EU Constitutional Treaty

European Union Constitutional Treaty

Title of the Treaty

Treaty establishing a Constitution for Europe including the Protocols and Annexes, and Final Act with Declarations.

Introduction

1. In Rome on 29 October 2004, the Heads of State or Government of the EU’s Member States signed the Constitutional Treaty for the EU. This Treaty is intended to reform the EU in the light of its enlargement to 25 Member States and beyond. The main changes will be to the Union’s institutional structures. The Treaty also defines the competences of the EU, incorporates the Charter of Fundamental Rights, and introduces a new mechanism for monitoring and enforcing the principle of subsidiarity.

2. A first draft of the Treaty was drawn up by the Convention on the Future of Europe, which was established by the European Council of December 2001 as an open forum consisting of representatives from across the political spectra of the EU and its candidates. The Member States then convened an Intergovernmental Conference (IGC) in October 2003, taking the draft prepared by the Convention as their starting point. In June this year, they agreed the Treaty. This final text as it appears in Command 6429 was then prepared for the October signature by the EU’s jurists-linguists.

3. In the UK, ratification of the treaty will depend upon a positive decision of both Parliament and the people. A Bill will be presented to Parliament in the new Parliamentary session to give effect to the new Treaty in UK law through amendment of the 1972 European Communities Act, and to provide that those changes to the Act can only come into force after approval in a referendum. The Bill will be fully debated in Parliament, and this process of scrutiny will inform the public debate. No decision has yet been taken about the date of the referendum, though it will obviously be after the Parliamentary process is complete.

4. Each Member State will ratify the Treaty in accordance with their own constitutional traditions, so the process will vary. At the time of going to press some have said they will also hold referendums: France, the Netherlands, Ireland, Portugal, Luxembourg, Spain, the Czech Republic and Denmark. Some have not yet decided, while others will follow parliamentary ratification procedures.

5. The Constitutional Treaty cannot come into force until every Member State has ratified it. If any Member State were to find itself unable to ratify, the Union would obviously be faced with a considerable political crisis. The Member States have agreed that, in those circumstances, there would need to be further European Council discussion.

Most EU Governments believe that the Constitutional Treaty would reform the newly enlarged European Union to make it more efficient, effective and open. This will allow the EU to concentrate on the issues that really matter to the people of Europe, in particular building prosperity and security on our continent. The new Treaty also makes clearer than ever before what the EU is: a union of sovereign states which only exercises those powers given to it by its members.

8. For the first time, the powers, rights and duties of this Union will be set out in a single Treaty. It provides a voting system for the Council which is both simpler and fairer. It provides for a significant strengthening of the voice of national governments within the EU, through the creation of a permanent President of the European Council. For the first time, it gives national parliaments a power to scrutinise proposals from the Commission at the draft stage and to send them back if they are not satisfied the EU needs to act. It introduces more workable arrangements for flexibility in Europe through ‘enhanced co-operation’ with all countries free to take part in new areas of co-operation, but none obliged to do so. It will streamline the European Commission. It provides for better foreign policy co-ordination between EU countries, while preserving national choice.

9. The Treaty also makes it plain that the European Union is not and will not be a federal superstate. Rather, it establishes clearly where the EU can and cannot act, and confirms that the EU is a union of nation states, which has only the powers given to it by these states. Unanimous agreement is still required for the most important decisions: for tax, social security, foreign policy, defence, and decisions on the financing of the EU affecting the nationals budget contributions.

The Shape of the Treaties

11. The EU is currently governed by two main Treaties the Treaty on European Union and the Treaty on the European Communities (which have themselves been changed by a series of subsequent Treaties). These set out a ‘three-pillar’ system and several different ways of producing many different kinds of laws. The EU’s powers (‘competences’) are set out in an unclear way. Moreover, certain principles, though long established and recognised, and essential to the EU’s operation, such as that of the primacy of EU law, were not hitherto explicitly mentioned in the treaties.

12. The Convention on the Future of Europe considered how it could simplify the Treaties and make them more comprehensible. The main elements of their recommendations were accepted by the Member States. The agreed Constitution will therefore:

abolish the three-pillar structure, merging the two main Treaties into one, and giving the Union a single legal personality, while at the same time ensuring that special arrangements governing the Common Foreign and Security Policy (CFSP) and some areas of Justice and Home Affairs (JHA) remain;
state much more clearly the nature of the EU. Article I-9.2 sets out plainly that the EU draws its powers from the Member States, not the other way round. For the first time, it also explicitly states that powers not explicitly conferred upon the Union remain with the Member States;
set out, again for the first time, in Articles I-12 to 14, a clear definition of the different types of competence: where the Member States have chosen to confer exclusive competence on the EU; where the competences are shared between the Union and Member States; and where the EU can take only supporting, coordinating or complementary action to help the Member States achieve their goals;
clarify and reduce the number of the Union’s legal instruments; and
make it explicit, in Article I-59, that Member States may leave the EU if they wish.

The Powers of the Union

13. The Constitution mostly clarifies rather than alters the current division of powers. But there are also for the first time separate areas of competences in a few areas: energy, tourism, sport and administrative co-operation.

14. Union activity in these areas is mostly not new. There is already some limited activity in these areas but has been taken under other legal bases. The Government is content that the new competences improve legal certainty and are appropriately drafted.

Primacy

15. Article I-5a of the new Treaty states that ‘the Constitution… shall have primacy over the law of the Member States’. This reflects existing ECJ case law, as the Declaration attached to the Article affirms case law dating back to at least 1964. The legal primacy of European law was accepted by Parliament when we joined the EEC.

Subsidiarity and National Parliaments

16. Subsidiarity is the principle whereby, in policy areas where competence is shared between Union and Member States, the Union should only get involved where it could add value in other words, where Member States and sub-Member State authorities such as the UK’s Devolved Administrations could not achieve the same objectives acting on their own. This new Treaty includes a mechanism to make sure this principle is enforced. Under this mechanism, national parliaments will gain the power to send any legislative proposal back for review, if one-third of them agree that it infringes the principle of subsidiarity. National parliaments will consult, where appropriate, regional parliaments with legislative powers. The subsidiarity mechanism is set out in the Protocol on the Application of the Principles of Subsidiarity and Proportionality.

17. This mechanism gives the national parliaments a direct say in the EU’s law-making procedures for the first time. At present, there is no obligation on Member States or the Commission even to inform national parliaments about draft EU laws, still less to let them have any power. Under the new mechanism, all national parliaments must be notified independently, and given six weeks to respond. It is obviously for national parliaments, including the UK Parliament, to decide how they wish to make use of this new power.

Institutions

18. The reformed institutional arrangements in the Constitution will ensure all the Union’s institutions work more effectively, while helping to rebalance power away from the centre to the Member States. As the House of Lords EU Committee concluded in its 21st report on 15 May 2003, ‘…the balance of power in the European Union is going to shift from the Commission in favour of the Member States if the [Convention’s] proposals … are adopted.’ In all but details, they have been.

President of the European Council

19. The most important change in the Union’s institutional arrangements is the creation of a full time President of the European Council (Article I-21) to replace the President under the rotating Presidency system. This new President will be elected by the members of the European Council for a mandate of two and a half years, renewable once.

20. The President will chair the European Council, drive forward its work, ensure its preparation and continuity on the basis of the work of the General Affairs Council, and facilitate cohesion and consensus. The President will also have a role in the most high-level aspects of the Union’s external relations. The President cannot hold a national mandate at the same time. Nor can the President also hold the job of President of the Commission.

21. The Government strongly supports this reform. It will bring much greater coherence and consistency to the EU’s actions. Moreover, it will give the Member States much greater capacity to give direction and momentum to the EU’s agenda.

The Presidency system

22. The Constitution provides for the replacement of the existing six-monthly rotating Presidency by a ‘Team Presidency’ system. Under it, all Councils apart from the Foreign Affairs Council (which will be chaired by the European Union Foreign Minister) will be chaired by a team of three Member States holding the Presidency for 18 months. In principle, one Member State will preside over all the Councils for 6 months, supported by others in the Team, though the Member States concerned may agree alternative arrangements amongst themselves. The details of rotation will be set out in a separate Council Decision.

23. The Government believes that the Team Presidency system will provide a longer-term, more stable decision-making structure and therefore ensure greater coherence and consistency in the work of various sectoral Councils. The Team Presidency system is set out in the Declaration re Article I-22, paragraph 6, concerning the European Council decision on the exercise of the Presidency of the Council of Ministers.

The Union Minister for Foreign Affairs

24. The Constitution establishes the new post of Union Minister for Foreign Affairs (Article I-27). This merges the existing roles of the Commissioner for External Relations and the High Representative for the Common Foreign and Security Policy (CFSP). The Foreign Minister will be appointed by the European Council, by qualified majority. The Foreign Minister’s task will be to conduct the CFSP and to ensure the consistency of the Union’s external action. He or she will chair the Foreign Affairs Council and will be able to present common policies in international organisations just as the Member State who holds the Presidency does currently. This does not affect the UK’s permanent membership of the UN Security Council or its right to speak in a national capacity.

25. The 30 June European Council agreed that the current High Representative, Javier Solana, would become the Foreign Minister when the Constitution entered into force.

The voting system

26. The Constitution will introduce a new system of qualified majority voting which is set out in Article I-24. It will operate from November 2009. It is a ‘dual majority’ system which means that a minimum number of Member States representing a minimum percentage of the EU’s population is required to pass legislation.

27. Under the formula in the Constitution set out in Article I-25, 55% of Member States (i.e. 15 of the EU’s then likely membership of 27) representing 65% of the EU’s population will need to support a proposed law in order for it to pass. That is 45% of the Member States, or Member States representing 35% of the EU’s population can block. However, there is a special mechanism under which if Member States representing at least 3/4 of either of those figures indicate their opposition to a proposal, the Council must delay a decision and do all in its power to reach a satisfactory solution. This mechanism is set out in the Declaration re Article I-25. It lasts until 2014 and thereafter can be removed from the Constitution by QMV. The Government is content with the new mechanism. It provides a reasonable balance between passing and blocking legislation, and ensures that the rights of small groups of Member States can be asserted when they need to be.

QMV

28. The EU Constitution will move 15 Articles (or sub-paragraphs) from a unanimous voting mechanism to QMV and introduces 24 new Articles (or sub-paragraphs) at QMV. In comparison, QMV was extended to 12 new or existing areas by the Single European Act; to 30 areas by Maastricht; to 16 areas by Amsterdam; and to 31 areas by Nice. The Treaty maintains unanimity or an emergency brake for those areas which the Government considers to be of vital national interest, such as treaty change, tax, social security, defence, key areas of criminal procedural law and the system of own resources (the EU’s revenue-raising mechanism). Unanimity will also remain the general rule for CFSP.

Commission

29. The Constitution envisages, from 2014, a reduction in the number of Commissioners to two-thirds of the number of Member States (Article I-25.6), selected from all Member States on a basis of equal rotation. The Government has consistently supported a stronger and more effective Commission, and is therefore content with this change. There is no substantive change to the mechanism for choosing the Commission President.

European Parliament

30. The Constitution strengthens the role of the European Parliament, primarily by increasing the number of policy areas subject to co-decision (the agreement of both the European Council and the European Parliament). The new Treaty applies co-decision to all areas where European laws and framework laws are adopted under the ordinary legislative procedure, unless an explicit provision to the contrary is made. This means that a number of areas will be transferred to co-decision by the Constitution, including laws on intellectual property, structural funds, the Common Agricultural Policy (CAP), asylum, immigration, Eurojust and Europol.

31. The European Parliament’s size will increase to 750 MEPs. The number of MEPs each country has will depend on population size, but each country will be allowed a minimum of 6 and a maximum of 96 MEPs. The actual number of MEPs each country has will be decided by a European Council decision, on the initiative of the European Parliament and with its consent.

Definition of Competences

32. For the first time the Treaty sets out the fundamental principles that underpin how the Union works in clear terms. The Treaty also organises the various competences into a number of categories. These are:

Exclusive competence areas where the EU has the sole right to act (for example Competition Rules in the internal market).
Shared competence areas where competence is shared between the Union and Member States (for example Agriculture and Energy).
Supporting or coordinating actions areas where the EU can only support or coordinate actions of the Member States.

33. The Treaty also collapses the pillar structure of the Maastricht Treaty and brings Justice and Home Affairs (JHA) and the Common Foreign and Security Policy (CFSP) into the main body of the Treaties. Decisions on CFSP and key aspects of JHA will still require unanimity at the Council before decisions can be taken.

Protocols

34. There are 36 Protocols and two annexes attached to the EU Constitutional Treaty.

Ministerial Responsibility

35. The Secretary of State for Foreign and Commonwealth Affairs has overall responsibility for UK policy relating to the EU and the ratification of the EU Constitutional Treaty. A large number of other Ministers and the Devolved Administrations have policy interests in particular aspects of the EU Constitutional Treaty.

Financial Implications

36. The EU Constitutional Treaty will have no direct impact on the UK as many of the substantive rules in the Treaty are taken from the current treaties. The new areas introduced by the Treaty are concerned with the internal structures, procedures and competences of the Union’s institutions.

37. There may be some indirect benefits. The Treaty aims to introduce institutional reforms that will allow the Union to operate more effectively with a membership of 25 Member States. These reforms include for example, more streamlined decision-making and a more disciplined procedure for agreeing the Union’s annual budget. The Treaty rules out tax, welfare and economic harmonisation. It allows the UK to remain as an influential power in the EU while retaining our economic flexibility. This would increase opportunities for UK businesses to benefit from the single market, and would mean better value for the UK contribution and a more prosperous Europe.

Declarations and Reservations

38. There are 50 Declarations annexed to the Final Act of the Conference that agreed the Treaty. Of these, 41 are made by the Conference as a whole, and three by the UK or the UK and others.

Implementation

39. The Treaty must be approved according to the constitutional requirements of each Member State before it can come into force. In the UK, this process will consist of a number of stages. The Government will first introduce a Bill to Parliament which will give effect to the Treaty in UK law subject to a referendum, and create provision for that referendum to take place. Once Parliament has debated the major issues and after an extensive public debate, the British people will have their say on the Treaty in the referendum. If all Member States, including the UK, have approved it by then, the Treaty will come into force on 1 November 2006.

Consultations

40. The EU Constitution will apply to most of the UK’s Overseas Territories only in respect of Title IV (Articles III 186-192) which sets out the basis for the relationship between the European Union and the non-European countries and territories of the UK, France, Netherlands and Denmark.

41. Gibraltar is unusual because, whilst it is not part of the United Kingdom, it is part of the European Union. The new Treaty will preserve continuity of Gibraltar’s status in the EU. The exemptions from the ‘acquis communautaire’, the obligations of Member States originally set out in the UK Act of Accession, will remain. But, as a natural consequence of the collapse of the pillar structure JHA Title VI measures on police and judicial cooperation, which previously were applied to Gibraltar on a case-by-case basis, will apply automatically.