The Legal System of the European Union - Research Paper Example

? The Legal System of the European Union The Legal System of the European Union Introduction The European Union (EU) is a legal order that connects nations in Europe. The EU is essentially a political and economic union that encompasses up to 27 members states within the European region. This union, previously known as and is still often referred to as the European Community, is an intergovernmental organization established through a number of treaties. These treaties include among others the European Coal and Steel Community established in 1851, the European Atomic Energy Commission or Euratom established in 1957, the Treaty of Rome that led to the institution of the European Economic Community in 1957, the Single European Act of 1987, and the Treaty of European Union also called the Maastricht Treaty, which founded the European Union in 1993. The treaty that established the Constitution for Europe was signed in the year 2004, but as at 2007, it became apparent that the treaty would not be ratified by member states. The Reform Treaty or the Treaty of Lisbon, which included an amended version of the original constitutional text of the Treaty that established the European Constitution, as well as numerous changes to the EU, was signed in December 2007 in Lisbon, Portugal. The aim of the new treaty was to ratify it in its member countries before the European elections held in 2009. The future of the Lisbon Treaty is uncertain following its rejection by a referendum in Ireland in the year 2008 and its ratification in other member states is still on hold since 2008 (Barnard, 2007). From the start, the plan behind establishing a common legal and economic community in Europe was to create a common market. This vision formally materialized in 1993, and is currently down the path of monetary, political and economic union. At this stage, it is imperative to point out the EU member states. From 2008, EU member states are Germany, Austria, Cyprus, Ireland, Latvia, Belgium, Lithuania, Czech Republic, Poland, Denmark, Italy, Estonia, Finland, Luxembourg, Netherlands, France, Hungary, Greece, Malta, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden and the United Kingdom. However, Turkey Republic of Macedonia and Croatia are currently official member countries while Herzegovina, Albania, Kosovo, Bosnia, Montenegro and Serbia are potential member candidates (Albi, 2008). The EU is continually enlarging its scope through the accession of new member states. The enlargement process started with the inner six nations that founded the European Coal and Steel Community in 1952, namely, Belgium, France, West, Italy, Luxembourg and Netherlands. Since then, membership to the EU has grown dramatically. European Integration refers to the method of improvement although this term also refers to the increased cooperation between EU members through the process of gradual harmonization of individual, national laws. In order to become a member of the EU, a state must meet numerous political and economic thresholds referred to as the Copenhagen Criteria, established pursuant to the Copenhagen summit of 1993. The criteria require that the state has a stable, democratic government, which upholds the rule of land, as well as the consequential institutions and freedoms under law. Pursuant to the Maastricht Treaty, all member states together with the European Parliament must approve any enlargement (Bache & George, 2006). The operations of the EU run through a scheme of supranational independent institutions, as well as decisions negotiated by member states through an intergovernmental system. The EU systems allow free interchange of goods, people, services, and capital among EU member states as within a nation. This means that there are no tariff restrictions among member states. Furthermore, the EU member states use a single unified set of tariffs on goods and services imported from outside the union. This tariff is referred to as the common customs tariff. The establishment of a single, unified EU market has had profound effects on international business. For instance, the single EU market has had major impacts on US businesses. This is because the common market has allowed for the formation of bigger European corporations with greater home market, which serves to augment large-scale research and development within Europe and other benefiting countries. Furthermore, it is apparent that the single market has increased demand and market for commodities from other countries. For instance, commodities from the US have gained greater market in the European nations as a result of the common market (Paul, Grainne & Craig, 2007).  The legal format of the EU allows it to negotiate all international trade agreement on behalf of the member states, but these agreements must be endorsed by the individual state. These negotiations include among others negotiations with the World Trade Organization. This gives the EU power to act against dumping in the EU by organizations in non-member states. Furthermore, agriculture is coordinated in a central manner in member states through the Common Agricultural Policy (CAP) that backs prizes for agricultural products produced by member states. Furthermore, the EU promotes modernization of agriculture through the CAP. The EU competition laws have their basis on the US antitrust principles, and are instrumental in preventing companies from participating in private trade restraints that can affect member states. For instance, in the year 2004, the European Commission asserted that the incorporation of the Microsoft Windows Media Player in the Windows operating system abused Microsoft’s dominance within the European market. The EU hence required Microsoft to offer a variation of its working system, which did not include a media player installed (Gilles, 2003). The most important institutions tasked with governing the EU include the European Court of Justice, the European Parliament, the Council of Ministers, the European Commission, and the European Court of Auditors. The uncertain Treaty of Lisbon would have added two institutions to the aforementioned institutions. These are the European Central Bank and the European Council (Albi, 2008). The European Commission is an executive arm of the EU, comprising 27 persons appointed by the governments of member states. Commissioners act independently of their governments of origin. The European Commission is the hub of the EU’s policy making processes. The commission oversees the formulation of viable recommendations, addressing opinions to member states. Furthermore, the legal mandate of the European Commission gives it power to bring member states before the Europeans Court of Justice when a member state fails to adhere to its obligations under the Rome and Maastricht Treaties. The Council of Ministers, on the other hand, formally termed the Council of the European Union, is the chief legislative body of the European Union. The functions of the Council of Ministers include the enactment of legislations based on recommendations issued to it by the European Commission. Essentially, governments of member states appoint members of the Council of Ministers. However, unlike the European Commission, members of the Council of Ministers typically represent the individual interests of their individual nations. Legislation in the EU takes the form of regulations that are explicitly applicable within its member states, and do not typically require member states to institute national measures for their implementation. Moreover, legislation within the EU may adopt two distinct forms. These are directives and decisions. Directives refer to laws enacted to direct member states to adopt certain laws or regulations. While directives allow national institutions to choose the form and means through which they will implement the directive, the directives are binding in terms of their desired objectives. Decisions, on the other hand, are orders directed at certain persons or member states (Kimmo, 2004). The European Parliament is made up of 785 members directly elected by citizens of member states relative to the population of each state. The Parliament has to be consulted twice on any legislative proposal. At first, it deliberates on the proposal at the committee level, and expresses its opinion through a poll in the plenary session. Whenever the European Parliament rejects a proposal, the proposal can be enacted as law only by a unanimous vote by the Council of Ministers. The European Parliament has the mandate to discharge the European Commission through a two-third vote, and to refute the Commission’s yearly budget. The European Court of Justice (ECJ) is the judicial arm of the EU. Its main roles is to interpret the treaties that established the EU, and determine whether national legislations, applied by national courts, adhere to the obligations of the treaties. The ECJ has substantive sway in affirming powers of community institutions and the establishment and enhancement of a single market. The composition of the ECJ entails 15 judges and 9 advocates appointed by national governments. The ECJ deals with cases such as failure to comply where the Commission advises countries and companies that have failed to comply with either a directive or regulation. If the company or country contests the ruling of the Commission, the issue is brought before the ECJ. In addition, the ECJ deals with the annulment of any decision that is contrary to the Rome Treaty pursuant to proposals by member states. In case of failure to act where a country accuses the Council of Ministers or Commission of failing to take required action, the ECJ has the mandate to make the relevant decision. Furthermore, national courts and other individuals may implore the ECJ to rule that a national government or the EU is liable for damages for either an act or a failure to act. Lastly, national courts can ask the ECJ’s opinion on whether or not the national laws conflict with articles within the Rome or Maastricht Treaties, and ask for guidance on how the EU laws should be interpreted and applied to the topic at hand. In order to reduce the incident of backlog in the EU judicial process, a junior court, the Court of First Instance was set up in the year 1989. This junior court hears administrative cases, competition cases, intellectual property cases and dumping suits concerning non-member countries. Appeals from the junior court to the ECJ are only made in matters of law and not matters of fact. The European Court of Auditors entails one member from all European member states. While the court typically has no judicial function, it acts as an external, independent investigatory audit agency that monitors and inspects the EU budget to ascertain whether the budget is properly implemented. The European Court of Auditors reports any discrepancies it finds and prepares yearly reports for the European Parliament. The Lisbon Treaty would have allowed the European Council to become part of the EU institutions. The European Council has no legislative or executive powers and consists of the heads of all member states. This institution would also have consisted of the President of the European Commission, therefore, would have become the supreme political institution in the EU. The European Central Bank, on the other hand, was also proposed under the Lisbon Treaty. The European Central Bank (ECB), whose headquarter is in Frankfurt, Germany, emerged in 1998. The main function of the ECB is to maintain price stability within the EU market, which is often done by lowering or increasing interest rates. According to the Maastricht Treaty, all EU member states should unite their monetary and economic policies with the single purpose of establishing a unified European currency, i.e. the euro. The convergence criteria called for the harmonization of member states’ budget deficits, public-sector debts, inflation levels and long term interest rates at specified target levels in order to attain stability in exchange rates. All these efforts ended in the institution of the European Monetary Union in 1999. Despite the impeccable progress made by the EU towards European integration, challenges are abound. Some of the challenges include the lack of a European citizenship meaning that a non-national person can cast their votes in local voting, but not national appointments. In addition, the absence of a European company law or Europe-wide insurance is also a challenge to the success of the EU (Michael, 2000). Rules regarding pension plans are uncoordinated, and plans are disallowed to hold non-national shares of stock. Furthermore, there is no tax harmonization. To date only national taxation options like value added tax, company, capital gains and wealth, and inheritance taxes are applicable. Contrary to the EU, the United States of America’s composition with regard to the legal structure is quite different. The US legal structure entails a unified constitution for all states, which constitutes different powers for all the three branches of the federal government i.e. the judiciary, executive and the legislature. Four articles in the constitution specify the principle of federalism, and the constitution’s tenth amendment asserts federal characteristics. The unified constitution of the US was established in 1787, and was ratified by eleven states. The legal American constitution directs the American law and political culture, and is the oldest charter of the supreme law through continuous use. The American legal systems have had substantial effects on international figures that established national constitutions. The main concepts of the American legal system are the balancing of Federal budgets and extension of democracy among all states. The US has unified insurance and taxation laws that specify taxation regiments for different entities (Wilkinson, 2001). Conclusion It is apparent that the EU’s legal system is quite robust in terms of its protection of the member states and the unification of different economic, political and social aspects of the EU society. While the EU is a unifying body for nations in the European region, it is clear that certain important aspects of the legal aspects of the EU such as insurance and taxation are not unified under the EU constitution. Unlike the EU, other nations such as the US have instituted unified taxation and insurance guidelines that require all states to abide by them. The judicial and legislative system of the US also integrates all member states. References Albi, A. (2008). Implications of the European constitution: EU enlargement and the constitutions of Central and Eastern Europe. Cambridge: Cambridge University Press. Bache, I. & George, S. (2006). Politics in the European Union. Oxford: Oxford University Press. Barnard, C. (2007). The substantive law of the EU: The four freedoms (2nd ed.).  Oxford: Oxford University Press. Gilles, G. (2003). The battle of the single European market: Achievements and economic thought, 1945–2000. London: Kegan Paul. Kimmo, K. (2004). The European constitution in the making. Brussels: Centre for European Policy Studies. Michael, B. (2000). Federalism and European Union: The building of Europe, 1950-2000. New York: Routledge. Paul, C., Grainne, DB., & Craig, P. P. (2007). EU law: Text, cases and materials (4th ed.). Oxford: Oxford University Press. Wilkinson, P. (2001). International relations. Oxford: Oxford University Press. Read More