The European Economic Community

In Western Europe, the experience of the depression the Second World War, the development of post-war cooperation and institutions and the efforts of notable individuals including Schuman, Monet and Hallstein contributed to the momentum for more comprehensive cooperation and integration.

The European Coal and Steel community proved to be a success and plans for more ambitious integration were promoted. After some false starts, the European atomic energy community (Euratom) and the European Economic Community were established under treaties in Rome in 1957

The European Economic Community was much more comprehensive than the earlier institutions. It provided for the creation of a single market between member states in which goods services workers and capital could freely move without restriction. It provided for a customs union with a common tariff in relation to non-member states reflecting a common community commercial policy.

The EEC was based on the principle that a larger market with free trade between participants brings greater benefits. This basic principle of free-market economics is reflected in the four freedoms set out, protected and promoted in the treaty, free movement of goods services of workers and of capital. Over time it has come to be counterbalanced by EU social and economic rights.

The Treaty provided for a Council which was the primary law-making body.  It provided for a parliament made up of representatives of member states.  An independent court of justice was also established charged with the interpretation of the EEC law and the resolution of disputes, enforcement of community law.

It provided for the approximation of laws required for the proper functioning of the common market. It provides for procedures by which economic policies of states might be coordinated and balance of payments problems remedied.

The Treaty provided for the development and implementation of common policies in various areas such as agriculture fisheries competition transport and other areas. It provided for the European Social fund to improve employment opportunities for workers and raise living standards. It established the European Investment Bank to facilitate expansion by opening new resources. It provided for association with overseas countries and territories to promote economic and social development.

Whether the ultimate arrangements would be a federation confederation or other arrangement could only emerge with the passage of time. However, it was clear that a form of cooperation and integration beyond that ever undertaken before was required to secure international peace and prosperity.

Evolution of the EU

Over time the European Communities have continued to evolve. The original six members have grown to 28 (falling to 27 after Brexit) in a series of accessions, with most of the former Eastern Bloc countries becoming members in 2004.

There have been several major revisions of the treaties, and the communities are now described as the European Union. There is a concept of EU citizenship based on national citizenship. The EU has taken on competence and powers in a broader range of areas including social, employment economic and environmental matters. The EU Parliament has been directly elected for over 40 years.  19 of the 28 member states share a common currency the euro.

Some states and governments have sought to promote a federal Europe in which the European Union would become the dominant governmental institution, the equivalent of the United States federal government. This would imply a strong central government with taxing and spending powers and a common policy on all matters in relation to the rest of the world.

Referenda and national elections have shown that most citizens and governments are opposed to a federal Europe in the above sense. The history of the EU since the completion of the single market in the 1990s has shown considerable resistance to further and deeper integration. The EU has responded by creating multispeed institutions. In some areas, some or most member states cooperate to a greater extent than in others. This is reflected in the areas of common security and defence matters justice and home affairs and in participation in the common currency, the euro.

The United Kingdom enjoyed significant opt-outs in the area of the common currency and the Schengen free movement area. Ireland opted out of the Schengen free movement area remaining in the common travel area with the United Kingdom. Ultimately the United Kingdom has opted out of the European Union entirely and is seeking to renegotiate a novel deep and comprehensive relationship with it as a non-member.

Ireland and the UK accession to membership

Following a virtual walkout by France from the EEC in the mid-1960s, the so-called Luxemburg Accord was adopted which allowed for the “veto”.  Even where the treaties allowed the EEC to proceed by majority vote, where the vital national interest of a country was involved, unanimity would be required.

Ireland and the UK sought to join the EEC from the early 1960s.  It was recognised that it was only feasible for Ireland to do so in parallel with the United Kingdom.  After two failed attempts to join caused by rejection by France, it was finally agreed in 1969 at The Hague Summit that the EEC would be enlarged by the admission of Ireland, the UK, Denmark, and Norway.

On January 1st, 1973, Ireland, the UK and Denmark joined the EEC. Ireland approved joining, by a referendum. Norway did not join following a failed referendum. In 1975 following splits in the UK’s Labour Government, a referendum was held in the UK which affirmed the decision to join.

Judicial activism

The EU treaty rights and freedoms are accompanied by law-making mechanisms by which the states are to give effect through the EU institutions to these principles. It was not clear to what extent the rights and freedoms could have direct effect, overruling inconsistent national law and practice. It might be argued that the general rights in the treaty were to be given effect only by EU legislation.

The period from the early 1970s to the mid-1980s was a period of stagnation in terms of the development of EU competence and legislation. It was not possible to achieve political agreement on the measures which were identified as necessary to achieve a meaningful single market.

Commencing in the late 1970s, the EU courts started to interpret the EU treaty in a manner which sought to give real effect to the basic common market principles, particularly those of free movement of goods persons services and capital. In a famous case in 1978, “Cassis de Dijon”, a German rule applied to require market authorisation for the sale of French fruit liquor in Germany. The importer had applied for an authorisation but was refused, on the basis that in the absence of harmonisation of consumer protection rules at EU level, German consumer protection rules applied.

Proposals for harmonisation had become stalled, effectively requiring unanimity at Council (member government) level. Traditionally, this would have been the end of the matter. However, the court declared a state could not impose national rules in relation to imports unless this was justified by mandatory European requirements of public interest. The requirement was invalidated.

The EU courts have continued to spell out the meaning and implications of the key EU rights and freedoms since that time and consequences. In common with most other constitutional courts, they have developed the meaning of the key EU freedoms time by analogy. The courts have continued to hold that the EU rights and freedoms and rights under EU legislation can be directly effective and give rise to individual citizens and courts to challenge and invalidate domestic law.

From the court’s perspective. it was giving effect to the general principles in the initial constitutional document. The nature of constitutional judicial decisions is that the principles are declared cases as they arise. The change may appear retrospective. The consequences of some of the decisions of the European Court of Justice appeared continuously to push out the boundaries of EU law by stealth, coming close to undemocratic law-making.

Political Cooperation

The Hague summit in 1969 established European political cooperation.  This involved a framework to exchange views and adopt common positions outside the strict legal institutions of the EEC.  There was no supranational foreign policy. The member states acted unanimously, and there were not autonomous institutions which made or developed foreign policy.

The European Political Cooperation mechanism was reorganised and provided for under the Single European Act adopted in 1986. The title of the Single European Act referred to the incorporation of the provisions for the modified European communities and the provisions for political cooperation in a single instrument. It was not a reference to the creation of a single or federal Europe.

Ultimately the arrangements for political cooperation were formalised later in the Common Foreign and Security Policy provisions of the Treaty on European Union. They remain as political intergovernmental arrangements rather than a community-based arrangement. They have their own independent and parallel legal base.

The Schengen Agreement

Emerging from discussions on European political cooperation, the member states established the TREVI mechanism in order to combat international terrorism. It later expanded to coordinate efforts in other policing and security areas, including action against organised crime. In this context, some states were willing to abolish border controls.

A treaty was signed by between five of the 10 (then) EEC member states in 1985 near Schengen. The first Schengen Agreement operated between France, Germany, and the Benelux countries. The arrangements involve coordination and strengthening of policies on asylum, deportation, visa, security, drug trafficking and crime.

The Schengen Area was established separately from the Communities, The Agreement was supplemented in 1990 by the Schengen Convention, which provided for the abolition of internal border controls and a common visa policy with. police and judicial cooperation. The Schengen area continued as an independent intergovernmental regime before being incorporated into the European Union structure in the 1990s under the Amsterdam Treaty

The EU states that joined after May 2004 were bound by the Schengen agreement and subject to the progressive statutory abolition of border control. The Schengen area includes countries outside of the EU.

Ireland, UK, and Denmark are not a party to the Schengen agreement.  Ireland and the UK have had a Common Travel Area with no internal border controls since the establishment of the Irish Free State in 1922.   The Common travel area has been recognised in the UK withdrawal Agreement, and Ireland will remain part of that agreement and outside of the Schengen Agreement.

The Schengen Agreement involves the full abolition of internal borders.  National identity cards rather than passports suffice in air travel. There is heightened cooperation in relation to immigration and asylum.  A common Schengen area visa covers the whole Schengen area.

There is strengthened cooperation between the police, immigration, and customs authority.  There are common rules for asylum seekers. There is a Schengen information system allowing for the exchange of information between police, judicial and other national authorities.

Monetary cooperation and Union

Early attempts were made to create a European and monetary union in the late 1960s.  Due to the explosion of inflation following the oil crisis in 1973, the early attempts at European monetary union collapsed.

The European Monetary System was adopted in 1979.  The participating states agreed to keep their relative exchange rates within a narrow range by intervening in the foreign currency markets as necessary. Ireland joined, but the United Kingdom did not, breaking parity and the effective currency union with sterling, which had lasted over 150 years.

Ireland sought to lock itself into the stability and relatively low inflation of the German Deutschmark and escape the high inflation which had beset Sterling in the 1970s. Ireland  found it difficult to maintain the target exchange rates, and there were significant evaluations in 1986 and again upon the effective collapse of the mechanism in 1992.

The arrangements worked in a broadly satisfactory manner until 1992.  The system effectively broke down in 1992 following sustained speculative attacks on the value of certain weaker currencies, caused by their obvious overvaluation relative to the Deutschmark.  Several countries, including the United Kingdom and Italy and Ireland, were forced out of the mechanism.

Ireland took a further 10 per cent devaluation of its currency. The mechanism continued but the currency fluctuation ban was expanded from 2.25 per cent to 15 per cent either side of a central target.  By that time, the proposals for a single currency were advanced and had been embodied d in the EU treaties.

European Council

The 1969 Hague Summit had shown the potential positive effect of initiatives by the heads of state or government in the evolution of the European communities. The European Council meetings were formalised in 1974. The heads of government decided to meet accompanied by the Ministers for Foreign Affairs three times a year and whenever necessary in the Council of the Communities in the context of political cooperation. An administrative secretariat was established.

The establishment of the European Council as a semi-permanent government of the European communities was an important and momentous development. While initially outside the European Communities, it would be eventually incorporated into it

1970 – 1985

There was relatively little development of the EEC during the period from the 1960s to the mid-1980s. It has been described as a period of stagnation. Following progressive steps during a transitional period, the EEC customs union was fully completed in 1968. The 1960s saw a long-running dispute in which France effectively walked out of the EEC for a period. The 1970s brought recession and economic downturn.

The 1970s saw the end of long-standing right-wing dictatorships in Spain and Portugal with the death of Franco and the overthrow of the Salazar regime. In Greece, a military junta that which had held power since 1967 was overthrown in 1974. Ultimately after the firm establishment of democracy, each commenced the accession process. Greece joined the EEC in 1980. Spain and Portugal joined in 1986.

The first significant environmental laws were enacted at the EU level. The 1970s saw the development of regional policy in the EU and the transfer of funds to create jobs and infrastructure in poorer areas. 1979 saw the first direct elections European Parliament.

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