The Greek financial crisis now threatens the whole eurozone. It appears that without substantial debt restructuring Greece is likely to default, and would have to leave the eurozone. This could lead, however, to substantial collateral damage and unintended effects for the whole European banking and financial system. The other option is a very large fiscal transfer from the eurozone core. This second option will lead donor Member States to demand substantial political guarantees for fiscal discipline in Greece and other possible recipients (i.e. Ireland and Portugal).
It looks like the crisis has brought back the idea for a true European political union on the table. The president of the ECB, Jean-Claude Trichet, himself has called for the establishment of a European financial minister.
Now, the idea is not really new. Back in the 1950s there was such a project, called the European Political Community (EPC) that aimed to politically unite the Member States in the European Economic Community (read more about it in the excellent paper by Berthold Rittberger). The main institutional innovation in the EPC was the central role of the bicameral parliamentary body in adopting the budget and the legislation. The EPC project failed, but some of its ideas were later implemented by including the European Parliament in the legislative and budgetary procedures.
Going back to Mr. Trichet’s ideas, we see something completely different. In his framework, the Council would act on the basis of a proposal by the Commission, in liaison with the ECB, to take some measures directly affecting the economy of the Member State that has not implemented its fiscal stability program. There is no role for the European Parliament whatsoever. Apparently Mr. Trichet believes that the very agreement on a stability program is substantial legitimation for a direct involvement in the economic and fiscal policies of a Member State by the Council.
This is quite doubtful. It’s very difficult to imagine how the same people that violently oppose to austerity measures taken by their democratically elected governments will somehow accept direct interference by an institution of the European Union. It’s equally difficult to imagine that the European Parliament will approve such an institutional framework. I can certainly understand the reasonable motives for proposing such a second stage of austerity enforcement, but I’m afraid that such a procedure will decisively worsen the democratic deficit of the European Union.
If and when the governments of the Member States decide that a more profound Treaty revision is needed for establishing tighter fiscal coordination, they will have to consult their national parliaments and the European Parliament. Such consultations are in fact inevitable, since TEU requires the summoning of a Convention to adopt the draft text of the revision (art. 48, para. 2-5 TEU).
Posted in Budget and Finance, EU Reform, Institutional Affairs
Tagged debt, European Central Bank, European Parliament, European Political Community, European Union, eurozone, fiscal policy coordination, Greece, Jean-Claude Trichet, political union, proposal
The simple answer is yes. Some justification follows.
First – some background of the case. The English newspaper Sunday Times has conducted an investigation, claiming that several MEPs were willing to take money in exchange for filing legislative amendments. Three MEPs were named – the Austrian centre-right Ernst Strasser, the Slovenian Socialist Zoran Thaler and the Romanian Socialist Adrian Severin. OLAF decided to open a formal investigation immediately and OLAF investigators attempted to collect evidence from the offices of the concerned MEPs located at the premises of the European Parliament in Brussels on Tuesday 22 March. However, the EP authorities refused to give access to these offices and claimed these would be secured by EP security personnel.
The EP clearly erred here. As OLAF has pointed out in its statement, its competences are outlined in art. 325 TFEU, and Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF). Art. 1, para. 3 of Regulation (EC) No 1073/1999 specifically points out that OLAF shall conduct administrative investigations within the institutions for the purpose of fighting fraud, corruption and any other illegal activity affecting the financial interests of the EU. Art. 4, para. 2 clearly says that OLAF has the right of immediate and unannounced access to any information held by the institutions, bodies, offices and agencies, and to their premises. In addition, Annex XII to the Rules of Procedure of the EP the services and any official or servant of the EP is required to cooperate fully with the Office’s agents and to lend any assistance required to the investigation.
Now, someone might claim that by providing the documents in question, the EP might have cooperated in good faith without granting physical access to OLAF. This is not true, however. First, the purpose of immediate and unannounced access to information and documents is to prevent any opportunity for tampering the evidence. Second, the EP officials are not trained and do not have legal authorization to open locked premises, document containers, etc.
Posted in Institutional Affairs, Justice and Internal Affairs, Procedural Law
Tagged Adrian Severin, Corruption, documents, Ernst Strasser, European Parliament, investigation, OLAF, premises, Zoran Thaler
Fellow bloggers Kosmopolit and John Worth have already weighed in on the (lack of) reaction by the European Union on the events unfolding in Egypt. Their analysis of the relative inactivity of the EU’s institutions is worth reading.
What I would like to point out is that the President of the European Parliament, Jerzy Buzek, was much more specific in addressing the situation in Egypt. He made a statement on Friday, 28 January, saying:
“The entire world is watching what is happening in Egypt tonight and will hold the authorities accountable for any inappropriate use of force or any innocent death. (…) I call on Egypt, as a partner country of the EU, to fully respect the fundamental rights and freedoms of their citizens.”
Now, this isn’t the first time Mr. Buzek has responded quickly with an unequivocal statement. He also addressed the violence against protesters in Belarus, specifically calling on Lukashenko to stop the violence. The High Representative remained silent on Belarus for a few days, too.
It should be clear that the High Representative cannot act before aligning positions of all Member States. It takes only one Member State – for example, Italy, to block a common position (art. 31 TEU). That is why Ashton is significantly restrained in her field of action.
It appears that Mr. Buzek’s statements are, in such situations, the only legitimate and decisive voice coming from the institutions of the European Union.
This is a very special day. The European Parliament has confirmed today the agreement with the Council on the new regulation on implementing powers for the Commission. This new regulation, will enter into force on 1st March and will automatically replace the existing system.
As in the past, the mechanism of control foreseen by the regulation is based on “comitology” – i.e. committees composed by representatives of Member States to which the Commission submits draft implementing measures – but, contrary to the present system, there can be no intervention from the Council as an appeal body. In some specific cases there might be a need to go to an “appeal committee”, but this is just a “normal” committee, chaired by the Commission, albeit of a higher level of representation. It provides the opportunity to reconsider the draft measures or to r make changes if need be.
The regulation foresees that implementing measures in policy areas such as trade defence measures will be included in the normal regime. Until now these measures were submitted to special procedures in which the Council frequently had the last word.
The new procedures also give more flexibility to the Commission and a greater political responsibility. In the absence of a qualified majority against or in favour of a Commission draft implementing act, the Commission will have the choice between adopting the act or reviewing it.
I am currently writing an article on the new legal regime of comitology, which will be available on this blog somewhere in February 2011.
Posted in EU Reform, Institutional Affairs, Procedural Law
Tagged advisory procedure, comitology, committees, Council, European Commission, European Parliament, examination procedure, implementing powers, Reform, Treaty of Lisbon
The Constitutional Affairs Committee of the European Parliament, the Commission and the Council have reached an agreement on the so-called citizens’ initiative (art. 24 TFEU). The citizens’ initiative allows one million citizens to ask the Commission to propose a new EU law. The main points:
- the admissibility check on an initiative will be made at the point of registration,
- a citizens’ committee of at least seven members coming from seven Member States should be set up to register an initiative,
- the signatories must come from a minimum one-quarter of the Member States,
- the Commission will help initiative organisers by providing a user-friendly guide and setting up a point of contact,
- if an initiative manages to collect one million signatures, a proper follow-up will be guaranteed, including a public hearing,
- Member States will choose how to verify the authenticity of signatures.
The 2011 budget of the European Union is in tatters after an unsuccessful negotiation session between the European Parliament and the Council. The budget procedure must now start anew, with the Commission proposing a new draft budget. The apple of discord has been the Parliament’s demand to participate in the negotiation of the next multiannual budget framework (2014-2020).
According to some diplomats cited by EUobserver, the Parliament wrongly assumed that member states would agree to a budget out of fear of being labeled as “anti-European” in case of a breakdown in talks.
Well, obviously they weren’t. Three countries – Netherlands, Sweden and the United Kingdom, refused even to consider the demands of the Parliament. “There will be a budget, based on 2010 figures. There is no drama, the world won’t go under,” said one diplomat to EUobserver.
But of course. Who cares if the EU malfunctions due to underfunding? And how dare the Parliament ask for a role in negotiating the multiannual budget framework?
The governments of the Member States seem to suffer from some very peculiar type of schizophrenia. It was them that approved the equal status of the Parliament in the budget procedure. It was them that actively advocated in 2009 for the entry into force of the Treaty of Lisbon. It was them that welcomed “a major step forward” for Europe. But now they are ready to block the EU budget in order to prevent the European Parliament from participating in talks for the multiannual budget.
This attitude of hostility towards supranational institutions and the European Union as a whole already peaked with the disgraceful treatment of the President of the Commission during the European Council meeting while discussing the deportation of Roma citizens from France. It has now been shown once again in the form of nonchalant attitude to the EU budget procedure, as if it doesn’t matter anyway.
It does matter, as will be shown in the first months of 2011 when budget rollover from 2010 will be used. But I am much more worried about the obvious lack of ownership of the European idea in Member States’ governments. They seem to distrust both the integration agenda and the supranational institutions it implies. This is a well-trod path to institutional paralysis and inefficiency.
Legal and political scholars pay great attention to the interinstitutional agreements among EU institutions, and for a good reason: it’s where a lot of the institutional innovations first take hold. Now an interinstitutional agreement (IIA) between the European Parliament (EP) and the European Commission has become an object of dispute. The Council has voiced its strong criticism of the document, claiming that several provisions of the framework agreement have modified the institutional balance set, providing certain prerogatives for the European Parliament that are not provided for in the treaties and that are limiting the autonomy of the Commission and its President (hat tip: EUobserver).
The Council is concerned about the participation of the EP in international talks and its increased access to classified documents and to information related to legal cases pursued by the Commission against Member States. The Council threatens to challenge any action of the Commission and the EP that would have an effect contrary to the interests and the prerogatives conferred upon it by the Treaties.
The question is whether these provisions do constitute a shift of the institutional balance that breaches the Treaties. This is a twofold question. We very well know that IIAs do shift the institutional balance to some extent, and this agreement is a good example. But does this one breach the Treaties?
Martinned thinks that the agreement shifts the political balance, and not so much the legal balance of power. Piotr Kaczynski from CEPS is quoted by EUobserver saying that the IIA as such doesn’t necessarily break the Lisbon Treaty.
I concur that the IIA probably does not breach the Treaties simply because it does not have the potential to do so. Naturally, the Council may wish to challenge the actions based on the IIA, but will likely face little understanding from the ECJ, provided that the Commission and the EP haven’t made a flagrant violation, of course.