About the EU

Six decades after its founding act, the European Union (EU) remains a unique form of integration and cooperation among sovereign states.  Neither a classic treaty-based international organization nor a federal one, the EU is a system in which Member States, currently numbering 28, work together through common institutions.  The EU countries have increasingly pooled parts of their sovereignty.  The pooling is most advanced in economic matters (e.g. trade and agriculture), in which the EU negotiates directly with non-member countries, including the U.S., on behalf and instead of the Member States.  The Lisbon Treaty reforms (entry into force December 1, 2009) were meant to streamline EU decision-making and enhance EU effectiveness in the world, and included the positions of permanent President of the European Council (top-level meetings of EU leaders) and High Representative of the Union for Foreign Affairs and Security Policy/Commission Vice President (HR/VP).

The European integration project was launched after WWII as a way of securing peace by bringing European nations together under a common, supra-national, expandable structure. French FM Robert Schuman, acting upon a suggestion from Jean Monnet, tabled a plan on May 9, 1950 for France and Germany to pool their coal and steel production under the control of a European organization set up for the purpose, thus making another war between the two countries “materially impossible.”  German Chancellor Konrad Adenauer seconded the proposal and the six founding countries (Belgium, France, Germany, Italy, Luxembourg and the Netherlands) established a treaty-based common market in coal and steel (the European Coal and Steel Community – ECSC, Treaty of Paris, 1951).

Following the success of the ECSC, the six countries attempted but failed to establish a European Defense Community and a European Political Community in the 1950’s.  The “Six” nevertheless pursued integration by setting up a common market.  They created the European Economic Community (EEC Treaty), built around the free movement of goods, capital, workers and services, and a companion treaty establishing the European Atomic Energy Community (EURATOM).  These Rome Treaties established institutions (Council, Commission, Parliament, Court) and decision-making mechanisms still in place today.  The three Communities (ECSC, EEC, EURATOM) were eventually merged into the single European Community.

The effects of the EEC Treaty of Rome were dramatic.  Customs duties on manufactured goods were abolished on July 1, 1968, after a transition period.  Trade within the Community increased six-fold, while EEC trade with the rest of the world went up by a factor of three.  New policies, including the Common Agricultural Policy (CAP) and a common trade policy, were put in place by the end of the 1960s.

The success of the integration project in years of continuing economic growth in the 1960s led to a first enlargement (UK, Ireland and Denmark) in 1973.  This was matched by further “deepening” of integration in social, regional and environment policies.  In 1979, the first direct elections to the European Parliament (EP) took place, altering the nature of that institution.  From then on, EP elections were held every five years.  The Community expanded southward with the accession of Greece (1981), followed by Spain and Portugal (1986).  These accessions made it necessary for the Community to adopt “structural policies” (regional aid programs) to reduce economic and social disparities among regions of the bloc.

During the 1960s and 1970s, the Community began to assert itself on the international scene with the conclusion of agreements with Southern Mediterranean countries and successive conventions linking Member States to their former colonies in Africa, the Caribbean and the Pacific (the ACP group).  These “Lome Conventions” offering trade benefits and development aid were later extended under a successor framework pact, now called the Cotonou Agreement.

World recession and disagreements about contributions to the Community budget held back further integration in the 1970’s and early 1980’s.  From 1985 onward, economic integration made further headway, based on the 1985 “Single European Act” (SEA), the first major treaty revision which set January 1, 1993 as the target date by which a full single market was to be established.  By extending the practice of qualified majority-voting (a weighted allocation of votes among Member States) in the Council, the SEA gave the Community the means of adopting some 280 Directives to remove outstanding barriers to the free movement of goods, capital, labor and services among Member States.

The collapse of the Berlin Wall and German unification prompted the Member States to negotiate the Treaty on European Union (TEU or Maastricht Treaty, signed in 1992; effective in 1993) with an ambitious program:  establishment of Economic and Monetary Union (EMU) by 1999; setting-up of a Common Foreign and Security Policy (CFSP); reinforcing cooperation on Justice and Home Affairs (JHA).  The TEU set the broader “European Union” as a three-pillar umbrella organization bringing CFSP (second pillar) and JHA cooperation (third pillar) alongside the original “European Communities” (first pillar, essentially economic integration).  It also led to a marked reinforcement in the powers of the European Parliament, which was raised to the rank of co-legislator with the Council on many issues (“co-decision”).

In 1995, three more countries (Austria, Finland and Sweden) joined the EU, raising membership to 15 (Norway also negotiated an Accession Treaty but rejected membership in a referendum).

The Amsterdam Treaty (signed in 1997, entry into force 1999) only partly achieved its objective of making the EU institutional apparatus more efficient with a view to further enlargement eastward.  Some aspects of JHA policy-making (including visas and asylum) became subject to Commission initiative and Council decision by qualified majority-voting.  A position of High Representative for CFSP was established and entrusted to the Spaniard Javier Solana, who held the job for two five-year terms through 2009.  The Amsterdam Treaty made the appointment of the Commission President subject to a positive vote of the EP and extended the EP’s co-decision powers to new areas.

The accession process for formerly communist countries of Central and Eastern Europe as well as Cyprus and Malta was launched in the years 1997-2000.  The scope of the enlargement project raised questions about EU resources, prompting the adoption of the “Agenda 2000” package covering amendments to the CAP and EU structural policies as well as a multiannual EU financial framework for the next seven years (renewed since then).

In the meantime, on January 1, 1999, the euro became the official currency of the EU and the single currency of eleven Member States.  Euro notes and coins were put into circulation on January 1, 2002.  New Member States – once they meet certain economic criteria – are expected to join the “euro area” (covering 19 EU countries as of August 2015) but older members Sweden, the UK and Denmark still remain outsiders.  No country has left the euro area after joining and there are no provisions governing a euro exit.  EU Member States are committed to observe the EMU Stability and Growth Pact imposing tight financial constraints.  A budget deficit ceiling of three percent of GDP occasionally turned out to be difficult to observe for several EU economies, notably Germany and France, thus bringing the credibility of the Pact into question.  The euro nevertheless proved to be a decisive instrument of stability, including through the 2008-2009 financial crisis.  The euro area has since been going through a sovereign debt crisis, which has forced governments to strengthen budgetary surveillance and to adopt new rules for EU economic governance, including a major revision strengthening the Stability and Growth Pact.

Another attempt to streamline the EU structures in view of forthcoming enlargement was completed in 2000 but the resulting institutional changes in the Treaty of Nice (entry into force 2003) were recognized to be imperfect by the leaders themselves.  At the December 2002 landmark Summit in Copenhagen, the EU and the ten “most advanced” candidates (Cyprus, Czech Republic, Hungary, Poland, Slovenia, Lithuania, Latvia, Estonia, Slovakia and Malta) nevertheless agreed on accession terms, leading to the largest enlargement ever from EU-15 to EU-25 on May 1, 2004.  Bulgaria and Romania subsequently completed their own negotiations and joined on January 1, 2007, raising the number of Member States to 27 and the total EU population to more than 500 million inhabitants.

Turkey was granted “candidate” status in 1999 and eventually started accession talks with the EU in October 2005.  The negotiations have been very slow due to the protracted stalemate in the Cyprus settlement talks.  By contrast, Croatia, which started its own EU accession talks simultaneously with Turkey in 2005, completed them in June 2011 and joined the EU in July 2013.

Four other countries have official candidate status: Macedonia, which officially became candidate in 2005 but has still to open formal accession talks with the EU; Montenegro, which obtained candidate status in December 2010 and has opened 20 of 35 negotiating chapters; Serbia, which obtained candidate status in March 2012 and formally opened talks in 2014 but has yet to open its first negotiating chapter; and Albania, which obtained candidate status in June 2014 but has not opened formal accession negotiations yet.  Iceland opened accession talks in 2010 but its current government is no longer pursuing the negotiations and withdrew the country’s EU accession application in March 2015.

The EU Stabilization and Association Agreement (SAA) with Bosnia-Herzegovina entered into force in June 2015.  The EU SAA with Kosovo (under UNSCR 1244) was initialed in July 2014 by EU and Kosovar negotiators but has yet to be signed and enter into force.

Since the end of the 1990s, the EU has developed a Common Security and Defense Policy (CSDP), a component of the EU’s Common Foreign and Security Policy (CFSP).  The first concrete step to enhance military capabilities occurred in 1999 when EU Member States set the “Helsinki Headline Goal,” implying a military capability target.  Following the conclusion of a landmark agreement on the use of NATO assets, the EU launched a military peacekeeping mission in Macedonia in 2003, taking over from NATO.  The mission was followed by many other military, civilian or police operations, including the civilian EU Rule of Law Mission (EULEX) in Kosovo, which involved the first-ever U.S. participation in an ESDP mission.

Aware of the flaws of the Nice Treaty reforms agreed in 2000, EU leaders at the end of 2001 set up a European Convention, which produced a draft Constitutional Treaty that was subsequently amended by EU governments and leaders in a 2004 intergovernmental conference (IGC) and submitted for ratification to the EU-25.  The concept consisted of reshaping all existing EU Treaties and replacing them with a single text, which was called “Constitution,” thus raising suspicions of a Brussels power grab and helping to elicit a backlash which led to failed referenda in France and the Netherlands in May-June 2005.  After a “period of reflection,” the leaders reverted to the classic way of amending the EU treaties: they agreed in 2007 on a collection of amendments to existing provisions – the Treaty of Lisbon.  The latest reforms entered into force in December 2009, following completion of the national ratification procedures which involved further temporary blockades in some countries.

Among the major innovations of the most recent treaty are the positions of permanent President of the European Council and High Representative of the Union for Foreign Affairs and Security Policy/Commission Vice President.  Both positions were intended to enhance the EU’s coherence and capacity to assert itself on the international scene.  The High Representative is assisted by the European External Action Service (EEAS), established under Ashton as an embryo of the EU Foreign Service, made up of staff derived from the External Relations Directorate General of the pre-Lisbon EU Commission, the EU Council Secretariat, and Member State Foreign Ministries.