07-086.pdf

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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’.


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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

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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