EU-integration knowledges Written by Endre Domonkos1st Semester, Academic Year 2010/2011

I. Preconditions of the European integration I. • The Roman Empire used to be the first integration endeavor. After the armed conquest the so

called „Pax Romana” was also provided. The cohesion force was the Roman law and the administrative system.

• During the Middle Ages behind the feudal division the Christianity and the Latin language played an important role. Geographic unit was also created by Charlemagne (Charles the Great or Charles I in the regnal lists of France and Germany). The King of the Franks succeeded in unifying the central and western part of Europe.

• Charlemagne was crowned by Pope Leo III as The Emperor of the Holy Roman Empire on 25 December 800.

• In 1648 the Peace of Westphalia meant a new era in the modern interstate relationships. Its results were the followings: the establishment of territorial national states and the creation of absolute monarchies.

• The most important non-written principle of the international relationship was the balance of power.

• The system of Holy Alliance in 1815. It was the antecedent of the organization among states.

• After the World War I tighter cooperation form was created by the European states. According to the Declaration of Woodrow Wilson the League of Nations were also established that used to be a forum for resolving debates.

• The plan for making an unified Europe was discussed in the framework of the League of Nations by the French Ministry of foreign affairs, Aristide Briand who suggested in creating a European confederation (dismantling the customs and barriers, and using a common currency).

• After World War II. an important endeavor was the promotion of interstate cooperation worldwide.

I. Preconditions of the European integration II. • However the idea of united European states is rooted in common European thinking much

earlier, especially in the Middle Ages, and its emergence cannot be attributed exclusively to the political and economic conditions that prevailed after the World War II.

• Various idealistic concepts had been formulated before in the works of artist, philosophers and scientists, including Dante, Comenius, Erasmus of Rotterdam, or Immanuel Kant.

• Dante supported the principle of universal monarchy. The monarchs were equals and sovereign in the system, but they accepted the principle of common law and a supranational power for preserving the peace among them.

• Pierre Dubois: instead of creating a common monarch he suggested in establishing a European Court of Justice composed on philosophers. This institution would have got sanctional competence as well.

• George Podjebrad: creation of „European federation” in there the sovereign states would have undertaken by the common norms. Their common things would have arranged by the Assembly and their disputes would have solved by European level Court. This form of Alliance would have had common army and budget as well.

• Prince of Sully (advisor of the French King Henry the Fourth): plan of a „Christian Republic” as a confederation of fifteen European independent states. The confederation would have got a European Council and common laws as well.

• Abbé de Saint Pierre: his work about the European confederation, international law and about the Council of European Alliance determined the process of integration later.

I. Preconditions of the European integration III. • Immanuel Kant’s „Everlasting Peace” conception: it should be established the confederation of

democratic and free states in the framework of rule of law. The „Everlasting Peace” would be guaranteed by acceptation of the common law system among the bourgeois Republic states.

• Saint-Simon’s conception: he studied the economic and technical conditions of European integration, pointing out the need for establishing a comprehensive European organisation, a kind of European Parliament.

• In 1849, Victor Hugo used the term „United States of Europe” to indicate a goal to be aimed at by each European country.

• Then, in the first half of the 20th century, several plans were put forward to realise European unity in an institutionalized form.

• In this respect, special mention should be made of Richard Coudenhove Calergi, a citizen born in the Austro-Hungarian Monarchy, who published his book entitled „Pan-Europe” in 1923.

• The book lists concrete proposals for uniting Europe. The „Pan European Movement”, organised on the basis of his work in the 1920s, formulated a concept of economic integration as well.

• During the interwar period we had to mention the plan of European Confederation by Aristide Briand.

• In 1943, the so called Ventotene Declaration was adopted by Altiero Spinelli and Ernesto Rossi. Their main targets were to create a federal Europe. Later Spinelli established the European Federal Movement and wanted to create a federal Europe as MP of the European Parliament.

I. Preconditions of the European integration IV. Yet, a basis for actually creating an institutionalised Europe was provided through the lessons

learned from the destruction caused by World War II.

It was then that many realised that cooperation created on loose intergovernmental basis, similar to that of League of Nations which operated between the two world wars, could not provide a sufficient guarantee for peaceful coexistence and development of the states of Europe.

The League of Nations failed to draw together European states either politically, economically and culturally, and it even failed, as a result of its weakness as an institution for one thing, to prevent the most horrible war in the history of Europe from happening.

This failure showed that Member States do not look upon an organisation operating without supranational control and based on loose intergovernmental relations as a guarantee of sustainable cooperation.

The Western part of Europe, split-up after World War II, realised quite early that the old continent would be able to increase its largely diminished political and economic weight and influence in the nascent bipolar arrangement of the world only through integration.

Regional economic cooperation appeared indispensable for the development of the countries of Europe with fragmented national markets, and also for regaining and strengthening the position occupied in the world economy.

Economic cooperation was necessary for restructuring the world economy and provide the competitive advantage of the United States. Technological and structural modernisation was also important as well.

I. Preconditions of the European integration V. After the World War II. politicians in Western Europe started to discuss the feasibility, rather

than the necessity, or integration.

The main issue was whether a political, military, or economic orientation, or a combination thereof, was needed to preserve peace in Europe and enable the countries of Europe to recover; also, it had to be determined which countries would take part in the integration process.

The development of the idea of European unity is evidenced by the fact that parties belonging to differing political families started to set up their European organisations with the aim of creating a federalist Europe.

A feature shared by the various national and international movements was the intention to create a united Europe on the basis of a common system of institutions. These ideas centred around a federalism that included, directly and indirectly, the establishment of a European system of institutions on a supranational basis.

Most governments of the European countries, however, appeared reluctant to make a definitive step in this direction and took a standpoint that preferred looser cooperation based on intergovernmental cooperation, in line with the tradition of policy making by nation-states.

This was the approach taken in the setting up of the Council of Europe on 5 May 1949 by ten countries of Western Europe.

The Council of Europe didn’t represent a block aiming at integration in terms of competence, operation or activities; rather, it appeared to be a regional international organisation in its traditional sense.

II. The international order after the World War II. In 1944 conference was held in Bretton Woods that created the International Monetary Fund

IMF) and World Bank (IBRD).

The Bretton Woods system was history's first example of a fully negotiated monetary order intended to govern currency relations among sovereign states. In principle, the regime was designed to combine binding legal obligations with multilateral decision-making conducted through an international organization, the IMF, endowed with limited supranational authority.

The American government set up a system of fixed exchange rates managed by a series of newly created international institutions using the U.S. dollar (which was a gold standard currency for central banks) as a reserve currency. The Bretton Woods system was based on monetary stability.

On 25 April 1945, the UN Conference on International Organization began in San Francisco, attended by 50 governments and a number of non-governmental organizations involved in drafting the Charter of the United Nations.

The main target of the establishment of UN was to promote the peaceful cooperation among the sovereign states and to avoid the eruption of World War III.

 The UN officially came into existence on 24 October 1945 upon ratification of the Charter by the five permanent members of the Security Council—France, the Republic of China, the Soviet Union, the United Kingdom and the United States—and by a majority of the other 46 signatories. 

The Charter of the United Nations is a collection of multilateral treaties that have got supremacy over any other international treaties.

II. The international order after the World War II.

The Charter of the United Nations determined the purposes of the Organizations that were the followings:

The Purposes of the United Nations are:

„To maintain international peace and security, and to that end: to take effective collective measures for the prevention and removal of threats to the peace, and for the suppression of acts of aggression or other breaches of the peace, and to bring about by peaceful means, and in conformity with the principles of justice and international law, adjustment or settlement of international disputes or situations which might lead to a breach of the peace;

To develop friendly relations among nations based on respect for the principle of equal rights and self-determination of peoples, and to take other appropriate measures to strengthen universal peace;

To achieve international co-operation in solving international problems of an economic, social, cultural, or humanitarian character, and in promoting and encouraging respect for human rights and for fundamental freedoms for all without distinction as to race, sex, language, or religion; and

To be a centre for harmonizing the actions of nations in the attainment of these common ends.”

III. The establishment of GATT I. The General Agreement on Tariffs and Trade (GATT) was established in 1948 to supervise

and liberalize international trade.

The GATT was the only multilateral instrument governing international trade from 1948 until the WTO was established in 1995.

The main endeavors of GATT were the followings: to liberalize the international commerce and to eliminate the tariffs and non-tariff barriers.

The principles of GATT (now WTO) are the followings:

1. Non-Discrimination. It has two major components: the most favoured nation(MFN) rule, and the national treatment policy.

The ”most favoured” nation term means the country which is the recipient of this treatment must, nominally, receive equal trade advantages as the "most favored nation" by the country granting such treatment. 

The notion of „National treatment” means that imported goods should be treated no less favorably than domestically produced goods (at least after the foreign goods have entered the market) and was introduced to tackle non-tariff barriers to trade (e.g. technical standards, security standards et al. discriminating against imported goods).

III. The establishment of GATT II. 2) Reciprocity. It reflects both a desire to limit the scope of free-riding that may arise because

of the MFN rule, and a desire to obtain better access to foreign markets.

A related point is that for a nation to negotiate, it is necessary that the gain from doing so be greater than the gain available from unilateral liberalization; reciprocal concessions intend to ensure that such gains will materialise.

3) Binding and enforceable commitments. The tariff commitments made by WTO members in a multilateral trade negotiation and on accession are enumerated in a schedule (list) of concessions.

These schedules establish "ceiling bindings": a country can change its bindings, but only after negotiating with its trading partners, which could mean compensating them for loss of trade. If satisfaction is not obtained, the complaining country may invoke the WTO dispute settlement procedures.

4) Transparency. The WTO members are required to publish their trade regulations, to maintain institutions allowing for the review of administrative decisions affecting trade, to respond to requests for information by other members, and to notify changes in trade policies to the WTO.

These internal transparency requirements are supplemented and facilitated by periodic country-specific reports (trade policy reviews) through the Trade Policy Review Mechanism (TPRM)

5) Safety valves. In specific circumstances, governments are able to restrict trade.

There are three types of provisions in this direction: articles allowing for the use of trade measures to attain non-economic objectives; articles aimed at ensuring "fair competition"; and provisions permitting intervention in trade for economic reasons.

IV. The establishment of the Council of Europe The Council of Europe (CoE) was established by 10 countries of Western Europe (Belgium,

Denmark, France, Ireland, Italy, Luxemburg , the Netherlands, Norway, Sweden and the United Kingdom in London on 5 May 1949.

The Council of Europe is a regional intergovernmental organisation with the following main aims: strengthening of a pluralist democracy, maintaining the rule of law, protecting human rights, promoting and developing the European cultural identity, and seeking solutions to problems facing society.

The activity of the Council of Europe is best charactarised by the nearly 200 Conventions elaborated by the Council and predominantly dealing with issues concerning human rights and various aspects of society and culture, including for example, the European Convention on Human Rights, the European Social Charter, the Convention for the Protection of National Minorities, and the European Charter for Regional or Minority Languages, all of which become part of national law following their ratification by the Member States.

The headquarters of the Council of Europe is in Strasbourg.

Its main bodies are the followings: the Committee of Ministers, the Parliamentary Assembly and the Secretariat headed by the Secretary General.

An important role is fulfilled by the European Court of Human Rights established within the framework of the European Convention on Human Rights, which represents the highest judicial forum for the protection of human rights in Europe.

Decision-making in the Council of Europe: it needs a full consent of the Member States.

V. The integration process in the second half of 1940’s I. Of the Western European countries, it was the United Kingdom, with its colonial and

commonwealth interests still playing an important role, that did not intend to join an organisation aimed at integration in which national sovereignty was restricted through the operation of supranational institutions.

On the other hand, the Benelux states promoted the idea of the establishment of an organisation based on economic cooperation realising mutual interests.

Belgium, the Netherlands and Luxemburg had decided to set up the Benelux Union in 1944, which was created in 1948. The cooperation between the Benelux states represented real integration, rather than a mere customs union.

Denmark, Iceland, Norway and Sweden: intergovernmental political cooperation, collaboration among national parliaments for controlling national rules + evaluate common standpoint in international politics. In 1948 Commission was set up to create customs union.

By 1949 dealing with the German issue had become a crucial problem. The Americans considered the military strengthening of West Germany as an increasingly urgent task, while France and the other earlier western European allies were reluctant to support this measure for lack of appropriate safety guarantees.

It was clear that resolving French-German relations was a critical issue for the future of Europe. The resolution of the century-old German-French conflict was a precondition for creating a common Europe.

Promoters of a unified Europe saw a guarantee for building a peaceful and strong Europe through institutions with a supranational character that could embrace France and Germany.

V. The integration process in the second half of 1940’s II. Considerable impetus for the acceleration of Western European integration was

stimulated by developments taking place in Central and Eastern Europe.

Following the World War II, the establishment of single-party states and communist regimes in countries occupied by the Soviet Union proceeded at a high speed.

In 1947, the economic division of Europe was institutionalised through the Marshall Plan. (The countries of Central and Eastern Europe falling under Soviet orientation, one-party system and centralized planed economy system was built up).

The participating countries of Western, Northern and Southern Europe established together with the United States, the OEEC (Organisation for European Economic Cooperation) in 1948.

Its aim was to promote European trade, economic stability and development + to coordinate and distribute assistance received from America under the Marshall Plan.

In 1961, the OEEC was redesigned considerably in terms of its objectives and cooperation: it converted from a European organisation of reconstruction into a cooperation organisation for the industrialised countries. Thus, the OECD (Organisation for Economic Cooperation and Development) was created.

On 17 March 1948. Brussels agreement was concluded among the Benelux-states, United Kingdom and France. Main target: to establish a common defence against aggression + cooperation in economic, social and cultural field.

V. The integration process in the second half of 1940’s III. Although the OEEC (and later on, the OECD) could not be viewed as an organisation

aimed at integration –similarly to the Council of Europe – its emergence signaled differing economic paths of progress taken by the western and the eastern sides of Europe due to political divisions.

The political and economic detachment of Central and Eastern Europe and its binding to the Soviet Union was indicated by the formation in 1949 of an organisation that was guided by the Soviet Union and which represented a characteristic economic integration of the communist countries, the Council for Mutual Economic Assistance (COMECOM).

The COMECOM could not be considered as an example of par excellence integration either since its activity was primarily confined, at least in the early period, to bartering agreements.

The sight of an Eastern Europe forming a political and also economic cluster had a fundamental influence on integration ambitions in Western Europe which, however, pursued a different course in terms of politics and economics.

The setting up of NATO (North Atlantic Treaty Organisation) in 1949 represented political, military and defence security against the Soviet threat.

The North Atlantic Treaty, the document set up NATO, was signed in Washington on 4 April 1949 by 10 West European countries (Belgium, Denmark, France, Iceland, Italy, Luxemburg, the Netherlands, Norway, Portugal and the United Kingdom) and the United States and Canada.

While the presence of the United States in NATO meant a guarantee for Western Europe in military terms, the area of economic thinking was more predominantly characterised by integration ambitions that could counter-balance the communist threat while at the same time make the western part of Europe independent of America.

VI. Establishment of the European Coal and Steel Community I.

Relying on an approach to the integration process from the aspect of economic cooperation and with the intention of preventing the emergence of a renewed conflict between France and Germany and paving the way toward security guarantees for French-German cooperation, Robert Schuman, the then French Minister for Foreign Affairs, put forward a proposal on 9 May 1950 that was prepared together with Jean Monnet, head of the planning department of the French government.

The proposal that became known as the Schuman Plan laid the foundation of European integration, the present European Union.

Dedicated to the idea of European unity and French-German reconciliation, Schuman and Monnet set the objective of creating a European federation along a French-German axis.

In order to realise their programme, they selected as a basis for European integration an area of crucial importance for maintaining peace in Europe. Their concept relied on the assumption that central control over the coal and steel industries would make preparations for launching a war impossible.

The Schuman Plan was targeted at creating a common market for German coal and French iron ore, which would offer a number of economic benefits in addition to providing security for maintaining peace.

At the turn of the forties and fifties, considerable shortages were recorded in both coal and steel and thus the coordinated utilisation of the available stocks provided an economic justification for the integration of these areas.

VI. Establishment of the European Coal and Steel Community II. The Schumann Plan proposed that French-German coal and steel production be placed under a

single high authority in the framework of a system that would be open to other countries as well.

The French proposal was warmly received in the Federal Republic of Germany, led by Chancellor Konrad Adenauer. The Benelux-states and Italy also supported the integration process.

On 18 April 1951, Belgium, France, the Federal Republic of Germany, Italy, Luxembourg and the Netherlands signed the Treaty establishing the European Coal and Steel Community (ECSC), which entered into force on 25 July 1952. In accordance with the dispositions of the Paris Treaty the customs for coal, iron and iron scrap were abolished among the member states. After a transitional period common market was established for the above mentioned products.

The organisation was headed by the „High Authority” (consisted of independent officials as members, nominated by their respective governments but acting fully independently when making decisions on the basis of the interests of the community as a whole). Decisions were taken by consensual way and had got direct effects to the Member States.

The Council of Ministers operated as intergovernmental body, supervising the activity of the High Authority + fulfilled a legislative function.

The Assembly was established as well, which consisted of delegates from the Member State parliaments (consultative function).

The Coal and Steal Community had got its own budget (taxes levied for coal and iron products of 1% of the revenues).

VII. From the failure of the European Defence Community to the Treaty of Rome I.

Impressed by the warm reception given to the ECSC, the promoters of federalism found that the time was also ripe for creating political integration in Europe.

The European Defence Community (EDC), which was to be set up form a common European defence force, again at the initiative of the French government, was intended to serve as the foundation stone.

The idea was based on the Pléven Plan named after the French prime minister and announced in October 1950.

The main target of the Pléven Plan was to set up a form of common European defence force. Putting the European defence forces and military industry under the control of High Authority. The European defence force would have been headed by the European defence minister + Council of Ministers.

Following several years of hesitation, the National Assembly of France refused to give its assent to the European Defence Community Treaty on 30 August 1954.

Failure of the EDC brought with it a stoppage of the attempts aimed at establishing a European Political Community (EPC).

It became apparent that the conditions for the political integration of Europe hadn’t been created.

Although six Member States of the ECSC and the United Kingdom created a defence organisation in 1954 to replace EDC, under the name Western European Union (WEU), this was based on a much weaker foundation than the EDC, with no intention of setting up a common defence force, restricting its mission to the adherence of collective defence.

VII. From the failure of the European Defence Community to the Treaty of Rome II.

Once the EDC failed, federalists had to resort again to the field of economics to promote the process of integration.

Member states of the ESCS met on 1 and 2 June 1955 in Messina to discuss the issue of deepening and expanding economic integration, with institutional issues of possible cooperation in the area of atomic energy and a common market in general.

The committee was headed by the Belgian foreign affairs minister, Paul-Henry Spaak. His suggestion were the followings: realising a common market based on customs union.

The Spaak Report proposed an institutionalised community structure for the would-be organisation of integration in which issues pertaining to general politics and the operation of the common market were to be handled separately.

While the former would remain within the competence of the Member States, a body with authority and community responsibility would be set up with the function of ensuring the operation of the common market.

The Spaak Committee evaded the reference to supranational status.

The pragmatic approach of the Spaak Committee appeared successful in working out concepts that was acceptable to all six ESCS Member states.

VII. From the failure of the European Defence Community to the Treaty of Rome III. The governments of Belgium, France, Netherlands, Luxembourg, the Federal Republic of

Germany and Italy signed the treaties establishing the European Economic Community (EEC) and the European Atomic Energy Community (Euratom) in Rome on 25 March 1957, known as the Treaties of Rome, which became effective on 1 January 1958.

The institutional model applied to the EEC and Euratom was that of the ECSC, with the difference that there was a shift in the scope of decision-making competence away from the Commission, that played the role of High Authority with respect to these treaties, to the Council as the body representing the governments.

Thus, an intergovernmental model, rather than a supranational one, was established as a consequence of the general political climate after the failure of the EDC.

The Commission became the main initiator of decisions, equipped with some decision-making authorisation but more restricted than enjoyed by the High Authority of the ECSC.

The Council of Ministers, on the other hand, being the main decision-making body, had more power than its ECSC counterpart.

The Assembly was assigned a similar role that in the ECSC, of consultation, authorisation and very limited supervisory competence.

The Court of Justice received the task of controlling and securing compliance with legal provisions. These latter two institutions operated as common bodies of the ECSC, the EEC and the Euratom, while the Commission and the Council were separate institutions for each of the three organisations.

VIII. Dispositions of the Treaty of Rome

The Treaty of Rome that established the EEC, set the establishment of a common market as the overall aim of the Community;

The main task of the Treaty was to provide „the harmonious and balanced development of economic activities… raising of the standard of living… economic and social cohesion and solidarity among Member States… through gradual convergence of economic policy (Article 2 of the Treaty).

The overall aim was to be achieved by following main specific objectives (Article 3):

- the elimination of customs duties and quantitative restrictions, and of all other measures having

equivalent effect; - the establishment of a customs union and adherence to a common commercial policy against countries

outside the Community; free movement not only for goods and services, but also of labour and capital

within the Community; - to establish a common policy in the areas of agriculture, transport, and competition; approximation of

national laws.

The Treaty of Rome that established EURATOM set as one of its aims the quick establishment and development of the atomic energy industry, identifying a number of tasks from common research to the effective utilisation of atomic energy + provision of nuclear safety.

IX. The establishment of EFTA In the fifties, the British who traditionally favoured free trade, intended to establish a free

trade association embracing all of Western Europe.

Instead of supranational organisations the British government supported the intergovermental cooperation and free trade.

However it became clear with the establishment of the EEC that „the Six” had a different idea about European integration.

Thus, the British had to realise their plan without the six states, so they set out to establish the European Free Trade Association (EFTA).

The agreement on establishing EFTA was signed in Stockholm on 4 January 1960.

Member States: Austria, Denmark, Norway, Portugal, Sweden and United Kingdom. (Later Iceland, Finland and Lichtenstein joined the Association).

However, some member countries left the organisation and decided to join the European Communities.

In accordance with the EFTA-agreement the Member States established a lazy form of cooperation and they concluded to reduce the industrial customs tariffs in the same way and manner as the EEC. Exceptions: the EFTA-agreement didn’t set up common external tariffs and wasn’t related to agricultural products.