European Commission

Directorate-General for Press and Communication

Manuscript completed in October 2003

Europe in 12 lessons

by Pascal Fontaine
Former assistant to Jean Monnet
and Professor at the Institut d’Etudes Politiques, Paris

Illustrated by Mario Ramos

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What purpose does the EU serve? Why and how was it set up? How does
it work? What has it already achieved for its citizens, and what new
challenges does it face today? As it expands to embrace 25 or 30
countries, how must the European Union change? In an age of
globalisation, can the EU compete successfully with other major
economies? Can Europe continue to play a leading role on the world
stage?

These are just some of the questions Pascal Fontaine – EU expert and
former university lecturer – explores in this fascinating booklet. Clear,
readable and fully updated in 2003, Europe in 12 lessons is the successor
to his very popular Europe in 10 points.

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Europe in 12 lessons

CONTENTS

1 Why the European Union? ..

2 Historic steps ..
3 Enlargement ..
4 How does the Union work? ..
5 What does the Union do? ..
6 The single market ..
7 Economic and monetary union and the euro ..
8 Towards a knowledge-based society ..
9 A citizens’ Europe ..
10 Freedom, security and justice ..
11 The European Union on the world stage ..
12 What future for Europe? ..

Key dates in the history of European integration ..

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1. Why the European Union?

Peace

The idea of a united Europe was once just a dream in the minds of
philosophers and visionaries. Victor Hugo, for example, imagined a
peaceful ‘United States of Europe’ inspired by humanistic ideals. The
dream was shattered by two terrible wars that ravaged the continent
during the first half of the 20th century.

But from the rubble of World War II emerged a new kind of hope.
People who had resisted totalitarianism during the war were determined
to put an end to international hatred and rivalry in Europe and to build a
lasting peace between former enemies. Between 1945 and 1950, a
handful of courageous statesmen including Konrad Adenauer, Winston
Churchill, Alcide de Gasperi and Robert Schuman set about
persuading their peoples to enter a new era. There would be a new order
in western Europe, based on the interests its peoples and nations shared
together, and it would be founded upon treaties guaranteeing the rule of
law and equality between all countries.

Robert Schuman (French Foreign Affairs Minister) took up an idea

originally conceived by Jean Monnet and, on 9 May 1950, proposed
setting up a European Coal and Steel Community (ECSC). In countries
that had once fought each other, the production of coal and steel would be
pooled under a shared authority – the ‘High Authority’. In a practical but
also richly symbolic way, the raw materials of war were being turned into
instruments of reconciliation and peace.

This bold and generous move was a big success. It was the start of more
than half a century of peaceful co-operation between the member states of
the European Communities. With the Treaty of Maastricht in 1992, the
Community institutions were strengthened and given broader
responsibilities, and the European Union (EU) as such was born.

The EU worked hard to help unify Germany after the fall of the Berlin
wall in 1989. When the Soviet empire fell apart in 1991, the countries of
central and eastern Europe, having lived for decades under the

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authoritarian yoke of the Warsaw Pact, quite naturally decided that their
future lay within the family of democratic European nations.

Safety and security

But Europe in the 21st century still has to deal with issues of safety and
security. These things can never be taken for granted. Every new step in
world development brings with it not only opportunities but also risks.
The EU has to take effective action to ensure the safety and security of its
15 (and soon 25) member states. It has to work constructively with the
regions just beyond its borders – North Africa, the Balkans, the Caucasus,
the Middle East. The tragic events of 11 September 2001 in New York
and Washington made us all aware of how vulnerable we are when
fanaticism and the spirit of vengeance are let loose.

The EU institutions are central to Europe’s success in inventing and

operating a system that has brought real and lasting peace to a large area
of the planet. But the EU must also protect its military and strategic
interests by working with its allies – especially its NATO allies – and by
developing a genuine European security and defence policy (ESDP).

Internal and external security are two sides of the same coin. In other
words, the EU also has to fight terrorism and organised crime – and that
means the police forces of all EU countries have to work closely together.
One of Europe’s new challenges is to make the EU an area of freedom,
security and justice where everyone has equal access to justice and is
equally protected by the law. To achieve this, EU governments need to
cooperate more closely and bodies like Europol (the European Police
Office) must play a more active and effective role.

Economic and social solidarity

The European Union has been built to achieve political goals, but its
dynamism and success spring from its economic foundations – the ‘single
market’ formed by all the EU member states, and the single currency (the
euro) used by 12 of them.

The EU countries account for an ever smaller percentage of the world’s

population. They must therefore continue pulling together if they are to
ensure economic growth and be able to compete on the world stage with
other major economies. No individual EU country is strong enough to go

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it alone in world trade. To achieve economies of scale and to find new
customers, European businesses need to operate in a bigger market than
just their home country. That is why the EU has worked so hard to open
up the single European market – removing the old obstacles to trade and
cutting away the red tape that entangles economic operators.

But Europe-wide free competition must be counterbalanced by Europe-

wide solidarity, expressed in practical help for ordinary people. When
European citizens become the victims of floods and other natural
disasters, they receive assistance from the EU budget. Furthermore, the
continent-wide market of 380 million consumers must benefit as many
people as possible. The ‘structural funds’, managed by the European
Commission, encourage and back up the efforts of the EU’s national and
regional authorities to close the gap between different levels of
development in different parts of Europe. Both the EU budget and money
raised by the European Investment Bank are used to improve Europe’s
transport infrastructure (for example, to extend the network of motorways
and high-speed railways), thus providing better access to outlying regions
and boosting trans-European trade.

Working more closely together to promote the European

model of society

Europe’s post-industrial societies are becoming increasingly complex.

Standards of living have risen steadily, but there are still gaps between
rich and poor and they may widen as former Communist countries join
the EU. That is why it is important for EU member states to work more
closely together on tackling social problems.

In the long run, every EU country benefits from this cooperation. Half a
century of European integration has shown that the whole is greater than
the sum of its parts. The EU as a unit has much more economic, social,
technological, commercial and political ‘clout’ than the individual efforts
of its member states, even when taken together. There is added value in
acting as one and speaking with a single voice as the European Union.

Why? Because the EU is the world’s leading trading power and thus
plays a key role in international negotiations. It brings all its trading and
agricultural strength to bear within the World Trade Organisation, and in
implementing the Kyoto Protocol on action to reduce air pollution and
prevent climate change. It launched important initiatives at the August
2002 Johannesburg Summit on sustainable development. It takes a clear

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position on sensitive issues that concern ordinary people – issues such as
the environment, renewable energy resources, the ‘precautionary
principle’ in food safety, the ethical aspects of biotechnology and the
need to protect endangered species.

The old saying "strength in unity" is as relevant as ever to today’s

Europeans. Europe’s strength springs from its ability to take united action
on the basis of decisions made by democratic institutions – the European
Council, the European Parliament, the Council of Ministers, the European
Commission, the Court of Justice, the Court of Auditors.

The EU wants to promote human values and social progress. Europeans

see globalisation and technological change revolutionising the world, and
they want people everywhere to be masters – not victims – of this
process of change. People’s needs cannot be met simply by market forces
or by the unilateral action of one country.

So the EU stands for a view of humanity and a model of society that the
vast majority of its citizens support. Europeans cherish their rich heritage
of values that includes a belief in human rights, social solidarity, free
enterprise, a fair sharing of the fruits of economic growth, the right to a
protected environment, respect for cultural, linguistic and religious
diversity and a harmonious yoking of tradition and progress.

The EU Charter of Fundamental Rights, proclaimed in Nice on 7

December 2000, sets out all the rights recognised today by the EU’s 15
member states and their citizens. Europeans have a wealth of national
and local cultures that distinguish them from one another, but they are
united by their common heritage of values that distinguishes Europeans
from the rest of the world.

The Treaty of Maastricht enshrined, for the first time, the ‘principle of
subsidiarity’, which is essential to the way the European Union works. It
means that the EU and its institutions act only if action is more effective
at EU level than at national or local level. This principle ensures that the
EU does not interfere unnecessarily in its citizens’ daily lives. European
identity is a valuable asset to be preserved: it must never be confused
with uniformity – which is something Europeans definitely reject.

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2. Historic steps

Today’s European Union is the result of the hard work put in by men and
women working for a united Europe. The EU is built on their concrete
achievements. In no other region of the world have sovereign countries
pooled their sovereignty to this extent and in so many areas of crucial
importance to their citizens. The EU has created a single currency and a
dynamic single market in which people, services, goods and capital move
around freely. It strives to ensure that, through social progress and fair
competition, as many people as possible enjoy the benefits of this single
market.

The ground rules of the European Union are set out in a series of treaties:
• the Treaty of Paris, which set up the European Coal and Steel
Community (ECSC) in 1951;
• the Treaties of Rome, which set up the European Economic
Community (EEC) and the European Atomic Energy Community
(Euratom) in 1957.

These founding treaties were subsequently amended by

• the Single European Act (1986),
• the Treaty on European Union (Maastricht, 1992)
• the Treaty of Amsterdam (1997) and
• the Treaty of Nice (2001).

These treaties have forged very strong legal ties between the EU’s
member states. European Union laws directly affect EU citizens and give
them very specific rights.

The first step in European integration was taken when six countries
(Belgium, the Federal Republic of Germany, France, Italy, Luxembourg
and the Netherlands) set up a common market in coal and steel. The aim,
in the aftermath of the Second World War, was to secure peace between
Europe’s victorious and vanquished nations It brought them together as
equals, cooperating within shared institutions.

The six member states then decided to build a European Economic

Community (EEC) based on a common market in a wide range of goods
and services. Customs duties between the six countries were completely
removed on 1 July 1968 and common policies – notably on trade and
agriculture – were also set up during the 1960s.

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So successful was this venture that Denmark, Ireland and the United
Kingdom decided to join the Communities. This first enlargement, from
six to nine members, took place in 1973. At the same time, the
Communities took on new tasks and introduced new social, regional and
environmental policies. To implement the regional policy, the European
Regional Development Fund (ERDF) was set up in 1975.

In the early 1970s, Community leaders realised that they had to bring
their economies into line with one another and that, in the end, what was
needed was monetary union. At about the same time, however, the United
States decided to suspend the dollar’s convertibility into gold. This
ushered in a period of great instability on the world’s money markets,
made worse by the oil crises of 1973 and 1979. The introduction of the
European Monetary System (EMS) in 1979 helped stabilise exchange
rates and encouraged the Community member states to implement strict
policies that allowed them to maintain their mutual solidarity and to
discipline their economies.

In 1981 Greece joined the Communities, followed by Spain and Portugal

in 1986. This made it all the more urgent to introduce ‘structural’
programmes such as the first Integrated Mediterranean Programmes
(IMP), aimed at reducing the economic development gap between the 12
member states.

At the same time, the EEC was beginning to play a more prominent
international role. With the countries of Africa, the Caribbean and the
Pacific (the ‘ACP’ countries) it signed a series of conventions on aid and
trade (Lomé I, II, III and IV, 1975-1989) that led to the Cotonou
Agreement of June 2000. Instruments such as these enable Europe, the
world’s leading trading power, to act – and be seen to act – on the
international stage. The European Union aims, ultimately, to implement a
common foreign and security policy.
A worldwide economic recession in the early 1980s brought with it a
wave of ‘euro-pessimism’. But hope sprang anew in 1985 when the
European Commission, under its President Jacques Delors, published a
‘white paper’ setting out a timetable for completing the European single
market by 1 January 1993. The Communities adopted this ambitious goal
and enshrined it in the Single European Act, which was signed in
February 1986 and came into force on 1 July 1987.

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The political shape of Europe was dramatically changed by the fall of the
Berlin wall in 1989. This led to the reunification of Germany on 3
October 1990 and the coming of democracy to the countries of central
and eastern Europe as they broke away from Soviet control. The Soviet
Union itself ceased to exist in December 1991.

Meanwhile, the European Communities were changing too. The member

states were negotiating a new treaty that was adopted by the European
Council (i.e. their presidents and/or prime ministers) at Maastricht in
December 1991. This ‘Treaty on European Union’ came into force on 1
November 1993. The EEC was renamed simply ‘the European
Community’ (EC). Moreover, by adding areas of intergovernmental
cooperation to the existing Community system, the Treaty created the
European Union (EU). It also set new ambitious goals for the member
states: monetary union by 1999, European citizenship, new common
policies – including a common foreign and security policy (CFSP) – and
arrangements for internal security.
The new European dynamism and the continent’s changing geopolitics
led three more countries – Austria, Finland and Sweden – to join the EU
on 1 January 1995. The Union now had 15 member states and was on
course for its most spectacular achievement yet – replacing its national
currencies with a single European currency, the euro. On 1 January 2002,
euro notes and coins came into circulation in 12 EU countries (the ‘euro
area’). The euro is now a major world currency, having a similar status to
the US dollar.

As the world moves forward into the 21st century, Europeans must
together face the challenges of globalisation. Revolutionary new
technologies and the Internet explosion are transforming the world
economy. But these profound economic changes bring with them social
disruption and culture shock.

Meeting in Lisbon in March 2000, the European Council adopted a

comprehensive strategy for modernising the EU’s economy and enabling
it to compete on the world market with other major players such as the
United States and the newly industrialised countries. The ‘Lisbon
strategy’ includes opening up all sectors of the economy to competition,
encouraging innovation and business investment, and modernising
Europe’s education systems to meet the needs of the information society.
At the same time, unemployment and the rising cost of pensions are both
putting pressure on the member states’ economies, and this makes reform

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all the more necessary. Voters are increasingly calling on their
governments to find practical solutions to these issues.

Scarcely had the European Union grown to encompass 15 member states

when another 12 began knocking at its door. In the mid 1990s, it received
membership applications from the former Soviet bloc countries (Bulgaria,
the Czech Republic, Hungary, Poland, Romania and Slovakia), the three
Baltic states that had once been part of the Soviet Union (Estonia, Latvia
and Lithuania), one of the republics of the former Yugoslavia (Slovenia)
and two Mediterranean countries (Cyprus and Malta).
The EU welcomed this opportunity to help stabilise the European
continent and to extend the benefits of European unification to these
young democracies. Accession negotiations with the candidate countries
were launched in Luxembourg in December 1997 and in Helsinki in
December 1999. The Union was on the way to its biggest enlargement
ever. For ten of the candidate countries, negotiations were completed on
13 December 2002 in Copenhagen. The European Union will have 25
member states in 2004, and will continue growing as more countries join
in the years ahead.
More than half a century of integration has had an enormous impact on
the history of Europe and on the mentality of Europeans. The member
state governments, whatever their political colour, know that the age of
absolute national sovereignty is over and that only by joining forces and
pursuing “a destiny henceforward shared” (to quote the ECSC Treaty)
can their ancient nations continue to make economic and social progress
and maintain their influence in the world.

Integration has succeeded in overcoming age-old enmity between

European countries. Attitudes of superiority and the use of force to
resolve international differences have been replaced by the ‘Community
method’ of working together. This method, which balances national
interests with the common interest and respects national diversity while
creating a Union identity, is as valuable today as ever. Throughout the
Cold War period it enabled Europe’s democratic and freedom-loving
countries to stick together. The end of east-west antagonism and the
political and economic reunification of the continent are a victory for the
spirit of Europe – a spirit that European peoples need more than ever
today.

The European Union offers a response to the huge challenge of

globalisation – a response that expresses the values Europeans believe in.

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The EU offers, above all, the best possible ‘insurance policy’ for a free
and peaceful future.

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3. Enlargement

Copenhagen – a historic summit

In Copenhagen on 13 December 2002, the European Council took one of

the most momentous steps in the entire history of European unification. It
decided to welcome 10 more countries to join the EU on 1 May 2004.

In taking this decision, the European Union was not simply increasing its
surface area and its population. It was putting an end to the split in our
continent – the rift that, from 1945 onwards, separated the free world
from the Communist world. So this fifth enlargement of the EU has a
political and moral dimension.

Not only geographically but also in terms of their culture, their history
and their aspirations, the countries concerned – Cyprus, the Czech
Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia
and Slovenia – are decidedly European. In joining the European Union
they are joining the democratic European family and taking their full part
in the great project conceived by the EU’s founding fathers. The
accession treaties, signed in Athens on 16 April 2003, allow the people of
the new member states to vote and to stand for election, on the same
terms as all other EU citizens, in the European parliamentary elections in
June 2004.

The long road to EU membership

The road to this particular enlargement starts in 1989, with the fall of the
Berlin wall and the iron curtain. The EU moved swiftly to set up the
‘Phare’ programme of financial assistance, designed to help the young
democracies rebuild their economies and to encourage political reform. In
Copenhagen on 22 June 1993, the European Council stated for the first
time that “the associated countries in central and eastern Europe that so
desire shall become members of the European Union ”.

At the same time, the European Council laid down three major criteria
that candidate countries must meet before they can join the EU.

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• First, a political criterion: candidate countries must have stable
institutions guaranteeing democracy, the rule of law, human rights and
respect for and protection of minorities.

• Second, an economic criterion: candidate countries must have a

functioning market economy and be able to cope with competitive
pressure and market forces within the Union.

• Third, the criterion of being able to take on the obligations of EU

membership, including adherence to the aims of political, economic and
monetary union. This means candidate countries must adopt the entire
body of EU law – known as the acquis communautaire.

The Commission made recommendations and Parliament gave its

opinions. On this basis, the European Council in Luxembourg (December
1997) and Helsinki (December 1999) gave the go-ahead for negotiations
with 10 central and eastern European countries plus Cyprus and Malta.

The treaties of Amsterdam (signed on 2 October 1997) and Nice (signed

on 26 February 2001) are designed to consolidate the Union and
streamline its decision-making system before enlargement.

Negotiations with 10 of the candidate countries were completed in

Copenhagen on 13 December 2002. The agreements reached give these
new member states the mechanisms and transitional periods they need in
order to meet all their obligations. Before accession, each of them must
pass its own national laws incorporating the whole acquis
communautaire – which amounts to 26 000 pieces of legislation and runs
to around 80 000 pages. This legislation must not only be adopted but
also applied in practice.

Clearly, this means a huge amount of work for the national parliaments
and other bodies in these countries whose institutions have only recently
been rebuilt. But this is what it takes to ensure that the EU’s policies and
the single European market continue operating smoothly. The 15 existing
member states are, of course, doing all they can to help.

The European Union is concerned to ensure that enlargement on this

scale will not turn it into a mere free trade area. So the EU wants to
strengthen its internal cohesion and make sure that this continent-wide
family of nations can work together efficiently and effectively. That is
why it set up a Convention, chaired by Valéry Giscard d’Estaing, to
discuss Europe’s future and to draft a Constitution for the new EU of 25

14
countries. The Convention completed this task in June 2003 and – on 20
June, in Thessaloniki – the European Council announced that it
considered the draft constitutional treaty a good basis for starting the next
intergovernmental conference.

The new member states played a full part in the Convention. They will
each appoint a commissioner who will take up his or her duties on 1 May
2004, when the accession treaties come into force. Once a new European
Parliament is elected in June 2004 it will vote on the proposed members
of the new Commission, which will take up its duties on 1 November
2004.

As Commission President Romano Prodi has pointed out, by sticking to

its commitment to the candidate countries the Union has put an end to the
injustice and brutality of the 20th century, with its totalitarianisms and the
Cold War. But the EU is also showing it can put into practice a new
philosophy of international relations – one that reflects Europe’s unity yet
diversity, its national differences yet its shared values. “The European
integration process and Europe's recent history are an acknowledgement
of the points we share and those that set us apart. Enlargement will mark
the first attempt to create a new type of citizenship on a continental scale.
And it will bring a huge increase in citizens' rights and power for the
states.’ (From President Prodi’s speech to the European Parliament in
Strasbourg, on 6 November 2002).

On average, the EU’s 75 million new citizens earn only 40% of the
income enjoyed by people in the rest of the Union. That is why the
accession arrangements include financial assistance worth €10 billion in
2004, €12.5 billion in 2005 and €15 billion in 2006. This will help the
economies of the 10 new EU countries to catch up with the other 15.
Some are growing strongly, and integration between the 10 and the 15 is
already largely complete, thanks to the removal of trade barriers in the
1990s and the domestic reforms being carried through by the
governments of the 10.

The €40 billion or so to be paid from the EU budget to the new member
states in 2004-2006 will be spent mainly on structural and regional
projects, support for farming, rural development, domestic policies and
administrative costs. The deal was agreed by the EU and the ten new
member states at Copenhagen in December 2002. It keeps to the rules
laid down by the Berlin European Council (in March 1999) for EU
spending until 2006.

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How large can the EU become?

The enlarged EU of 25 countries and 454 million people will expand

even further in 2007, when Bulgaria and Romania join – if all goes
according to the plans agreed at Copenhagen. At that meeting the
European Council also agreed that it could decide, in December 2004, to
begin formal accession negotiations with Turkey if the European
Commission’s report recommends it. Negotiations with a candidate
country can begin once it has met the EU’s political and economic
criteria.

Already in 1999 the Helsinki European Council had decided that “Turkey
is a candidate State destined to join the Union on the basis of the same
criteria as applied to the other candidate States.” Turkey is a member of
NATO and the Council of Europe. It has had an association agreement
with the EU since 1964 and has been an applicant for EU membership
since 1987.

But Turkey lies on the very edge of the European continent, and the
prospect of its joining the EU raises questions about where to draw the
ultimate boundaries of the European Union. Can any country anywhere
apply for EU membership and start negotiations provided it meets the
political and economic criteria laid down in Copenhagen? Certainly, the
countries of the western Balkans such as Albania, Bosnia and
Herzegovina, Croatia, the Former Yugoslav Republic of Macedonia, and
Serbia and Montenegro could apply once they have achieved political
stability and meet the Copenhagen criteria.

Indeed, it is in the EU’s interests to promote stability in the regions that

lie on its doorstep. Enlargement pushes back and lengthens the Union’s
borders. In 2004 it will have Belarus, Russia and Ukraine as its next-door
neighbours. It will have to step up cross-border co-operation with them
on transport and environmental policy as well as on issues such as
internal security and the fight against people smuggling and other forms
of international crime.

If it is a success, could this same strategy be applied to the EU’s relations

with countries on the southern shore of the Mediterranean? Questions like
these open up the whole debate about what it means to be European, what
is the ultimate purpose of European integration and what are the EU’s
interests in the world at large. It is time to redefine and reinforce the EU’s

16
 preferential agreements with its near neighbours, and to do so in the most
wide-ranging terms possible.

THE MAIN STAGES OF THE EU’S FIFTH

ENLARGEMENT

19 December 1989: the EU sets up a programme known as Phare, for

providing financial and technical assistance to the countries of central and
eastern Europe.

3 and 16 July 1990: Cyprus and Malta apply for EU membership.

22 June 1993: the Copenhagen European Council lays down the criteria for
joining the European Union.

31 March and 5 April 1994: Hungary and Poland apply for EU membership.

1995: applications received from Slovakia (21 June), Romania (22 June),
Latvia (13 October), Estonia (24 November), Lithuania (8 December) and
Bulgaria (14 December).

1996: applications received from the Czech Republc (17 January) and
Slovenia (10 June).

12-13 December 1997: the Luxembourg European Council decides to launch

the enlargement process.

10-11 December 1999: the Helsinki European Council confirms that

accession talks will be held with 12 candidate countries. Turkey is considered
to be a candidate country “destined to join the Union”.

13 December 2002: the EU reaches agreement with 10 candidate countries

that they can join on 1 May 2004.

16 April 2003: the 10 accession treaties are signed in Athens.

1 May 2004: the 10 new member states join the EU.

December 2004: decision on whether to start accession talks with Turkey.

17
2007: the year set by the Copenhagen European Council for Bulgaria and
Romania to become EU members.

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4. How does the Union work?

The European Union is more than just a confederation of countries, but it

is not a federal State. It is, in fact, something entirely new and historically
unique. Its political system has been constantly evolving over the past 50
years and it is founded on a series of treaties – from those signed in Paris
and Rome in the 1950s to the treaties of Maastricht, Amsterdam and
Nice, agreed in the 1990s.

Under these treaties, the member states of the Union delegate some of
their national sovereignty to institutions they share and that represent not
only their national interests but also their collective interest.

The treaties constitute what is known as ‘primary’ legislation. From

them is derived a large body of ‘secondary’ legislation that has a direct
impact on the daily lives of European Union citizens. It consists mainly
of regulations, directives and recommendations.

These laws, along with EU policies in general, are the result of decisions
taken by three main institutions:
• the Council of the European Union (representing the member states),
• the European Parliament (representing the citizens) and
• the European Commission (a politically independent body that
upholds the collective European interest).

This ‘institutional triangle’ can function only if the three institutions

work closely together and trust one another. "In order to carry out their
task and in accordance with the provisions of this Treaty, the European
Parliament acting jointly with the Council and the Commission shall
make regulations and issue directives, take decisions, make
recommendations or deliver opinions". (Article 249 of the Treaty of
Maastricht).

The Council of the European Union

The Council of the European Union is the EU’s main decision-making

institution. It was formerly known as the ‘Council of Ministers’, and for
short it is simply called ‘the Council’.

19
Each EU country in turn presides over the Council for a six-month
period. Every Council meeting is attended by one minister from each of
the member states. Which ministers attend a meeting depends on which
topic is on the agenda. If foreign policy, it will be the Foreign Affairs
Minister from each country. If agriculture, it will be the Minister for
Agriculture. And so on. There are nine different Council ‘configurations’,
covering all the different policy areas including industry, transport, the
environment, etc. The Council’s work as a whole is planned and co-
ordinated by the General Affairs and External Relations Council.

The preparatory work for Council meetings is done by the Permanent

Representatives Committee (Coreper), made up of the member states’
ambassadors to the EU, assisted by officials from the national ministries.
The Council’s administrative work is handled by its General Secretariat,
based in Brussels.

The Council and European Parliament share legislative power as well as

responsibility for the budget. The Council also concludes international
agreements that have been negotiated by the Commission. According to
the treaties, the Council has to take its decisions either unanimously or by
a majority or ‘qualified majority’ vote.

On important questions such as amending the treaties, launching a new

common policy or allowing a new country to join the Union, the Council
has to agree unanimously.

In most other cases, qualified majority voting is required – in other

words, a decision cannot be taken unless a specified minimum number of
votes is cast in its favour. The number of votes each EU country can cast
roughly reflects the size of its population. Until 1 May 2004, the numbers
are as follows:

• Germany, France, Italy, the UK 10

• Spain 8
• Belgium, Greece, the Netherlands, Portugal 5
• Austria, Sweden 4
• Denmark, Ireland, Finland 3
• Luxembourg 2
TOTAL: 87

The minimum number of votes required to reach a qualified majority is

62 out of the total of 87 (i.e. 71.3%).

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For six months from 1 May 2004, when new member states join the EU,
transitional arrangements apply. From 1 November 2004, the number of
votes each country can cast is as follows:

• Germany, France, Italy and the United Kingdom 29

• Spain and Poland 27
• Netherlands 13
• Belgium, Czech Republic, Greece, Hungary and Portugal 12
• Austria and Sweden 10
• Denmark, Ireland, Lithuania, Slovakia and Finland 7
• Cyprus, Estonia, Latvia, Luxembourg and Slovenia 4
• Malta 3
TOTAL 321

A minimum of 232 votes (72.3%) will be required to reach a qualified

majority. In addition,
• a majority of member states (in some cases two thirds) must
approve the decision, and
• any member state can ask for confirmation that the votes cast in
favour represent at least 62% of the EU’s total population.

The European Council

The European Council brings together the presidents and prime ministers
of all the EU countries plus the President of the European Commission.
The President of the European Parliament also addresses every European
Council.

Its origins go back to 1974, when the EU’s political leaders (the ‘heads of
State or government’) began holding regular meetings. This practice was
made official by the Single European Act (1987). The European Council
now meets, in principle, four times a year. It is chaired by the President or
Prime Minister of the country currently presiding over the Council of the
European Union.

Given the growing importance of EU affairs in national political life, it is

appropriate that the national presidents and prime ministers should have
these regular opportunities to meet and discuss major European issues.
With the Treaty of Maastricht, the European Council officially became
the initiator of the Union’s major policies and was empowered to settle

21
difficult issues on which ministers (meeting in the Council of the
European Union) fail to agree.

The European Council has become a major media event, since its
members are all well-known public figures and some of the issues they
debate can be highly contentious. It also discusses current world
problems. Its aim is to speak with one voice on international issues,
developing a Common Foreign and Security Policy (CFSP).

The European Council is thus the EU’s highest-level policymaking body.

Some Member States would like it to become the government of Europe,
and want one of its members to represent the Union on the world stage.
Would this person be chosen by the European Council or would it
automatically be the President of the European Commission? There is
disagreement over this question.

In the mean time, the role of ‘Mr Europe’ is played by the EU’s High
Representative for the Common Foreign and Security Policy (a post
created by the Treaty of Amsterdam), who is also Secretary-General of
the Council. Javier Solana was appointed to this position in 1999.

The European Parliament

The European Parliament is the elected body that represents the EU’s
citizens and takes part in the legislative process. Since 1979, members of
the European Parliament (MEPs) have been directly elected, by universal
suffrage, every five years.

Until the 2004 elections there are 626 MEPs. Thereafter, enlargements of
the EU will increase that number. The number of MEPs from each
country is as follows (in alphabetical order according to the country’s
name in its own language):

22
 1999- 2004- 2007-
2004 2007 2009
Bulgaria - - 18
Belgium 25 24 24
Czech Republic - 24 24
Denmark 16 14 14
Germany 99 99 99
Estonia - 6 6
Greece 25 24 24
Spain 64 54 54
France 87 78 78
Ireland 15 13 13
Italy 87 78 78
Cyprus - 6 6
Latvia - 9 9
Lithuania - 13 13
Luxembourg 6 6 6
Hungary - 24 24
Malta - 5 5
Netherlands 31 27 27
Austria 21 18 18
Poland - 54 54
Portugal 25 24 24
Romania - - 36
Slovenia - 7 7
Slovakia - 14 14
Finland 16 14 14
Sweden 22 19 19
United Kingdom 87 78 78
(MAX) TOTAL 626 732 786

Parliament normally holds its plenary session in Strasbourg and any

additional sessions in Brussels. It has 17 committees that do the
preparatory work for its plenary sessions, and a number of political
groups that mostly meet in Brussels. The Secretariat-General is based in
Luxembourg.

Parliament and the Council share legislative power, and they do so using
three different procedures (in addition to simple consultation).

23
First, there is the ‘cooperation procedure’, introduced by the Single
European Act in 1986. Under this procedure, Parliament gives its opinion
on draft directives and regulations proposed by the European
Commission, which can amend its proposal to take account of
Parliament’s opinion.

Second, there is the ‘assent procedure’, also introduced in 1986. Under

this procedure, Parliament must give its assent to international
agreements negotiated by the Commission, to any proposed enlargement
of the European Union and to a number of other matters including any
changes in election rules.

Third, there is the ‘co-decision procedure’, introduced by the Treaty of

Maastricht (1992). This puts the Parliament on an equal footing with the
Council when legislating on a whole series of important issues including
the free movement of workers, the internal market, education, research,
the environment, Trans-European Networks, health, culture and consumer
protection. Parliament has the power to throw out proposed legislation in
these fields if an absolute majority of MEPs vote against the Council’s
‘common position’. However, the matter can be put before a conciliation
committee.

The Treaty of Amsterdam added another 23 and the Treaty of Nice a

further seven to the number of fields in which the co-decision procedure
applies.

Parliament and the Council also share equal responsibility for adopting
the EU budget. The European Commission proposes a draft budget,
which is then debated by Parliament and the Council. Parliament can
reject the proposed budget, and it has already done so on several
occasions. When this happens, the entire budget procedure has to be re-
started. Parliament has made full use of its budgetary powers to influence
EU policymaking. However, most of the EU’s spending on agriculture is
beyond Parliament’s control.

Parliament is a driving force in European politics. It is the EU’s primary

debating chamber, a place where the political and national viewpoints of
all the member states meet and mix. So Parliament quite naturally gives
birth to a good many policy initiatives.

Parliamentary debates are dominated by the political groups. The largest

of these are:

24
• the European People’s Party (Christian Democrats) and European
Democrats – the EPP-ED group;
• the Party of European Socialists – PES.

Parliament played a key role in drawing up the EU Charter of

Fundamental Rights (proclaimed in December 2000) and in setting up the
European Convention following the Laeken European Council in
December 2001.

Last but not least, Parliament is the body that exercises democratic
control over the Union. It has the power to dismiss the Commission by
adopting a motion of censure. (This requires a two thirds majority). It
checks that EU policies are being properly managed and implemented –
for example by examining the reports it receives from the Court of
Auditors and by putting oral and written questions to the Commission and
Council. The current President of the European Council also reports to
Parliament on the decisions taken by the EU’s political leaders.

Pat Cox was elected President of the European Parliament in 2002.

The European Commission

The Commission is one of the EU’s key institutions. Until 1 May 2004 it
has 20 members (two each from France, Germany, Italy, Spain and the
United Kingdom, one from each of the other countries), appointed for a
five year period by agreement between the Member States, subject to
approval by Parliament.

From 1 May 2004, when new member states join the EU, there will be
one commissioner per country.

The Commission acts with complete political independence. Its job is to

uphold the interest of the EU as a whole, so it must not take instructions
from any member state government. As ‘Guardian of the Treaties’, it has
to ensure that the regulations and directives adopted by the Council and
Parliament are being put into effect. If they are not, the Commission can
take the offending party to the Court of Justice to oblige it to comply with
EU law.

The Commission is also the only institution that has the right to propose
new EU legislation, and it can take action at any stage to help bring about

25
agreement both within the Council and between the Council and
Parliament.

As the EU’s executive arm, the Commission carries out the decisions
taken by the Council – in relation to the Common Agricultural Policy, for
example. The Commission is largely responsible for managing the EU’s
common policies, such as research, development aid, regional policy etc.
It also manages the budget for these policies.

The Commission is answerable to Parliament, and the entire Commission

has to resign if Parliament passes a motion of censure against it. It was
when faced with just such a motion of censure that President Jacques
Santer tendered the collective resignation of his Commission on 16
March 1999. Romano Prodi became President of the Commission for
the period 1999-2004.

The Commission is assisted by a civil service made up of 36

“Directorates-General” (DGs) and services, based mainly in Brussels and
Luxembourg. Unlike the secretariats of traditional international
organisations, the Commission has its own financial resources and can
thus act quite independently.

The Court of Justice

The Court of Justice of the European Communities, located in

Luxembourg, is made up of one judge from each EU country, assisted by
eight advocates-general. They are appointed by joint agreement of the
governments of the member states. Each is appointed for a term of six
years, after which they may be reappointed for one or two further periods
of three years. They can be relied on to show impartiality.

The Court’s job is to ensure that EU law is complied with, and that the
treaties are correctly interpreted and applied.

It can find any EU member state guilty of failing to fulfil its obligations
under the treaties. It can check whether EU laws have been properly
enacted and it can find the European Parliament, the Council or the
Commission guilty of failing to act as required.

The Court of Justice is also the only institution that can, at the request of
the national courts, give a ruling on the interpretation of the treaties and
on the validity and interpretation of EU law. So, when a question of this

26
sort is brought before a court in one of the member states, that court may
– and sometimes must – ask the Court of Justice for its ruling.

This system ensures that EU law is interpreted and applied in the same
way throughout the European Union.

The Treaties explicitly allow the Court to check whether EU legislation

respects the fundamental rights of EU citizens and to give rulings on
questions of personal freedom and security.

The Court of First Instance, which was set up in 1989 and consists of one
judge from each EU country, is responsible for giving rulings on certain
kinds of case, particularly actions brought by firms or private individuals
against EU institutions, and disputes between the institutions and their
employees.

The Court of Auditors

The Court of Auditors, set up in 1977, has one member from each EU
country, appointed for a term of six years by agreement between the
member states, after consulting the European Parliament. The Court of
Auditors checks that all the European Union's revenue has been received
and all its expenditure incurred in a lawful and regular manner and that
the EU budget has been managed soundly. It has the right to audit the
accounts of any organisation that is handling EU funds and, where
appropriate, to refer matters to the Court of Justice.

The European Economic and Social Committee

When taking decisions in policy areas covered by the EC and Euratom

treaties, the Council and Commission consult the European Economic
and Social Committee (EESC). Its members represent the various interest
groups that collectively make up ‘organised civil society’, and are
appointed by the Council for a four year term.

The EESC has to be consulted before decisions are taken in a great many
fields (employment, the European Social Fund, vocational training, etc.)
On its own initiative it can also give opinions on other matters it
considers important.

27
The Committee of the Regions

The Committee of the regions (CoR), set up under the Treaty on

European Union, consists of representatives of regional and local
government, proposed by the member states and appointed by the
Council for a four-year term. Under the Treaty, the Council and
Commission must consult the CoR on matters of relevance to the regions,
and the Committee may also adopt opinions on its own initiative.

The European Investment Bank

The European Investment Bank (EIB), based in Luxembourg, finances

projects to help the EU’s less developed regions and to help make small
businesses more competitive.

The European Central Bank

The European Central Bank (ECB), based in Frankfurt, is responsible for

managing the euro and the EU’s monetary policy. Its work is described in
greater detail in Chapter 7.

The European Convention

The institutions and other bodies described above are the main cogs in the
EU’s decision-making machinery. But the system needs overhauling if
the EU is to continue working effectively. That is why the European
Convention was set up by the European Council at Laeken in December
2001. Its 105 members represented the governments of the Member
States and candidate countries, the national parliaments, the European
Parliament and the European Commission, under the chairmanship of
former French President Valéry Giscard d'Estaing. Its job was to
propose a new way of running the European Union after enlargement.

The EU faces two main challenges. First, enlargement over the next
decade or two will bring the total number of member states to perhaps 30
or 35. Can the Council be expected to reach unanimous agreement on
anything with so many ministers around the table? Will EU decision-
making not simply grind to a halt? How will the Union be governed?
Who will speak for Europe on the world stage? Where will the final

28
frontiers of the European Union be drawn? After all, the Council of
Europe (not an EU institution) already has 45 member states including
Russia, Ukraine, Turkey and the Caucasus countries.

Second, the EU’s citizens want to have a greater say in shaping EU

policies, but they find it hard to understand the EU’s highly complex
decision-making system and they perceive ‘Brussels’ as too remote from
their daily lives. Hence the need for a Constitution that clearly sets out
who is responsible for doing what in the European Union. A Constitution
that specifies the powers and responsibilities of each EU institution and
what should be left to the authorities at regional and national level.

The EU needs to invent a new form of ‘governance’ that is simpler, more

democratic and brings Europe closer to its citizens. So the Convention
drafted a Constitution designed to meet these needs, and presented it to
the European Council in June 2003.

The Constitution will be of huge importance for the future of the Union.
It was the main subject of discussion at the intergovernmental conference
(IGC) that began on 4 October 2003, and it will be a major topic of
debate in the run-up to the European parliamentary elections in June
2004.

29
TEXT BOX
Towards a European Constitution

At its meeting in Thessaloniki on 19 and 20 June 2003, the European

Council welcomed the draft constitutional treaty presented by Mr Valéry
Giscard d'Estaing, President of the Convention. The EU’s political
leaders described the draft as "a good basis for starting the
intergovernmental conference" in October 2003.

The draft proposes, among other things:

• The President of the European Council should be elected by qualified

majority for a term of two and a half years, renewable once.

• The President of the Commission should be elected by a majority of

members of the European Parliament. He or she should be proposed
by the European Council, taking into account the European
parliamentary elections.

• An EU Minister for Foreign Affairs should be appointed. He or she

should be both a Commission Vice-President and a member of the
European Council.

• The Charter of Fundamental Rights should be incorporated into the

Treaty.

• The European Union should be given legal personality.

• There should be more qualified majority voting in the Council.

• The European Parliament should be given greater legislative and

budgetary powers.

• The powers and responsibilities of the Union and its member states
should be spelt out more clearly.

• National parliaments should play a part in ensuring that the EU

complies with the principle of subsidiarity.

30
5. What does the Union do?

The people who drafted the Treaty of Rome set the following task for the
European Economic Community: "by establishing a common market and
progressively approximating the economic policies of Member States, to
promote throughout the Community a harmonious development of
economic activities, a continuous and balanced expansion, an increase in
stability, an accelerated raising of the standard of living and closer
relations between the States belonging to it".

These goals have been largely achieved, thanks to the free movement of
goods, people, services and capital and to the EU’s policy of ensuring fair
competition between businesses and protecting consumer interests. The
single market was completed in 1993 and the euro came into circulation
in 2002.

But, to enable all sectors of the economy and all regions of Europe to
benefit from these achievements, they had to be backed up by ‘structural’
policies financed and pursued with commitment and determination by the
EU itself.

Europe’s political leaders realised early on that European solidarity

would mean taking action to strengthen ‘economic and social cohesion’ –
in other words, to narrow the gap between richer and poorer regions. In
practice, this meant introducing regional and social policies, and these
policies have become more important with each successive enlargement
of the EU.

Regional action

The EU’s regional policy consists essentially of making payments from

the EU budget to disadvantaged regions and sections of the population.
The total amount allocated in 2000-2006 is 213 billion euro. The
payments are used to boost development in backward regions, to convert
old industrial zones, to help young people and the long-term unemployed
find work, to modernise farming and to help less-favoured rural areas.

The money is paid through specific funds – the European Regional

Development Fund (ERDF), the European Social Fund (ESF), the
Financial Instrument for Fisheries Guidance (FIFG) and the European

31
Agricultural Guidance and Guarantee Fund (EAGGF, also commonly
known by its French acronym FEOGA).

These payments top up or stimulate investment by the private sector and

by national and regional government. To target the payments where they
will have the greatest effect, the EU has set itself three priority objectives:

• Objective 1 is to help develop regions where the wealth produced

divided by the number of inhabitants – technically known as ‘gross
domestic product (GDP) per capita’ – is less than 75% of the EU
average. This aid, amounting to 135 billion euro, is two thirds of all
the money allocated to regional policy in 2000-2006. It goes to benefit
about 50 regions, representing 22% of the EU’s population. It is used
to get the economy moving in these regions by creating the
infrastructure they lack, providing better training for local people and
stimulating investment in local businesses.

• Objective 2 is to help other regions in difficulty. They may be areas

where the economy is being restructured, declining rural areas, fishing
communities in crisis or urban areas with serious problems.

• Objective 3 is to combat unemployment by modernising training

systems and helping to create jobs.

Specific programmes aimed at these objectives include Interreg, which

promotes co-operation across borders and between regions, and Urban –
which supports the sustainable development of cities and urban areas in
crisis.

In addition to these ‘structural’ funds there is a ‘Cohesion Fund’. This is

used to finance transport infrastructure and environmental projects in EU
countries whose per capita GDP is less than 90% of the EU average. The
countries concerned until now have been Greece, Ireland, Portugal and
Spain.

Thanks to structural schemes such as these, financed by the European

Union, EU countries have been better able to bring their economies into
line with one another. This economic ‘convergence’ is also the result of
action by EU governments to meet the requirements for economic and
monetary union.

32
Extending structural policy to embrace the new member
states

Enlarging the Union to take in 10 new member states will pose a major
challenge for economic and social cohesion, because development in
some regions of these countries lags well behind the rest of the EU.
Enlargement will, in fact, make the Union more diverse and require
further efforts at sectoral and regional adjustment.

A number of ‘instruments’ are already being used to help the candidate

countries. First there is the Phare programme, which channels aid to the
candidate countries in central and eastern Europe. Over the period 2000
to 2006 they will receive a total of €10.9 billion in ‘pre-accession’ aid.

Then there is ISPA (Instrument for Structural Policies for Pre-

Accession), which finances environmental and transport projects and has
a budget of €7.2 billion.

Thirdly, Sapard (an instrument for financing agriculture) has a budget of

€3.6 billion.

After accession (i.e. after the new member states join), the structural fund
programmes and Cohesion Fund projects will take over from pre-
accession aid.

The social dimension

The aim of the EU’s social policy is to correct the most glaring
inequalities in European society. The European Social Fund (ESF) was
set up in 1961 to promote job creation and help workers move from one
type of work and one geographical area to another. For 2003, the ESF
was allocated €4.8 billion from the EU budget.

Financial aid is not the only way in which the EU seeks to improve social
conditions in Europe. Aid alone could never solve all the problems
caused by economic recession or by regional under-development. Social
progress springs, first and foremost, from economic growth and is
nurtured by both national and EU policies.

Social progress is also supported by legislation that guarantees all EU

citizens a solid set of basic rights. Some of these rights are enshrined in

33
the Treaties – for example, the right of men and women to equal pay for
equal work. Others are set out in directives about the protection of
workers (health and safety at work) and essential safety standards.

In December 1991, the Maastricht European Council adopted the

Community Charter of basic social rights, setting out the rights all
workers in the EU should enjoy: free movement; fair pay; improved
working conditions; social protection; the right to form associations and
to undertake collective bargaining; the right to vocational training; equal
treatment of women and men; worker information, consultation and
participation; health protection and safety at the workplace; protection for
children, the elderly and the disabled. At Amsterdam in June 1997, this
Charter became an integral part of the Treaty and is applicable in all the
member states.

Employment policy

During the final decade of the 20th century, EU citizens were increasingly
calling on their governments to take more vigorous action to create jobs.
How could Europeans believe in the benefits of European integration and
have confidence in its future while more than 10% of the EU’s workforce
(until 1997) were unemployed? So a new chapter on employment was
inserted into the Treaty of Amsterdam, making job creation a priority for
the EU’s economic policy.

At the European Council in Luxembourg on 20 and 21 November 1997,

the leaders of the 15 member states agreed a coordinated strategy for
making their individual national policies more effective. It was a strategy
for better vocational training, for helping start up new businesses and for
improving ‘social dialogue’ – i.e. relations between employers and
employees. It laid down guidelines for boosting employment. Progress on
implementing these guidelines is regularly reviewed by the member states
and the EU institutions, using a jointly agreed assessment procedure.

The ‘Luxembourg strategy’ was beefed up and given a broader scope by

the European Council in Lisbon in March 2000. It became the ‘Lisbon
strategy’, and it was directed towards a new and very ambitious goal: to
make the EU, within a decade, "the most competitive and dynamic
knowledge-based economy in the world, capable of sustainable growth
with more and better jobs and greater social cohesion” (see chapter 8:
Towards a knowledge-based society).

34
Financing the common policies

In March 1999, the Berlin European Council agreed the overall size and
shape of EU finances for the period 2000-2006. This agreement was
called ‘Agenda 2000’, and its purpose was to ensure that the EU had
enough money to implement its policies and, at the same time, to prepare
for enlargement.

It was also aimed at tightening the EU’s purse strings and showing the
European taxpayer that EU funds would be used properly and efficiently.
The EU’s ‘own resources’ – chiefly made up of the money it raises from
VAT and of contributions from the member states, based on their gross
national product (GNP) – would not be allowed to exceed 1.27% of the
Union’s GNP in 2000-2006.

This budgetary discipline should enable the EU to cover the costs of

enlargement until the end of 2006 without calling into question the
solidarity policies already being implemented or preventing the Union
from undertaking new activities. The EU’s total budget for 2003 is less
than 100 billion euro – well below the ceiling agreed in Berlin.

Reforming the common agricultural policy

At the Berlin summit, when agreeing the ‘Agenda 2000’ arrangements,

the European Council decided to reform the common agricultural policy
(CAP) so as to cut the costs involved and keep European farming
competitive.

The aims of the CAP, as set out in the Treaty of Rome, have largely been
achieved: a fair standard of living has been ensured for the farming
community; markets have been stabilised; supplies reach consumers at
reasonable prices; structures have been modernised. Other principles that
were adopted in the course of time have also worked well. Consumers
enjoy security of supplies, and the prices of agricultural products are kept
stable, protected from fluctuations on the world market.

But the CAP has been a victim of its own success. As farming methods
were modernised and agriculture in Europe became increasingly
competitive, more and more people left the countryside and the farming
community as a proportion of the EU workforce shrank from 20% to less
than 5%. Production grew far faster than consumption, and the EU budget

35
had to bear the heavy cost of disposing of the surpluses. Moreover,
production was subsidised. In 2002, farm subsidies under the CAP still
amounted to €45.4 billion – which is 40% of the entire European Union
budget.

Steps had to be taken to reform this policy, which is why Agenda 2000
changed the CAP’s aims and methods. The main objective was now to
encourage farmers to produce high-quality products, in quantities more in
line with demand, and to move away from intensive farming methods that
damage the environment. Aid to farmers would no longer be related to
the volume of goods they produce.

This reform is beginning to bear fruit: production has been curbed. The
European Union is one of the world’s leading exporters and importers of
agri-foodstuffs. Farmers are being encouraged to use sustainable farming
practices that safeguard the environment and preserve the countryside.
The new role of the farming community is to ensure a certain amount of
economic activity in every rural area and to maintain the diversity of
Europe’s landscapes. This diversity and the recognition given to the ‘rural
way of life’ – people living in harmony with the land – are an important
part of Europe’s identity.

The European Commission, which is responsible for managing the CAP,

believes that farmers’ and consumers’ interests need to converge even
further. The consumer has the right to high-quality food that fully meets
public health requirements. It was the failure of EU food safety and
animal health policies in the 1990s and early 2000s that allowed foot-and-
mouth disease and ‘mad cow disease’ (bovine spongiform
encephalopathy - BSE) to spread across Europe. To stop this happening,
sale and trade embargos had to be introduced.

In 2002, the Commission proposed further reforms that would enable

Europe to influence the way the World Trade Organisation (WTO) draws
up its rules. The Commission wants the emphasis to be on food quality,
the precautionary principle and animal welfare.
Similarly, the European Union has begun reforming its fisheries policy.
The aim here is to reduce the overcapacity in fishing fleets, to preserve
fish stocks and to provide financial assistance to people who leave the
fishing industry.

36
Sustainable development

EU policies were originally focused on supporting the single market, but

they have gradually come to embrace many other aspects of daily life and
to address the challenges facing European society: environmental
protection; public health; consumer rights; competition and safety in
transport; education and access to culture.

Issues that transcend national boundaries call for concerted international

action if they are to be tackled effectively. Most cross-border issues
cannot be resolved without EU-wide legislation and funding on a scale
that only the EU can provide. To meet ordinary people’s concerns, the
Treaty of Amsterdam gave the European Union much greater powers and
responsibilities in fields such as health and consumer protection.

The most striking example of the way European institutions respond to

public opinion is surely in the field of environmental protection. People
have come to realise that pollution knows no boundaries, that our natural
heritage needs to be protected and that the individual citizen has a right to
safe and healthy products and living conditions. So the European Union
has had to take very specific action on a whole range of issues: adopting
EU-wide standards on air pollution; protecting the ozone layer by
reducing emissions of chlorofluorocarbons (CFCs); improving waste
water treatment and waste management in general; monitoring the use of
chemicals; reducing the level of noise from vehicles, and so on.

Protecting the environment is not just a matter of making tougher laws.

The European Union has also funded environmental projects and
provided financial assistance to help business and industry comply with
European environmental legislation.

In Johannesburg in August 2002, the United Nations held its ‘World

Summit on Sustainable Development’. To prepare for the summit, the
European Council met in Barcelona in March that year. It set a clear
priority for the EU: to make its own sustainable development policy an
example for the whole world to follow. The policy must include
conserving and sustainably managing natural resources; an international
system for managing the environment; action to boost Europe’s
technological capacity and greater efforts to share that technology with
the developing world. The Barcelona European Council made it the EU’s
aim to increase official development aid to 0.7% of GNP.

37
There are major challenges here. How can economic growth – which is
vital to developing countries – be encouraged without damaging the
environment? How should water resources be managed? How can we
access sustainable sources of energy? How can Africa be saved from
famine and disease? Here again are issues that can be tackled more
effectively by concerted action at EU level than by individual European
nations doing their own thing.

Technological innovation

The founders of the European Union rightly saw that Europe’s future
prosperity would depend on its ability to remain a world leader in
technology. They saw the advantages to be gained from doing joint
European research. So, in 1958, alongside the EEC, they set up Euratom
– the European Atomic Energy Community. Its aim was to enable the
member states to jointly exploit nuclear energy for peaceful purposes. It
was given its own Joint Research Centre (JRC) consisting of nine
research institutes spread among four sites: Ispra (Italy), Karlsruhe
(Germany), Petten (the Netherlands) and Geel (Belgium).

But as scientific and technological innovation gathered pace, European

research had to diversify, bringing together as wide a variety of scientists
and research workers as possible. The EU had to find new ways of
funding their work and new industrial applications for their discoveries.

Joint research at EU level is designed to complement national research

programmes. It focuses on projects that bring together a number of
laboratories in different EU countries. It supports fundamental research in
fields such as controlled thermonuclear fusion (a potentially inexhaustible
source of energy for the 21st century) through the Joint European Torus
(JET) programme. It also encourages research and technological
development (RTD) in key industries such as electronics and computers,
which face stiff competition from outside Europe.

In June 2002, the EU adopted its sixth RTD framework programme,

covering the period 2002-2006. With a budget of €17.5 billion, this
programme finances a whole series of projects that bring together
thousands of researchers from all over the EU.

It is also designed to stimulate RTD in the individual member states and

to increase the amount they spend on it from 1.9% to 3% of their GDP.
Its priorities include the life sciences (genetics and biotechnologies), the

38
treatment of serious illnesses, nanotechnologies, aeronautics and space
research, sustainable energy systems, global environmental change and
the ecosystem.

39
6. The single market
Article 2 of the Treaty of Rome set the following aim for the European
Economic Community (EEC): "to promote throughout the Community a
harmonious development of economic activities, a continuous and
balanced expansion, an increase in stability, an accelerated raising of
the standard of living and closer relations between the States belonging
to it”.

There were two complementary ways of achieving this. One was to open
up the borders, allowing people, goods and services to move around
freely within the EEC. The other was to organise solidarity among the
member states by setting up common policies and financial instruments.

The single market was finally declared ‘complete’ on 1 January 1993 -

and even then the project was not quite finished. Why did it take more
than 40 years to get this far? After all, customs duties and tariffs were
abolished within the EEC as long ago as July 1968 – eighteen months
ahead of schedule. So why the subsequent delays? Because it is much
easier to harmonise customs tariffs than to harmonise taxation. Because
the rules governing professions differ from one country to another. And
because, at the start of the 1980s, a combination of concealed
protectionism and a plethora of new technical standards drove Europe’s
national markets even further apart.

This is not quite as paradoxical as it may seem. Some of the member

states were particularly hard hit by economic recession in the wake of the
two oil crises in 1973 and 1980. These countries resorted to protectionist
measures to shield their markets from the painful pressure of increasing
world competition.

Then, in 1985, the Commission – under President Jacques Delors –

published a startling White Paper. It pointed out that the expanding
Community had the potential to become a single market serving more
than 300 million consumers. But it also showed very clearly that this
tremendous potential was being thwarted by many obstacles: queues at
border crossings; technical barriers to trade; closed markets for public
contracts… The cost of this inefficiency – the ‘cost of non-Europe’ as it
was famously called – was put at around 200 billion euro.

40
The White Paper spurred the 12 member states into action. In February
1986, they signed the Single European Act, setting out a timetable for
taking the 270 or so steps necessary for completing the single market by
1993. Progress thereafter was rapid. Businesses, professions and trade
unions all moved ahead swiftly, adapting their strategies to the new rules
of the game. The benefits were soon felt in everyone’s daily life, as a
wider range of goods and services became available and people were able
to move around freely in Europe, whether for work or leisure.

This ‘virtuous circle’ of increasing freedom of movement,

competitiveness and economic growth has become irreversible. Physical,
fiscal and technical barriers are falling one after another, although there is
still disagreement over some particularly sensitive subjects such as
harmonising taxes on savings.

If goods, services, people and money are to move around freely within
the single market, there must be rules to ensure fair competition. These
rules are laid down in the EC Treaty. For example, the Treaty prohibits
any business agreements “which have as their object or effect the
prevention, restriction or distortion of competition within the common
market” (Article 81). The Treaty also prohibits “any abuse by one or
more undertakings of a dominant position within the common market”
(Article 82).

The European Commission plays a key role in making sure that these
rules are obeyed. It can impose penalties on any firm or EU country that
breaks them. Such is the Commission’s power in this area that it can
actually ban an operation agreed between companies outside the EU if
that operation could affect the single market. The Commission also
monitors ‘State aid’ (i.e. help given to companies by EU governments).

The state of play

Overall, the achievements so far have been very satisfactory:

• The national public contract markets have been opened up, thanks to
tougher rules requiring transparent procedures and proper checks for
public supply and works contracts;

41
• Disparities between national tax systems have been ironed out by
certain common rules on indirect taxation, value added tax (VAT) and
excise duties;

• The money markets and financial services markets have been

liberalised;

• Steps have been taken to harmonise national laws on safety and

pollution, and more generally EU countries have agreed to recognise
the equivalence of each other’s laws and certification systems;

• Obstacles hindering the free movement of persons have been

removed: passport checks at most of the EU’s internal borders have
been abolished, and professional qualifications are mutually
recognised by the EU countries. For example, it is now easier for
lawyers to practice their profession throughout the European Union,
thanks to the Directive adopted in November 1997;

• Company law has been harmonised in the EU, and the member states
have brought their national laws on intellectual and industrial property
rights (trade marks and patents) into line with one another. This has
created a much better environment for industrial cooperation.

However, freedom of movement is far from complete. There are still

plenty of obstacles to hinder people from moving to another EU country
or doing certain types of work there. The Commission has taken steps to
improve worker mobility – to ensure, for example, that educational
diplomas and job qualifications obtained in one EU country are
recognised in all the others.

The single market is certainly up and running, but it is still very much a
‘work in progress’ with constant room for improvement. The coming of
the euro has been good for market transparency and competition: since
1 January 2002, consumers with euros in their pockets have been able to
shop around, directly comparing prices in a dozen different EU countries.

Work in progress

Most of the European Union’s wealth comes from its service industries,
and these are being liberalised – though some sectors are opening up
faster than others.

42
Liberalisation of the telecommunications sector has already cut prices
considerably. At the end of 2001, long-distance telephone calls were, on
average, 11% cheaper than in 2000, and 45% cheaper than in 1998.
Steps are being taken to create a genuine single market for natural gas
and electricity, but the whole subject of energy sales is a delicate one.
The market must ensure that all consumers have access to dependable
supplies of energy at affordable prices.

In November 2000, the Commission published a discussion document (a

‘Green Paper’) setting out guidelines for a Europe-wide energy policy
that uses a range of energy sources and ensures safety of supply. Unless
the EU takes action on this, in 20 to 30 years’ time it will find itself
having to import 70% of its energy resources, as against 50% at present.
It is already dependent on the Middle East for 45% of its oil imports and
on Russia for 40% of its imports of natural gas.

Furthermore, EU countries depend on one another for energy supplies

and are jointly committed to cutting their greenhouse gas emissions to
combat climate change. One of the EU’s objectives is to develop new and
renewable energy resources (including bio-fuels) so that, by 2010, the
contribution made by these ‘clean’ resources to the EU’s overall energy
supplies will have doubled – from 6% to 12%.

One major way to save energy in the EU – and to improve the

environment – is through transport policy. At present, some 50% of all
goods transported in Europe, and 80% of all passengers, go by road. Not
only does this consume a lot of energy, it also causes congestion and
harms the environment. In some urban areas, traffic is virtually
gridlocked and air pollution has reached alarming levels. To help deal
with this problem, the EU aims to take as much freight as possible off the
roads and put it onto the railways and inland waterways.

The EU needs a transport policy that will ensure the greatest possible
mobility for both people and goods throughout its frontier-free single
market. That is why rail transport in Europe must be fully liberalised –
which means harmonising the technical standards that govern the use of
Europe’s railways and giving competing operators access to the national
rail networks.

Air transport too needs improving. Every day, 25 000 planes fly across
Europe’s skies and are handled by a whole series of national air traffic

43
control (ATC) systems. This leads to congestion, delayed flights and
frustration for passengers. The Commission proposes merging the
separate ATC systems to create a ‘single European sky’.

Under pressure from the Commission and Parliament, the EU’s postal
services are also being opened up to competition. This raises the whole
issue of ‘services of general interest’. The European Union Treaty
recognises the importance of providing public services that the market
alone cannot supply. Everyone must have access to basic services (such
as water, electricity, health and postal services, etc.) at affordable prices.
Indeed, this access is essential for the EU’s economic and social
cohesion. So the EU institutions are drawing up legislation to ensure
there is no conflict between the Treaty rules on competition within the
single market and the need to maintain services of general interest at a
high level of provision. This is all part of the European Union’s efforts to
provide its citizens with a distinctively European ‘model’ of society.

Work to complete the single market now focuses on service sectors that,
in some countries, have long been the preserve of national service
providers. Opening them up to competition should help create jobs and
strengthen Europe’s economy.

44
7. Economic and monetary union – and the
euro
Since 1 January 2002, more than 300 million European citizens have
been using the euro as a normal part of daily life. It took only 10 years to
get from the Treaty of Maastricht (February 1992), enshrining the
principle of a single European currency, to the point where euro notes and
coins were circulating in 12 EU countries. This is a remarkably short time
to carry through an operation that is unique in world history.

The euro has replaced currencies that were, for many of the countries
concerned, centuries-old symbols and instruments of their national
sovereignty. In doing so, the new currency has moved Europe
considerably closer to economic union. It has also given EU citizens a
much clearer sense of sharing a common European identity. With euro
cash in their pockets, people can travel and shop throughout most of the
Union without having to change money.

How was the idea of a single European currency born? As long ago as
1970, the Werner Report, named after the then Prime Minister of
Luxembourg, proposed a convergence between the economies and
currencies of the six EEC countries. The first step in this direction was
not taken until March 1979, when the European Monetary System (EMS)
was set up. The EMS was designed to reduce variations in the exchange
rates between the currencies of the member states. It allowed them
fluctuation margins of between 2.25% and 6%. But its mechanisms were
weakened by a series of crises caused by the instability of the US dollar
and the weakness of some currencies that became prey to speculators,
especially at times of international tension.

The need for an area of monetary stability was felt increasingly as Europe
made progress in completing the single market. The Single European Act,
signed in February 1986, logically implied convergence between
European economies and the need to limit fluctuations in the exchange
rates between their currencies. How could a single market, based on the
free movement of people, goods and capital, be expected to work
properly if the currencies involved could be devalued? Devaluing a
currency would give it an unfair competitive advantage and lead to
distortions in trade.

45
In June 1989, at the Madrid European Council, Commission President
Jacques Delors put forward a plan and a timetable for bringing about
economic and monetary union (EMU). This plan was later enshrined in
the Treaty signed at Maastricht in February 1992. The Treaty laid down a
set of criteria to be met by the member states if they were to qualify for
EMU. These criteria were all about economic and financial discipline:
curbing inflation, cutting interest rates, reducing budget deficits to a
maximum of 3% of GDP, limiting public borrowing to a maximum of
60% of GDP and stabilising the currency’s exchange rate.

In protocols annexed to the Treaty, Denmark and the United Kingdom

reserved the right not to move to the third stage of EMU (i.e. adoption of
the euro) even if they met the criteria. This was called ‘opting out’.
Following a referendum, Denmark announced that it did not intend to
adopt the euro. Sweden too expressed reservations.

There would have to be some way of ensuring the stability of the single
currency, because inflation makes the economy less competitive,
undermines people’s confidence and reduces their purchasing power. So
an independent EuropeanCentral Bank (ECB) was set up, based in
Frankfurt, and given the task of setting interest rates to maintain the value
of the euro.

In Amsterdam, in June 1997, the European Council adopted two

important resolutions.

• The first, known as the ‘stability and growth pact’, committed the
countries concerned to maintain their budgetary discipline. They
would all keep a watchful eye on one another and not allow any of
them to run up excessive deficits.

• The second resolution was about economic growth. It announced

that the member states and the Commission were firmly committed
to making sure employment remained at the top of the EU’s
agenda.

In Luxembourg, in December 1997, the European Council adopted a

further resolution – on coordinating economic policies. This included the
important decision that "ministers of the States participating in the euro
area may meet informally among themselves to discuss issues connected
with their shared specific responsibilities for the single currency". The
EU’s political leaders thus opened the way to even closer ties between

46
countries that adopted the euro – ties that went beyond monetary union to
embrace financial, budgetary, social and fiscal policies.

Progress in achieving EMU has made it easier to open up and complete

the single market. In spite of the turbulent world situation (with stock
market crises, terrorist attacks and the war in Iraq), the euro area has
enjoyed the kind of stability and predictability that investors and
consumers need. European citizens’ confidence in the euro was boosted
by the successful and unexpectedly swift introduction of coins and
banknotes during the first half of 2002. People appreciate being able to
shop around more easily, now they can directly compare prices in
different European countries.

The euro has become the world’s second most important currency. It is
increasingly being used for international payments and as a reserve
currency, alongside the US dollar. Integration between financial markets
in the euro area has speeded up, with mergers taking place not only
between stockbroking firms but also between stock exchanges. An EU
action plan for financial services is due to be implemented by 2005.

STEP BY STEP TO THE EURO

7 February 1992: the Treaty of Maastricht is signed

The Treaty on European Union and Economic and Monetary Union (EMU) is
agreed in Maastricht in December 1991. It is signed in February 1992 and comes
into force in November 1993. Under this treaty, the national currencies will be
replaced by a single European currency – provided the countries concerned meet a
number of economic conditions. The most important of the ‘Maastricht criteria’ is
that the country’s budget deficit cannot exceed 3% of its gross domestic product
(GDP) for more than a short period. Public borrowing must not exceed 60% of
GDP. Prices and interest rates must also remain stable over a long period, as must
exchange rates between the currencies concerned.

47
January 1994: the European Monetary Institute is set up

The European Monetary Institute (EMI) is set up and new procedures are
introduced for monitoring EU countries’ economies and encouraging convergence
between them.

June 1997: the Stability and Growth Pact

The Amsterdam European Council agrees the ‘stability and growth pact’ and the
new exchange rate mechanism (a re-born EMS) designed to ensure stable
exchange rates between the euro and the currencies of EU countries that remain
outside the euro area. A design is also agreed for the ‘European’ side of euro
coins.

May 1998: eleven countries qualify for the euro

Meeting in Brussels from 1 to 3 May 1998, the Union’s political leaders decide
that 11 EU countries meet the requirements for membership of the euro area.
They announce the definitive exchange rates between the participating currencies.

1 January 1999: birth of the euro

On 1 January 1999, the 11 currencies of the participating countries disappear and

are replaced by the euro, which thus becomes the shared currency of Austria,
Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands
Portugal and Spain. (Greece joins them on 1 January 2001). From this point
onwards, the European Central Bank takes over from the EMI and is responsible
for monetary policy, which is defined and implemented in euro. Exchange
operations in euro begin on 4 January 1999, at a rate of about €1 to 1.18 US
dollars. This is the start of the transitional period that will last until 31 December
2001.

1 January 2002: euro coins and notes are introduced

On 1 January 2002, euro-denominated notes and coins are put into circulation.
This is the start of the period during which national currency notes and coins are
withdrawn from circulation. The period ends on 28 February 2002. Thereafter,
only the euro is legal tender in the euro area countries.

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8. Towards a knowledge-based society

As the final decade of the 20th century got under way, two great changes
began transforming economies and ways of life around the world – not
least in Europe. One was globalisation: as economies everywhere became
increasingly interdependent, a ‘global economy’ was being born. The
other was the technological revolution – the coming of the Internet and of
new information and communication technologies.

The technological revolution was born in the United States and chiefly
benefited the US economy. Doing business via the Internet made
American companies much more efficient and productive. Between 1995
and 2001, the US economy grew, on average, by 3.6% per year – well
ahead of Europe’s 2.4% annual average over the same period. In Europe,
GDP per capita is only 69% of its level in the United States, and average
labour productivity in Europe is 78% of the American figure.

By the year 2000, EU leaders were well aware that the EU economy
needed thorough modernisation in order to compete with the US and
other major world players. Meeting in Lisbon in March that year, the
European Council set the EU a new and very ambitious goal: to become,
within a decade, "the most competitive and dynamic knowledge-based
economy in the world, capable of sustainable growth with more and
better jobs and greater social cohesion.”

The EU’s leaders also agreed on a detailed strategy for achieving this
goal. The ‘Lisbon strategy’ covers such matters as research, education,
training, Internet access and on-line business. It also covers reform of
Europe’s social protection systems. These systems are one of Europe’s
great assets: they enable our societies to embrace change without too
much pain. But they must be made sustainable so that their benefits can
be enjoyed by future generations.

Every spring the European Council meets to review progress in

implementing the Lisbon strategy.

At the Council’s request, the Commission has put forward an action plan
entitled ‘e-Europe 2005’, aimed at boosting use of the Internet in the
European Union. By 2005, Europe should have modern, online public
services including government, training and health services. Users

49
everywhere should have access, at competitive prices, to a secure
‘broadband’ infrastructure. In other words, they should be able to send
voice, data and video signals over high-speed lines or satellite links and
be confident that the privacy of their messages is protected.

Much remains to be done if Europe is to exploit its full digital potential,

and to give its businesses and citizens access to low-cost but world-class
communication networks and a wide range of on-line services. For
example, all schools in the European Union must be connected to the
Internet and teachers must be trained to use it. There must be European
laws governing electronic trade and such matters as intellectual property
rights, electronic payments and online sales of financial services.

One of the aims agreed at Lisbon was to create a ‘European research

area’. This involves, for example, setting up a very high-speed trans-
European network for electronic scientific communications to link
Europe’s universities and research institutes, its science libraries and –
gradually – its schools. Steps are also being taken to remove obstacles
that hinder research workers from moving around Europe. At the same
time, there must be incentives to attract the world’s top scientists to
Europe and to encourage them to stay.

Small and medium-sized enterprises (SMEs) are the backbone of the

European economy. All too often, their competitiveness and dynamism
is hampered by fussy rules and regulations that may differ from one
country to another. Part of the Lisbon strategy is to draw up a Charter for
small businesses and to provide entrepreneurs with the capital they need
to start up high-tech businesses.

One of the EU’s priorities is to step up investment in people and

training, which are Europe’s chief assets. The European Union
recognises the importance of education and life-long learning, the need to
learn several languages and to have technological skills. The lack of well-
qualified personnel is a handicap for Europe’s telecommunications and
internet services.

Through programmes such as Socrates, Leonardo and the Youth

Programme, the European Union encourages students, teachers and
research workers to move around in Europe. It is also taking steps to
ensure that training periods spent and qualifications obtained in any one
EU country are recognised in all others.

50
Finally, the Lisbon strategy involves tackling one of Europe’s most
intractable problems – the fact that its population is ageing, and the
serious implications this has for the workforce and for the financing of
Europe’s social security and pension schemes. There are not enough
Europeans in work, especially women and older people. At the same
time, long-term unemployment is endemic in some regions of the EU and
unemployment in general varies considerably from one region to another.

So the Lisbon European Council aimed to raise the employment rate from
an average of 61% in 2000 to 70% in 2010, and to increase the proportion
of women in work from 51% to 60% over the same period.

To tackle the effects of ageing on European societies, the Barcelona

European Council in March 2002 called on EU governments to reduce
“early retirement incentives for individuals and the introduction of early
retirement schemes by companies”. By 2010, there should be “a
progressive increase of about five years in the effective average age at
which people stop working in the European Union”.

51
9. A citizens’ Europe

Is Europe about people or about business? The process of uniting Europe

began with the political vision of the EU’s founding fathers. Their
primary concern was to ensure that war could never again ravage Europe
as it had for centuries past. But to build the united Europe as effectively
and solidly as possible, they adopted a pragmatic approach, creating
European solidarity in very practical areas: coal and steel; the single
market; agricultural policies; competition…

Thus was born a Europe that some people have described as

‘technocratic’, because it needs experts, economists and civil servants to
make it work. Technocratic it may be, but the original vision would never
have become concrete reality had it not been sustained by the political
will of the European institutions.

Europe in daily life

Most of the objectives laid down in the Treaties have now been achieved.
Gone are the old rules and regulations, tax and customs barriers that once
restricted human activity in Europe and hampered the free movement of
goods, capital and services. Although we are not always aware of it, each
one of us in day-to-day life enjoys the benefits of the single market:
access to a wide range of consumer goods and products; prices kept down
by competition; policies that protect consumers and the environment;
technical standards that tend to be harmonised upwards.

Similarly, people who live in Europe’s outlying regions benefit from the
structural funds, such as the European Regional Development Fund.
Europe’s farmers have, for decades, benefited from the price support
mechanisms provided by the EAGGF (European Agriculture Guidance
and Guarantee Fund).

Almost all expenditure from the EU budget, which came to around €100
billion in 2003, goes on measures that have an impact on the daily life of
European citizens.

As soon as the Treaty of Rome came into force in 1958, European

legislators got to work on laws guaranteeing the free movement of

52
workers, freedom to provide services and the right of establishment for
professional people. Every EU citizen, regardless of nationality, is thus
free to look for work anywhere in the Union. Discrimination on the
grounds of nationality is banned. EU directives have harmonised the rules
allowing people to practise their professions in the Union. Painstaking
work was done to harmonise legislation so that the qualifications
obtained by a doctor, barrister, nurse, vet, chemist, architect, insurance
broker, etc. in any EU country would be recognised in all others.

But there were still so many activities governed by different national

rules that, on 21 December 1988, the EU member states adopted a
directive setting up a system of mutual recognition for higher education
diplomas. This directive applies to all university courses lasting at least
three years and it is based on the principle of mutual trust between the
national education and training systems.

So the first right of a European citizen is the right to move around, work
and live anywhere in the Union. The Treaty of Maastricht enshrined this
right in its chapter on citizenship.

Apart from activities covered by the prerogative of public authorities (the

police, armed forces, foreign affairs, etc.), any person who is a national of
an EU country can be involved in providing health, education and other
public services anywhere in the Union. So, what could be more natural
than recruiting a British teacher to teach English in Rome, or encouraging
a young French graduate to compete in a civil service exam in Belgium?

But the European citizen is not just a consumer or someone with an

economic or social role to play. He or she is a citizen of the European
Union, and as such has specific political rights. Thanks to the Maastricht
Treaty, every citizen of the Union – regardless of nationality – has the
right to vote and to stand as a candidate at municipal and European
parliamentary elections in the EU country where he or she is living.

Citizenship of the Union is enshrined in Article 17 of the Treaty of

Amsterdam: "Every person holding the nationality of a Member State
shall be a citizen of the Union. Citizenship of the Union shall complement
and not replace national citizenship".

Fundamental rights

53
The Treaty of Amsterdam goes further in underpinning fundamental
rights. It introduces a procedure for suspending the EU membership
rights of any country that violates EU citizens’ fundamental rights. And it
extends the principle of non-discrimination so that it covers not only
nationality but also gender, race, religion, age and sexual orientation. The
Treaty further strengthens the principle of equality between men and
women.

Finally, the Amsterdam Treaty improves the EU policy of transparency,

allowing citizens greater access to the European institutions’ official
documents.

The European Union’s commitment to citizens’ rights was confirmed in

Nice in December 2000 when the Charter of Fundamental Rights of
the European Union was solemnly proclaimed. This Charter was drawn
up by a Convention composed of members of the national and European
parliaments, representatives of the national governments and a member of
the Commission. Under six headings – Dignity, Freedoms, Equality,
Solidarity, Citizens’ rights and Justice – its 54 articles spell out the
European Union’s fundamental values and the civil, political, economic
and social rights of the EU citizen.

The opening articles are about human dignity, the right to life, to the
‘integrity of the person’, to freedom of expression and of conscience. The
chapter on ‘Solidarity’ brings together, in an innovative way, social and
economic rights such as
• the right to strike;
• the right of workers to be informed and consulted;
• the right to reconcile family life and professional life;
• the right to health care, social security and social assistance
throughout the European Union.

The Charter also promotes equality between men and women and
introduces rights such as data protection, a ban on eugenic practices and
the reproductive cloning of human beings, the right to environmental
protection, the rights of children and elderly people and the right to good
administration.

This ‘citizens’ Europe’ points towards some form of political Europe, the
exact nature of which has yet to be decided. What values and ambitions
will Europe’s peoples be prepared to share together in a European Union
of 25 or more members?

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Europe means culture and education

A sense of being European and belonging together cannot be

manufactured. It can only arise from a shared cultural awareness – which
is why Europe now needs to focus its attention not just on economics but
also on culture.

First steps include the EU’s educational and training programmes such as
Erasmus (which promotes student mobility), Comett (technological
education and training) and Lingua, which encourages people to learn
foreign languages. More than a million students have been able to study
abroad thanks to the Erasmus programme.

The European Union has set itself the target of having 10% of its students
spend one year in another European country taking a higher education
course. To achieve this, more EU funds will have to be invested in
education policy. Further progress in this direction should be possible
thanks to the Socrates, Leonardo da Vinci and Youth programmes.

The Directive on Television without frontiers gives viewers better

access to television programmes produced in Europe: European
broadcasters must include a certain percentage of European programmes
in their schedules. The Directive introduces stronger measures to protect
young viewers and to support programmes by independent producers, and
it lays down rules on advertising and teleshopping.

The Culture 2000 framework programme for 2000-2004 is designed to

foster cooperation between programme creators, promoters, broadcasters,
networks and cultural institutions.

The MEDIA+ programme (2001-2005) provides support to the

audiovisual industry. At present there is a shortage of European-made TV
programmes and films compared to the large output from the United
States. MEDIA+ aims to make good this shortfall and to encourage the
distribution of European films and programmes in Europe.

A sense of belonging

The idea of a ‘citizens’ Europe’ is very new. Making it a reality will

mean, among other things, rallying popular support for symbols that
represent shared European identity. Things like the European model of

55
passport (in use since 1985), the European anthem (Beethoven’s Ode to
Joy) and the European flag (a circle of 12 golden stars on a blue
background). EU model driving licences have been issued in all member
states since 1996.

Since 1979, the European Parliament has been directly elected by

universal suffrage. This gives greater democratic legitimacy to the
process of European unification, linking it directly with the will of the
people. Europe needs to be made even more democratic by giving
Parliament a greater role, by creating genuine European political parties
and by giving the ordinary citizen a greater say in EU policymaking via
non-governmental organisations and other voluntary associations.

The introduction of euro notes and coins on 1 January 2002 had a major
psychological impact. Most Europeans now manage their bank accounts
in euro and can shop around for goods and services now that prices in
most of the EU are given in euro and can be directly compared. Thanks to
the Schengen Agreement, checks have been abolished at most of the
borders between EU countries, and this already gives citizens a sense of
belonging to a single, unified geographical area. The Schengen Area will
grow as more countries join it.

To help bring the EU closer to its citizens, the treaty on European Union
created the post of Ombudsman. The European Parliament elects the
Ombudsman and his term of office is the same as Parliament’s. His role
is to investigate complaints against EU institutions and bodies.
Complaints can be brought by any EU citizen and by any person or
organisation living or based in an EU member state. The Ombudsman
tries to arrange an amicable settlement between the complainant and the
institution or body concerned.

Another important link between citizens and the EU institutions is

Parliament’s well-established practice of accepting petitions from any
person residing in an EU member state.

"We are not bringing together states, we are uniting people", said Jean
Monnet back in 1952. Rallying public support for European integration is
still the greatest challenge facing the EU institutions today.

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10. Freedom, security and justice

European citizens are entitled to live in freedom, without fear of

persecution or violence, anywhere in the European Union. Yet
international crime and terrorism are among the things that most concern
Europeans today.

These challenges call for swift joint action at EU level. The European
Union clearly needs a policy on ‘justice and home affairs’ – particularly
now that enlargement is giving a new dimension to the issue of Europe’s
internal security.

EU action in this field was not on the agenda when the European
Economic Community was set up. Article 3 of the Treaty of Rome simply
states that the Community must take “measures concerning the entry and
movement of persons”. But, as time went by, it became clear that freedom
of movement must mean giving everyone, everywhere in the EU, the
same protection and the same access to justice. So the original treaties
were amended – first by the Single European Act, then by the Treaties of
Maastricht, Amsterdam and Nice.

Freedom to move

Personal freedom to move around within the EU raises security issues for
the member states, since checks have been abolished at most of the
Union’s internal borders. To compensate for this, extra security measures
have to be put in place at the EU’s external borders. And since freedom
of movement in the Union applies to criminals too, the EU’s national
police forces and judicial authorities have to work together to combat
international crime.

The three concepts of freedom, security and justice are, in fact, closely
linked. Freedom becomes largely meaningless if people cannot live in
safety, protected by a legal system on which all can rely equally.

On 15 and 16 October 1999, the European Council held a special meeting

at Tampere (Finland) to discuss the whole question of justice and home
affairs. The EU’s leaders agreed on a very clear and ambitious
programme of action – some 60 steps to be taken by 2004 to turn the

57
Union into “an area of freedom, security and justice”. The European
Commission was given the task of monitoring the EU’s progress via a
‘scoreboard’.

The main issues tackled at Tampere were:

• a common EU policy on asylum and migration;
• a genuine ‘European area of justice’;
• a Union-wide fight against crime;
• stronger external action.

One of the most important moves to make life easier for travellers in the
European Union took place in 1985, when the governments of Belgium,
France, Germany, Luxembourg and the Netherlands signed an agreement
in a little Luxembourg border town called Schengen. They agreed to
abolish all checks on persons – regardless of nationality – at their
common borders, to harmonise controls at their borders with non-EU
countries and to introduce a common policy on visas.

They thus formed an area without internal frontiers known as the

Schengen Area. At its external borders, EU citizens need show only their
identity card or passport.

The 1985 Schengen Agreement, the 1990 Convention implementing it

and all laws derived from those agreements have since become an
integral part of the EU Treaties, and the Schengen Area has gradually
expanded. Since March 2001, Iceland and Norway as well as 13 EU
countries (Austria, Belgium, Denmark, Finland, France, Germany,
Greece, Italy, Luxembourg, the Netherlands, Portugal, Spain and
Sweden) have been fully implementing the Schengen rules.

The aim is not to create a ‘fortress Europe’ but to make it easier for
people to enter the European Union legally and to move around in it
freely. At the same time, the EU is determined to combat the activities of
criminal gangs who exploit human beings.

Asylum and immigration policy

Europe is proud of its long tradition of welcoming foreigners and its
humanitarian willingness to offer asylum to refugees fleeing danger and
persecution. Today, EU governments face the pressing question of how to
deal with rising numbers of immigrants, both legal and illegal, in an area
without internal frontiers.

58
EU governments have agreed to harmonise their rules so that applications
for asylum are processed in accordance with a set of basic principles that
are uniformly recognised throughout the European Union. At Tampere
they set themselves the goal of adopting a common asylum procedure and
giving equal treatment throughout the Union to persons who have been
granted asylum. The EU will give immigrants similar rights and
obligations to those of European citizens. The extent of these rights and
obligations will vary according to how long an individual has been
legally resident in the European Union.

Fighting international crime

To make this policy viable, the EU must have an effective system for
managing immigration, including proper checks at its external borders
and efficient means of preventing secret immigration. A coordinated
effort is needed to combat criminal gangs who run people-smuggling
networks and who exploit vulnerable human beings, particularly women
and children.

Organised crime is becoming ever more sophisticated and regularly uses

European or international networks for its activities. Terrorism has clearly
shown that it can strike, with great brutality, anywhere in the world. That
is why the Schengen Information System (SIS) was set up. It is a
complex data base that enables the law enforcement officers and judicial
authorities to exchange information on wanted people and property – for
example, stolen vehicles or works of art, or persons for whom an arrest
warrant or extradition request has been issued.

One of the best ways of catching criminals is to follow the track of their
ill-gotten gains. For this reason, and to cut off the funding of criminal
organisations, the EU is using legislation to prevent money laundering.

By far the greatest advance made in recent years in the field of co-
operation between law enforcement officers was the creation of Europol.
This EU body is composed of police and customs officers, and its job is
to enforce the law throughout the European Union. It tackles a wide range
of international crime: drug trafficking, trade in stolen vehicles, people
smuggling, the sexual exploitation of women and children, pornography,
forgery, the trafficking of radioactive and nuclear materials, terrorism,
money laundering and counterfeiting the euro.

59
Towards a ‘European judicial area’

At present, there are more than 15 different judicial systems operating

side by side in the European Union, each within the borders of a member
state. People living in a country of which they are not nationals can find
themselves facing family or work-related problems that have to be dealt
with by an unfamiliar legal system, and this just makes daily life even
harder. If the Union wants people to move around freely within its
borders and have access to justice everywhere, its legal systems must
make people’s life easier – not harder.

EU programmes have been set up to bring together law professionals

from different member states. The Grotius programme, for example, has
helped lawyers and judges to get to know how the legal systems of other
EU countries operate. The Falcone programme has helped develop
contacts between judges, prosecution services, police forces and customs
officers throughout the European Union.

But the most significant example of practical cooperation in this field is

the work done by Eurojust – a central coordinating structure. Its purpose
is to enable the national investigating and prosecuting authorities to work
together on criminal investigations that involve several EU countries.

Cooperation between the courts in different countries can be hampered by

their differing definitions of certain criminal acts. But international crime,
including terrorism, respects no national boundaries. To deal effectively
with it, the Union is gradually putting together a common penal policy.
The Union aims to have a common legal framework for fighting
terrorism, to guarantee its citizens a high level of protection and to step
up international cooperation in this area.

Until 1997, issues like asylum and immigration, external border checks
(visas) and judicial cooperation in civil and commercial matters were
matters for direct cooperation between EU governments. But the Treaty
of Amsterdam transferred these issues from the intergovernmental to the
‘Community’ domain, so they can be dealt with more effectively using
the tried and tested ‘Community method’.

However, the move was hedged about with conditions: a five-year

transitional period; the right of initiative shared between the Commission
and the member states; decisions to be taken unanimously; the European

60
Parliament to be simply consulted; the Court of Justice allowed only
limited powers.

One field remains exclusively intergovernmental: the field of police and

judicial cooperation in criminal matters. Under the Maastricht Treaty, the
Council coordinates the action of EU governments in this area, which is a
sensitive one for national sovereignty. Here too, the Commission shares
the right of initiative with the member states.

At Tampere, the EU’s political leaders aimed to have the area of freedom,
security and justice set up by the end of 2004.

61
11. The European Union on the world stage

In economic, trade and monetary terms, the European Union has become
a major world power. It has considerable influence within international
organisations such as the World Trade Organisation (WTO), the
specialist branches of the United Nations (UN) and at world summits on
the environment and development.

Some have described the EU as an economic giant but a ‘political dwarf’.

This is an exaggeration. Nevertheless, it is true that the EU member states
have a long way to go, in diplomatic and political terms, before they can
speak with one voice on major issues like peace and stability, terrorism,
the Middle East, relations with the United States and the role of the UN
Security Council. The EU countries retain full national sovereignty over
their armed forces. Their defence systems are firmly in the hands of the
national governments, and the only ties between them are those forged
within alliances such as NATO.

An embryonic common defence policy

The Common Foreign and Security Policy (CFSP) and the European
Security and Defence Policy (ESDP), provided for in the Maastricht and
Amsterdam treaties, define the EU’s main tasks in the area of defence. On
this basis, the EU has developed its ‘second pillar’ – the policy domain in
which action is decided by inter-governmental agreement and in which
the Commission and Parliament play only a minor role. Decisions in this
domain are taken by consensus, allowing individual states to abstain.

In 2003, the EU’s political and strategic landscape looks like this:

• With Russia following the path of friendship with the western world,
and the former Communist countries of central and eastern Europe
joining NATO and the EU almost simultaneously, more than half a
century of Cold War is well and truly behind us. The continent of
Europe is becoming peacefully united, and European countries are
working together to fight international crime such as people
smuggling and money laundering. The EU has formed an organised
partnership with its large neighbours, such as Russia and the Ukraine,

62
 which have no prospect of joining the European Union – at least in the
medium term.
• The EU member states want to establish a European Security and
Defence Policy in accordance with the Treaties. In December 1999,
the Helsinki European Council set the EU a specific objective: to be
able, by 2003, to deploy within 60 days a force of up to 60 000 troops,
with naval and air support, and to sustain it for at least one year. This
rapid reaction force is not a ‘European army’: it will be made up of
contingents from the national armed forces. But it will be coordinated
by a Political and Security Committee (PSC), a Military Committee
(EUMC) and a military staff (EUMS), under the authority of the
Council and located in Brussels. This give the Union a political and
military tool for carrying out certain specific types of task –
humanitarian and rescue missions outside Europe, peace-keeping
operations and other crisis management tasks including peacemaking.

• The United States accepts that, for military action in which America
does not want to be involved, Europe can use some of NATO’s
logistical capacity such as its intelligence, communications, command
and transport capabilities.

• Actual defence and deterrence capabilities, such as the nuclear

weapons owned by France and the United Kingdom, remain under
national control. As military technology becomes ever more
sophisticated and expensive, EU governments will find it increasingly
necessary to work together on arms manufacture. Moreover, if their
armed forces are to carry out joint missions, their systems must be
interoperable and their equipment sufficiently standardised.

• The attacks on Washington and New York on 11 September 2001, and

the terrorist violence that has struck many parts of the world since
then, have profoundly altered the strategic landscape. European
countries are working more closely together to exchange information
that will help prevent such attacks. Since the fight against terrorism is
a global priority, Europe today is going beyond its traditional
alliances, working not only with the United States but also with many
other countries around the world to support democracy and human
rights.

Given this shifting strategic landscape, the European Union is trying to

find the right balance between its different national traditions in the field
of security and defence policy.

63
"If I want to talk to Europe, who do I phone?"

The Convention on the future of Europe proposed changes that could give
Europe a much clearer identity. Several countries support the idea of
having an EU President who would be empowered to speak for the Union
in the international arena. The President would be a member or former
member of the European Council and his or her term of office would be
longer than the present six months’ presidency of the Council. This
would answer the question famously asked by Henry Kissinger in the
1970s: "If I want to talk to Europe, who do I phone?"

But it leaves open a number of questions. How would this ‘EU President’
be appointed? What power would he or she actually have? What would
become of the present High Representative for the CFSP? Would the EU
President have authority over the EU military staff and the rapid reaction
force? To what democratic controls would the President be subject?
Before taking any major decision, would the President have to get the
agreement of every member of the European Council? What would be the
EU President’s relationship with the President of the European
Commission and with the Commissioner for external relations?

The Treaty of Amsterdam also tried to set up a procedure introducing

enough flexibility into the CFSP area. ‘Enhanced cooperation’ would
enable a group of countries to go ahead with action in which other
member states did not wish to be involved – because of their tradition of
neutrality, for example.

The trouble with this apparently pragmatic solution is that the

cohesiveness of the Union as a whole and its credibility on the world
stage would be undermined if European foreign policy became a matter
of ‘variable geometry’. Moreover, there would be an increased risk of
breaking the link between the EU’s internal policies (managing the single
market, competition policy, economic and monetary union, internal
security, etc.) and its external policies (trade, development aid, diplomacy
and defence).

For the future, it is essential that Europeans act in unison and have a
policy that is clear for all to see. The EU countries need to speak with one
voice, to show determination in defending their major interests and
resolute solidarity in safeguarding their peoples’ destiny.

64
Europe open to the world

The completion of the single market in 1993 affected the EU’s trade
policy. The import restrictions that EU countries had been allowed to
maintain were steadily abolished, as was the internal distribution of
‘sensitive’ imports such as textiles, steel, cars and electronic goods. Once
the WTO had been set up, at Europe’s instigation, it provided a
permanent forum within which to settle trade disputes through
multilateral negotiation.

The average weighted level of customs duties on industrial goods

entering the European Union is less than 5%. The EU and its world
trading partners have agreed new rules on trade in services and
agricultural products. The discussions on agriculture clearly revealed the
divergent views of producers on either side of the Atlantic. Because the
EU presented a united front in these talks, it was able to mount an
effective defence of its member states’ viewpoint.

The EU is a single trading bloc, and it is home to 373 million consumers

(nearly half a billion after enlargement), with a relatively high average
level of income. As such, it is a very attractive market for exporters in
other countries. The EU can use this influence to persuade its trading
partners to keep to the rules of the game – rules that ensure healthy
competition and fair and equal access to one another’s markets.

An important partner within the industrialised world

From the United States’ point of view, the new Europe now under
construction is an ally that shares the same values but also a competitor in
trade and technology. The NATO alliance, which brings together the US
and many EU countries, has helped mitigate the impact of trans-Atlantic
trade disputes over farm produce, steel and the aerospace industry.

Towards the end of the 20th century, dramatic events – particularly the
end of the Cold War – transformed the world of international politics. In
these new circumstances, the members of NATO are having to re-define
their relationship. Euro-American cooperation needs new objectives. The
allies must work together to tackle new dangers: nuclear proliferation,
international terrorism, international crime such as drug trafficking, and
so on. In terms of trade and investment, the European Union is the United
States’ main partner and the only one with which it enjoys a stable

65
relationship. However, Europe has to contend with a certain tendency in
the US Congress to resort to unilateral action that may threaten Europe’s
global interests.

Relations between the EU and the Mediterranean countries

Only a short distance from Europe, on the southern shore of the

Mediterranean, are countries with which the EU has historical and
cultural ties. There has been a good deal of migration between the two
regions, and there is potential for much more. So these countries are very
important partners for the EU, which has traditionally chosen to pursue a
policy of Mediterranean regional integration.

The EU’s Mediterranean neighbours were among the first to establish

special economic and trading relations with the Union. In November
1995, a major conference was held in Barcelona, attended by all the EU
member states and the countries bordering the Mediterranean (except for
Libya, Albania and the countries that once formed Yugoslavia). This
conference laid the foundations for a new Euro-Mediterranean
partnership, involving:

• Political dialogue between the participating countries and a security

partnership based, in particular, on mechanisms for arms control and
the peaceful resolution of conflicts;

• Stepping up economic and trading relations between the two regions.

The key to this is the creation of a Euro-Mediterranean free trade area
by 2010, in compliance with WTO rules. Once this happens,
manufactured goods can be traded, duty free, on the trans-
Mediterranean market, which will become the biggest free trade area
in the world, embracing up to 800 million consumers.

• Partnership in social, cultural and similar fields.

Under the MEDA programme, the EU will grant the Mediterranean

countries financial assistance worth €5.3 billion over the period 2000-
2006.

66
Africa

Relations between Europe and sub-Saharan Africa go back a long way.

With the Treaty of Rome in 1957, the former colonies and overseas
territories of some EEC member states became the Community’s
associates. Decolonisation, which began in the early 1960s, turned this
link into a different kind of association – an association between
sovereign countries.

The Cotonou Agreement, signed in June 2000 in the capital of Benin,

marked a new stage in the EU’s development policy. The Agreement,
between the European Union and the African, Caribbean and Pacific
(ACP) countries, is the most ambitious and far-reaching trade and aid
agreement ever concluded between developed and developing countries.
It followed on from the Lomé Convention – originally signed in 1975 in
the capital of Togo and subsequently updated at regular intervals.

The basic aim of the Agreement remains the same as that of the Lomé
Convention: “to promote and expedite the economic, cultural and social
development of the ACP states and to consolidate and diversify their
relations [with the European Union and its member states] in a spirit of
solidarity and mutual interest”.

The focus of Lomé was on trade relations and market access: the Cotonou
Agreement has a broader scope. For example, it introduces new
procedures for dealing with human rights abuses.

The European Union has granted special trading concessions to the least
developed countries, 39 of which are signatories to the Agreement.
Starting from 2005, they will be able to export practically any type of
product to the EU, duty free.

The European Development Fund finances the ACP programmes from a

budget of 13.5 billion euro over a seven-year period. This is in addition to
9.5 billion euro left over from the previous funds and 1.7 billion euro lent
by the European Investment Bank.

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12. What future for Europe?
"A day will come when all the nations of this continent, without losing
their distinct qualities or their glorious individuality, will fuse together in
a higher unity and form the European brotherhood. A day will come
when there will be no other battlefields than those of the mind – open
marketplaces for ideas. A day will come when bullets and bombs will be
replaced by votes".

Victor Hugo spoke those prophetic words in 1849. It took more than a
century for his utopian predictions to start coming true. During that time,
two world wars and countless other conflicts on European soil caused
millions of deaths. There were times when all hope seemed lost. Today,
the dawning of the 21st century offers brighter prospects and renewed
hope. But it also brings Europe new difficulties and challenges.

Enlargement of the Union to 25 member states has gone ahead, keeping

to the timetable set by the EU institutions. As a politician from one of the
new member states put it: "Europe has finally managed to reconcile its
history with its geography". The period 2007 to 2015 should see further
enlargements of the European Union. In the mean time, its leaders –
listening carefully to public opinion – will have to decide where,
ultimately, to draw the Union’s geographical, political and cultural
frontiers.

The EU’s foundational agreement is a pact between sovereign nations

that have resolved to share a common destiny and to pool an increasing
share of their sovereignty. It concerns the things that European peoples
care most deeply about: peace, security, participatory democracy, justice
and solidarity. This pact is being strengthened and confirmed all across
Europe: half a billion human beings have chosen to live under the rule of
law and in accordance with age-old values that centre on humanity and
human dignity.

The current technological revolution is radically transforming life in the

industrialised world, including Europe. In doing do, it creates new
challenges that transcend national frontiers. Nations acting individually
cannot effectively tackle issues like sustainable development, population
trends or the need for social solidarity. National policies alone cannot
secure economic growth, nor can individual governments provide the
ethical response to world progress in the life sciences. Pollution of the

68
oceans by wrecked oil tankers or the risk of a Chernobyl-type nuclear
accident call for collective preventive measures that safeguard the
‘common European good’ and preserve it for future generations.

The enlarged European Union is part of a rapidly and radically

changing world that needs to find new stability. Europe is affected by
upheavals on other continents – whether it be the resurgence of religious
fervour in the islamic world, disease and famine in Africa, unilateralist
tendencies in North America, economic crises in Latin America, the
population explosion in Asia or the global relocation of industries and
jobs. Europe must not only concentrate on its own development but also
be fully involved in globalisation. While it can be proud of its
achievements in trade policy, the European Union still has a long way to
go before it can claim to be speaking with one voice or to be a credible
actor on the stage of world politics.

The EU institutions have proved their worth, but they must be adapted
to cope with the growing number of tasks to be carried out by a growing
Union. The more member states the EU has, the greater become the
centrifugal forces that threaten to tear it apart. Short-term views of
national interests can all too easily derail the long-term priorities of the
Union as a whole. That is why everyone taking part in this unprecedented
adventure must shoulder their responsibilities and act in such a way that
the EU’s institutional system continues working effectively. Any major
change in the present system must ensure that Europe’s plurality is
respected. After all, Europe’s most precious asset is its rich diversity –
the many differences between its nations. Reforms must also concentrate
on the decision-making process. Insisting on unanimous agreement would
simply lead to paralysis. The only kind of system that will work is a
political and legal system based on majority voting, and with checks and
balances built in.

The draft Constitution drawn up by the Convention is designed to

simplify the Treaties and to make the EU’s decision-making system more
transparent. EU citizens need to know who does what in Europe and to
feel it is relevant to their daily lives. Only then will people support the
idea of European integration and feel motivated to vote in European
elections. The draft Constitution clarifies what powers and
responsibilities belong to the EU, to its member states and to regional
authorities. It makes it clear that European integration is based on two
kinds of legitimacy: the directly expressed will of the people and the
legitimacy of the national governments. The nation state is still the
legitimate framework within which European societies operate.

69
The Constitution is a further important step in the process of getting
Europe’s nations and peoples to act together. Is this to be the final stage
in the grand project envisaged by the EU’s founding fathers? Or will
Europe’s political structures evolve even further as it seeks to fulfil its
destiny? Who knows!

70
Key dates in the history of European integration

1948
7-11 May
The Hague Congress: more than a thousand delegates from some 20
European countries discuss new forms of cooperation in Europe. They
come out in favour of setting up a ‘European assembly’.

1949
27-28 January
As a result of the Hague Congress, the Council of Europe is set up. It is to
be based in Strasbourg.

That same year it begins drawing up the European Convention on Human

Rights, which is signed in Rome in 1950 and comes into force in
September 1953.

In the course of time, nearly all European countries become members of

the Council of Europe.

1950
9 May
Robert Schuman, French Minister of Foreign Affairs, makes an important
speech putting forward proposals based on the ideas of Jean Monnet. He
proposes that France and the Federal Republic of Germany pool their coal
and steel resources in a new organisation that other European countries
can join.

Since this date can be regarded as the birthday of the European Union, 9
May is now celebrated annually as ‘Europe Day’.

1951
18 April
In Paris, six countries – Belgium, France, Germany (Federal Republic),
Italy, Luxembourg and the Netherlands – sign the Treaty establishing the
European Coal and Steel Community (ECSC). It comes into force on 23
July 1952, for a period of 50 years.

1955
1-2 June

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Meeting in Messina, the Foreign Affairs ministers of the six countries
decide to extend European integration to the economy as a whole.

1957
25 March
In Rome, the six countries sign the treaties establishing the European
Economic Community (EEC) and the European Atomic Energy
Community (Euratom). They come into force on 1 January 1958.

1960
4 January
At the instigation of the United Kingdom, the Stockholm Convention sets
up the European Free Trade Association (EFTA), comprising a number of
European countries that are not part of the EEC.

1962
30 July
A common agricultural policy (CAP) is introduced.

1963
14 January
At a press conference, General de Gaulle announces that France will veto
the United Kingdom joining the European Communities.

20 July
In Yaoundé, an association agreement is signed between the EEC and 18
African countries.

1965
8 April
A treaty is signed merging the executive bodies of the three Communities
and creating a single Council and Commission. It comes into force on l
July 1967.

1966
29 January
The ‘Luxembourg compromise’. Following a political crisis, France
agrees to take part in Council meetings once again, in return for an
agreement that the unanimity rule be maintained when ‘vital national
interests’ are at stake.

1968
1 July

72
Customs duties on industrial goods are completely abolished, 18 months
ahead of schedule, and a Common External Tariff is introduced.

1969
1-2 December
At the Hague Summit, the EEC’s political leaders decide to move further
ahead with European integration.

1970
22 April
In Luxembourg, a treaty is signed allowing the European Communities to
be increasingly financed from ‘own resources’ and giving greater powers
to the European Parliament.

1972
22 January
In Brussels, accession treaties to the European Communities are signed
with Denmark, Ireland, Norway and the United Kingdom.

24 April
The six EEC member states decide that the exchange rates between their
currencies must not be allowed to fluctuate by more than 2.25%. This
system is known as the ‘snake’.

1973
1 January
Denmark, Ireland and the United Kingdom join the European
Communities, bringing their membership to nine. Norway stays out,
following a referendum in which most people voted against membership.

1974
9-10 December
At the Paris Summit, the political leaders of the nine member states
decide to meet three times a year as the European Council. They also give
the go-ahead for direct elections to the European Parliament, and agree to
set up the European Regional Development Fund.

1975
28 February
In Lomé, a convention (Lomé I) is signed between the EEC and 46
African, Caribbean and Pacific (ACP) countries.

22 July

73
A treaty is signed giving the European Parliament greater power over the
budget and setting up the European Court of Auditors. It comes into
force on 1 June 1977.

1978
6-7 July
At the Bremen Summit, France and Germany (Federal Republic) propose
relaunching monetary cooperation by setting up a European Monetary
System (EMS) to take the place of the ‘snake’. The EMS comes into
operation on 13 March 1979.

1979
28 May
The European Communities sign a treaty of accession with Greece.

7 and 10 June
The first direct elections to the 410-seat European Parliament.

1981
1 January
Greece joins the European Communities, bringing the number of member
states to 10.

1984
28 February
The ‘Esprit’ Programme is adopted – aimed at boosting research and
development in the field of information technology.

14 and 17 June
The second direct elections to the European Parliament.

1985
7 January
Jacques Delors becomes President of the Commission (1985-1995).

12 June
The European Communities sign accession treaties with Spain and
Portugal.

2-4 December
At the Luxembourg European Council, leaders of the 10 member states
agree to revise the Treaty of Rome and to re-launch European integration

74
via a ‘Single European Act’. This paves the way for creating the single
market by 1993.

1986
1 January
Spain and Portugal join the European Communities, bringing their
membership to 12.

17 and 28 February
The Single European Act is signed in Luxembourg and The Hague. It
comes into force on 1 July 1987.

1987
15 June
Start of the ‘Erasmus’ programme, set up to help young Europeans study
abroad, in other European countries.

1989
15 and 18 June
The third direct elections to the European Parliament.

9 November
The Berlin wall is opened.

9 December
In Strasbourg, the European Council decides to convene an inter-
governmental conference on moving ahead with economic and monetary
union (EMU) and political union.

1990
19 June
The Schengen Agreement is signed, aimed at abolishing checks at the
borders between member states of the European Communities.

3 October
Germany is reunited.

14 December
In Rome, start of the inter-governmental conferences on EMU and
political union.

1991
9-10 December

75
The Maastricht European Council adopts a Treaty on European Union. It
lays the basis for a common foreign and security policy, closer
cooperation on justice and home affairs and the creation of an economic
and monetary union, including a single currency. The inter-governmental
cooperation in these fields added to the existing Community system
creates the European Union (EU). The EEC is renamed the ‘European
Community’ (EC).

1992
7 February
The Treaty on European Union is signed at Maastricht. It enters into force
on 1 November 1993.

1993
1 January
The Single Market is created.

1994
9 and 12 June
The fourth direct elections to the European Parliament.

24-25 June
At the Corfu European Council, the EU signs accession treaties with
Austria, Finland, Norway and Sweden.

1995
1 January
Austria, Finland and Sweden join the EU, bringing its membership to 15.
Norway stays out, following a referendum in which most people voted
against membership.

23 January
A new European Commission takes office (1995-1999), with Jacques
Santer as its President.

27-28 November
The Euro-Mediterranean Conference in Barcelona launches a partnership
between the EU and the countries on the southern shore of the
Mediterranean.

1997
16-17 June

76
The Amsterdam European Council agrees a treaty giving the European
Union new powers and responsibilities.

2 October
The Amsterdam Treaty is signed. It comes into force on 1 May 1999.

1998
30 March
The accession process begins for the new candidate countries. Cyprus,
Malta and 10 countries of central and eastern Europe will be involved in
this process.

3 May
The Brussels European Council decides that 11 EU member states
(Austria, Belgium, Finland, France, Germany, Ireland, Italy,
Luxembourg, the Netherlands, Portugal and Spain) meet the requirements
for adopting the single currency on 1 January 1999. Greece will join
later.

31 December
Fixed and irrevocable exchange rates are set between the currencies that
are to be replaced by the euro.

1999
1 January
Start of the third stage of EMU: the currencies of 11 EU countries are
replaced by the euro. The single currency is launched on the money
markets. From this point onwards, the European Central Bank (ECB) has
responsibility for the EU’s monetary policy, which is defined and
implemented in euro.

24-25 March
The Berlin European Council agrees the outline for the EU’s budget
2000-2006 within the ‘Agenda 2000’framework.

3-4 June
The Cologne European Council decides to ask a Convention to draw up a
European Charter of Fundamental Rights. The members of the
Convention are representatives of the EU’s heads of state or government
and of the European Commission President.

Javier Solana is appointed as High Representative for the Common

Foreign and Security Policy (CFSP).

77
8 and 13 June
The fifth direct elections to the European Parliament.

15 September
A new European Commission takes office (1999-2004), with Romano
Prodi as its President.

15-16 October
The Tampere European Council decides to make the EU an area of
freedom, security and justice.

10-11 December
The Helsinki European Council, chiefly devoted to enlargement of the
EU, officially recognises Turkey as a candidate for EU membership, and
decides to push ahead with negotiations with the other 12 candidate
countries.

2000
23-24 March
The Lisbon European Council draws up a strategy for boosting
employment in the EU, modernising the economy and strengthening
social cohesion in a knowledge-based Europe.

7-8 December
In Nice, the European Council reaches agreement on the text of a new
Treaty changing the EU’s decision-making system so that the Union will
be ready for enlargement. The presidents of the European Parliament, the
European Council and the European Commission solemnly proclaim the
EU Charter of Fundamental Rights.

2001
26 February
The Treaty of Nice is signed. It comes into force on 1 February 2003.

14-15 December
The Laeken European Council adopts a declaration on the future of the
Union. This opens the way for the forthcoming major reform of the EU
and for setting up a Convention to prepare a European Constitution.
Valéry Giscard d’Estaing is appointed Chairman of the Convention.

2002
1 January

78
People in the euro area countries begin using euro notes and coins.

31 May
All 15 EU member states simultaneously ratify the Kyoto Protocol – the
world-wide agreement to reduce air pollution.

21-22 June
The Seville European Council reaches agreement on an EU asylum and
immigration policy.

13 December
The Copenhagen European Council agrees that 10 of the candidate
countries (Cyprus, the Czech Republic, Estonia, Hungary, Latvia,
Lithuania, Malta, Poland, Slovakia and Slovenia) can join the EU on 1
May 2004. Bulgaria and Romania are expected to join in 2007.

It is decided that talks with Turkey can begin if, on the basis of a report
and a recommendation from the Commission, the European Council in
December 2004 decides that Turkey meets all the ‘Copenhagen criteria’.

2003
16 April
In Athens, the EU signs accession treaties with Cyprus, the Czech
Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia
and Slovenia.

10 July
The Convention on the Future of Europe completes its work on the draft
European Constitution.

4 October
Start of the inter-governmental conference that will draw up a new treaty
embodying the European Constitution.

2004
1 May
Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta,
Poland, Slovakia and Slovenia join the European Union.

10 and 13 June
The sixth direct elections to the European Parliament.

2007

79
Date set by the 2002 Copenhagen European Council for Bulgaria and
Romania to join the EU.

80