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Glossary of Institutions, policies and enlargement of the European Union
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Economic and Monetary Union (EMU)

Economic and monetary union (EMU) is the process of harmonising the economic and monetary policies of the Member States of the Union with a view to the introduction of a single currency, the euro. It was the subject of an Intergovernmental Conference (IGC), which concluded its deliberations in Maastricht in December 1991.

EMU was achieved in three stages:

  • First stage (1 July 1990 to 31 December 1993): free movement of capital between Member States, closer coordination of economic policies and closer cooperation between central banks.
  • Second stage (1 January 1994 to 31 December 1998): convergence of the economic and monetary policies of the Member States (to ensure stability of prices and sound public finances) and the establishment of the European Monetary Institute (EMI) and, in 1998, of the European Central Bank (ECB).
  • Third stage (from 1 January 1999): irrevocable fixing of exchange rates and introduction of the single currency on the foreign-exchange markets and for electronic payments. Introduction of euro notes and coins.

When the third stage of EMU was launched, eleven Member States adopted the euro as the single currency. They were joined two years later by Greece. Slovenia entered the euro zone on 1 January 2007.

Three Member States did not adopt the single currency: the United Kingdom and Denmark, both of which have an opt-out clause, and Sweden, following a referendum in September 2003. The States which joined the Union on 1 May 2004 and 1 January 2007 are required to adopt the euro as soon as they meet all the convergence criteria. They were not granted opt-out clauses during the accession negotiations.

The challenges facing the long-term success of EMU are continued budgetary consolidation and closer coordination of Member States' economic policies.

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Economic policy

Economic and Monetary Union (EMU) implies close coordination of national economic policies, which have thus become a matter of common concern. In practical terms, the Council, acting by a qualified majority on a recommendation from the Commission, formulates draft guidelines that are sent to the European Council. In the light of the latter's conclusions, the Council, again acting by qualified majority, adopts a recommendation setting out the Broad Economic Policy Guidelines (BEPG) of the of the Member States and the Community and informs the European Parliament (Article 99 of the EC Treaty). These annual broad guidelines are the central element of coordination for the Union's economic policies.

In addition to these guidelines, the EC Treaty lays down other economic policy provisions in Title VII, including:

  • multilateral surveillance: the Member States, meeting within the Council, monitor economic developments and the application of the broad economic policy guidelines; they may issue recommendations to the government of a Member State which is failing to comply with the guidelines;
  • the excessive-deficit procedure: the Member States must avoid excessive government deficits, and it is up to the Commission to ensure that this principle is complied with;
  • financial assistance: when a Member State is experiencing severe difficulties, the Council is able, under certain conditions, to grant it financial assistance;
  • prohibition against assuming the commitments of other Member States: the Community or the Member States may not assume the commitments of other Member States;
  • prohibition of privileged access: it is prohibited to grant public bodies, authorities or undertakings privileged access to finance.

The EC Treaty also lays down the institutional provisions applicable to the European Central Bank and the transitional provisions necessary for the implementation of the various stages of EMU.

The European Constitution, which is now in the process of ratification, gives Member States belonging to the euro area greater autonomy to settle certain issues amongst themselves. In addition, the Commission's role will be enhanced in the excessive-deficit procedure. Finally, the Constitution will simplify the existing texts significantly.

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Economic, social and territorial cohesion

Economic and social cohesion is an expression of solidarity between the Member States and regions of the European Union. The aim is balanced development throughout the EU, reducing structural disparities between regions and promoting equal opportunities for all. In practical terms, this is achieved by means of a variety of financing operations, principally through the Structural Funds and the Cohesion Fund. Every three years the European Commission presents a report on progress made in achieving economic and social cohesion and on how Community policies have contributed to it.

At European level, the origins of economic and social cohesion go back to the Treaty of Rome (1957) where a reference is made in the preamble to reducing regional disparities. In the 1970s, Community action was taken to coordinate the national instruments and provide additional financial resources. Subsequently these measures proved inadequate given the situation in the Community, where the establishment of the internal market, contrary to forecasts, had failed to even out the differences between regions. With the adoption of the Single European Act in 1986, economic and social cohesion proper was made an objective alongside completing the single market. The Maastricht Treaty (1992), finally, incorporated the policy into the EC Treaty itself (Articles 158 to 162).

Economic and social cohesion is essentially implemented through the regional policy of the European Union. Besides the reform of the common agricultural policy and enlargement to the Central and East European countries in 2004, regional policy was one of the major issues discussed in Agenda 2000, which covers the period 2000-2006, largely because of the financial implications.

Regional policy is the European Union's second largest budget item, with an allocation of 348 billion euros (2006 prices) for the period 2007-2013. Enlargement to 27 Member States in January 2007 has meant an entirely new order. The surface area of the European Union has increased by over 25%, its population by over 20%, and its wealth by only 5% approximately. Average GDP per capita in the European Union has fallen by more than 10% and regional disparities have doubled. Since 60% of the regions whose development is lagging behind are in the 12 Member States which joined the EU In 2004, the centre of gravity of regional policy is shifting eastwards.

For the period 2007-2013, economic and social cohesion will have to concentrate more on crucial development concerns in the field of economic growth and employment while continuing to support regions which have not completed the process of convergence in real terms. Structural assistance also remains necessary in geographical areas facing specific structural problems (areas undergoing industrial restructuring, urban areas, rural areas, areas dependent on fishing, and areas suffering from natural or demographic handicaps). Finally, simplification and decentralisation of the management of regional policy financial instruments (Structural Funds and Cohesion Fund) will be the watchwords of the regional policy reform for the period 2007-2013.

The European Constitution, which is in the process of being ratified, provides for the objective of territorial cohesion to be added to the concept of economic and social cohesion. If ratified, it will definitively sanction the territorial dimension of regional policy and also reinforce the role of the local authorities. Furthermore, the Committee of the Regions will be more involved in monitoring compliance with the principle of subsidiarity.

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Education

Each Member State is responsible for the organisation of its education and training systems and the content of teaching programmes. In accordance with Article 149 of the EC Treaty, the Community's role is to contribute to the development of quality education by encouraging cooperation between Member States and, if necessary, by supporting and supplementing their action. The Community aims specifically to develop the European dimension in education and the exchange of information on issues common to education systems in the Member States.

It also aims to stimulate mobility and to promote cooperation at European and international levels. The European Union has at its disposal a number of specific tools which also aim to foster mutual understanding, the learning of foreign languages and the use of new technologies, while promoting the recognition of skills and qualifications, namely:

  • the Lifelong Learning Programme for action at EU level, comprising the following sectoral programmes: Comenius (pre-school and school education), Erasmus (higher education, higher vocational education and training), Leonardo da Vinci (vocational education and training other than at higher level), Grundtvig (adult education), the transversal programme (areas which fall outside of the four preceding programmes), and the Jean Monnet programme (European university integration and support for certain key institutions and associations active in education at European level);

     

  • the programmes involving international cooperation in higher education, such as the Erasmus Mundus programme between the European Union and third countries, the objective of which is to improve the quality of higher education in Europe and to make it a centre of excellence. In addition, the regional programmes Tempus (Western Balkans, Eastern Europe, Central Asia and Mediterranean Partner Countries), Alfa (Latin America), and Asia-link (Asia) involve modernising higher education in the partner countries.

Education is part of the drive to achieve the goals of the Lisbon Strategy (to become the most competitive and dynamic knowledge-based economy in the world). In this context, the Commission has stepped up policy cooperation in the field of education, particularly through the open method of coordination.

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Employment

Promoting a high level of employment has been one of the Community's objectives since the Treaty of Amsterdam came into force in May 1999 and added a Title VIII "Employment" to the Treaty establishing the European Community.

The Union's responsibilities with regard to employment are complementary to those of the Member States, the main aim being to create a European Employment Strategy (EES). The EES is intended as the main instrument to provide direction and coordinate the employment policy priorities supported by the Member States at European level.

The new Title VIII "Employment" also requires an Employment Committee with advisory status to be established, to facilitate the Union's task of promoting the coordination of national employment and labour market policies.

The Lisbon European Council (March 2000) considered that the overall aim of these measures was to raise the overall employment rate in the European Union to 70% and the female employment rate to more than 60% by 2010. The Stockholm European Council (March 2001) added two intermediate targets and one additional target:

  • the overall employment rate and the female employment rate to reach 67% and 57% respectively in 2005;
  • the employment rate for older workers to reach 50% by 2010.

The Barcelona Council (March 2002) called for the reinforcement of the European Employment Strategy as an instrument of the Lisbon Strategy.

Financial support for employment policy is provided through various instruments:

  • the future programme PROGRESS 2007-2013, the aim of which is to provide financial assistance for work towards the Union's employment and social affairs objectives;
  • the priorities of the European Social Fund which are part of the EES objectives;
  • the Mutual Learning Programme, launched at the beginning of 2005, as part of the incentive measures to promote employment. Its main objective is to enhance the transferability of the most effective policies within key areas of the EES.

At European level, the main structures in the field of employment are:

  • the European Employment Observatory, an employment policy information system established in 1982 by the Commission in collaboration with the national authorities;
  • the EURES network, which contributes to creating a European labour market accessible to all through the international, interregional and cross-border exchange of job vacancies and applications and the exchange of information on living conditions and gaining qualifications.

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Employment Committee

As provided for by the Treaty of Amsterdam, and since a Council Decision of January 2000, the Employment Committee officially replaces the Employment and Labour Market Committee (ELMC) set up in 1996.

The Employment Committee takes over the tasks hitherto carried out by the ELMC on promoting the coordination of national employment and labour market policies.

The Committee's main task is to assist the Council in its work on the European Employment Strategy and its instruments (Employment Guidelines, recommendations on the implementation of national employment policies, etc.).

The Committee also formulates opinions at the request of either the Council or the Commission or on its own initiative.

It is made up of two representatives of each Member State and two representatives of the Commission. It consults the social partners at European level in order to carry out its work successfully.

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Energy

The aim of European energy policy is to develop a low-energy economy which is safer, more sustainable and more competitive.

To achieve this, the European Union (EU) will have to deal with a number of difficult issues:

  • climate change;
  • guaranteeing a secure energy supply;
  • investing in research and development in the field of energy efficiency, renewable energy and new technologies, in particular low-carbon technologies;
  • achieving the internal market in energy.

The EU is aware of the importance of diversifying its range of energy sources, and is looking not only at fossil fuels (coal, gas and oil), but also at nuclear energy and renewable energy (solar, wind-power, biomass, geothermal, hydro-electric, tidal).

The presentation of a common energy policy in January 2007 placed energy back at the heart of the Community's action — the treaties creating the European Coal and Steel Community (ECSC Treaty) and the European Atomic Energy Community (EURATOM) in 1951 and 1957 respectively formed the basis for subsequent European integration.

The Treating establishing the European Community did not provide a specific legal basis for Community energy policy, the underlying principles of which are still based on the Euratom Treaty and on a number of provisions contained in the chapters on the internal market and the environment.

The Intelligent Energy - Europe programme, which comes under the framework programme for innovation and competitiveness (2007-2013), provides Community funding to help achieve the Union's objectives in the field of sustainable energy.

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Enhanced cooperation

Enhanced cooperation allows those countries of the Union that wish to continue to work more closely together to do so, while respecting the single institutional framework of the Union. The Member States concerned can thus move forward at different speeds and/or towards different goals. However, enhanced cooperation does not allow extension of the powers as laid down by the Treaties. Moreover it may be undertaken only as a last resort, when it has been established within the Council that the objectives of such cooperation cannot be attained within a reasonable period by applying the relevant provisions of the Treaties.

The general arrangements for enhanced cooperation are laid down by the Treaty on European Union (EU Treaty, Title VII) and relate to both the European Union and the European Community. In principle, at least eight States must be involved in enhanced cooperation, but it remains open to any State that wishes to participate. It may not constitute discrimination between the participating States and the others. Enhanced cooperation must also further the Treaty objectives and respect the whole of the acquis communautaire and the powers of the various parties. It may not apply to an area that falls within the exclusive competence of the Community.

In addition to the general regime, special arrangements may be made or added by individual Treaties, as in the case of the Treaty establishing the European Community (EC Treaty, Articles 11 and 11 A). Under the EC Treaty, for example, the initiative for enhanced cooperation is taken by the Commission at the request of the Member States concerned, whereas under the EU Treaty the initiative comes from the Member States. In either case, institution of enhanced cooperation is subject to a decision of the Council, acting by a qualified majority. Enhanced cooperation may also be pursued in relation to the common foreign and security policy (CFSP), except for military or defence matters.

The Treaty of Amsterdam incorporated the "enhanced cooperation" concept into the Treaty on European Union as regards judicial cooperation on criminal matters and into the Treaty establishing the European Community. The Treaty of Nice introduced major changes aimed at simplifying the mechanism. In particular, a Member State may not oppose the establishment of enhanced cooperation as originally allowed by the Treaty of Amsterdam.

The European Constitution now being ratified provides for easier recourse to this mechanism. In particular, the initial authorisation procedures and those concerning participation by other Member States at a later stage have been simplified. The minimum participation threshold has been set at one third of Member States. The restrictions concerning the CFSP are removed. The Constitution provides for a special mechanism in defence matters: permanent structured cooperation.

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Enlargement

The European Union currently has 27 Member States. In addition to the first six Member States — Belgium, France, Germany, Italy, Luxembourg and the Netherlands — 21 countries have acceded to the Union. These are:

  • 1973: Denmark, Ireland and the United Kingdom;
  • 1981: Greece;
  • 1986: Spain and Portugal;
  • 1995: Austria, Finland and Sweden;
  • the fifth enlargement of 2004 and 2007: Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia, then Bulgaria and Romania.

Croatia, the Former Yugoslav Republic of Macedonia and Turkey have the status of candidate countries. Accession negotiations with Croatia and Turkey opened on 3 October 2005.

The countries of the Western Balkans which are engaged in the stabilisation and association process have the status of potential candidate countries. Apart from Croatia and the Former Yugoslav Republic of Macedonia, which are candidate countries, these are Albania, Bosnia-Herzegovina, Montenegro and Serbia, including Kosovo, as defined by UN Security Council Resolution 1244.

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Enterprise policy

The objective of enterprise policy is to produce an environment that is more conducive to the creation and development of businesses, especially small and medium-sized enterprises (SMEs), within the European Union.

The main focus of this policy is on:

  • promoting entrepreneurship (encouraging business creation, and supporting companies, especially SMEs, during their start-up and development phase);
  • promoting European performances in terms of competitiveness (encouraging businesses to adapt to structural change and maintaining a high and consistent level of productivity growth;
  • taking account of the specific characteristics and needs of the different sectors of industry;
  • promoting innovation (following up technological developments, new product designs, developing new ways of marketing products);
  • better access to funding, support networks and programmes;
  • simplification of the regulatory and administrative environment.

Enterprise policy thus contributes to sustainable growth and job creation. It is involved in achieving the objective set by the European Council in Lisbon on 23 and 24 March 2000 when the Heads of State and Government declared that the European Union was to become the most competitive and dynamic knowledge-based economy in the world by 2010.

EU enterprise policy helps to support and coordinate the Member States' activities. The Union can neither replace national competences nor harmonise national legislation and regulations.

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Environment

The European Union's environment policy, based on Article 174 of the Treaty establishing the European Community, aims to preserve, protect and improve the quality of the environment and to protect human health. It also focuses on the careful and rational use of natural resources and contributes to promoting, at international level, measures intended to combat regional or global environmental problems.

It is based on the precautionary, preventive action, correction at source and "polluter pays" principles.

The Sixth Environment Action Programme, adopted in 2002, defines the priorities and objectives of European environmental policy until 2010, concentrating on four priority areas: climate change; nature and biodiversity; environment, health and quality of life; and natural resources and wastes. It is complemented by seven thematic strategies in the following areas: atmospheric pollution, waste, the marine environment, soils, pesticides, natural resources and the urban environment.

Over the past thirty years, European environmental action has evolved from the resolution of certain specific problems to a more horizontal, preventive and integrated approach. The idea of "sustainable development" was enshrined as one of the objectives of the Union in the Amsterdam Treaty, and the mainstreaming of environmental protection has been reinforced in other Community policies, in particular those pertaining to the internal market, transport and energy.

It has been made easier for a Member State to apply stricter standards than the harmonised standards, as long as they are compatible with the Treaty and communicated to the Commission.

Most of the Community acts in this area have been adopted in accordance with the codecision procedure, with the exception of certain fields such as fiscal provisions, land use planning or areas that significantly affect Member States' choices with regard to energy.

Most of the Community acts in this area have been adopted in accordance with the codecision procedure, with the exception of certain fields such as fiscal provisions, land use planning or areas that significantly affect Member States' choices with regard to energy.

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Environmental liability

Environmental liability is an application of the "polluter pays" principle outlined in the Treaty establishing the European Community. Arrangements for applying it are set out in Directive 2004/35/EC.

It applies to environmental damage and the risk of damage resulting from commercial activities, once it is possible to establish a causal link between the damage and the activity in question. Environmental damage is defined as direct or indirect damage caused to the aquatic environment, flora and fauna and natural habitats protected by the Natura 2000 network, as well as direct or indirect contamination of the soil which could lead to a serious risk to human health.

Two systems of liability have been created: a system with no fault to be proved and a system where evidence of a fault or negligence must be presented. The former applies to dangerous or potentially dangerous commercial activities listed in the Community legislation. In this case, the operator may be held liable even if he has committed no fault. The second system applies to all other commercial activities where species and natural habitats protected under Community law have been damaged or are at imminent risk of damage. In this case, the operator will not be liable unless he has committed a fault or has been negligent.

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Equal opportunities

The general principle of equal opportunities contains two key elements: one is the ban on discrimination on grounds of nationality, and the other is equality for men and women. It is intended to apply to all fields, particularly economic, social, cultural and family life.

The Treaty of Amsterdam added a new provision, reinforcing the principle of non-discrimination, which is closely linked to equal opportunities. Under this new provision, the Council has the power to take appropriate action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation. Moreover, thanks to its programme to combat discrimination (2001-2006), the European Union has been encouraging and complementing the activities of the Member States to combat all forms of discrimination.

Adopted in December 2000, and due to be incorporated in the European Constitution, which is currently being ratified, the Charter of Fundamental Rights of the European Union includes a chapter entitled "Equality" which sets out the principles of non-discrimination, equality between men and women, and cultural, religious and linguistic diversity. It also covers the rights of the child, the elderly and persons with disabilities.

The Constitution explicitly adds the principles of equality and the ban on discrimination to the values on which the Union is founded. The text identifies them as general provisions that the Union must promote in the definition and implementation of its policies and actions.

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Equal treatment for men and women

As early as 1957, the Treaty establishing the European Economic Community enshrined the principle of equality between men and women, with Article 141 requiring that they should receive equal pay for equivalent work. Since 1975 a series of directives have broadened the principle to cover access to employment, training and promotion, the aim being to eliminate all forms of discrimination at work, and later in social security, statutory schemes and occupational schemes.

In addition to the promotion of equal opportunities via multiannual programmes started in the 1980s, the Commission launched a Community strategy (2001-2005) to establish a framework of action within which all Community activities could contribute to the objective of abolishing inequalities and promoting equality between women and men.

The Treaty of Amsterdam sought to supplement Article 141 (which is limited in scope, covering only equal pay) by including the promotion of equality between men and women as one of the tasks of the Community set out in Article 2 of the EC Treaty. The Charter of Fundamental Rights of the European Union, adopted in December 2000 and due to be incorporated in the European Constitution, which is being ratified, states that "Equality between men and women must be ensured in all areas, including employment, work and pay."

The Constitution adds the principle of equality between men and women to the values on which the Union is founded and identifies it as a general provision that the Union must take into account in all its actions.

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Eurojust

Set up by a Council Decision in 2002, Eurojust is the body entrusted with reinforcing the fight against serious crime through closer judicial cooperation within the European Union.

This body for coordinating Member States' national public prosecution services comprises 27 national representatives: judges, prosecutors and police officers on secondment from each Member State. It can carry out its tasks through one or more of the national members or collectively. Moreover, each Member State may appoint one or more national correspondents, who may also act as contact points for the European Judicial Network.

Eurojust's competence covers investigations and prosecutions in relation to serious crime, particularly organised crime or cross-border crime. Its goals are to promote coordination between competent authorities in the Member States but also to facilitate international mutual legal assistance, and carry out extradition requests and European arrest warrants.

Eurojust also contributes to Member States' criminal investigations on the basis of analyses carried out by Europol. There is some overlap in the two bodies' competences with regard to: computer crime, fraud and corruption, laundering of the proceeds of crime, environmental crime, participation in a criminal organisation.

The European Constitution, which is in the process of ratification, expands and more closely defines Eurojust's operational competences. The Treaty of Nice entitles Eurojust to request Member States to open investigations, without this request being binding. In contrast, the constitutional treaty provides for Eurojust itself to:

  • initiate criminal investigations, while taking account of national practices and rules;
  • propose to national authorities that prosecutions be initiated;
  • coordinate investigations and prosecutions being pursued by the competent authorities.

The European Constitution also provides that the Council may take a unanimous decision to establish a European Public Prosecutor's Office on the basis of Eurojust. This would be responsible for investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices in, serious cross-border crime and illegal activities which harm the European Union's interests.

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Europe 'à la carte'

This refers to the idea of a non-uniform method of integration which allows Member States to select policies as if from a menu and involve themselves fully in those policies; there would still be a minimum number of common objectives.

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European Central Bank (ECB)

Founded on 30 June 1998 in Frankfurt, the European Central Bank (ECB) is responsible for monetary policy in the thirteen member countries of the Eurozone. Since 1 January 1999, its main tasks have been to maintain price stability in the Eurozone and to implement the European monetary policy defined by the European System of Central Banks (ESCB).

The decision-making bodies of the ECB (Executive Board and Governing Council) administer the European System of Central Banks (ESCB), whose roles are to manage money supply, conduct exchange operations, hold and manage the official foreign reserve assets of the Member States and ensure the smooth functioning of payment systems.

The ECB acts totally independently.

The Treaty of Nice, which came into force on 1 February 2003, did not change the composition of the Governing Council (comprising the members of the Executive Board and the governors of the national central banks), but created the possibility of changing the rules on decision-making (generally adopted by a simple majority of members, with each having one vote).

The planned enlargement of the Eurozone to include the ten countries that joined the Union in 2004 as well as Bulgaria and Romania in 2007 will lead to more members of the Governing Council. A Council Decision of March 2003 therefore allowed the ECB and ESCB constitutions to be amended with regard to voting arrangements, in order to maintain the Governing Council's ability to take decisions effectively in an enlarged Eurozone, however many Member States adopt the euro.

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European Commission

The European Commission is a politically independent collegial institution which embodies and defends the general interests of the European Union. Its virtually exclusive right of initiative in the field of legislation makes it the driving force of European integration. It prepares and then implements the legislative instruments adopted by the Council and the European Parliament in connection with Community policies.

The Commission also has powers of implementation, management and control. It is responsible for planning and implementing common policies, executing the budget and managing Community programmes. As "guardian of the Treaties", it also ensures that European law is applied.

The Commission is appointed for a five-year term by the Council acting by qualified majority in agreement with the Member States. It is subject to a vote of appointment by the European Parliament, to which it is answerable. The Commissioners are assisted by an administration made up of Directorates-General and specialised departments whose staff are divided mainly between Brussels and Luxembourg.

Since its inception the Commission has always been made up of two nationals from each of the Member States with larger populations and one national from each of the others. However, the Treaty of Nice limited the number of Members of the Commission to one per Member State. The Constitution, which is in the process of ratification, provides for a Commission in which only two thirds of the Member States would be represented after 2014. The Members will then be selected in accordance with a rotation system based on the principle of equality.

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European Community

The European Community (EC) is a founding element of the European integration process.

It was established (as the European Economic Community) by the Treaty of Rome in 1957, with the principal objective of creating a common market without internal borders.

The establishment of the European Union (EU) in 1992 did not cause the European Economic Community to disappear. It remains part of the EU under the designation "European Community".

Article 2 of the Treaty establishing the EC defines its task as promoting throughout the Community:

  • a harmonious, balanced and sustainable development of economic activities;
  • a high level of employment and of social protection, and equality between men and women;
  • sustainable, non-inflationary growth;
  • a high degree of competitiveness and convergence of economic performance;
  • a high level of protection and improvement of the quality of the environment, the raising of the standard of living and quality of life, economic and social cohesion, and solidarity among the Member States.

To achieve these goals, the EC has devised a set of sectoral policies, focusing on the fields of transport, competition, fisheries and agriculture, asylum and immigration, energy and the environment.

These policies are implemented under the decision-making procedure laid down by the Treaty establishing the EC, with particular emphasis on codecision. The decision-making mechanism governing these policies is based on a specific model known as the "Community method".

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European Company

The European Company (known by its Latin name of "Societas Europaea" or SE) is a company established under Community law. It has its own legal framework and can operate as a single entity throughout the EU.

In 2001, the Union formally adopted the regulation on the Statute for a European Company and the associated directive on employee participation in European Companies.

This legislation entered into force in 2004 after some 30 years of discussion. It allows companies to cut administrative costs and provides them with a legal structure suitable for the common market, avoiding the legal and practical constraints arising from 25 different legal systems.

Under the European Company Statute, an SE can be set up by:

  • merger;
  • creation of a holding company;
  • creation of a joint subsidiary;
  • conversion of an existing company set up under national law.

The SE must have a minimum subscribed capital of 120 000 euros and its registered office, specified in the statutes, must be at the same place as its real head office.

The agreement on the SE is one of the priorities identified by the Financial Services Action Plan (FSAP) and is regarded as vital to the creation of a fully integrated market in financial services.

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European Constitution

The European Constitution, officially known as the "Treaty establishing a Constitution for Europe", marks a key step in European integration.

It is the result of the work of the Convention, which drew up a "Draft Treaty establishing a Constitution for Europe" in July 2003. This draft served as a basis for the work of the Intergovernmental Conference (IGC) which started officially in October 2003. The IGC concluded on 29 October 2004 in Rome with the signature of the new Constitutional Treaty by the 25 Heads of State and Government of the Member States.

The aim of the Treaty establishing a Constitution for Europe is to make the enlarged Europe more effective, democratic and transparent. It is intended to replace the Treaty on European Union and the Treaty establishing the European Community. It also:

  • simplifies the treaties so as to improve the visibility of the EU's work;
  • reforms the institutions (in particular by scrapping the pillar-based structure of the Union);
  • deepens European integration (for example reinforcing the common foreign and security policy by creating a European foreign affairs minister).

To enter into force, the Treaty establishing a Constitution for Europe must be ratified by all the Member States, in accordance with each one's constitutional rules.

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European Convention

The process of setting up the European Convention began in December 2000 with a Declaration annexed to the Nice Treaty, the "Declaration on the Future of the Union". This proposed continuing with institutional reform beyond what had been achieved at the 2000 Intergovernmental Conference (IGC) following a three-stage procedure: launching a debate on the future of the European Union, a Convention on institutional reform to be set up as decided at the Laeken European Council in December 2001 and an IGC to be convened in 2004.

According to the Laeken Declaration, which created it, the aim of this Convention was to examine four key questions on the future of the Union: the division of powers, the simplification of the treaties, the role of the national parliaments and the status of the Charter of Fundamental Rights. Three phases were envisaged: a listening phase, a deliberating phase and a drafting phase. At the end of the last phase, a single constitutional text would be proposed. This document would serve as the starting point for the IGC negotiations conducted by the Heads of State and Government, ultimately responsible for any decision on amendments to the treaties.

The inaugural meeting of the Convention was held on 28 February 2002, and it concluded its work on 10 July 2003 after reaching agreement on a proposal for a European Constitution.

The Convention is an innovation in the history of the European Union as previous IGCs had never been preceded by a phase of debate open to all stakeholders.

On18 June 2004, the Intergovernmental Conference met at Head of State or Government level and agreed on the draft European Constitution prepared by the Convention.

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European Convention on Human Rights (ECHR)

The European Convention on Human Rights, signed in Rome under the aegis of the Council of Europe on 4 November 1950, established an unprecedented system of international protection for human rights, offering individuals the possibility of applying to the courts for the enforcement of their rights. The Convention, which has been ratified by all the Member States of the Union, established a number of supervisory bodies based in Strasbourg. These were:

  • a Commission responsible for advance examination of applications from States or from individuals;
  • a European Court of Human Rights, to which cases were referred by the Commission or by a Member State following a report by the Commission (in the case of a judicial settlement);
  • a Committee of Ministers of the Council of Europe, which acted as the guardian of the ECHR and was called upon to secure a political settlement of a dispute where a case was not brought before the Court.

The growing number of cases made it necessary to reform the supervisory arrangements established by the Convention. The supervisory bodies were thus replaced on 1 November 1998 by a single European Court of Human Rights. The simplified structure shortened the length of procedures and enhanced the judicial character of the system.

The idea of the European Union acceding to the ECHR has often been raised. However, in an opinion given on 28 March 1996, the Court of Justice of the European Union stated that the European Communities could not accede to the Convention because the EC Treaty did not provide any powers to lay down rules or to conclude international agreements on human rights.

The Treaty of Amsterdam nevertheless calls for respect for the fundamental rights guaranteed by the Convention, while formalising the judgments of the Court of Justice on the matter. As regards relations between the two Courts, the practice developed by the Court of Justice of incorporating the principles of the Convention into Union law has made it possible to maintain their independence and coherence in their work.

The Constitution, which is in the process of ratification, nevertheless provides for the European Union to have legal personality, thus enabling it to accede to the ECHR. It also provides for the incorporation of the Charter of Fundamental Rights, announced at the Nice European Council on 7 December 2000, which will give it binding legal force.

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European Council

The European Council is the term used to describe the regular meetings of the Heads of State or Government of the European Union Member States. Its role is to provide the European Union with the necessary impetus for its development and to define the general political guidelines (Article 4 of the Treaty on European Union). It does not enact legislation and is not an institution.

It meets at least twice per year (in practice, twice per presidency) and the President of the European Commission attends as a full member. An extraordinary meeting can be held whenever necessary. It is chaired by the Member State holding the six-month presidency of the Union. Decisions are taken by consensus following negotiation between the Member States, which begins before the summit. The outcome of the European Council deliberations is recorded in the conclusions published at the end of the meeting.

The European Council was set up by the communiqué issued at the close of the December 1974 Paris Summit and first met in 1975. Before that time, from 1961 to 1974, the practice had been to hold European summit conferences. The Single European Act (1986) gave a legal basis to its existence and the Treaty on European Union (Treaty of Maastricht, 1992) specified its functions.

Under the terms of a declaration attached to the Final Act of the Intergovernmental Conference preparatory to the Treaty of Nice, all meetings of the European Council have been held in Brussels since the Union attained a membership of 18 (May 2004).

The European Constitution currently being ratified gives the European Council the status of a European institution. It also provides for changes to the presidency system by establishing the permanent function of President of the European Council, elected by that body for a term of two and a half years.

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European Court of Auditors

The European Court of Auditors, based in Luxembourg, is composed of one national from each Member State. Its members are appointed for six years (renewable) by a qualified majority of the Council of the European Union after consulting the European Parliament. The Court of Auditors acts in complete independence.

The Court checks the revenue and expenditure of the European Union (and any body created by the Community) for legality and regularity and ensures that its financial management is sound. It also supplies the European Parliament and the Council with a statement of assurance as to the reliability of the accounts and the legality and regularity of the underlying transactions. It draws up an annual report published in the Official Journal at the end of each budgetary year.

Under the Treaty of Amsterdam, the Court of Auditors also has the power to report any irregularities to the European Parliament and the Council, and its audit responsibilities have been extended to Community funds managed by outside bodies and by the European Investment Bank. However, it does not have the power to impose penalties.

Under the Treaty of Nice, the Court is also able to establish internal chambers to adopt certain categories of report or opinion.

The Court of Auditors was established in 1975 and began work in 1977, and has been a European institution since the Treaty on European Union in 1992. It is governed by Articles 246 to 248 of the EC Treaty.

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European Development Fund

Created by the Treaty of Rome in 1957, the European Development Fund (EDF) is the main instrument providing Community aid for development cooperation with the countries of Africa, the Caribbean and the Pacific (ACP countries) and with the Overseas Countries and Territories (OCTs).

The EDF finances any projects or programmes which contribute to the economic, social or cultural development of the countries in question. It consists of several instruments, including grants, risk capital and loans to the private sector.

The EDF is funded by the Member States and does not yet come under the general Community budget. However, the aid granted to OCTs is to be included in the European Union's general budget as of 1 January 2008, while the aid granted to ACP countries will continue to be funded by the EDF, at least for the period 2008-2013.

Each EDF, which generally follows the cycle of the partnership agreements, is concluded for a period of around five years. The ninth EDF (2000-2007) has been allocated 13.5 billion euros, in addition to 9.9 billion euros left over from the previous EDFs. The European Investment Bank's own resources contribution adds a further 1.7 billion euros over the period covered by the ninth EDF.

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European Economic and Social Committee (EESC)

The European Economic and Social Committee was set up, as an advisory body, by the Treaty establishing the European Economic Community in 1957 to represent the interests of the various economic and social groups. It consists of 344 members falling into three categories: employers, workers and representatives of particular types of activity (such as farmers, craftsmen, small businesses and industry, the professions, consumer representatives, scientists and teachers, cooperatives, families, environmental movements). Members are appointed by qualified majority of the Council for four years and this term may be renewed.

The EESC is consulted before a great many instruments concerning the internal market, education, consumer protection, environment, regional development and social affairs are adopted. It may also issue opinions on its own initiative. Since the entry into force of the Treaty of Amsterdam (May 1999), the EESC has to be consulted on an even wider range of issues (the new employment policy, the new social affairs legislation, public health and equal opportunities) and it may also be consulted by the European Parliament.

The Treaty of Nice, which entered into force on 2003, did not change the number and distribution by Member State of seats on the Committee. However, eligibility for membership was clarified: the EESC is to consist of "representatives of the various economic and social components of organised civil society".

The European Constitution, which is in the process of being ratified, envisages increasing the term of EESC members from four to five years.

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European Employment Strategy (EES)

Since the Treaty of Amsterdam added a new Title VIII on Employment to the Treaty establishing the European Community, coordination of Member States' employment policies has become a Community priority.

It was on the basis of these new provisions that the Luxembourg European Council, held in November 1997, launched the European Employment Strategy (EES), also known as the "Luxembourg process".

The EES is an annual programme of planning, monitoring, examination and readjustment of policies put in place by Member States to coordinate the instruments they use to tackle unemployment. The Strategy is based on four components:

  • Employment Guidelines: common priorities for Member States' employment policies, drawn up by the Commission;
  • National Action Plans (NAPs) for employment: implementation of the common Guidelines at national level;
  • Joint Employment Report: summary of the National Action Plans, to be used as a basis for drawing up the following year's Guidelines;
  • Recommendations: the Council adopts country-specific recommendations by a qualified majority.

In 2005 the Lisbon Strategy was revised in order to focus more closely on developing strong, sustainable growth and creating more and better jobs.

This re-launch of the Lisbon Strategy led to a thorough review of the EES, implementing the new process in July 2005, with the European Council's approval of the Integrated Guidelines for Growth and Jobs.

The European Employment Strategy is based on four components:

  • the Integrated Guidelines for Growth and Jobs (the Guidelines will now be presented jointly with the guidelines for the EU's macroeconomic and microeconomic policies for a period of three years);
  • the national reform programmes for each country;
  • the Commission's annual report on growth and employment, which analyses the 25 new national reform programmes presented by the Member States;
  • any recommendations adopted by the Council.

The Integrated Guidelines for Growth and Jobs will serve as a basis for the Community Lisbon Programme and the national action programmes.

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European Investment Bank (EIB)

Set up by the Treaty of Rome, the European Investment Bank is the European Union's financial institution. Its task is to contribute to economic, social and territorial cohesion through the balanced development of the EU territory.

The EIB's shareholders are the 27 Member States of the European Union. The bank is supervised by the Board of Governors, which comprises the 27 Finance Ministers. It has legal personality and is financially independent. It provides long-term financing for practical projects, the economic, technical, environmental and financial viability of which is guaranteed. It grants loans essentially from resources borrowed on capital markets, to which is added shareholders' equity. Between 1994 and 1999 the transport, telecommunications, energy, water, education and training sectors were the main beneficiaries.

In March 2000 the Lisbon European Council called for a strengthening of support for small and medium-sized enterprises (SMEs). The EIB Group, which comprises the EIB and the European Investment Fund (EIF), was thus created with a view to boosting European economic competitiveness. Through the Innovation 2000 initiative, it fosters entrepreneurship, innovation and the optimal utilisation of human resources by granting SMEs medium-term loans and bank guarantees, and by financing venture capital activities.

Outside the European Union the EIB supports the pre-accession strategies of the candidate countries and of the Western Balkans. It also manages the financial dimension of the agreements concluded under European development aid and cooperation policies. In this connection, it is active in the Mediterranean countries and in the African, Caribbean and Pacific (ACP) countries.

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European Judicial Network in criminal matters (EJN)

The purpose of the European Judicial Network (EJN) in criminal matters is to facilitate mutual judicial assistance in the fight against transnational crime. It originates in a Joint Action adopted by the Council on 29 June 1998.

The judicial network is made up of contact points designed to enable local judicial authorities and judicial authorities in the other Member States to establish direct contacts between themselves. These contact points also provide the legal or practical information necessary to help the authorities concerned to prepare an effective request for judicial cooperation.

There is also a European Judicial Network in civil and commercial matters, established by Council Decision of 28 May 2001 and based on the network in criminal matters.

The European Constitution, currently being ratified, heralds a new stage in the development of a "judicial Europe" by providing for the adoption of laws and framework laws designed to encourage support for the training of the judiciary.

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European Parliament

The European Parliament is the assembly of the representatives of the 492 million Union citizens. Since 1979 they have been elected by direct universal suffrage and today total 785, distributed between Member States by reference to their population.

The European Parliament's main functions are as follows:

  • legislative power: in most cases Parliament shares the legislative power with the Council, in particular through the codecision procedure;
  • budgetary power: Parliament shares budgetary powers with the Council in voting on the annual budget, rendering it enforceable through the President of Parliament's signature, and overseeing its implementation;
  • power of control over the Union's institutions, in particular the Commission. Parliament can give or withhold approval for the designation of Commissioners and has the power to dismiss the Commission as a body by passing a motion of censure. It also exercises a power of control over the Union's activities through the written and oral questions it can put to the Commission and the Council. And it can set up temporary committees and committees of inquiry whose remit is not necessarily confined to the activities of Community institutions but can extend to action taken by the Member States in implementing Community policies.

The Treaty of Amsterdam (in force since 1999) boosted Parliament's powers by considerably extending the codecision procedure. The Treaty of Nice, which entered into force in 2003, also enhanced Parliament's role as co-legislator by extending the codecision procedure and granted Parliament a right to bring actions before the Court of Justice of the European Communities.

The European Constitution currently being ratified also provides for stronger powers for Parliament as co-legislator. The codecision procedure is to be extended to new areas and Parliament is to be given equal decision-making powers in budgetary matters with the Council. From 2009, the number of Members of the European Parliament may not exceed 750.

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European Research Area (ERA)

The European Research Area brings together all of the Community's resources to better coordinate research and innovation activities at the level of both the Member States and the European Union.

This concept was launched by the Commission in 2000 with the idea of developing truly attractive opportunities for researchers.

Previously, research at European level had faced numerous difficulties: fragmentation of activities, isolation of national research systems, disparity of regulatory and administrative frameworks, and low levels of investment in knowledge.

Through the resources made available, the ERA should make it possible to share data, compare results, carry out multi-disciplinary studies, transfer and protect new scientific knowledge and gain access to centres of excellence and state-of-the-art equipment.

The European research area should thus fulfil an ambition of determining value for the European Union, namely to develop a genuine common research policy.

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European Security and Defence Policy (ESDP)

The European Union's European security and defence policy (ESDP) includes the gradual framing of a common defence policy which might in time lead to a common defence. The European security and defence policy (ESDP) aims to allow the Union to develop its civilian and military capacities for crisis management and conflict prevention at international level, thus helping to maintain peace and international security, in accordance with the United Nations Charter. The ESDP, which does not involve the creation of a European army, is developing in a manner that is compatible and coordinated with NATO.

The Maastricht Treaty (1992) was the first to include provisions on the Union's responsibilities in terms of security and the possibility of a future common defence policy. With the entry into force of the Treaty of Amsterdam (1999), new tasks have been included in the Treaty on European Union (Title V). This important innovation relates to humanitarian and rescue operations, peacekeeping operations and the use of combat forces in crisis management, including peacemaking operations (known as "Petersberg tasks"). In addition to these civilian and military crisis management operations, the ESDP includes a "conflict prevention" component. The Political and Security Committee (PSC), the EU Military Committee (EUMC) and EU Military Staff (EUMS) are the permanent political and military structures responsible for an autonomous, operational EU defence policy. In December 1999, the Helsinki European Council established the "global objective", in other words that the Union must be able to deploy up to 60 000 persons within 60 days and for at least one year.

At the Göteborg European Council of June 2001, the European Council spoke of its willingness to improve EU capacities in the fields of conflict prevention and crisis management, making use of military and civilian means.

The Treaty of Nice (2001) gave the PSC charge of crisis management operations, although the Council retained responsibility.

The European Constitution, currently being ratified, clearly states the goal of establishing a genuine common European defence. It updates the Petersberg tasks and inserts two clauses: a mutual defence clause and a solidarity clause in the event of terrorist attacks or natural or man-made disasters. It also provides for military tasks to be assigned to a group of Member States or the establishment of a "permanent structured cooperation" in the defence field. These measures would allow some Member States to move faster towards the goal of a common European defence.

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European Union

The European Union (EU) was established by the Treaty on European Union (Maastricht, 1992).

The project of creating a Union has a long history, and was first mooted at the European summit of 1972.

The Union is both a political project and a form of legal organisation.

It is a political project in that the Union's task is "to organise, in a manner demonstrating consistency and solidarity, relations between the Member States and between their peoples" (Article 1 of the Treaty on European Union).

To achieve this, the Union is set a number of objectives:

  • To promote economic and social progress, sustainable development, an area without internal frontiers and economic and monetary union. These objectives match the aims pursued by the EU's sectoral policies.
  • To assert its identity on the international scene. This aim is linked with implementation of the common foreign and security policy.
  • To strengthen the protection of rights through the introduction of a citizenship of the Union. Union citizenship, which is created by the Treaty of Maastricht, is a special relationship between the EU and the nationals of the Member States.
  • To create an area of freedom, security and justice. As its name suggests, this area is intended to promote greater freedom, security and justice for the citizen.
  • To build on the acquis communautaire -- the corpus of rules established by and in the context of the Union.

The European Constitution now being ratified adds two further aspects. First of all, the Union is founded on values: respect for human dignity, liberty, democracy, equality, the rule of law and human rights. It also has its own symbols: a flag (twelve stars on a blue background), an anthem (Ludwig van Beethoven's "Ode to Joy"), a motto ("United in diversity"), a currency (the euro) and a Europe day (9 May).

The Union is a form of legal organisation consisting of three pillars:

  • the first corresponding to the European Community;
  • the second comprising the common foreign and security policy (CFSP) and the European security and defence policy (ESDP);
  • the third consisting of police and judicial cooperation in criminal matters.

It has a single institutional framework for the three pillars (essentially consisting of the European Council, the European Parliament, the Council of the Union and the European Commission). This ensures coherence and consistency in the Union's action across the pillars.

The Treaties do not officially confer legal personality on the Union but there is a consensus among the political players that this should be done. This option is endorsed by the Constitution, which clearly provides that the Union shall have such personality.

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European Union agencies

The agencies of the European Union are bodies established under European public law and enjoying legal personality, which have been set up by an instrument of Community secondary legislation to carry out a specific technical, scientific or administrative task.

The first agencies were set up in the 1970s but most of them started work in 1994 or 1995, following the decision of the Brussels European Council (October 1993) on the siting of the headquarters of seven of them. The most recent are the executive agencies that have been created to manage one or more European programmes. These have been established for a fixed period of time and are located in Brussels or Luxembourg.

29 bodies currently meet the definition of a Community agency, though referred to by various names (centre, foundation, agency, office, monitoring centre, etc.).

As autonomous organisations, the agencies are a heterogeneous group, with a common organisational model. They can be divided into three sub-groups according to their areas of activity (pillars of the European Union), to which the executive agencies have recently been added.

Community agencies:

  • OHIM – Office for Harmonisation in the Internal Market (Trade Marks and Designs), with its headquarters in Alicante (Spain);
  • CPVO – Community Plant Variety Office, Angers (France);
  • ERA – European Reconstruction Agency, Thessaloniki (Greece);
  • EMEA – European Medicines Agency, London (United Kingdom);
  • EFSA – European Food Safety Authority, Parma (Italy);
  • EMSA – European Maritime Safety Agency, Lisbon (Portugal);
  • EASA – European Aviation Safety Agency, Cologne (Germany);
  • ENISA – European Network and Information Security Agency, Heraklion (Greece);
  • EU-OSHA – European Agency for Safety and Health at Work, Bilbao (Spain);
  • ECDC – European Centre for Disease Prevention and Control, Stockholm (Sweden);
  • CEDEFOP – European Centre for the Development of Vocational Training, Thessaloniki (Greece);
  • EEA – European Environment Agency, Copenhagen (Denmark);
  • EUROFOUND – European Foundation for the Improvement of Living and Working Conditions, Dublin (Ireland);
  • EMCDDA – European Monitoring Centre for Drugs and Drug Addiction, Lisbon (Portugal);
  • EFRA - European Fundamental Rights Agency, Vienna (Austria);
  • ERA – European Railway Agency, Valenciennes and Lille (France);
  • ETF – European Training Foundation, Turin (Italy);
  • CdT – Translation Centre for the Bodies of the European Union, Luxembourg;
  • CFCA – Community Fisheries Control Agency, Vigo (Spain);
  • FRONTEX – European Agency for the Management of Operational Cooperation at the External Borders of the Member States of the European Union, Warsaw (Poland);
  • ECHA – European Chemicals Agency, Helsinki (Finland);
  • European Global Navigation Satellite System (GNSS) Supervisory Authority, Brussels (Belgium).

Agencies in the field of the common foreign and security policy:

  • EDA – European Defence Agency, Brussels (Belgium);
  • EUISS – European Union Institute for Security Studies, Paris (France);
  • EUSC – European Union Satellite Centre, Madrid (Spain).

Agencies in the field of police and judicial cooperation in criminal matters:

  • Eurojust – The European Union's Judicial Cooperation Unit, the Hague (Netherlands);
  • Europol – European Police Office, the Hague (Netherlands);
  • CEPOL – European Police College, Bramshill (United Kingdom).

Executive agencies:

  • Education, Audiovisual and Culture Executive Agency, Brussels (Belgium);
  • Public Health Executive Agency, Luxembourg;
  • Intelligent Energy Executive Agency, Brussels (Belgium).

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European arrest warrant

The European arrest warrant is a judicial decision issued by a Member State with a view to the arrest and surrender by another Member State of a person being sought for a criminal prosecution or a custodial sentence.

It is a tool designed to strengthen cooperation between the judicial authorities of the Member States by eliminating the use of extradition. It is based on the principle of mutual recognition of decisions in criminal matters.

The European arrest warrant is based on a Framework Decision adopted by the Council on 13 June 2002. This decision is applied from 1 January 2004.

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European institutions

The European institutions are the political bodies created by the Treaty of Rome to build a united Europe.

Article 7 of the Treaty establishing the European Community lists five European institutions in the strict sense of the term:

  • the European Parliament;
  • the Council of the European Union;
  • the European Commission;
  • the Court of Justice;
  • the Court of Auditors.

Article 3 of the Treaty on European Union provides that the institutions shall operate within a single institutional framework. This means that they act within the decisional process of the three pillars.

They interact with other players such as the European Economic and Social Committee, the Committee of the Regions, the European Central Bank, the European Investment Bank, the European Ombudsman and the Community agencies, thus forming the European institutional system.

The European Constitution now being ratified provides that the Union's "institutional framework" shall comprise the European Parliament, the Council of Ministers (known as "the Council"), the European Commission, the Court of Justice and the European Council, which would thus acquire the status of a European institution.

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European political cooperation (EPC)

European political cooperation (EPC) was introduced informally in 1970 (in response to the Davignon report) and formalised by the Single European Act with effect from 1987. The object is consultations between the Member States in foreign policy matters. The Member States have regard for the views of the European Parliament and wherever possible take common positions in international organisations. EPC was superseded by the common foreign and security policy.

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European political parties

The Regulation on the regulations governing political parties at European level and the rules regarding their funding entered into force in 2004. It lays down conditions for recognition of a European political party, generating entitlement to Community funding:

  • it must have legal personality in the Member State in which its seat is located;
  • it must be represented, in at least one quarter of Member States, by Members of the European, national or regional Parliaments or assemblies, or have received, in at least one quarter of the Member States, at least three per cent of the votes cast in each of those Member States at the most recent European Parliament elections;
  • it must observe the principles of the European Union;
  • it must have participated in elections to the European Parliament, or have expressed the intention to do so.

The conditions to be met for entitlement to Community funding (8.4 million annually) are also set: it must declare its sources of funding, and certain sources are prohibited. Community funds must be used solely to cover expenditure related to its political programme and can in no circumstances be used to finance national political parties.

The European People's Party (EPP), the Party of European Socialists (PSE), the Alliance of Liberals and Democrats for Europe (ALDE), the European Green Party (EGP) and European United Left (GUE) are just some of the parties set up in European form.

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European security and defence identity

The military intervention of NATO in Bosnia highlighted an imbalance in terms of risk linked to the fact that, broadly speaking, the European forces were operating on the ground whereas the US forces intervened in the air, and were less at risk.

The Clinton administration recognised that there could be crises within Europe in which the United States would not wish to intervene. It was therefore in favour of the idea of creating a kind of European pillar within NATO -- in other words, a European security and defence identity.

Against this background, the NATO Council held in Brussels in January 1994 recognised the importance of defining a specifically European identity in relation to security and defence. The first steps towards this were taken at the NATO Council held in Berlin on 3 June 1996.

Since then, the European Union has set up its own permanent political and military structures for the political control and strategic management of crises. In December 2002, within the framework of the permanent arrangements for EU-NATO cooperation and consultation known as "Berlin Plus", the Union and NATO signed a strategic partnership agreement on crisis management. Through this agreement, the Union will have access with immediate effect to NATO's logistical and planning resources, including intelligence.

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Europol (European Police Office)

Europol is responsible for improving cooperation between the Member States' police and customs authorities.

The idea of a European Police Office was first raised at the Luxembourg European Council (June 1991). Provision for the Office was made in the Treaty of Maastricht, and it began its activities in January 1994 as the Europol Drugs Unit (EDU).

The Convention establishing Europol was signed in July 1995 and entered into force on 1 October 1998. Europol's field of competence is the combating of crime and terrorism, but it is not a European police force as such. It is an instrument at the service of the Member States designed to help them deal with criminal phenomena. In practical terms, Europol's work consists of facilitating the flow of information between national authorities and providing the latter with crime analyses. Europol participates in joint investigation teams comprising representatives of the various Member State authorities and provides the information they need on the spot.

The European Convention currently being ratified provides for the Office's powers to be strengthened to allow it to coordinate, organise and conduct investigations jointly with national authorities. The Constitution also provides that the European Parliament is to exercise control over Europol together with the national parliaments. Europol must abide by the Charter of Fundamental Rights and its activities will be subject to judicial review by the Court of Justice.

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Excessive deficit procedure

The excessive deficit procedure is governed by Article 104 of the Treaty establishing the European Community, under which the Member States are obliged to avoid excessive deficits in national budgets.

The Commission assesses the situation and the Council decides whether or not an excessive deficit exists. The Commission, which draws up a report in this connection, is required to take into account all the relevant factors (cyclical conditions, reforms, etc.) having a bearing on an excessive deficit.

When the Council decides that an excessive deficit exists in a Member State, it first of all makes recommendations to the State concerned, with a view to rectifying the situation within a given period. If the Member State fails to comply with these recommendations, the Council may instruct it to take appropriate measures for reducing the deficit. If necessary, the Council has the option of imposing penalties or fines and of inviting the European Investment Bank (EIB) to reconsider its lending policy towards the Member State concerned.

The reference value for the existence of an excessive deficit is 3% of gross domestic product (GDP). A Council Regulation adopted in 1997 is designed to speed up and clarify the implementation of the excessive deficit procedure.

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External responsibilities of the European Community

The European Community's external responsibilities are defined in accordance with whether they are conferred on the Community or on the Member States. Competence is described as "exclusive" where exercised entirely by the Community (e.g. the common agricultural policy) and "mixed" where shared with the Member States (e.g. transport policy).

The distinction has been defined in Court of Justice case law and is based on the principle of implicit powers, whereby external competence derives from the existence of explicit internal competence. The EC Treaty confers explicit powers in only two cases: commercial policy (Article 133) and association agreements (Article 310).

The common foreign and security policy comes under the heading of the EU's external relations, which are governed by intergovernmental procedures (second pillar), rather than under the external responsibilities of the European Community. To enable the Community to adapt to structural change in the world economy and reflect the wide responsibilities given to the World Trade Organisation, the Treaty of Amsterdam has amended Article 133 of the EC Treaty to allow the Council, acting unanimously, to broaden the scope of the common commercial policy to cover international negotiations and agreements on services and intellectual property.

The Treaty of Nice has enabled decision-making through qualified majority to be introduced into these areas. Competence for agreements on the harmonisation of cultural, audiovisual, educational, social and health services will continue to be shared with the Member States. The agreements are therefore subject to unanimity.

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eEurope

The European Commission launched the eEurope initiative in December 1999, and it was approved by the Lisbon European Council in March 2000. The communication adopted, "eEurope - an information society for all", is part of the Lisbon Strategy which states that the European Union should become, by 2010, the most competitive and dynamic knowledge-based economy in the world. The main objectives of the initiative are the following:

  • bringing every citizen, home and school, every business and administration, into the digital age and online;
  • creating a digitally literate Europe, supported by an entrepreneurial culture open to information technology;
  • ensuring that the information society is socially inclusive.

To achieve this, the Commission adopted the eEurope 2002 action plan in May 2000. The main actions were intended to stimulate a cheaper, faster, more secure Internet, promote human and financial investment and stimulate the use of the Internet.

The eEurope 2005 action plan succeeded eEurope 2002. eEurope 2005 was essentially focused on the deployment of broadband access at competitive prices, network security and better use of information technology by public bodies ("eGovernment").

Launched in June 2005, the "i2010" initiative is a new strategy framework of the Commission in the field of the information society and the media. i2010 is the first Commission initiative adopted in the context of the revised Lisbon Strategy and the partnership for growth and employment.

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