European institutions

1. European institutions

2. Why does understanding how the EU works matter for business? • Helps business understand rationale for policy • Facilitates business preparation for change • Helps business influence and shape policy

3. Key institutional questions • Institutions reflect and determine the nature of the organisation • Who does what? • How is it done? • Nature of the institutions

4. Supranational vs. Intergovernmental institutions • Supranational = above the nation In the EU, institutions which take decisions according to European rather than national criteria – e.g. European Commission, European Court of Justice • Intergovernmental = between nations In the EU, the balancing of national interests among members – e.g. the European Council, the Council of Ministers • In reality – the EU uses both types of institutions

5. Types of EU laws • Regulations: have direct effect • Directives: establish basic principles and objectives – need to be interpreted via national law. Bulk of EU law • Decisions: issued by European Commission on specific issues – directly applicable • Recommendations and opinions – view of European Commission but not legally binding

6. The European Council (1) • EU’s supreme political decision-making body – balances interests of member states and develops EU’s overarching strategy and policies • Composed of member states’ heads of government and Presidents of the Council and European Commission • Meets 4 times p.a. – more often if emergency

7. The European Council (2) • Since 2009, chaired by permanent President (currently Donald Tusk, former PM of Poland). Also represents EU to outside world (with the High Representative for Foreign Affairs and Security Policy) • Where possible, takes decisions by consensus • When voting does occur, only heads of government take part • No direct role in the legislative process but can request the Commission to bring policies forward

8. Functions of the Council of Ministers • No power to initiate legislation process but can require the Commission to bring policies forward • Legislative Powers (with EP) – Commission proposes and Council and EP decides • Co-ordination of economic policies • Mandates and signs external agreements • Approves EU budget (with EP) • Common Foreign and Security Policy (CFSP) • Justice and Home Affairs (JHA)

9. Composition of the Council of Ministers • Fluid membership – depends on subject of Council • e.g. Member states’ Transport Ministers attend Transport council, Agricultural Ministers attend Agriculture Council , etc. • Members states take it in turns to act as Council Presidency for 6 months • Council Presidency sets agenda, co-ordinates business and acts as broker in forging agreements • Coreper – members of ambassadorial rank from member states carries out detailed technical work on behalf of the Council of Ministers

10. Council voting • Often controversial – amended by Lisbon Treaty • From November 2014, double majority voting. All decisions not requiring unanimity need: • 55% of Council members (16/28 members) • Council members representing 65% of the EU population (329 million) • To block a decision requires at least 4 member states representing 35% of EU population • Unanimity still applies in limited cases – e.g. taxation • Decision making by consensus preferred

11. Functions of the European Commission • Community’s civil service • Initiator of legislation – requests from a number of sources • Legislator in its own right – secondary legislation • Guardian of EU Treaties – ensures EU policies applied correctly • Represents EU internationally (e.g. WTO) and negotiates trade agreements • Draws up draft budget • Informal role as broker to reconcile different views of member states

12. The European Commission • 28 Commissioners: one from each EU member – nominated by member governments for 5 years • Subject to approval of European Parliament (EP) • Commission President – appointed by heads of governments and subject to approval of EP • Commission split into Directorates General (DG) and Services – each is headed by a Commissioner • Commissioners must act in EU interest – they are not there to represent interests of their home state

13. European Parliament • Direct elections since 1979 – from talking shop to co-legislator • June 2014 – 751 MEPs from 28 states elected for 5 years • MEPs organised in 7 political groups along transnational lines • EP – main beneficiary of Treaty reforms • But low electoral turn-outs – 43% in 2014, ranging from 13% in Slovakia to 90% in Belgium and Luxembourg

14. EP functions • Co-legislator – with Council – under the Ordinary Legislative Procedure (formerly known as ‘co-decision’). EP has same status as Council of Ministers and cannot be overruled • Supervisory/scrutiny • confirms appointment of Commissioners • regularly questions Commission about policy • EP → 1999 Commission resignation • Authority over Budget

15. European Court of Justice • Supreme judicial body of the EU – interprets and enforces EC law • 28 judges – one from each member state • Safeguards EU law in the application and interpretation of the Treaties • Sole authority to decide on the interpretation of EU law

16. European Court of Justice • Main role – ensure the treaties and EU law are respected • This includes: • Preliminary rulings: when national courts seek advice from the ECJ about the interpretation of EU law • Failure to fulfil an obligation: the Commission (or a member state) can start proceedings if another member state fails to fulfil its obligations under EU law • Procedures for annulment: the ECJ can annul EU legislation if it conflicts with the treaties

17. The General Court • Since 1989, the General Court (formerly known as the Court of First Instance) has assisted the ECJ • General Court deals with a range of cases including competition cases