Language learning | English » Ábrahám Tamás - History of the European Union with special attention to the development of relations with central

http://www.doksihu Budapest Business School FOREIGN TRADE COLLEGE FACULTY Foreign Language Business Correspondence Studies Department College level professional education History of the European Union with special attention to the development of relations with central and Eastern European countries and institutional reforms Prepared by: Tamás Ábrahám BUDAPEST, 2005 http://www.doksihu Contents Introduction . 4 1. Short history and evolution of the European Union 6 2. Institutions of the EU 9 3. Development of relations of Central and Eastern European Countries 13 3.1 System of conditions for joining Central and Eastern European Countries to EU 14 3.2 The procedure of admittance of new member states 14 3.3 Evolution of relations between EU and Hungary (the PHARE Program) 15 3.4 General issues of process of enlargement 16 3.5 Process of enlargement and accessation negotiations ( AGENDA 2000) 17 3.6 Challenges of eastern enlargement 18 3.7 Problems of operability and

functionality of EU institutional system 21 3.8 The institutional reform 23 4. Summary 28 5. Used references: 29 3 http://www.doksihu Introduction The idea of the united Europe has already brought up before the Second World War, which mainly based on French conceptions. After the Second World War there had been a British, and then at the early ’50s a French proposal prepared for the break down of the political and economic borders. The first steps could be connected to the French Foreign Affairs Minister Robert Schuman in the early ’50s, which aim was to unite the German and French coal mining and steel industry under a common main authority. As a result of this effort, the MontanUnion has been established in 1951 (European Coal and Steel Community (ECSC)). The Benelux States and Italy joined to this community In the year 1957 the community has been expanded and set up the European Economic Community (EEC) and the European Atomic Energy Community (Euratom), and the main goal

is to achieve the total economic integration. However the markets of the member states have not been opened in the desired proportion. For which the solution was the creation of the Single European Act in the year 1986. The main aim of this act was the establishment of the free movement of goods, capital and workforce for the year 1993. There were granted extensions in several areas (e.g Finance, etc) Before the deadline of the establishment of the single market the 12 member states have decided on the further integration. With the signing of the Treaty of Maastricht in 1992 the European Union (EU) has been founded, which has three pillars: Action for Cooperation in the field of Economics, the Common Foreign and Security Policy, and in the area of justice and home affairs. Certainly the execution and the implementation of the above mentioned principles have not been without problems. There were difficulties with the coordination of the actions for justice and home affairs, and in the

implementation of the Treaty of Schengen, which aim was to attain the free movement within the EU. The idea of the creation of an economic and financial union also caused difficulties, as a result of this the European Monetary System (EMS) has been created in 1979, which linked the currencies of the member states and the ECU created as the basket of these currencies. 4 http://www.doksihu As a main economic task for the member states the Treaty of Maastricht pointed the establishment of an economical and financial union in order to reach the full integration of the member states. For this reason the members states founded in 1st January 1999 the European Central Bank and the single currency the EURO has been created. As a result of these measures the citizens of the EU have used the EURO as a legal tender since 2002. One outstanding event was in the last period the assembly of the European Council held in Nice on the 7-11 December 2000, which closed down the French Presidency and

the Intergovernmental Conference (IGC). The IGC’s task was to find solutions, develop proposals and submit to the Council for the key institutional problems not regulated in the Treaty of Amsterdam and necessary for the further operation of the EU. The stake was great for the countries, who wanted to join to the EU on the Conference held in Nice: the agreement on the functionality of the institutions of the EU was the prerequisite for the enlargement of the EU, in fact the stake was the enlargement within a reasonable period. On the Conference held in Nice the participants had made decisions on the main institutional questions, in this way the EU fulfilled those undertaken tasks till the end of 2002, which were necessary for the acceptance of the new member states The 15 member states accepted the strategy and the schedule of the enlargement developed by the European Commission, in which the deadline of the discussion and closing of the individual sections had to be discussed for

the joining countries, was the end of 2002. Knowing the condition system of the enlargement the parties are take into consideration the newly accepted countries during the development and agreement on the institutional reforms. In the closing speech of the Conference held in Nice the head of the states and the prime ministers give voice to their expectations –which meant a reasonable time period for the accession-, that the newly accepted countries could be participate in the European Parliamentary election will be held in 2004. As it known, on the conference held in Copenhagen on the date of 12-13 December 2002, the EU has closed the acceptance negotiations with the ten newly joining states. The member states declared that they are ready for the acceptance for the newly joined countries from the 1st May 2004. 5 http://www.doksihu The ceremonial signing of the acceptance agreement took place in Athens on the 16th April 2003. After that according to the constitutional requirements

all contracting countries, actual member states and joining countries had to ratify the agreement. After the closing of the successful ratification process the countries candidate for membership had become the member of the EU with full power on the 1st May 2004. 1. Short history and evolution of the European Union After the Second World War it was essential to establish an organization based on common institutions, which make the further wars impossible and resolve the centuriesold conflict between France and Germany, restore and improve the competitiveness of the European countries in the world by the improvement of the economic cooperation, and represent a counterweight against the socialist countries. For these reasons in the ’50s the 6 West-European countries established the three Communities, the predecessor organizations of the modern European Union. On the 18th April 1951 the six European countries (Belgium, France, Germany, Italy, Luxembourg, Netherlands) signed the Treaty

of Paris and established the European Coal and Steel Community (ECSC), and the Treaties as of today they will be referred to as the "Treaties of Rome" establishing the European Economic Community (EEC) and the European Atomic Energy Community (Euratom) are signed in Rome on the 25th March 1957. Later on the above mentioned three organization of the Communities had been merged and the European Communities (EC) naming used. The main goal of the EC was the creation of the customs union and the single market. The customs union means the elimination of the trade restrictions (customs duty, quotas) and pursues a common foreign commercial policy towards the outer countries. The European Single Market such an area, where the free movement of the goods, services, capital and workforce is ensured. In 1973 Denmark, Ireland and the United Kingdom, in 1981 Greece and in 1986 Portugal and Spain join to the European Communities. The number of the member states increased to 12. The customs

union within the EC has been already established for the year 1968. The single market i.e the free movement of goods, services, capital and workforce could not be realized completely till the eighties. For this reason the member states motivated by the 6 http://www.doksihu enhancement of their competitiveness to strengthen their integration, announce the program for the Single European Market with the signing of the Single European Act ont he 18th February 1986. The single market, which meant a higher level of the common market has been built up to the 1st January 1993 by the elimination of the existing obstacles, the harmonization of the national jurisdiction. In order to ensure the flawless operation and the improvement of the market, the harmonization of the individual national rules is stayed a continuous objective after the legal foundation of the market. After the successful realization of the single market, the member states decided on the further integration towards to the

economic, financial and political union. On the 7th February 1992 by the signing of the Treaty of Maastricht the European integration is became stronger, and the European Union as a new name of the communities had been presented. With the foundation of the European Union and continuing the activities of the EC, the member states decided to start an economic and financial union, and to introduce of a single currency, which was necessary for this kind of integration. Furthermore, as a starting point of the political union the organization of the common foreign and security policy and the cooperation in home affairs and criminal matters has been started. In relation to the political union the Treaty of Maastricht introduced the institution of the European Union citizenship, which main right is to provide free movement and residence on the territory of any member states. The achievements of the Treaty of Maastricht have been confirmed and improved by the signing of the Treaty of Amsterdam

on the 2nd October 1997. The stronger integration became very popular for other European countries, and in 1995 another 3 countries joined to the EU: Austria, Finland and Sweden. The number of the member states has been increased to 15. 7 http://www.doksihu As a result of the decisions made by the Treaty of Maastricht on the economic and political union in 1999 the EU introduced the EURO as the single currency of the EU. With the exception of Denmark, United Kingdom, and Sweden all of the member states joined to the EURO-zone. However the real single currency has been introduced on the 1st January 2002, when the EURO coins and banknotes appeared became the legal tender within the 12 EU member states after a two month transitional period. According to the political union described in the Treaty of Maastricht the member states had made efforts to create the common foreign and security policy since the early ’90s. In the spirit of this, nowadays the member states coordinate not just

their foreign policy attitude, measures and collectively represent the viewpoints of the EU in international issues, but they are started to organize a common army, which will be ready for 2003, and its task will be to deal with the crises related to Europe. Another achievement of the political union is the strong cooperation in the area of justice and home affairs of the member states. In the framework of this, especially to ensure the free movement of people within the member states, cancelled the border control between the member states, and the defence of the borders transferred to the outer borders. The member states built up a common visa-, refugee- and immigration policy, and organize a strong cooperation between the police and judiciary authorities of the member states. In the late nineties the accession to the European Union is became the main goal for the Central and Eastern European Countries, that liberated from the communist systems at this time. Until 1996 there were ten

Central and Eastern European Countries (Bulgaria, Czech Republic, Estonia, Poland, Latvia, Lithuania, Hungary, Romania, Slovakia, Slovenia), and three Southern-European countries (Cyprus, Malta and Turkey) declared their intention to accession. With the exception of Turkey the EU has started the accession negotiations all of the above mentioned countries until 2000. For the enlargement the EU – besides the successful negotiations – has to create the conditions of the enlargement within the EU. Therefore the member states after a long discussion on 26th February 2001 signed the Treaty of Nice, which made possible with the reconstruction of the EU institutions for the candidate countries to join to the EU. On the Conference held in Gothenburg in June 2001 the member states confirmed, that the accession negotiations with the mostly prepared candidates – placed among Hungary too- 8 http://www.doksihu could be finished till the end of 2002 and in this way the EU could be access

new members in the year 2004. After this short introduction and the overview of the history of the EU I would like to introduce the institutions of the European Union. 2. Institutions of the EU The European Union, which means the integration of a large group of European nations, is a particular subject of international relations and the general international law, regulating these legal relations. Firstly, the European Community, which is forming the first pillar of the EU, is a community established by an international agreement concluded between the member states and based on law. The Community has external and internal scope of authority, and within its scope it can legislate and make obligatory force decisions. On the other hand, the European Union is such an international organization, where the member states makes the mostly important decisions, rules according to rules and procedures stipulated in the foundation treaties in the name of the European Union and/or the European

Community. In this case, we can speak about the Union as an intergovernmental cooperation, which assert the fact that the EU is the „Europe of Nations”. These specialities, and the dual nature of the European Union and the European Community is reflected by the three pillars and unified permanent institutional system of the EU.(The fact that there is no scope of authority and their activities are greatly limited in relation to the second and third pillars of unity, does not injure the unity.) The three pillars of the European Union is shown on Figure 1. Source: The ABC of Community Law, Dr. Klaus Dieter Borchardt, 1999 9 http://www.doksihu Figure 1. Three pillars of the EU European Union First Pillar European Community European Community: • Customs union and single market • Agricultural policy • Structural policy • Commercial policy New or changed regulations: Second Pillar Common Foreign and Security Policy Foreign Policy: • Cooperation, common viewpoints and

intervention • Preservation of peace • Democracy • Grants for nonmember states Security Policy • Union citizenship • Education and culture • Trans -European networks • Consumer protection • Public health • Research and environment protection • Social policy • Refugee policy • External borders • Immigration policy • Taking advantage of the Western European Union (WEU ), questions related to the security of the EU • Disband • Financial issues of defense • Long-term: European security system ECSC EURATOM 10 Third pillar Police and judicial cooperation in criminal matters • Cooperation between the authorities on the area of civil and criminal law • Police cooperation • Fight against racism and antiSemitism • Fight against the trade of prohibited drugs and arms • Fight against terrorism • Crimes against childrens • Trade of humans http://www.doksihu There are EU institutions, which are independent from the member states in their,

place under the Community Law and the interests of the EU (Parliament, Court, Commission) however the Council the main decision making institution consist of the ministers of the member states (and in case of the European Council, which has two session in a year consist of the head of the states and the prime ministers). In connection with the accession process the institutional issues has been raised in two areas: - Issues related to the main or in other words the constitutional institutions (Council, Parliament, Commission, Court, Court of Auditors) of the unified institutional system of the European Union, and the auxiliary institutions (e.g Economic and Social Committee, Committee of the Regions), which task are to help their work and other institutions (European Investment Bank, and the institutions of the Economic and Financial Union). The participation and the collaboration is the right and obligation of the new member state from the date of accession. - The effectiveness and

execution of the law constituted by the institutions of the European Union have to be ensured by the member states. In order to the national public administration, judicial organization and the authorities applying the Community law have to be prepared for the tasks arising from the functioning of the institutions of EU. All these issues require state and governmental policy on the area of legislation, administration, education. The institutions of the European Union are under continuous reformation. It has to be take into consideration during the accession process, because the candidates have to take the changing rules and have to use the system in force at the given time. The structure of the base institutions of the EU is built up according to the principles of intergovernmentalism and „Divide et impera”. The model of the community institutes are based on the followings: intergovernmental cooperation, decision making over the nations, and the balance created among the

institutions. 11 http://www.doksihu The institutional system of the European Union is shown in Figure 2. Figure 2. - Institutions of the EU Source: The ABC of Community Law, Dr. Klaus Dieter, Borchardt, 1999) The Council of the European Union ministers of the member states and the president of Commision Council of the European Union The Committee of the Regions European Court of Auditors The European Parliament Az Európai Közösségek Bizottsága European Central Bank Court of Justice of the European Communities The European Economic and Social Committee European Investment Bank In the followings I would like to describe the sdevelopment of the relations between the Central and Eastern European Countries (former socialist countries) and the EU. 12 http://www.doksihu 3. Development of relations of Central and Eastern European Countries Relation between COMECON countries – former socialist countries - ( Council for Mutual Economic Assistance - Moscow 1949 ) and EC

(European Community ) was characterised by differentiation and mutual denegation. There were changes started in the policy of COMECON countries from 1982 (after death of Brezsnyev), but only after accession to power of Gorbacsov in 1985 took pace steps on the merits, negotiations. Hungary started negotiations on the merits with EC only in 1987 but only on 26th of September 1988 was signed the Trade and economic cooperation agreement between the Community and Hungary . The result of Agreement on Trade and economic cooperation was that EC gradually eliminated former discriminative limitations against Hungary. The leading economic powers (G-7) of the world in Western Economic Summit was held in Paris, France on 14. July 1989, took decision about establishment of PHARE Program, Poland Hungary Assistance for Restructuring the Economy. The aim of the program was to coordinate the necessary measures to assist economic restructuring in Poland and Hungary countries in transformation for

restructuring their transformation to market economy and establishing democratic social structure and preparation of joining country for admittance to EU. This program first of all provided non refundable financial subsidy Because of changes similar to PHARE program was launched for CIS countries (Commonwealths of Independent States) too. The TACIS program serving similar aims was also launched for CIS countries (Technical Assistance to the Commonwealths of Independent States. I would like to shortly present conditions of joining Central and Eastern European Countries to EU, development of relations, challenges of process of enlargement in the following sections. 13 http://www.doksihu 3.1 System of conditions for joining Central and Eastern European Countries to EU Conditions for joining Central and Eastern European Countries to EU was formulated in Summit held in Copenhagen in June of 1993. These conditions were called as Copenhagen Criteria. The candidate countries of Central

and Eastern Europe which signed the Europe Agreements will become full members as soon as they satisfy the following requisite political and economic conditions • Stability of institutions guarantying respect for human dignity, liberty, democracy, equality, the rule of law, and human rights. • respecting and defence of minority rights, (political criteria), • functioning market economy, which is capable compete with competence of market forces existing in the European Union (economical criteria), • Ability to comply with obligations originating from membership, adaptation and implementation of acquis communataire, including political. economical and monetary union ( legal, institutional criteria) • The EU added to above listed criteria a fourth criteria, namely that EU shall prepare itself to be capable (its politic, institutions) for adaptation of new member states. The Copenhagen criteria can be considered as an political declaration, special importance of it that firstly

in history of EU was formulated the requisite conditions of admittance for a group of countries wishing to join to the EU. 3.2 The procedure of admittance of new member states The candidate of EU membership countries shall submit application on admittance to the Council. Then the Council will ask the Commission to prepare an County report on country wishing to join to the EU (country assessment). On the basis of Country Report the Council adopts decision about acceptance or rejection of admittance application. If the decision of Council is positive, then EU starts accession negotiations with candidate countries. Questionnaires compiled by the EU Commission were handed over to the ten 14 http://www.doksihu candidate countries submitting application on admittance on 26th April 1996. This moment was actually launch of preparation accession negotiations. Questionnaire contained questions regarding political structure of countries, economical life and the whole legislation related to

EU functionaries. 3 months deadline was determined for preparation of answers. Preparation of answers was task of Foreign Ministry and governmental apparatus. On the basis of answers given on questionnaires the Commission elaborated and compiled so called country assessment about 10 candidate Central and Eastern European Countries. This work was performed by the Commission approximately during 1 year. The Summit held in Amsterdam (16-17 June 1997), established that conditions of clears the enlargement process were created. The European Commission published the country opinions - its opinions on the applications of 10 Central and Eastern European countries on 16th July 1997. In this opinions the assessment of preparedness of candidate countries were assessed, the measure was the so called Copenhagen criteria, which I have presented in the previous chapter. The proposal of European Commission was to start accession negotiations in the first circle with 5+1 countries. The selected

countries were as follows: Poland, Czech Republic, Hungary, Estonia, Slovenia and the plus one country was Cyprus. From the first circle Slovakia, Latvia, Lithuania, Bulgaria and Romania were left out. The reason for it was mainly progress made in change of their political and economical system. After closing down the accession negotiations, before signing the Acts of Accession after political agreement between governments of member states and candidate states – the European Parliament approves or rejects the accession of candidate country. After approval of European Parliament the member states and the candidate state sign the Act of Accession. The Act of Accession must be ratified in all signing countries in accordance with constitutional rules of each country. This will be performed in the national Parliament. The accession is generally confirmed by referendum in the candidate country. 3.3 Evolution of relations between EU and Hungary (the PHARE Program) Hungary and the European

Community established diplomatic relation in 1988 as part of normalisation of east-west relations. Simultaneously with launching the PHARE-program (1989) the EC eliminated the import restrictions against Hungary and Poland. “Europe 15 http://www.doksihu Agreements" are signed with Hungary in December of 1991 created the highest level of relation which EU could establish with a non member country. The relations of Hungary and European Union picks up on the basis of partnership relation. The accredited Hungarian EU Embassy was separated from embassy in Belgium from 1993. On 1st of April 1994 Hungary submitted application of accession. The EU initiated regular ministry level dialogue in spring of 1994 with those Central and Eastern European Countries, among them with Hungary, which entered into partnership agreement. The accession negotiations were started in the end of March 1998 and were continued according to planned schedule. The accession negotiations were finished in

Summit held in Copenhagen in 12-13 December 2002. The PHARE program (Poland Hungary Assistance for Restructuring the Economy) is a program of European Union providing non refundable financial subsidy for Central and Eastern European Countries. The aim of this program is assistance realisation of socialeconomical reform and subsidizing preparation for integration The PHARE program was launched in 1989, when the European Community adopted decision about providing 300 million ECU economic aid for Hungary and Poland, and launched the program called as PHARE. The designation program in the PHARE system means development plan, which is implemented during certain time and contains different projects. The financing is realised in form of branch programs, containing medium term targets. Individual PHARE programs in Hungary e.g are connected with development of small enterprises and environment protection. Financing is realised though funds, into which recourses are placed regularly by the

fiduciary country too. During utilisation of joint funds both PHARE regulations, and rules of given country must be fulfilled. 3.4 General issues of process of enlargement First enlargement of European Community (EC) 1973. Denmark, Ireland and the United Kingdom joined the European Communities in the first circle (European Community was increased to nine countries). To second circle of enlargement of European Community belonged the Mediterranean countries, Greece in 1981, Portugal and Spain in 1986 joined to the European Community. As a result of enlargement with Mediterranean countries 16 http://www.doksihu European Community of 12 members was formed. The precondition for joining to the European Community was acceptance of following conditions Countries applying for accessation need to accept the Rome Treaty rules and and decisions adopted since then by EC . • Problems occurring in subsidizing shall be solved by temporary measures and not by changing rules of EC. • Temporary

measures shall be mutually advantageous, therefore increase of free trade of industrial products shall be ensured together with existing results of common agrar market. • The transition period in the trade shall be same for each candidate, in other areas the transition period might be different duration and country by country or areas of cooperation. It can be seen that the EC endeavour was to maintain own results, while no serious criteria system was determined towards candidates for accessation. The duration of transition period was determined as 5 years. 3.5 Process of enlargement and accessation negotiations ( AGENDA 2000) The European Commission issued the program called AGENDA 2000 in 16 July 1997.The document was adopted after long negotiation and dispute in the Summit held in Berlin, on 26th March 1999, Heads of State or Government of EU. The document described the Union entering into the XXI-st century, which gives answers to challenges, for enlargement, globalisation and

improvement of competetiveness. The document determines expenditures related to enlargement for the period of 20002006 and basic principles of EU budget. The European commission enclosed to Agenda 2000 document the country opinions of candidate countries for accession. The Commission suggested to start the accession negotiations with Cyprus, Czech Republic, Estonia, Poland, Slovenia and Hungary. The Commission found other Central and Eastern European Countries not able for accession, against Slovakia the complaint was incompliance with political criteria, against other countries (Bulgaria, Latvia, Lithuania, Romania) the compliant was because of incompliance with economical criteria. The decision about proposal of Commission in Summit held in Luxemburg in December 1997 was made by Heads of State or 17 http://www.doksihu Government of Union adopting decision about enlargement of EU with Central and Eastern European Countries. According to the decision the accession negotiations

were started on 31st March 1998. with most prepared for accession 6 countries. The accession negotiations between the candidate country and EU were multilevel negotiations. During this negotiation it was examined how is given country complying with accession requirements. During these negotiations it was decided what will be included in the Act of accession, what temporary exemption is given to the particular country. The highest level negotiation was the ministry level negotiation; the lowest level negotiation was negotiation between experts of given country and experts of EU: Hungary continued accession negotiation with European Union since 10th November 1998. 3.6 Challenges of eastern enlargement There was no example of such former enlargement of EU with 10-13 countries simultaneously applying for accession. Because of different level of development of (underdevelopment) candidate countries, the EU did never meet such an accession challenge. According to estimations if the EU will

have in 2007 27 member states, then number of population will reach half billion. The expected population and GNP per capita after enlargement of EU I present in table 1. 18 http://www.doksihu Table 1. showing the population and GNP per capita of EU with 27 member states GNP per capita EU-27= 100 2002 Austria Belgium Bulgaria Cyprus Czech Republic Denmark Estonia Finland France Greece Holland Ireland Poland Latvia Lithuania Luxemburg Hungary Great-Britain Germany Italy Portugal Romania Spain Sweden Slovakia Slovenia EU-15 12 EU –candidate EU-27 population 1000 persons 2007 127 125 29 93 72 135 46 117 114 78 128 123 45 35 39 193 59 117 123 116 88 36 94 117 59 81 - Source: : DIW Wochenbericht , 2001 /36. 19 8147 10157 7803 723 10099 5311 1333 5200 60052 10357 15790 3960 39016 2252 3610 445 9708 59695 81637 55846 9770 21719 38672 8956 5440 1936 373996 104040 478036 http://www.doksihu The future of EU depends on next wave of enlargement, the realisation of accession.

Reasons for it are as follows: • Until now never were simultaneously 10-12 new member states accessed in the past near half century. • the development differences are very large • because of postponed internal reforms, the danger of recession expected in the beginning of 2000’s years the sacrificing ability of richer member states towards new member states is would be less. Because of above mentioned issues there are three groups of anxiety which were formulated by European Union: • how present level of integration, tenability can be ensured • how can be preserved obtained results of EU public policy, how it can be expanded to new member states, that it would be acceptable for old members. • how the functionality of institution system can be maintained in case of 25-27 member states. The first issue among above mentioned three issues is in connection with preparedness, maturity of candidate countries applying for accession. The solution of second and third issues occurred

as internal task of EU, as function of political will of member states. Preservation of common political results and operability of institutional system should be ensured by EU itself. 20 http://www.doksihu 3.7 Problems of operability and functionality of EU institutional system The institutions of EU were functioning slowly already in case of 15 member countries, and increase of 25-27 member countries operation trouble would occur. After last enlargement there were serious debates about reorganisation of institutional system of EU. Serious problem occurs because the EU institutional system was developed originally for six member states, and there were operation troubles in case of 12 and 15 member states. In case of enlargement with new member states the institutional system would reach according to some opinions its limits of operability. It is necessary to emphasize that the problem occurred not because of accession of one-two new member states, it could be handled without

changes of institutional system, but the ever largest volume of enlargement by 10-12 new member states cases the problem. Therefore EU considered as precondition of further enlargement with eastern member and solving this issue was inseparable from further enlargement after formulation of Copenhagen criteria. In connection with enlargement reorganisation of three key institutions the Council, the Commission and the Parliament is considered as essential precondition of enlargement. Among institutional reforms change of decision making in Council is considered as most important. It is hardly feasible that the EU consisting of more than 25 member states could functioning without problem maintaining the consensus based decision making. The member states make many important decisions with solid vote. At the same time reaching such a consensus of 25-27 member states, which is acceptable for each member state, would have several disadvantageous consequences. On one hand the decision making

would drag on and the EU would paralyse, on the other hand the decisions would become abortive, content less because of sequential compromises. In order to maintain the ability of decision making of Council further expansion and making it general the qualified majority decision making is suggested by most of interested parties. At the same time as other problem appeared that maintaining the voting weight principles after enlargement would result in serious disproportion. The existing system favours the small states. In some cases extreme disproportion could occur, eg the 80 million population Germany has only five times more votes in the Council than the much less Luxemburg ( 400 thousands population), which has 2 votes. 21 http://www.doksihu I present the ratio of votes in the European Union in table 2. Table 2: Distribution of number of votes held by each country based on ionnania compromise. Member state Number of votes Member state Number of votes Austria 3 Ireland 3

Belgium 5 Luxemburg 2 Denmark 3 Germany United Kingdom Finland France 10 Italy 3 Portugal 10 Spain Greece 5 Sweden Holland 5 Total 10 10 5 8 4 87 The compromise contains following: To pass a vote by Qualified Majority Voting it necessary to vote for supporting the suggested decision submitted by the European Commission at least 62 votes. • If the suggested decision is not originated from the European Commission then to pass a vote also 62 votes ate necessary, but the votes must originated from at least 10 member states. • Blocking minority is considered 25 votes against, but if against draft are 23 votes, the Council cannot adopt decision. As result of large enlargement problem occurred regarding number of Commission members. Before enlargement the larger member states could delegate two – two, smaller countries one-one commissioner into the commission. There were similar to the Council and Commission problems occurred in the European Parliament. In the EP similarly

to the Council – although less distorted the smaller member states are beneficiary – it means the opportunity of obtaining place of representative is different. In a smaller country for obtaining mandate even half of number of votes is enough as compared with a larger country. It may cause problem the number of representatives of EP may further increase. Operationability of a body consisting of 800-900 persons may become much harder. I would like to present more detail the institutional reform of European Union. 22 http://www.doksihu 3.8 The institutional reform One of main aim of the Intergovernmental Conference is held in Turin, Italy on 29 March 1996 was to revise the Maastricht Treaty to solve institutional problems related to enlargement of EU, which was closed down by adopting the Treaty of Amsterdam in June 1997 after 15 months debate. The Treaty of Amsterdam signed on 2nd October 1997 did not resolved expectations related to institutional reform. The member states

could not agree in most important issues. It became obvious that changing the system of decision making would result in such changes in the character of Union, which was not acceptable for several member states; therefore the more serious reforms were postponed. The Treaty of Amsterdam resulted in considerable reform among institutional reforms only in European Parliament. Widening the role of parliamentary codification (widening the mutual decision right) was an important progress in decreasing the democratic deficit. As a success of the Treaty of Amsterdam can be considered decision adopted about number of members of parliament, that after further enlargement of EU number of members of parliament cannot exceed 700 members. The Treaty of Amsterdam did not determined how will be realised the 700 upper limit of parliament, how will be decreased the number of representatives of existing old member states, and how will be determined the number of representatives of new member states.

There was disappointing result of Treaty of Amsterdam regarding most important and necessary reforms of Council and Commission. The Qualified Majority Voting was introduced in the Council in 16 new cases, but only in case of 5 existing issues changed from requirement unanimity to Qualified Majority Voting to pass decisions. In most areas of decision making in the Council remained subject to unanimity. Regarding Commission the member states could agree only that the number of members of Commission remains 20 until the number of member states does not exceeds 20. According to this agreement the larger member states will abandon their second commissioner places. From the Treaty of Amsterdam the conclusion was that in principle the enlargement of EU can be realised with existing institutional system up to 20 member states. 23 http://www.doksihu More serious reorganisation, i.e calling newer Intergovernmental Conference will be necessary if more than five new member state would join to

EU. At the same time it is necessary to consider, that the aim of Intergovernmental Conference was realisation of necessary reforms for enlargement of EU and maintain the effectiveness of operation of institutions of EU, which was postponed. Therefore three member states, Belgium, France and Italy attached a declaration to the Treaty, in which they expressed their disappointment and that precondition for any enlargement of EU is realisation of postponed institutional reforms. The importance of this declaration was strengthened by the statement of European Parliament, in which approval of enlargement was linked with request for realisation of institutional reforms. After the Treaty of Amsterdam it was uncleared that for realisation of postponed reforms a newer Intergovernmental Conference or only smaller meeting will be necessary. Because these three above mentioned countries definitively requested calling of newer Intergovernmental Conference, more and more country representatives

accepted that before first circle of enlargement it is necessary to solve the most important institutional problems, independently of number of states, to be accessed. The decision was adopted on the annual G8 summit held in Köln, Germany. The heads of state or government took decision about calling an IGC- Intergovernmental Conference for beginning of 2000 for settlement of open issues of ( IGC- Intergovernmental Conference, and decided to close the IGC until the end of 2000 year. Until this date it is necessary to reach agreement about necessary amendments of Treaty. The heads of state or government defined the agenda of Conference avoiding in such way the prolongation. Following issues were determined for agenda of Intergovernmental Conference of 2000 year: • size and composition of Commission, • Weight of council votes, • possible widening of use of Qualified Majority Voting in the Council In the closing document of summit held in Köln it was added that such issues,

related to other institutions, requiring amendment of Treaty, which occur from above mentioned three problems or from realisation of Treaty of Amsterdam possible also will be discussed. The European Commission and the European Parliament and some member states, first of all the Benelux States and Italy after summit of Köln suggested wider Intergovernmental 24 http://www.doksihu Conference. The heads of state or government undertake in Helsinki that they will make ready for accession until end of 2002 from institutional point of view, i.e they will open the EU for accession of new members earliest at beginning of January 2003. It means, that they undertook that if they can close down Intergovernmental Conference in the Summit held in Nice in December 2000, then signing the Treaty of Nice about institutional reforms, it will be ratified until 2002. The Intergovernmental Conference on institutional reform was opened on 14 February 2000 in Brussels, Belgium, aim of which was creating

an operationable institutional structure of European integration for the case of significant enlargement of number of member states of EU. The task of conference was not basic reconstruction of EU institutions, but development and adaptation of such modifications and mechanisms which ensures fast and effective decision making in case of increasing the number of member states from originally planned 6 to 30 members. The Intergovernmental Conference of 2000 year was closed down after long debates in the Summit European Council is held in Nice, France between 7-10 December by adopting Treaty of Nice. Following the December 2000 European Council meeting held in Nice, France, a new Treaty amending the Treaty on European Union and the Treaties establishing the European Communities, was signed on 26th February 2001. The Treaty of Nice realised essential institutional reforms for enlargement of EU. Signing of Treaty of Nice closed the period of uncertainty, and made possible the further

enlargement of EU. Treaty of Nice was proven to be successful in liquidation of “Amsterdam residuals” and solving problems prohibiting enlargement. Although the Treaty of Nice did not changed basically the institutional and decision making system of EU, but it found the acceptable for member states compromise for most burning issues, necessary for launching further enlargement of EU. The Treaty of Nice fulfilled its main task, determined the necessary changes in institutional structure, determined method, procedure of change. Treaty of Nice and attached documents aimed to solve problems arising in connection with accession negotiations with interested 12 candidate countries of EU enlargement. The approved documents restructures the structure of EU institutions up to 27 member states, determining exactly number of votes held by 15 old member states and 12 new member states. I present this in table 3 25 http://www.doksihu Table 3. Number of votes of member states in Council of

European union determined in the Treaty of European Union from 1st January 2005 Member state Number of votes Member state Number of votes Austria 10 Latvia 4 Belgium 12 Lithuania 7 Bulgaria 10 Luxemburg 4 Cyprus 4 Czech Republic Denmark United Kingdom Hungary 12 Malta 7 29 12 3 Germany 29 Italy 29 Estonia 4 Portugal 12 Finland 7 Romania 14 France 29 Spain 27 Greece 12 Sweden 10 Holland 13 Slovakia 7 Ireland 7 Slovenia 4 Poland 27 The Nice compromise contains followings: To pass a vote by QMV, these conditions apply: • • • gathered 72 % of votes is backed by a majority, at least 2/3 of member states these countries represent at least 62% of the EU population I present in the following articles main elements of the Treaty of Nice related to enlargement of EU: • It readied the EU for further enlargement, setting a cap on the number of MEPs (732) and the European Commission (25). The latter provision meant that larger

countries which had previously nominated two commissioners would in future only have one. 26 http://www.doksihu • Qualified Majority Voting was again extended to more areas, abolishing the national right to vetio in some areas. A concept of "enhanced co-operation" was introduced for countries wishing to forge closer links in areas where other states disagreed. • The Treaty of Nice with validity of 1st of January 2005 executed the change of weight of votes in the Council. The larger member states obtain larger voting weight, the ratio of votes are changed in their favour. Taking into consideration the interest of smaller member states to pass a decision by Qualified Majority Voting in addition to weight of votes also necessary supporting voting by a majority number of member states. • in widening Qualified Majority Voting the Treaty of Nice could reach less results as expected. Among 70 issues requiring unanimity in 30 issue areas introduction of Qualified

Majority Voting was decided. • regarding Commission no outstanding results were reached in Nice , but such a success in compromise was reached, which is acceptable for each member states, therefore it makes possible enlargement of EU. • Regarding Parliament the Treaty of Nice could not maintain the upper limit of representatives 700, determined by Treaty of Amsterdam, and finally determined in 732 representatives as maximum number of members of European Union Parliament. As summary we can state that the Treaty of Nice eliminated the largest barriers, adopted the essential decisions for enlargement, and realised institutional reforms, which were considered as most important precondition for accession of new member states. 27 http://www.doksihu 4. Summary I reviewed in previous chapter’s development of European Union from its foundation until today. I presented the institutional system of European Union and its three pillars Reviewing development of relations of European

Union with Central and Eastern European Countries and condition system of accession of new member states, I emphasized the importance of institutional reforms. As summary I can state that in the area of institutional reforms, from point of view of enlargement of EU, the Treaty of Nice is the most important and the progress of enlargement, the accession negotiations would not affected, slowed down by the Convent and the success of Intergovernmental Conference of 2004 year is not a precondition of enlargement. The new reform will be realised simultaneously with accession of new member states. It is strengthened by the fact that to the Convent established in February 2002 all of 13 candidate member countries (12 countries continuing accession negotiation and Turkey with status of candidate for membership) received invitation and they could participate in the work of convent under equal conditions with the member states. The newly accessed member states and those candidate countries which

already signed their act of accession could participate with full right in Intergovernmental Conference of 2004 year. The new Treaty of Union which will be elaborated here will enter into force in the enlarged EU in the existing and new member states too. The Convent can be considered in this respect as experimental workshop of enlarged EU, where at first time make joint consultation the 15 existing member states and 13 candidate states, and try to elaborate jointly such proposals for the future of Europe which enjoys the largest agreement. 28 http://www.doksihu 5. Used references: 1./ Magyar Péter : Az Európai Unió története (Peter Magyar: History of European Union.) 2./ Derek W Urwin : The Joint Europe The European integration from 1945 till now 3/ Horváth Zoltán : Kézikönyv az Európai Unióról (Zoltan Horvath: Guidebook of European Union) 4./ Czuczai Jenő és Ficzere Lajos : Európa A-tól - Z-ig (Jenő Czuczai and Lajos Ficzere Europe from A – to Z) 5./ Mezei

István szerk: Az Európai Unió és a vasutak (Istvan Mezei editor: The European Union and the railways) 6./ Ecostat Gazdaságelemző és Informatikai Intézet : Bővülő Európa 1, 3 kötet (Ecostat Institute of Economic analysis and Informatics) 7./ Világpolitikai Kislexikon (Short Lexikon of World politik) 8./ Dr Klaus Dieter Bochardt : A közösségi jog ABC-je (ABC of European Law) 9./ Rácz Margit szerk: Őszinte könyv az Európai Unióról ( Honest book about European Union) 10./ Európa Institut Budapest: Az európai integráció ( European integration) 11./ Dr Majoros Pál : Kutatásmódszertan (Dr. Pál Majoros: Methodology of research) 29