State of the Union: better regulation and enforcement

The latest updates on the  European Commission’s State of the Union 2017 web page are the new industrial policy strategy, press release IP/17/3185, cybersecurity, press release IP/17/3193, and the flow of non-personal data in the EU, press release IP/17/3190.

I have presented roughly half of the 108-page State of the Union 2017 brochure in earlier blog entries. Now we turn to better regulation and enforcement.

Better regulation

The substance of the section on better regulation is on a single text page (63), but it carries a lot of punch.

The Commission’s figures demonstrate that it has been serious about being big on big things and small on small things, which tallies with my experience of the strategic way the Juncker Commission works, beginning with the political guidelines, which said:

My agenda will focus on ten policy areas. My emphasis will be on concrete results in these ten areas. Beyond that, I will leave other policy areas to the Member States where they are more legitimate and better equipped to give effective policy responses at national, regional or local level, in line with the principles of subsidiarity and proportionality. I want a European Union that is bigger and more ambitious on big things, and smaller and more modest on small things.

I am just going to provide a few links to readers, who want to go beyond the SOTEU 2017 brochure.

Sorted under the Democratic change priority, the Better regulation webpage offers background information and links, although the page is in need of an update, for instance the Commission Work Programme (CWP) 2017, soon to be followed by the CWP 2018. (It would be helpful if the Commission priority pages and other web pages provided the date of the latest update.)

Here is an introduction to the Regulatory Fitness and Performance (REFIT) programme, as a part of the Commission’s better regulation agenda and integrated into the CWP process.

We remember the Interinstitutional Agreement on Better Law-Making (13 April 2016); here an IIA explanation.

On 13 December 2016 the European Parliament, the Council and the Commission signed a Joint Declaration on the EU’s legislative priorities for 2017, and the Parliament’s Legislative train schedule - last updated to the end of June - keeps track of legislative proposals.

Here is an introduction to impact assessments in EU legislative processes and here to the Regulatory Scrutiny Board.  

Subsidiarity and Proportionality Task Force

From the state of the union address we remember president Juncker’s new opening:

Last but not least, I want our Union to have a stronger focus on things that matter, building on the work this Commission has already undertaken. We should not meddle in the everyday lives of European citizens by regulating every aspect. We should be big on the big things. We should not march in with a stream of new initiatives or seek ever growing competences. We should give back competences to Member States where it makes sense.

This is why this Commission has been big on big issues and small on the small ones, putting forward less than 25 new initiatives a year where previous Commissions proposed over 100. We have handed back powers where it makes more sense for national governments to deal with things. Thanks to the good work of Commissioner Vestager, we have delegated 90% of state aid decisions to the regional or local level.

To finish the work we started, I am setting up a Subsidiarity and Proportionality Task Force as of this month to take a very critical look at all policy areas to make sure we are only acting where the EU adds value. First Vice-President Frans Timmermans, who has a proven track record on better regulation, will head this Task Force. The Timmermans Task Force, which should include Members of this Parliament as well as Members of national Parliaments, should report back in a years’ time.  

Better enforcement

The European Union is, as president Juncker underlined, a community of law. Correct and timely transposition is crucial, as is effective application of EU law (page 66):

Better application of EU law is a priority of the Juncker Commission and a key part of the Better Regulation Agenda. The Commission restated its commitment to improving the application of EU law in a Communication of December 2016 which sets out a more strategic approach to its infringement policy. It announced that it would give priority to pursuing the most serious breaches of EU law affecting the interests of citizens and businesses. As of September 2017, 1,659 infringement cases have been opened by the Commission. This is a considerable increase from the previous years.

SOTEU brochure presentations   

Having come this far, we might as well remind ourselves what the remaining part of the State of the Union 2017 brochure promises to deal with:

The State of Public Opinion in the EU

Progress in the Economic Situation

Policy Implementation Report

The European Solidarity Corps: One Year on

Visits to national Parliaments

Citizens’ Dialogues

Letter on the Roadmap for a More United, Stronger and a More Democratic Union   

Future blog posts are going to look at these sections.

Ralf Grahn

Progress on the European Commission’s ten priorities

After our customary pit stop on the European Commission’s State of the Union 2017 web page,  the Commission State of the Union 2017 brochure (108 pages) continues on page 35 with a section Progress on the European Commission’s 10 priorities.

Starting from the 2014 political guidelines for the Commission - with the ten priorities presented in detail in the booklet A New Start for Europe - the SOTEU 2017 brochure dedicates two pages or more to each priority in a readable mix for an educated  general reader (or participant at a citizens’ dialogue) about statistical fact, legislative progress, individual examples, next steps and potential benefits.

This means that on more than twenty pages in all (pages 35 to 59, to be exact), there is more context and detail (and support for arguments) than the Commission president Jean-Claude Juncker was able to highlight during his hour-long state of the union address.

Since I am not going into each Commission priority in this blog post, here is a reminder of what they are at headline level:

1. A new boost for jobs, growth and investment

2. A connected digital single market

3. A resilient energy union with a forward-looking climate change policy

4. A deeper and fairer internal market with a strengthened industrial base

5. A deeper and fairer economic and monetary union (EMU)

6. A balanced and progressive trade policy to harness globalisation [renamed and updated]

7. An area of justice and fundamental rights based on mutual trust

8. Towards a new policy on migration

9. Europe as a stronger global actor

10. A union of democratic change

Trade and investment   

Circumstances have changed for the sixth priority, leading to a new title and revised content. The headline A Reasonable and Balanced Free Trade Agreement with the U.S. reflected the expectations of a groundbreaking Transatlantic Trade and Investment Partnership (TTIP).

Since the TTIP negotiations are on hold during the new US administration, this has liberated Commission resources to pursue and initiate (separate) free and fair trade deals and investment agreements with other important trading partners, while conducting negotiations in a more transparent manner. Besides, the Commission has moved towards a more protective (or protectionist) mould for trade policy, labeled as ‘not naïve’. The latest proposals were published the day after the SOTEU address. See IP/17/3182 and  IP/17/3183, the launch of trade negotiations with Australia and New Zealand, as well as other links in the press releases.    

Worthwhile summary

The SOTEU brochure section Progress on the European Commission’s 10 priorities is a worthwhile summary of progress in various areas for an educated public interested in EU affairs.

For professionals interested in more exact references to legislative processes, I would recommend the EPRS publication presented in the blog post European Commission priorities at mid-term. Even more detailed, if we consult the background documentation (print versions), is the European Parliament’s Legislative train schedule, last updated to the end of June 2017.

Naturally, outside perspectives and independent views are necessary in order to evaluate gaps between wishes and realities, between gloss and gaps. In a 16 September 2017 post, The State of the Union [What Think Tanks Are Thinking], the European Parliamentary Research Service Blog has compiled titles and links to more than fifty papers from research institutes and organisations since April 2017.

After the state of the union speech, we can expect more activity with a specific SOTEU focus from think tanks, organisations and individual writers. Thus, a new and hopefully thematic compilation from the EPRS soon would be welcome.

SOTEU brochure in progress  

Having come this far, we might as well remind ourselves what the remaining part of the State of the Union 2017 brochure promises to deal with:

Better Regulation

Delivering on What the EU Promised: Enforcing More Effectively Our Joint Decisions

The State of Public Opinion in the EU

Progress in the Economic Situation

Policy Implementation Report

The European Solidarity Corps: One Year on

Visits to national Parliaments

Citizens’ Dialogues

Letter on the Roadmap for a More United, Stronger and a More Democratic Union   

We continue the presentations in future blog posts.

Ralf Grahn

European Council endorsed Annual Growth Survey 2012 priorities

The European Semester was kicked off by the Annual Growth Survey 2012 (AGS) Brussels, 23.11.2011 COM(2011) 815 final VOL. 1/5 (and the four annexes, Volumes 2-5).


EUCO conclusions

The conclusions of the spring European Council (EUCO) were brief and general in the fourth cornerstone paragraph:

4. For 2012, the European Council endorses the five priorities set out in the Commission's Annual Growth Survey for action taken at the EU and national level to:

– pursue differentiated, growth-friendly, fiscal consolidation,
– restore normal lending to the economy,
– promote growth and competitiveness,
– tackle unemployment and the social consequences of the crisis, and
– modernise public administration.

Synthesis report

When the European Council conclusions endorse the priorities proposed by the Commission, there is - if not a whole mountain - at least a molehill of views and conclusions behind each paragraph to inspire more detailed future policy work.

The Danish presidency prepared a shortcut: Implementation of the European Semester - Synthesis report (22 February 2012, Council document 6662/12).

However, the Synthesis report did not offer links to the various documents. Some readers may need to revisit the original and more detailed contributions submitted to the spring European Council, in order to find out what the five priorities set out in the Commission's Annual Growth Survey (AGS) and its annexes actually mean and require in the form of action.



Ralf Grahn
speaker on EU affairs, especially digital policy and law

P.S. Between the global issues and the national level, with a tenuous hold on democracy, the European Union institutions and the eurozone coteries shape our future. At the same time we see a European online public sphere emerging. Grahnlaw (recently ranked fourth among political blogs in Finland), Grahnblawg (in Swedish) and Eurooppaoikeus (meaning European Law, in Finnish) are among the more than 900 euroblogs aggregated by multilingual Bloggingportal.eu. Are you following the debates which matter for your future? Is your blog already listed on Bloggingportal?

EU Council presidency of Denmark in the media 1/2

After a look at media reporting about the Danish presidency of the Council of the European Union, the euroblogger Jon Worth pronounced ”perhaps not stellar, but at least there is some online discussion about the Press Trip and the launch of the Presidency”.


UK official blogging (FCO Blogs)

You can check Worth's blog for several entries about the press trip and the Danish presidency. He proceeded to give sound blogging advice to the presidency blog launched by the Copenhagen British Embassy (FCO Blogs), based on the post by the UK ambassador Nick Archer about the beginning of the Danish presidency.

According to the ambassador, the prime minister and the deputy prime minister of the United Kingdom are passionate enough about some of the (thirty plus) policies of the European Union to abstain from heading for the exit, namely growth, jobs, Single Market and free trade.


Linking and engaging

I am not going to start providing photos, but let us take Jon Worth's blogging lesson about linking and engaging (discussing) seriously, just adding that substance and sources have a role in political and legal affairs.

It may be somewhat self-centred to start by linking to myself before beginning the wider media tour, but my blog posts present and discuss the Danish priorities and make references to primary sources, while occasionally linking to news reports and media comments, including blog entries.

Grahnblawg (SV): Ekonomisk politik under pågående kris: Danmark ordförande i EU:s råd

Grahnlaw (EN): Growth and jobs: Denmark's EU Council presidency

Eurooppaoikeus (FI): Tanska vesijohtovedellä maineeseen: Painotukset EU:n neuvoston puheenjohtajana

Grahnblawg (SV): Danmark första gröna ordförandeskapet för EU:s råd?

Grahnlaw (EN): A safe Europe a priority Denmark has opted out of

Grahnlaw (EN): EU Council presidency with opt-outs

Grahnlaw (EN): Thorny questions for Denmark and EU Council

Eurooppaoikeus (FI): Tanska: neljän prioriteetin ja poikkeuksen paradoksi EU:ssa

***

Far from stellar, but an introduction to the next six months of monitoring. In part 2/2 I am going to look at some of the news and opinion I have noticed and gathered for my readers with regard to the EU Council presidency of Denmark.



Ralf Grahn

European Council: Economic policy reform priorities I

What impetus, political directions and priorities did the spring European Council provide the EU and the member states with regard to economic policy?

The European Council speaks through its conclusions:

European Council 24/25 March 2011 Conclusions; Brussels, 25 March 2011 (EUCO 10/11; 34 pages)


Procedure

The European Council adheres to the improved policy planning cycle put into practice since the beginning of 2011 and known as the European semester. Each EU member state is going to present the final version of two programmes (by the end of April):

a) each euro area member a Stability Programme, and for a state which still has not adopted the euro currency a Convergence Programme, in accordance with the Stability and Growth Pact (SGP);

b) a National Reform Programme (NPR) as a means towards the Europe 2020 strategy aims of smart, sustainable and inclusive growth.

The European Commission will then have a further chance to issue opinions and recommendations aimed at individual member states (end of May or beginning of June).

Different Council configurations can be expected to contribute with their grain of wisdom, before the June 2011 European Council concludes the first integrated planning cycle, laying the foundation for the ultimate success or failure of the policies for sustainable public finances and the EU2020 decade of growth reforms in the European Union.

The next steps are schematically outlined in paragraph 2 of the European Council conclusions:

2. Within the new framework of the European semester, the European Council endorsed the priorities for fiscal consolidation and structural reform (1). It underscored the need to give priority to restoring sound budgets and fiscal sustainability, reducing unemployment through labour market reforms and making new efforts to enhance growth. All Member States will translate these priorities into concrete measures to be included in their Stability or Convergence Programmes and National Reform Programmes. On this basis, the Commission will present its proposals for country-specific opinions and recommendations in good time for their adoption before the June European Council.

European semester

The clearest exposition of the European semester is probably the Commission memo (with links to relevant proposals):

European semester: a new architecture for the new EU Economic governance – Q&A; Brussels, 12 January 2011 (MEMO/11/14)

See also Grahnlaw Suomi Finland: EU EPSCO Council: Recalling the European semester.

In Finnish, for instance 'EU:n talouspolitiikan eurooppalainen ohjausjakso (European Semester)' or in Swedish 'Katekes och mässbok för EU-toppmötet'.


”The priorities”

Even if later paragraphs add some text, without the footnote (1) in paragraph 2 of the European Council conclusions we would have been even more ignorant with regard to what ”the priorities” for fiscal consolidation and structural reform are:

In line with the Council's conclusions of 15 February and 7 March 2011 and further to the Commission's Annual Growth Survey. See also the Presidency's synthesis report of 16 March 2011.

Without this footnote, readers would have been totally lost. However, the European Council seems to care little about offering readers convenient guidance through links to relevant documents or even exact references. ”In line with” is sibylline enough, but we are invited to embark on a search for four different documents.

Adding to opacity and poor governance, the European Council generally does not acknowledge even the documents specifically submitted to it by different Council configurations.


Annual Growth Survey (AGS)

Even if the European Council refers to the first Annual Growth Survey (AGS) in an off-hand manner, this is the logical place to start. This communication from the Commission is the synthesis or catechism of needed macro-economic and growth-enhancing reforms:

Annual Growth Survey: advancing the EU's comprehensive response to the crisis; Brussels, 12.1.2010 COM(2011) 11 final (10 pages, plus three annexed reports)

Back in January, the reports annexed to the Annual Growth Survey were:

Annex 1: Progress report on Europe 2020 (16 pages)

Annex 2: Macro-economic report (23 pages)

Annex 3: Draft Joint Employment Report (13 pages)

The draft JER has since then become the Joint Employment Report, as adopted by the Council EPSCO) 7 March 2011.

See also Grahnlaw: EU EPSCO and Competitiveness Council: Annual Growth Survey is cornerstone.


The foundation

As we have seen, the off-hand remark by the European Council regarding the Annual Growth Survey from the Commission actually leads us to four documents (62 pages in all), instead of one.

Thanks to the proactive stance of the Commission, in the AGS we have a foundation on which later Council and European Council conclusions are built.

Part II is going to look at the Council documents the European Council referred to.



Ralf Grahn



P.S. What happens in Europe? With updates from media on European affairs and from 28 countries – more than 1000 newspapers - you can find out directly in a few instances through EUfeeds. Bookmark this great service from the European Journalism Centre.

EU TFEU: Directives on specific services

The EU’s Treaty of Lisbon strengthens the role of the directly elected European Parliament by the extended use of the ‘ordinary legislative procedure’ (co-decision).

Article 52 of the Treaty establishing the European Community is one example of this, in the context of specific services. In practice, though, there are a number of reasons why the practical change is less than it seems in this specific case.

We follow the route of the current treaty, the draft Constitution, the Constitutional Treaty and the Lisbon Treaty to end up with a consolidated version of the Article as part of the Treaty on the Functioning of the European Union, although our progress is not chronological.


***

The Treaty of Lisbon (ToL) makes an amendment to Article 52 of the Treaty establishing the European Community (TEC). This is what the intergovernmental conference (IGC 2007) says in point 58 (OJ 17.12.2007 C 306/55):

58) In Article 52(1), the words ‘the Council shall, on a proposal from the Commission and after consulting the Economic and Social Committee and the European Parliament, issue’ shall be replaced by ‘the European Parliament and the Council, acting in accordance with the ordinary legislative procedure and after consulting the Economic and Social Committee, shall issue’.

***

The surrounding words are found in the latest consolidated version of the current treaties, the TEU and the TEC, in OJ 29.12.2006 C 321 E/63:

Article 52 TEC

1. In order to achieve the liberalisation of a specific service, the Council shall, on a proposal from the Commission and after consulting the Economic and Social Committee and the European Parliament, issue directives acting by a qualified majority.

2. As regards the directives referred to in paragraph 1, priority shall as a general rule be given to those services which directly affect production costs or the liberalisation of which helps to promote trade in goods.

***

There is one specific amendment and one horizontal amendment to be made, deleting ‘acting by a qualified majority’ according to point 2(d), but we add the renumbering of the Article and the location of the provision from the Tables of equivalences. This is what the Article should look like according to the Lisbon Treaty, where it forms part of the Treaty on the Functioning of the European Union (TFEU):

Part Three ‘Policies and internal actions of the Union’

Title III (renumbered Title IV) ‘Free movement of persons, services and capital’

Chapter 3 ‘Services’

Article 52 TFEU (ToL), renumbered Article 59 TFEU

1. In order to achieve the liberalisation of a specific service, the European Parliament and the Council, acting in accordance with the ordinary legislative procedure and after consulting the Economic and Social Committee, shall issue directives.

2. As regards the directives referred to in paragraph 1, priority shall as a general rule be given to those services which directly affect production costs or the liberalisation of which helps to promote trade in goods.

***

The corresponding provision in the draft Treaty establishing a Constitution for Europe was Article III-32 (OJ 18.7.2003 C 169/33):

Article III-32 Draft Constitution

1. A European framework law shall establish the measures in order to achieve the liberalisation of a specific service. It shall be adopted after consultation of the Economic and Social Committee.

2. As regards the European framework law referred to in paragraph 1, priority shall as a general rule be given to those services which directly affect production costs or the liberalisation of which helps to promote trade in goods.

***

The IGC 2004 took over the draft text with minor retouches in Article III-147 of the Treaty establishing a Constitution for Europe (OJ 16.12.2004 C 310/64):

Article III-147 Constitution

1. European framework laws shall establish measures to achieve the liberalisation of a specific
service. They shall be adopted after consultation of the Economic and Social Committee.

2. European framework laws referred to in paragraph 1 shall as a general rule give priority to those services which directly affect production costs or the liberalisation of which helps to promote trade in goods.

***

Between the current TEC and the proposed Lisbon Treaty there is one substantial amendment, namely that the ordinary legislative procedure (co-decision) shall apply to directives issued on this legal base. This change was introduced by the European Convention.

The UK Foreign and Commonwealth Office (FCO) correctly describes Article 59 TFEU (Article 52 ToL) in ‘A comparative table of the current EC and EU Treaties as amended by the Treaty of Lisbon’ (Command paper 7311; page 9):

“Draws on Article 52 TEC. QMV already applies, decision-making moves to co-decision.”

Because the new names for the legal instruments were scrapped by the IGC 2007 as part of the ‘constitutional concept’, the efforts by the European Convention and the IGC 2004 to introduce plainer language fell by the wayside.

***

In practice, the victory for the European Parliament is more numerical than actual, since most EC (EU) legislation on services has been based on other provisions. Thus, co-decision has been the norm.

The direct effect of treaty provisions on free movement and the limited scope of Article 52 TEC (specific services) have also diminished its importance as a legal base.

The loosely accorded priority given by Article 52(2) TEC to services affecting production costs or helping to promote trade in goods have been of minor significance.


Ralf Grahn

EU TFEU: Quantitative import restrictions

Besides security, the main objective of European integration is prosperity for the citizens of the European Union.

The prohibition of quantitative restrictions between member states on imports is one of the fundamental principles of the internal market.

The drafters of the earlier treaties have been smart enough to include ‘all measures having equivalent effect’ and the Treaty of Lisbon to leave the single market provisions undisturbed.


***

In the Treaty of Lisbon (ToL) the intergovernmental conference (IGC 2007) is silent between point 45 on Customs cooperation and point 46 on Agriculture and fisheries (OJ 17.12.2007 C 306/52-53). The annexed Tables of equivalences however give us an indication that there is a whole chapter to look at, brief but of fundamental importance to the internal market (OJ 17.12.2007 C 306/207).

We notice that Article 28 of the Treaty establishing the European Community (TEC) first becomes Article 28 of the Treaty on the Functioning of the European Union (TFEU) in the Lisbon Treaty version (ToL), later to be renumbered Article 34 TFEU in the coming consolidated version.

We set the provision into its future context (from the Tables of equivalences) and present its contents (taken from the latest consolidated version of the current treaties, OJ 29.12.2006 C 321 E/52):

Part Three Policies and internal actions of the Union

Title I The internal market

Chapter 2 (renumbered Chapter 3) Prohibition of quantitative restrictions between Member States

Article 28 TFEU (ToL), renumbered Article 34 TFEU

Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited between Member States.

***

The European Convention proposed the following Article III-42 of the draft Treaty establishing a Constitution for Europe (OJ 18.7.2003 C 169/34):

Subsection 3
Prohibition of quantitative restrictions

Article III-42 Draft Constitution

Quantitative restrictions on imports and exports and all measures having equivalent effect shall be prohibited between Member States.

***

The IGC 2004 took over the draft text ‘verbatim’ as you see in Article III-153 of the Treaty establishing a Constitution for Europe (OJ 16.12.2004 C 310/65):

Subsection 3
Prohibition of quantitative restrictions

Article III-153 Constitution

Quantitative restrictions on imports and exports and all measures having equivalent effect shall be prohibited between Member States.

***

If we take a look at the following Articles of the current TEC and the proposed TFEU, we are able to see that they have separate provisions concerning quantitative restrictions on imports and on exports, whereas the draft Constitution and the Constitution shortened the text by merging the two.

A citizen of the European Union can only dream of the brevity of the Constitution of the United States of America, but shorter, sharper and clearer treaty texts would in general be an improvement.

In this case, however, the provisions under discussion are among the shortest, and despite their brevity they carry a lot of punch. In addition, they are much sinned against. Preserving the distinction between two different Articles makes it easier to track case law back in time and to deal with different measures where in depth study is called for.

It is therefore preferable to let the coin preserve its two sides, considering the fundamental importance of these distinct provisions for the working of the internal market.

***

Clear quantitative restrictions in international trade are usually called quotas, in this case import quotas.

Import quotas are protective or protectionist measures, since they leave part of the demand to be filled by domestic suppliers (leading to a privileged position for them and conversely to higher prices and less choice for enterprises looking for components or raw materials as well as for consumers).

Creating national artificial bottlenecks on imports contradicts the basic ideas behind the internal market.

***

‘What’s in a name? that which we call a rose
By any other name would smell as sweet.’

Or, as nasty, Shakespeare might have said, had he been into trade instead of young love and protectionism instead of flowers.

One of the main contributions of the drafters of the treaties is the appropriate and repeated use of the phrase ‘and all measures having equivalent effect’. Member states’ restrictive legislative acts or administrative practices do not escape (in the long run) despite creative labelling. Their effects count, not the label.

***

Since the basic tenets of the internal market are left unchanged, they are barely noticeable if you read the research papers or the commentaries on the Lisbon Treaty. You just have to go to text books or case law, if you want to study the single market. (My intention is to look at the treaties as a whole, as they would stand when the Treaty of Lisbon has entered into force. At the present time, earlier posts cover most of the TEU and the beginning of the TFEU.)

***

Some of the treaty provisions need clarifying (secondary) legislation to become effective. Others, like Article 28 (new 34) of the Lisbon Treaty TFEU are clear enough to have direct effect, automatic application. Only by having priority over national provisions does European Community law offer redress to EU firms and citizens.

***

There are permissible prohibitions and restrictions on imports (and exports and goods in transit), but these will be dealt with another day, after we have looked at quantitative restrictions on exports.


Ralf Grahn