The European Communities

The European Communities

On 9 May 1950, in Paris, in a speech inspired by Jean Monnet, Robert Schuman, French Foreign Minister, proposed that Franco-German production of coal and steel as a whole be placed under a common High Authority, within the framework of an organisation open to the participation of the other countries of Europe. That concrete achievement, relating to one limited but decisive point the heavy industry of two long-opposed countries was to set up common foundations for the economic development of the European nations while preventing their confrontation. The aim was to create de facto solidarity as a first step in the federation of Europe.

That famous declaration marked the beginning of the history of the European Communities. It set out the principles of the functional and step-by-step construction of the European Communities as it was effectively to be achieved subsequently: its economic foundations and its goal of political unification, its method of sectoral integration based on common decision-making, and its evolutionary and open nature.

The immediate consequence of the French Governments declaration was the signature in Paris, on 18 April 1951, of the Treaty establishing the European Coal and Steel Community (ECSC). That Treaty, which entered into force on 23 July 1952 for a limited period of 50 years, integrated the economic sectors of the coal and steel industry. Based on the same principles set out in the declaration, the Treaty establishing the European Economic Community (EEC) and the Treaty establishing the European Atomic Energy Community (EAEC or Euratom) were signed in Rome on 25 March 1957. Those treaties, which entered into force on 1 January 1958 for an unlimited period, provided for the further integration of economic sectors by creating a common market in the framework of the EEC and by pooling nuclear industries in the framework of Euratom. As an organisation aimed at the common management of the entire economy of the Member States, the EEC soon emerged as the most important Community. It became the main tool for indirectly achieving political unification.

The three European Communities were set up as three distinct, international organisations, each with its own institutions and fields of activity. Moreover, compared with their big sister the Council of Europe they emerged as organisations that were restricted, in terms both of their field of activity which was originally purely economic and of their membership originally six Member States. Thanks to their evolutionary and open nature, however, they tended to deepen constantly in a growing number of fields of activity and to enlarge gradually to include more Member States.

The European Communities were the first organisations based on supranational integration thanks to the states that composed them pooling a whole range of national powers. The Member States of the Communities did not confine themselves to coordinating their policies, as they could have done within a traditional international organisation based on intergovernmental cooperation, but conducted them jointly by creating common institutions responsible for Community decision-making. According to the principle of the distribution of powers, however, the Communities and their institutions must act within the limits of the powers conferred on them and the objectives assigned to them by the treaties establishing them. It was, therefore, always up to the Member States to decide whether to extend Community powers to new fields of activity by reforming those treaties.

The three Communities were created separately and each retained its legal personality and its respective powers within the framework of each treaty. Nevertheless, because of the need to save on resources and the desire to avoid duplication, the three Communities institutions were merged. The entry into force, on the same date as the Treaties of Rome to which they were annexed, of the Convention on certain Institutions common to the European Communities made it possible, from the outset, for the three Communities to share a single Assembly and a single Court of Justice. The entry into force on 1 July 1967 of the Treaty establishing a Single Council and a Single Commission of the European Communities then led to the merger of executives. From that date on, the three Communities also shared a single Commission and a single Council. That treaty also created a single budget and administration of the Communities, together with a single Staff Regulations applicable to their officials and other servants.

Despite the difficulties created by the existence of three distinct Communities, one of which had general economic powers, unification of the Communities, over and above their organic merger, was not to happen. The various projects to merge the Communities by the adoption of a single treaty were to fail. Furthermore, until the Single European Act was adopted in 1986, the major institutional reforms took place in a strictly Community framework (such as replacement of Member States financial contributions by the Communities own resources in 1971, increase in the European Parliaments democratic legitimacy as from its first direct election in 1979 and gradual increase in its legislative and budgetary powers). The only area of growth was cooperation in foreign policy, which covered practical diplomatic relations, outside the Community system.

The European Single Act, which entered into force on 1 July 1987, institutionalised European political cooperation (EPC), thus putting an end to the purely Community Europe. Henceforth the Member States, acting within the Community institutional framework, applied both the method of supranational integration (in the context of Community policies) and the method of intergovernmental cooperation (in the context of EPC) in their areas of common activity. Despite its title, the Single European Act did not lead to a merger of the various treaties. First and foremost it was a treaty reforming the constituent treaties, which consolidated, in a single act, the amendments to the treaties establishing the European Communities and the provisions on EPC. The Communities, with the EEC as their main organisation, remained the central pillar of integration.

With the entry into force on 1 November 1993 of the Treaty on European Union (EU Treaty), two intergovernmental pillars were added to the Community pillar within a single institutional framework: the common foreign and security policy (CFSP), which superseded EPC, and the policy of cooperation in the fields of justice and home affairs (JHA). Within this complex system, the three Communities survived with distinct legal personalities until the expiry of the ECSC Treaty on 23 July 2002. Since then, only two Communities have made up the Community pillar of the European Union. With the EU Treaty, the EEC has become known as the European Community (EC) in order to highlight the extension of its powers to non-economic areas such as education, culture and public health.

The Communities path towards political union

The creation of the European Communities is the first step on the long path towards the political unification of the continent. With this objective in mind, projects of varying degrees of audacity and practicality are seeing the light of day, marking successive stages in an original process which combines the supranational integration method with the intergovernmental cooperation method.

The Communities in the European Union

With the entry into force on 1 November 1993 of the Treaty on European Union, signed in Maastricht on 7 February 1992, the Member States of the European Communities established a European Union.

Pursuant to Article A of the Treaty, the Union shall be founded on the European Communities, supplemented by the policies and forms of cooperation established by this Treaty. The European Union has not, therefore, taken over from the Communities, which survive as distinct organisations of supranational integration. Moreover, the European Union does not have a legal personality.

Since that date, the Communities have carried out their activities within the framework of a wider institutionalised structure, of a controversial legal nature, that encompasses them and supplements them with two areas of intergovernmental cooperation: the common foreign and security policy (CFSP) and cooperation in the fields of justice and home affairs (JHA). Article M of the Treaty guarantees the survival of the Communities. It specifies that, subject to the provisions amending the Treaties establishing the three European Communities, nothing in the Treaty shall affect the Treaties establishing the European Communities or the subsequent Treaties and Acts modifying or supplementing them.

In establishing the European Union, the representatives of the Member States stated that they were resolved to mark a new stage in the process of European integration undertaken with the establishment of the European Communities and recalled the historical importance of the ending of the division of the European continent and the need to create firm bases for the construction of the future Europe. Thus, the European Union, as established by the Maastricht Treaty, was no more than a step along the road leading the European Communities to become a politically integrated European area. The moment to take a further step came with the fall of the Berlin Wall in November 1989, which brought a radical change in the geopolitical situation of the continent. Thanks to that treaty, the Member States of the Communities acquired a uniform institutional framework that was more coherent and effective, covering all the areas of their common action and making the task of an organisation that aspired to encompass the neighbouring countries of central and eastern Europe easier.

The model of a Greek temple made up of three pillars, with a common pediment and base, is generally used to explain the structure of the text of the treaty, which is divided into seven titles, followed by protocols and declarations. Title I, which contains the common provisions, is the single pediment that heads the structure as a whole, while Title VII, containing the final provisions, represents the base on which it is founded and the basis on which it can be revised, in that it provides for the amendment of the Treaties. The main pillar of the temple represents the three Communities (Titles II, III and IV, which contain provisions amending the founding treaties). The other two pillars represent the areas of intergovernmental cooperation (Title V on the CFSP and Title VI on JHA).

In the framework of the first pillar, the main new development brought by the Maastricht Treaty was the introduction into the Treaty establishing the European Economic Community (EEC) which became the Treaty establishing the European Community (EC) of provisions on establishing, step by step, economic and monetary union (EMU). In the wake of economic integration, EMU was set as the new goal to be achieved following the completion of the single market in 1992, as provided by the Single European Act of 1986. The change in the title of the organisation to European Community was final evidence that the Communitys powers now extended to non-economic areas. Among the three Communities, the EC confirmed its dominant and general role, namely gradually to extend its activities towards other economic and social areas, as also to absorb sensitive political powers relating to the two intergovernmental pillars during future stages of development, in a process of communitarisation. Alongside it, the EAEC and the ECSC tended more and more to appear as specific sectors of the main Community. It is also worth noting that it was the Maastricht Treaty that introduced the new provisions on Union citizenship into the EC Treaty.

The later treaty reforms agreed in Amsterdam in 1997 and in Nice in 2001 in no way changed the organisational structure set out in Maastricht and merely followed on from the 1992 reform by making a few formal editorial changes (e.g. following the Amsterdam Treaty, the EU Treaty articles are set out in numbers rather than letters) and substantial changes (e.g. the Amsterdam Treaty provided for new social powers, especially in the field of employment policy, while the Treaty of Nice adjusted the composition and functioning of the institutions to enable the Union to enlarge towards the east). Yet it is worth underlining two factors that more directly affected the structure set up in Maastricht: the communitarisation of visa, asylum and immigration policy following the Amsterdam reform henceforth the third pillar became police and judicial cooperation in criminal matters (PJCC) , and the dissolution of the ECSC on 23 July 2002 following the expiry, 50 years after it entered into force, of the treaty establishing it. After that date, the two surviving Communities, the EC and the EAEC, remained as they were within the framework of the European Union.

That complex structure, based on the Maastricht Treaty and often described as incomprehensible, required in-depth reform. With the approach of enlargement of the European Union to 25 Member States in May 2004, that major reform was regarded as urgent.

Signed in Rome on 29 October 2004, the Treaty establishing a Constitution for Europe defined a new architecture for the European Union that was simpler and more transparent. The Constitutional Treaty provided for the repeal of all earlier treaties except for the EAEC Treaty. On the date of its entry into force, it was to repeal the EC Treaty as well as the EU Treaty. The revised European Union, finally endowed with a legal personality, was to take over from the European Union as established by the Maastricht Treaty and the European Community.

As regards the surviving Community (EAEC or Euratom), the Treaty establishing a Constitution for Europe contains a protocol on adapting the EAEC Treaty to the new rules laid down in the Constitutional Treaty, in particular in the institutional and financial fields. The provisions amending the EAEC are annexed to the Constitutional Treaty. In a declaration annexed to the Constitutional Treaty, Germany, Ireland, Hungary, Austria and Sweden noted that the core provisions of the Treaty establishing the European Atomic Energy Community have not been substantially amended since its entry into force and need to be brought up to date. These five countries therefore supported the idea of convening an intergovernmental conference as soon as possible. The links between the EAEC and the revised European Union, as distinct organisations established by two different treaties, have not been fully defined yet. In the future, therefore, the European Union will no doubt assimilate the powers of the EAEC in the nuclear field.

The framing of the Treaty establishing a Constitution for Europe

In order to facilitate the reform of the Communities and the European Union (EU), four Treaties were drawn up one after the other from 1986 to 2001, yet they did not succeed in resolving all the questions on the agendas of various intergovernmental conferences (IGCs). The difficulty of the negotiations on finalising each Treaty and the tendency to defer the resolution of certain points to a future text, moreover, showed that the traditional approach of an intergovernmental conference to revise treaties had been exhausted. In addition, the need to take up the challenge of the greatest ever enlargement of the EU and that of making the structure and activities of the EU more democratic and transparent called for a reform of the Union in depth. A number of interested parties then moved to propose the adoption of a new approach to overcoming the obstacles which had rendered the negotiations on previous treaties so difficult and unproductive.

Thus a forum, known as the European Convention, was convened following the European Council Presidency Conclusions at Laeken on 14 and 15 December 2001. Under the chairmanship of Valry Giscard dEstaing and consisting of representatives from 28 countries (15 Member States, 12 candidate countries and one applicant country for membership of the Union) and representatives of the Commission and the European Parliament, it was charged with presenting proposals to the European Council on the necessary reforms and with preparing the work of the future IGC. The solution of a Convention had proved very effective for the drafting of the Charter of Fundamental Rights of the European Union, signed in Nice on 7 December 2001. Indeed, the Convention replaced the meetings behind closed doors of government officials by a forum meeting in public and consisting of all parties having a political interest in the process.

The European Convention drew up a draft Treaty establishing a Constitution for Europe, which was adopted by consensus on 13 June and 10 July 2003, and presented it to the President of the European Council. On 4 October 2003, an IGC met in Rome in order to negotiate the text of the new Treaty. However, it only introduced a limited number of amendments to the draft which had emerged from the Convention. The Brussels European Council, held on 17 and 18 June 2004, settled the remaining points in dispute and reached agreement on the Treaty establishing a Constitution for Europe. The Constitutional Treaty (popularly known as the European Constitution) was signed in Rome on 29 October 2004. It will come into force on 1 November 2006, if all the Member States ratify it, and will supersede the Treaty establishing the European Community, the Treaty on European Union and the Acts and Treaties supplementing or amending them (including the various Accession Treaties). The Treaty establishing the European Atomic Energy Community will not be repealed but will remain in force as amended by Protocol No 36 annexed to the Constitutional Treaty.

European Union Member States and applicant countries

The European Union has had 25 Member States since 1 May 2004.

The founding States were the six western European countries which, in the post-war years, signed and ratified the Treaty establishing the European Coal and Steel Community (ECSC) of 18 April 1951 and, six years later, the Treaty establishing the European Economic Community (EEC) and the Treaty establishing the European Atomic Energy Community (EAEC or Euratom) of 25 March 1957: Belgium, Germany, France, Italy, Luxembourg and the Netherlands.

Before the European Union was established in 1993 the European Communities were enlarged three times:

the United Kingdom, Ireland and Denmark joined on 1 January 1973. This was the first wave of Anglo-Scandinavian countries, two of which (Denmark and the United Kingdom) came from the European Free Trade Association (EFTA). Norway, another EFTA country which should have been part of the same group, rejected accession in a referendum in September 1972. The European Communities then had nine members.

The fall of the military dictatorships in Greece, Spain and Portugal then enabled the Communities to be enlarged to the south:

Greece, linked to the Communities through an association agreement since 1962, joined on 1 January 1981 as the tenth Member State.

The accession of Spain and Portugal on 1 January 1986 then brought the number of Member States to 12.

After the Treaty on European Union, signed in Maastricht on 7 February 1992, came into force on 1 November 1993, the European Union (which incorporated the Communities but did not replace them) was enlarged twice:

On 1 January 1995, the number of Member States rose to 15 with the entry of Austria, Finland and Sweden. This was the second wave of countries from EFTA. Norway, which was attempting to join for the second time, again rejected accession in a referendum in November 1994.

The Union of 25 was born on 1 May 2004 with the accession of the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovenia and Slovakia. As well as being a second enlargement south to the Mediterranean (Malta and Cyprus, associated States since 1971 and 1973 respectively), this was the first enlargement to include Central and Eastern European countries (CCEE) from the former Soviet bloc. The European continent was symbolically unified after almost 60 years of east/west divide. The entry of the two other CCEE countries, Bulgaria and Romania, which have negotiated accession alongside each other and signed the accession treaty on 25 April 2005, is scheduled for 2007.

The applicant countries

Turkey, linked to the Community through an association agreement since 1964 (the Ankara Agreement), which provided for a customs union that has been in operation since 1996, applied for accession in April 1987. At the Helsinki European Council on 10 and 11 December 1999 it was accorded the status of a candidate State destined to join the Union. On 16 and 17 December 2004, on the basis of a report and recommendation from the Commission, the Brussels European Council decided that Turkey fulfilled the Copenhagen political criteria sufficiently to open accession negotiations, on condition that it brought into force six specific items of legislation identified by the Commission, and in particular the aspects relating to fundamental freedoms and full respect for human rights. The European Council asked the Council to agree on a framework for negotiations with Turkey with a view to opening negotiations on 3 October 2005.

Following the Santa Maria da Feira European Council on 19 and 20 June 2000, which considered that the Western Balkan countries (Albania, Bosnia and Herzegovina, Croatia, the Former Yugoslav Republic of Macedonia and Serbia and Montenegro) were potential accession candidates, Croatia applied for accession in February 2003 and was granted official applicant country status at the European Council on 16 and 17 June 2004. It was linked to the European Union through a Stabilisation and Association Agreement (SAA) from February 2005. The European Council of 16 and 17 December 2004 asked the Council to agree on a framework for negotiations with Croatia with a view to opening negotiations on 17 March 2005, provided that Croatia cooperated fully with the International Criminal Tribunal for the Former Yugoslavia (ICTY). On 16 March 2005 the General Affairs and External Relations Council postponed the opening of accession negotiations in the absence of a common agreement. On 3 October 2005, on the basis of a positive assessment of Croatias cooperation with the ICTY, the Council gave the go-ahead for negotiations to start on Croatias accession to the European Union, and at the same time approved the framework for negotiations with Turkey.

The Former Yugoslav Republic of Macedonia applied for accession on 22 March 2004 and was granted official applicant country status at the European Council on 15 and 16 December 2005. It has been linked to the European Union by an SAA since April 2004.

The single institutional framework

Consisting of three international integration organisations the European Communities (ECSC, EEC becoming EC after 1993 and EAEC or Euratom) and two areas of intergovernmental cooperation, the European Union came into existence in 1993 as a complex political structure. Despite the heterogeneity of its fields of activity and the diversity of its decision-making procedures, the Union has a single institutional framework whose task is to manage all of its policies consistently.

The Unions institutions are first and foremost institutions of the Communities. Depending on the field of activity concerned Community or intergovernmental the same institutions have different functions and act in accordance with different decision-making procedures.

In order to convey an understanding of the institutional architecture of the European Union in a visual way, the organisation is commonly represented as a temple with three pillars.

The first pillar, that of the European Communities (of which there are now two, since the winding-up of the ECSC in 2002), is the main support for the structure. It is governed by the Community method, based on a balance between the three main institutions (Commission, Council, Parliament) and decisions taken by qualified majority in the Council.

The second and third pillars, which are, respectively, that of the common foreign and security policy (CFSP) and that of justice and home affairs (JHA) now police and judicial cooperation on criminal matters (PJCC) after the reform brought about by the Amsterdam Treaty are the other supports. They are governed by the intergovernmental cooperation method, based on decisions taken unanimously in the Council with contributory involvement of the other institutions.

Crowning the whole structure, the single institutional framework forms the pediment, showing that all the institutions are involved to different degrees in the functions of each pillar.

European Parliament

The European Parliament represents the peoples of the States which together form the European Community. Created in 1951 by the Treaty establishing the European Coal and Steel Community (ECSC) and known as the Common Assembly, Parliament was set up purely as a consultative assembly.

There is no reference to an Assembly as part of the ECSC in the Declaration of 9 May 1950 presented by the French Foreign Minister, Robert Schuman. The concept was put forward by Jean Monnet on the second day of the treaty negotiations. The principle of an Assembly was rapidly adopted for two reasons:

the Assembly constituted a counterweight to the High Authority;

the Assembly had the power to monitor the High Authority.

The institution of the Common Assembly thus provided the democratic legitimacy required by the Community. Although its powers were limited, it was a Parliamentary Assembly and thus both representative and sovereign. After signing the Treaty instituting a European Defence Community (EDC) on 26 May 1952, the Foreign Ministers of the Six asked the Common Assembly, as early as September 1952, to draw up a draft Treaty establishing a European Political Community. The ECSC Assembly therefore became a constituent assembly referred to as the Ad Hoc Assembly.

After the establishment of the European Economic Community (EEC) and of the European Atomic Energy Community (EAEC or Euratom) in 1957, it was agreed that a single assembly, composed and appointed in accordance with the same principles, would have the powers and responsibilities that the EEC and the EAEC Treaties assigned to the Assembly. The single Assembly would also replace the Common Assembly of the ECSC and enjoy the same powers and responsibilities (Articles 1 and 2 of the Convention on certain institutions common to the European Communities).

The single Assembly convened for the first time from 19 to 21 March 1958. Right from its very first session it adopted the name European Parliamentary Assembly. A few years later, on 30 March 1962, it became known as the European Parliament. That designation was made official by the Single European Act of 1986.

Elected by direct universal suffrage since 1979, the European Parliament has seen its powers increase as European integration has proceeded and, more recently, with the entry into force of the 2001 Treaty of Nice.

Composition

Establishing the composition of the Common Assembly was no easy task. To determine the total number of Members and the numbers from each Member State, the authors of the Treaty establishing the European Coal and Steel Community (ECSC) referred to the only model for a European Assembly in existence at that time: the Assembly of the Council of Europe.

The small Benelux countries, major producers of coal and steel, were afraid of being underrepresented. As a result, the number of Members representing them was increased. France, Germany and Italy had eighteen Members, Belgium and the Netherlands had ten Members, and Luxembourg had four.

The Common Assembly was thus initially made up of seventy-eight Members. The ECSC Treaty (Article 20) uses the term representatives of the peoples, an expression clearly demonstrating the authors desire to differentiate between the Common Assembly and an ordinary assembly organised along conventional lines at international level and made up of national government representatives. The Common Assembly was the first international assembly of a parliamentary nature: under the terms of Article 21 of the ECSC Treaty, it was made up of delegates whom the parliaments of each of the member States shall be called upon to designate once a year from among their own membership, or who shall be elected by direct universal suffrage, according to the procedure determined by each respective High Contracting Party.

The composition of the Common Assembly, as well as its operation, were radically changed with the establishment of the Ad Hoc Assembly in 1952. This Assembly was charged with drawing up a draft Treaty establishing the European Political Community, (EPC). For this occasion nine more representatives (three French, three German and three Italian) were co-opted by the Members of the ECSC Assembly. After the failure of the European Political Community the scheme was rejected by the Foreign Ministers of the Six in November 1953 and of the European Defence Community (EDC) the Treaty was rejected by the French National Assembly on 28 August 1954 the Common Assembly resumed its normal work until 1958.

It was at this time that the Treaties establishing the European Economic Community (EEC) and the European Atomic Energy Community (EAEC or Euratom) came into force. A single assembly, the European Parliamentary Assembly, was set up to avoid increasing the number of assemblies. It constituted both the Assembly of the two new Communities and the continuation of the ECSC Common Assembly. Its activities extended to new areas and its membership was increased to 142.

The number of Members of the European Parliament has been changed with each successive enlargement of the European Communities. On 1 January 1973, with the first enlargement (Denmark, Ireland and the United Kingdom), the number increased to 198. The second enlargement (Greece), on 1 January 1981, added a further 24 new Members, and on 1 January 1986 the number increased to 518 with the addition of 60 Spanish and 24 Portuguese Members (third enlargement). Since 1 January 1995, following the accession of Austria, Finland and Sweden, Parliament has consisted of 626 Members.

The maximum number of representatives (700) allowed for by the 1997 Treaty of Amsterdam in view of the enlargement of the European Union has been increased by the Treaty of Nice of 26 February 2001. The total number of representatives in the European Parliament shall not exceed 732 (Articles 189 of the Treaty establishing the European Economic Community and Article 107 of the Treaty establishing the European Atomic Energy Community).

The Treaty of Nice therefore brought about a new distribution of seats in the European Parliament with the prospect of a Union made up of 27 Member States; this became applicable on 1 January 2004, with effect from the beginning of the 2004 to 2009 term (Article 2 of the Protocol on the enlargement of the European Union). The number of seats held by representatives of the Member States that had belonged to the Europe of 15 fell from 626 to 535: to this figure the number of seats held by representatives from the 12 candidate countries should be added. The protocol provides for the application of a pro rata correction to the number of representatives to be elected in each Member State if, on this date, the Member States are fewer than 27, without such a correction leading to the number of representatives being higher than that provided for in the 1999 to 2004 term.

Since only ten new States signed the Treaty of Accession in Athens on 16 April 2003, the 50 seats allotted for Romania and Bulgaria have been distributed among the 25 so that the total number of representatives is 732 Members (Article 11 of the Act of Accession).

The number of members of the European Parliament may temporarily exceed 732 in order to take account of the representatives of the new Member States resulting from the accession treaties after the 2004 European elections.

The election of the Members of the European Parliament

The founding Treaties had provided for the possibility of election by direct universal suffrage [Article 138 of the Treaty establishing the European Economic Community (EEC), Article 21 of the Treaty establishing the European Coal and Steel Community (ECSC) and Article 108 of the Treaty establishing the European Atomic Energy Community (EAEC)]. On 17 May 1960, the European Parliamentary Assembly approved a resolution for the adoption of a draft agreement on the election of the Assembly by direct universal suffrage. The draft was forwarded to the Councils of the European Communities, but no further action was taken. Accordingly, pending a Council decision authorising direct elections, Members of the European Parliament were designated by the national parliaments, in accordance with the procedure laid down by each Member State.

Further to the agreement reached at the 1974 Paris Summit, and on the basis of a new draft agreement forwarded to it by the European Parliament, on 20 September 1976 the Council adopted the decision relating to the Act concerning the election of the representatives of the Assembly by direct universal suffrage. The first elections took place on 7 and 10 June 1979, and 410 Members were elected. This Act led to a change in the allocation of seats in Parliament among the Member States:

Belgium 24

Denmark 16

Germany 81

France 81

Ireland 15

Italy 81

Luxembourg 6

Netherlands 25

United Kingdom 87.

The accession of Greece in 1981, and of Spain and Portugal in 1986, increased the number of seats without altering the allocation scheme: Greece was allocated 25 seats, Spain 60 and Portugal 24.

With a view to implementing the conclusions of the December 1992 Edinburgh European Council relating to the allocation of seats in the European Parliament, on 1 February 1993 the Council adopted a decision amending the 1976 Act which was then implemented during the 1994 June elections. From 1995, the number of elected representatives from each Member State (as amended by the Act of Accession of Austria, Finland and Sweden) was as follows:

Belgium 25

Denmark 16

Germany 99

Greece 25

Spain 64

France 87

Ireland 15

Italy 87

Luxembourg 6

Netherlands 31

Austria 21

Portugal 25

Finland 16

Sweden 22

United Kingdom 87.

With the prospect of European Union enlargement, a new allocation of seats was provided for by the Treaty of Nice. Pursuant to Article 190(2) of the Treaty establishing the European Community (EC) and 108(2) of the Treaty establishing the European Atomic Energy Community (EAEC), (as amended by Article 2 of the Protocol on the enlargement of the European Union), on 1 January 2004 and with effect from the start of the 2004-2009 term, the number of representatives elected in each Member State was as follows:

Belgium 22

Denmark 13

Germany 99

Greece 22

Spain 50

France 72

Ireland 12

Italy 72

Luxembourg 6

Netherlands 25

Austria 17

Portugal 22

Finland 13

Sweden 18

The United Kingdom 72.

The number of seats allocated to the Member States went from 626 to 535. Only Germany and Luxembourg kept the same number of seats. To this number was added the number of representatives of the ten new Member States resulting from the Treaty of Accession signed in Athens on 16 April 2003. In accordance with Article 11 of the Treaty of Accession, with effect from the start of the 2004-2009 term, the number of representatives elected in each Member State was as follows:

Belgium 24

The Czech Republic 24

Denmark 14

Germany 99

Estonia 6

Greece 24

Spain 54

France 78

Ireland 13

Italy 78

Cyprus 6

Latvia 9

Lithuania 13

Luxembourg 6

Hungary 24

Malta 5

Netherlands 27

Austria 18

Poland 54

Portugal 24

Slovenia 7

Slovakia 14

Finland 14

Sweden 19

The United Kingdom 78.

The number of representatives to be elected in each Member State in 2004 was therefore increased pro rata. In this way, the total number of seats reached the maximum threshold of 732 and the number of seats per Member State was no higher than that provided for in the 1999 to 2004 term.

Electoral procedures for the election of the Members of the European Parliament

For want of a uniform electoral procedure in all the Member States - as laid down in the constituent Treaties [Article 138 of the Treaty establishing the European Economic Community (EEC) and Article 108 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom); see also Article 21 of the Treaty establishing the European Coal and Steel Community (ECSC), which expired on 23 July 2002]  - elections to the European Parliament by direct universal suffrage have always been governed by the electoral legislation of each individual Member State.

Since 1999, all Member States have been using a system of proportional representation, despite the differences that exist with regard to the number of constituencies and whether or not there is a minimum threshold for the allocation of seats or a preferential vote.

The voting age is 18 in all the Member States. Citizens of the Union residing in a Member State of which they are not nationals have the right to vote and to stand as a candidate in elections to the European Parliament in the Member State in which they reside, under the same conditions as nationals of that State [Article 19 formerly Article 8(b) of the Treaty establishing the European Community (EC)]. However, the electoral systems of the Member States differ with regard to the concept of residence: some require citizens to have their domicile or customary residence on electoral territory (Finland and France), some requiring them customarily to stay there (Belgium, Germany, Greece, Italy, Luxembourg, Portugal and Spain), and others requiring them to be registered on the electoral roll (Austria, Denmark, Ireland, the Netherlands, Sweden and the United Kingdom).

There are also differences with regard to the right to vote for citizens living abroad: in the United Kingdom, this right is confined to civil servants, members of the armed forces and citizens who left the country less than five years before, provided they have submitted an Overseas Electors Declaration form; Austria, Denmark, the Netherlands and Portugal grant the right to vote only to their nationals living in another Member State; Belgium, France, Greece, Italy, Spain and Sweden grant their nationals the right to vote whatever their country of residence; Germany requires the period of residence in another country to be less than ten years; in Ireland, the right to vote is confined to EU citizens domiciled on national territory.

The conditions governing eligibility to stand for election also differ, apart from the fact that the individual must be a national of an EU Member State. The minimum age is 18 in Denmark, Finland, Germany, the Netherlands, Portugal, Spain and Sweden, 19 in Austria, 21 in Belgium, Greece, Ireland, Luxembourg and the United Kingdom, 23 in France and 25 in Italy. In Luxembourg at least ten years residence is required to entitle a Community national to stand for election to the European Parliament, and a list must comprise a majority of candidates who hold Luxembourgish nationality.

Having regard to Articles 190 of the EC Treaty (Article 108 of the EAEC Treaty and Article 21 of the ECSC Treaty), the European Parliament has drawn up a draft to facilitate election by direct universal suffrage in accordance with a uniform procedure in all the Member States or, following the changes introduced by the 1997 Treaty of Amsterdam, in accordance with the principles common to all the Member States, thus simplifying the adoption of the electoral procedure.

In order to facilitate election by direct universal suffrage in accordance with the principles common to all the Member States, Council Decision of 25 June 2002 and of 23 September 2002 (2002/772/EC, Euratom) amended the Act of 20 September 1976, whilst leaving Member States free to apply their national provisions where the aspects are not governed the Act, without, on the whole, threatening the proportional character of the voting system.

These common principles may be summarised as follows:

vote by a system of proportional representation, whether by list or by single transferable vote,

direct universal suffrage, free and secret,

possibility for a minimal threshold for distributing seats to be set which, at the national level, may not exceed 5 % of the votes cast.

The Council recommended adoption of the provisions of Decision 2002/772/EC, Euratom by the Member States, in accordance with their respective constitutional requirements.

The length of the term of office of Members

In the Treaty establishing the European Coal and Steel Community (ECSC), Members of the Common Assembly were designated annually by the national parliaments (Article 21). The Treaties of Rome establishing the European Economic Community (EEC) and the European Atomic Energy Community (EAEC or Euratom) did not set a limit on the length of the term of office of Assembly Members. The national parliaments were therefore free to fix the length of the term of office.

In principle, representatives remained in office until the expiry of the mandate given to them by the Member State they represented. The mandate lapsed on death or resignation or when Members were not re-elected to their national parliaments.

The problems created by the existence of terms of office of different lengths were resolved once the Assembly was elected by universal suffrage. The Act of 20 September 1976 concerning election by direct universal suffrage laid down that the term of office of Members of the European Parliament should be five years. Article 190(3) of the Treaty establishing the European Community (EC) and Article 108(3) of the Treaty establishing the European Atomic Energy Community (EAEC), inserted under the 1997 Treaty of Amsterdam, take their wording from the Act: Representatives shall be elected for a term of five years.

The term of office begins and expires as laid down in the Act, i.e., at the same time as the five-year period beginning at the opening of the first session following each election. This period can be extended or reduced by a Council decision. The term of office still ends on death or resignation or on expiry of his term of office. Provisions for the vacant seat are made for the rest of the five-year period, according to the procedure set up by each Member State.

Members remain in office until the opening of the first sitting of the European Parliament following the elections.

Organisation and operation of the European Parliament

The organisation and the operation of the European Parliament are governed by the founding Treaties, by its Rules of Procedure and by the Act of 20 September 1976 concerning the election of representatives of the European Parliament by direct universal suffrage.

Organisation

The governing bodies of the Common Assembly

Article 23 of the Treaty establishing the European Coal and Steel Community (ECSC) of 18 April 1951 laid down that the Assembly was to elect its President and its officers from among its Members.

The Bureau of the Common Assembly consisted of a President and five Vice Presidents who were elected by secret ballot at the opening of each ordinary session.

The Rules of Procedure of the Assembly also provided for a Committee of Presidents consisting of the President of the Assembly Chairman of the Committee the Vice Presidents and the chairmen of the general committees. It was convened in order to review the order of business set by the President and to draw up a draft agenda for sessions.

The governing bodies of the European Parliamentary Assembly

In its Rules of Procedure, the European Parliamentary Assembly, founded when the Rome Treaties came into force on 25 March 1957, laid down provisions governing the Bureau responsible for supervising its activities. It consisted of a President and eight Vice Presidents.

The Bureau had two major functions:

(a) It acted as the supreme administrative body. It appointed the Secretary General, determined the composition and organisation of the Secretariat, the number of civil servants, and internal financial regulations.

(b) It played a role in the setting up of committees.

The Rules of Procedure assigned a very important administrative, procedural and disciplinary role to the President of the Assembly.

The President was assisted in preparing the session agendas by a Committee of Presidents. It consisted of the President of the Assembly, who chaired the Committee, the Vice Presidents, the committee chairmen and the political group chairmen.

The Assembly was assisted by a Secretary General who was appointed by the Bureau. He was solely responsible for the smooth running of the administrative services and for the management of the Secretariat, the composition and organisation of which were determined by the Bureau.

The governing bodies of the European Parliament

In terms of its organisational structure, the European Parliament is the descendant of the European Parliamentary Assembly, albeit with several changes made to cope with the main changes in the development of the Community. According to the Rules of Procedure, Parliaments governing bodies are as follows:

the Bureau,

the Conference of Presidents,

the Conference of Committee Chairmen,

the Conference of Delegation Chairmen.

(a) The Bureau.

The Bureau consists of the President and the 14 Vice Presidents of Parliament. The Quaestors are members in an advisory capacity. The main duties of the Bureau are:

to take financial, organisational and administrative decisions on matters concerning Members and the internal organisation of Parliament, its Secretariat and its bodies, as well as on matters relating to the conduct of sittings,

to decide the establishment plan of the Secretariat General and lay down regulations relating to the administrative and financial situation of officials and other servants,

to draw up Parliaments preliminary draft estimates,

to appoint the Secretary General.

The President directs all the activities of Parliament and its bodies. He/she presides over the proceedings of Parliament and ensures that they are properly conducted. The duties of the President are to open, suspend and close sittings, to ensure observance of the Rules of Procedure, maintain order, call upon speakers, close debates, put matters to the vote and announce the results of votes. The President represents the institution in international relations, on ceremonial occasions and in administrative, legal or financial matters. Should the President be absent, unable to discharge his/her duties, or should he/she wish to take part in a debate, he/she is replaced by one of the Vice Presidents.

The Quaestors are responsible for administrative and financial matters concerning Members, pursuant to guidelines laid down by the Bureau.

Elected by Parliament, the term of office of the President, Vice Presidents and Quaestors is two and a half years.

(b) The Conference of Presidents.

The Conference of Presidents consists of the President of Parliament and the chairmen of the political groups. Non attached Members delegate two of their number to attend meetings, but they do not have the right to vote.

The Conference of Presidents is the body responsible in particular for organising parliamentary activities, for matters dealing with relations with other European Union bodies and institutions, with the national parliaments of Member States and with non member countries and with non Union organisations. It is also responsible for drawing up the draft agenda for Parliaments part sessions.

(c) Conference of Committee Chairmen.

The Conference of Committee Chairmen consists of the chairmen of all standing or temporary committees.

(d) Conference of Delegation Chairmen.

The Conference of Delegation Chairmen consists of the chairmen of all standing interparliamentary delegations.

The Parliamentary Committees

Parliament sets up standing committees, whose powers are defined in an annex to the Rules of Procedure (Annex VI). Their members are elected during the first part session following the re election of Parliament and again two and a half years thereafter.

Parliament may set up temporary committees, whose powers are defined at the same time as the decision to set them up is taken. It may also set up temporary committees of inquiry to investigate alleged contraventions of Community law or alleged maladministration in its application.

In addition, any standing or temporary committee may appoint one or more subcommittees to assist it in its work and subject to prior authorisation from the Conference of Presidents.

Interparliamentary delegations

Parliament sets up standing interparliamentary delegations. The number of members varies according to their duties. They are elected during the first part session following the re election of Parliament and again two and a half years thereafter. Parliament determines the general powers of the individual delegations.

The European Parliament may set up joint parliamentary committees with the parliaments of States associated with the Community or States with which accession negotiations have begun. The powers and responsibilities of the various committees are defined by the European Parliament and by the agreements with the third countries.

Political groups

Members may form themselves into groups according to their political allegiance.

The Treaty establishing the European Coal and Steel Community (ECSC) did not make provisions for political groups. The Common Assembly was made up of national delegations. However, Members very soon began grouping themselves according to their political allegiance, and on 16 June 1953 the Assembly decided to add a new article to the Rules of Procedure allowing for the formation of groups. The minimum number of Members required to form a political group was nine.

In 1953, three political groups were formed: Christian Democrats, Liberals and their allies, and Socialists. These three groups and a few Non-attached Members were represented in the European Parliamentary Assembly from 1958.

The names and number of political groups have gradually changed over the years with the introduction of new political tendencies and the accession of new Member States to the European Communities.

The number of political groups represented in the 2004 elected European Parliament is seven. In Parliaments Rules of Procedure, in force on 20 July 2004, the minimum number of Members required to form a political group is 19 Members. All political groups must include Members from more than one Member State.

Members who do not belong to a political group (Non-attached Members) are provided with a secretariat. The Bureau determines their status and parliamentary rights.

Political groups play a role in putting forward candidates for the post of President of the European Parliament and for the posts of Vice-Presidents and Quaestors, in determining the composition of committees and delegations, in appointing rapporteurs and in organising parliamentary activities in general.

Article 191 of the Treaty establishing the European Community (EC) recognises the importance of political parties at European level as a factor for integration within the Union and emphasises their contribution to the forming of a European awareness and to the expression of the political will of EU citizens. Their statute is laid down by the Council, acting in accordance with codecision procedure.

Operation

Operation of the Common Assembly

The Treaty establishing the European Coal and Steel Community (ECSC) made provision for the Common Assembly to hold an annual session, without requiring to be convened, on the second Tuesday in May, which might not be extended beyond the end of the current financial year (i.e. 30 June). It also provides for the convening of extraordinary sessions, either at the request of the Council, in order to deliver an opinion on such questions as might be put to it by the Council, or at the request of a majority of its Members or of the High Authority (Article 22).

In practice, the annual session gradually split into two parts, one part in May, the other in June. The High Authority considered that the Common Assembly should meet at least every six months. The Common Assembly therefore increased the number of sessions once again. It eventually held three or even four sessions per year: in November, February, May-June and October.

Operation of the European Parliamentary Assembly

That system was altered by the implementation of the 1957 Treaties of Rome and the establishment of a single assembly, the European Parliamentary Assembly, for the three Communities. Article 130 of the Treaty establishing the European Economic Community (EEC) and Article 109 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom) made provision for the Assembly to hold an annual session, without requiring to be convened, on the third Tuesday in October. It could also convene extraordinary sessions at the request of a majority of its Members and at the request of the Council or the Commission.

To resolve the problems of overlap created by the differences in the length of ordinary sessions, the Assembly held a single annual session, effectively subdivided into several part-sessions. It met, without having to be convened, on the dates specified by the Treaties, and it decided on the length of adjournments of the session. The number of part-sessions was not laid down.

After the entry into force of the Merger Treaty of 8 April 1965, the beginning of the annual session was brought forward to the second Tuesday in March (Article 27).

Operation of the European Parliament

The election of the European Parliament by direct universal suffrage, provided for by the Act of 20 September 1976, introduced a five-year legislative period coinciding with the term of office of Members.

As before, the European Parliament holds an annual session, without requiring to be convened, and now meets on the second Tuesday in March. It may convene extraordinary sessions at the request of a majority of its Members and at the request of the Council or the Commission.

The European Parliament meets during part-sessions for one week per month, with the exception of August. Each part-session is broken down into sittings.

Part-sessions were held in Strasbourg and Luxembourg from 1979 until 1981. Since then, Strasbourg has been the venue for the twelve part-sessions, with the exception of one extraordinary part-session held in Brussels (April 1983) and one part-session held in Luxembourg (July 1985). Additional part-sessions (mini-part-sessions) are held in Brussels.

The parliamentary committees generally meet in Brussels for two weeks per month.

The order of business of the European Parliament is determined by its Rules of Procedure. The draft agenda is drawn up by the Conference of Presidents on the basis of recommendations by the Conference of Committee Chairmen and of the agreed annual legislative programme. At the beginning of every part-session, Parliament adopts the final draft agenda. Changes to the draft agenda may be proposed by a committee, a political group or at least thirty-two Members. Once the agenda has been adopted, it may be altered only if there is a request for urgent debate, if the inadmissibility of a matter is put to vote, if a report is referred back to committee, if the debate is closed, or on a proposal from the President.

Parliamentary debates are open to the public. The committees likewise normally meet in public. In keeping with Article 1 of the Treaty on European Union, the European Parliament ensures the utmost transparency of its activities through respect for the principle of openness, and decisions are taken as closely as possible to the citizen.

Save where provided otherwise, the European Parliament acts by an absolute majority of votes cast. A quorum exists when one-third of the Members of Parliament are present in the Chamber. All votes are valid whatever the number of voters unless the President, in response to a request made before voting has begun by at least thirty-two Members, establishes that a quorum is not present. The right to vote is personal; Members cast their votes individually and in person. Parliament usually votes by show of hands; alternatively, a vote may be taken using the electronic voting system, by sitting and standing, by roll call or by secret ballot.

Power to legislate of the European Parliament

While the 1951 Treaty establishing the European Coal and Steel Community (ECSC) did not assign the Assembly any legislative power, the 1957 Treaties of Rome gave the Assembly a role in the legislative process of the Communities, and in a great many cases it had to be consulted prior to the adoption of any Council or Commission decision.

This consultative role evolved with the development of the Assembly. Over the years, the Assembly acquired more and more powers until it obtained the power of codecision, thus putting it on an equal footing with the Council.

The European Parliament participates in the legislative process on a number of levels, depending on the procedure determined by the drafting of Community acts:

consultation

conciliation

assent

cooperation

codecision.

Consultation

The consultation procedure applies in cases where no other procedure is specified. The Council takes a decision on the basis of a Commission proposal and after securing the opinion of the European Parliament. The Commission and the Council consider the amendments put forward by Parliament and generally deliver an informal opinion substantiating their decision to accept or reject an amendment. The consultation procedure can be either compulsory or optional.

Conciliation

The conciliation procedure between the European Parliament and the Council, with the active assistance of the Commission, was established by the Joint Declaration of 4 March 1975. It may be followed for Community acts of general application which have appreciable financial implications, and of which the adoption is not required by virtue of acts already in existence.

When submitting its proposal, the Commission indicates whether the act in question is, in its opinion, capable of being the subject of the conciliation procedure. Both the European Parliament, when delivering its opinion, and the Council may request that this procedure be initiated in the event that the Council intends to depart from Parliaments opinion.

The aim of the conciliation procedure is to achieve agreement between the European Parliament and the Council. It takes place in a Conciliation Committee consisting of representatives of the two institutions. The Commission participates in the work of the Conciliation Committee.

When the positions of the two institutions are sufficiently close, Parliament may deliver a fresh opinion, and the Council will then take a final decision.

Assent

The Council acts on a Commission proposal and after securing the assent of the European Parliament. Assent is required in order to:

confer specific tasks upon the European Central Bank (Article 105(6) of the EC Treaty),

amend certain articles of the Statute of the European System of Central Banks (Article 107(5) of the EC Treaty),

define the tasks, objectives and organisation of the Structural Funds (Article 161 of the EC Treaty),

define a uniform electoral procedure for the European Parliament (Article 190 of the EC Treaty),

conclude association agreements based on Article 310 of the Treaty establishing the European Community (EC), agreements establishing a specific institutional framework by organising cooperation procedures, agreements having important budgetary implications for the Community and agreements entailing amendment of an act adopted under the codecision procedure (Article 300 of the EC Treaty),

determine the existence of a serious and persistent breach by a Member State of the principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law (Article 7 of the EU Treaty),

decide on the accession of new Member States (Article 49 of the EU Treaty).

Cooperation

The cooperation procedure (Article 252 of the EC Treaty) was introduced by the 1986 Single European Act to deal with certain areas, such as measures relating to the establishment and functioning of the common market. Following the implementation of the 1992 EU Treaty, it is applicable in all cases where the Council is obliged to act by a qualified majority.

At first reading, Parliament draws up an opinion on a Commission proposal. The Council, acting by a qualified majority, adopts a common position which is forwarded to Parliament. Within three months, Parliament may approve, reject, or amend the Councils common position. In the latter two cases, Parliaments decision must be adopted by an absolute majority of its Members. If Parliament rejects the common position, at second reading the Council may only act unanimously.

In the case of a parliamentary amendment, the Commission has one month in which to review its proposal. It then forwards to the Council, with its amended proposal, the amendments tabled by Parliament which it has not accepted and expresses its opinion thereon. Within three months, which may be extended by a maximum of one month, the Council may adopt the amended proposal by qualified majority, it may amend it unanimously or adopt the amendments tabled by Parliament but not accepted by the Commission, likewise by unanimity. If no decision is taken within this period, the Commission proposal is deemed not to have been adopted.

Following revision introduced by the 1997 Treaty of Amsterdam, the cooperation procedure was cancelled and replaced in all areas of application by codecision, except economic policy (Article 99, Article 102 and Article 103 of the EC Treaty) and monetary policy (Article 106 of the EC Treaty).

Codecision

The codecision procedure (Article 251 of the EC Treaty) was introduced by the 1992 EU Treaty with a view to increasing the role played by Parliament in the legislative process. There are certain differences between the codecision and cooperation procedures, in particular:

the possibility of adopting an act at first reading if Parliament proposes no amendments or if the Council approves all the amendments proposed by Parliament,

the introduction of a conciliation phase between representatives of the Council and Parliament in cases where the Council does not approve all the amendments at second reading.

The codecision procedure was significantly simplified by the 1997 Treaty of Amsterdam. Its scope was extended to new areas by this Treaty and, most recently, by the 2001 Treaty of Nice.

Power of the purse of the European Parliament

The procedure for the adoption of the European Communities budget has developed over a long period of time and has seen the European Parliament become firmly established as one arm of budgetary authority along with the Council. The current procedure is the result of Parliaments sustained effort in securing for itself the basic powers of a parliament in budgetary matters.

In the 1951 Treaty establishing the European Coal and Steel Treaty (ECSC) expired on 23 July 2002, the Common Assembly had only very limited powers in budgetary matters (Article 78). It examined the estimated budget for administrative expenditure drawn up by each institution included in the General Report of the High Authority but could not discuss it. It could neither reject nor amend it.

In 1958, following the entry into force of the 1957 Treaties establishing the European Economic Community (EEC) and the European Atomic Energy Community (EAEC or Euratom), the European Parliamentary Assembly was given more powers, and it participated in the drawing up of the budget. The draft budget was forwarded to it, and it had the right to propose modifications to the Council (Article 203 of the EEC Treaty and Article 177 of the EAEC Treaty). As in the ECSC, the Assembly examined the accounts (Article 206 of the EEC Treaty and Article 180 of the EAEC Treaty), but the new Treaties also made provision for the Assembly to be notified of a recommendation from the Council giving discharge to the Commission in respect of the implementation of the budget.

The Council Decision of 21 April 1970, which replaced Member States financial contributions with the Communities own resources, allowed the governments of the Member States to confer on the European Parliament real powers in budgetary matters. The Treaty of 22 April 1970 gave the Assembly the right to take a formal decision on the budget of the Communities, even though its decision-making powers were restricted to non-compulsory expenditure.

A new Treaty relating to the strengthening of Parliaments budgetary powers was signed by representatives of the Member State governments on 22 July 1975. The reform focused on three points of the procedure:

modifications to the draft budget forwarded by Parliament to the Council (modification not involving an increase in the total expenditure of an institution) would be deemed to have been approved where they had not been rejected by the Council;

the right of Parliament to reject the budget as a whole;

the right of Parliament alone to give discharge to the Commission in respect of the implementation of the budget.

After the 1970 reform, close collaboration became necessary between Parliament and the Council on the budgetary procedure. In view of the fact that Parliament had greater powers for the implementation of a system using the Communities own resources, a conciliation procedure was instituted on 4 March 1975 by a Joint Declaration of Parliament, the Council and the Commission. Conciliation between the European Parliament and the Council, with the active assistance of the Commission, was be applied to Community acts of general application which had appreciable financial implications and in respect of which adoption was not required under acts already in existence.

The procedure remained the same after the reform of the Treaty of 22 July 1975 until the Joint Declaration of the European Parliament, the Council and the Commission for improved interinstitutional collaboration of 30 June 1982. Later agreements were reached on 29 June 1988, 29 October 1993 and 6 May 1999. The aim of these agreements was to implement budgetary discipline and improve the functioning of the annual budgetary procedure and interinstitutional cooperation in budgetary matters.

The budgetary procedure is laid down in Article 272 of the EC Treaty, Article 177 of the EAEC Treaty (and Article 78 of the ECSC  Treaty expired on 23 July 2002). The European Parliament must be forwarded the draft budget administrative budget for the ECSC drawn up by the Council (based on the preliminary draft budget drawn up by the Commission) no later than 5 October in the year preceding the year in which the budget is to be implemented. Parliament has the right to make amendments (with regard to non-compulsory expenditure) and to propose modifications (with regard to compulsory expenditure). If, within 45 days of the draft budget being placed before it, the European Parliament has given its approval, the budget is deemed to be finally adopted. However, if it has adopted amendments or proposed modifications, the draft budget is forwarded to the Council.

If, within 15 days, the Council has not modified any of the amendments, and if the modifications proposed have been accepted, the budget is deemed to be finally adopted and the European Parliament informed thereof. If the Council has modified the amendments or if the modifications proposed have been rejected or modified, the modified draft budget is forwarded to the European Parliament. Within 15 days, Parliament may amend or reject the modifications made by the Council and adopt the budget accordingly. The President of the European Parliament declares that the budget has been finally adopted. However, the European Parliament may, if there are important reasons, reject the draft budget and ask for a new draft to be submitted to it.

In addition, the European Parliament gives discharge to the Commission in respect of the implementation of the budget. To that end, the Council and the European Parliament in turn examine the accounts and the financial statement submitted by the Commission, as well as the annual report, the Statement of Assurance and special reports by the Court of Auditors. Parliament may ask to hear the Commission (Article 276 of the EC Treaty, Article 180b of the EAEC Treaty; see also Article 78g of the ECSC Treaty).

The power to monitor the executive

The power to monitor the executive was the only power conferred on the Common Assembly by the 1951 Treaty establishing the European Coal and Steel Community (ECSC) (Article 20) which expired on 23 July 2002. The main purpose of the Assembly was to exercise democratic supervision over the High Authority.

The 1957 Treaties establishing the European Economic Community (EEC) and the European Atomic Energy Community (EAEC or Euratom) extended parliamentary supervision, which was exercised principally in two ways:

discussion of the Annual General Report on Community Activities, submitted by the Commission,

the possibility of passing a vote of censure forcing Members of the Commission to resign as a body. The motion might be tabled, not only with regard to the general report, as stated in the ECSC Treaty (Article 24), but at any time with regard to the management of the Commission. It would be carried by a two-thirds majority of the votes cast, representing a majority of the Members of the Assembly (Article 144 of the EEC Treaty Article 201 of the EC Treaty, following the Treaty of Amsterdam and Article 114 of the EAEC Treaty). Permanent and simultaneous supervision is involved.

Originally, this power applied solely to the activities of the Commission. With time, however, it has been extended to the Council and, in general, to all the institutions and bodies of the Community. It covers all Community activities.

In addition to the annual report and the motion of censure, the European Parliament has available other supervisory instruments provided for by the Treaties:

approval of the nomination by Member State governments of the President of the Commission and the approval of the President of the other Members of the Commission as a body (Article 214 of the EC Treaty and Article 127 of the EAEC Treaty; see also Article 10 of the ECSC Treaty),

written and oral questions tabled by the European Parliament or by its members to the Commission. The Council is also heard by the European Parliament (Article 140 of the EC Treaty and Article 110 of the EAEC Treaty; see also Article 23 of the ECSC Treaty). Accordingly, the President-in-Office of the Council presents his programme to Parliament at the beginning of a presidency and summarises its achievements at the end of the presidency. Members of the Council also attend part-sessions, and MEPs may table written and oral questions to them.

temporary committees of inquiry set up by the European Parliament to investigate alleged contraventions or maladministration in the implementation of Community law (Article 193 of the EC Treaty and Article 107(b) of the EAEC Treaty; see also Article 20(b) of the ECSC Treaty).

The right of petition

Despite the lack of any reference thereto in the founding Treaties, the submission of petitions to the Assembly and its examination thereof was provided for in the Rules of Procedure of the Common Assembly of the European Coal and Steel Community (ECSC) from 1952-1953 and in those of its successor, the European Parliamentary Assembly, from 1958 onwards.

The right to submit a petition to the European Parliament was introduced into the Treaty by the 1992 EU Treaty [Article 21 and Article 194 of the Treaty establishing the European Community (EC) and Article 107(c) of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom); see also Article 20(c) of the Treaty establishing the European Coal and Steel Community (ECSC), which expired on 23 July 2002].

Any citizen of the Union, and any natural or legal person residing or having its registered office in a Member State, has the right to submit, individually or in association with other citizens or persons, a petition to the European Parliament on a matter which falls within the Communitys spheres of activities and which affects him, her or it directly.

Petitions entered in the register are forwarded by the President of Parliament to the committee responsible, which may decide to draw up a report or take a decision in any other way that it sees fit on petitions it has declared admissible. The President informs petitioners of the decisions taken and the reasons therefor. Some petitions are announced in the House.

Appointment of the European Ombudsman

The Ombudsman is appointed by Parliament after each election for the duration of the legislative period. The mandate is renewable. He is chosen from among persons who are Union citizens, have full civil and political rights, offer every guarantee of independence and meet the conditions required for the exercise of the highest judicial office in their country or have the acknowledged competence and experience to undertake the duties of Ombudsman.

At the start of each parliamentary term, the President calls for nominations and sets a time-limit for their submission. Nominations must have the support of at least thirty-seven Members who are nationals of at least two Member States. The vote is held by secret ballot, and the result is secured by a majority of the votes cast. After two ballots and in the event of a tie, the oldest candidate prevails. The person appointed is called upon to take an oath before the Court of Justice.

The Ombudsman ceases to exercise his duties either at the end of his term of office or on his resignation or dismissal. He exercises his duties until his successor takes office, save in the case of death or dismissal. He may be dismissed by the Court of Justice at the request of Parliament (one-tenth of its Members), if he no longer fulfils the conditions required for the performance of his duties or if he is guilty of serious misconduct.

Nature of the European Ombudsmans duties

The Ombudsman performs his duties with complete independence, in the general interest of the European Communities and of the citizens of the European Union. In the performance of his duties, he neither seeks nor accepts instructions from any government or other body. During his term of office, he may not engage in any political or administrative duties or any other occupation, whether gainful or not.

Powers and responsibilities of the European Ombudsman

The Ombudsman helps to identify instances of maladministration in the activities of the Community institutions or bodies, with the exception of the Court of Justice and the Court of First Instance acting in their judicial role, and makes recommendations for redress.

The definition of maladministration was given by the Ombudsman in his 1997 Annual Report: Maladministration occurs when a public body fails to act in accordance with a rule or principle which is binding upon it.

The Ombudsman conducts inquiries, for which he finds grounds, on his own initiative or on the basis of a complaint. He refers the matter to the institution or body concerned. As far as possible, he cooperates with the institution concerned in seeking an amicable agreement likely to eliminate the instance of maladministration and to satisfy the complainant.

If the Ombudsman considers that an amicable agreement is not possible or that the search for an amicable agreement has been unsuccessful, he either closes the case with a reasoned decision, which may include a critical commentary, or draws up a report with draft recommendations.

He makes a critical commentary if he considers that it is no longer possible for the institution concerned to eliminate the instance of maladministration and if he considers that the instance of maladministration has no general implications.

He draws up a report including draft recommendations if he considers that it is possible for the institution concerned to eliminate the instance of maladministration or if he considers that the instance of maladministration has general implications.

In the second instance, the Ombudsman sends a copy of his report and draft recommendations to the institution concerned and to the citizen. Within three months, the institution or body concerned forwards a detailed opinion to him. If the Ombudsman does not consider that the detailed opinion is satisfactory, he draws up a report on the instance of maladministration which takes the form of a special report addressed to the European Parliament. The report may contain recommendations. The Ombudsman sends a copy of the report to the institution concerned and to the citizen.

At the end of each annual session, the Ombudsman submits a report to the European Parliament on his activities as a whole, particularly on the outcome of his inquiries. The annual and special reports are published in the Official Journal of the European Union.

THE COUNCIL OF THE EUROPEAN UNION

Named officially after the entry into force of the 1992 Treaty on European Union, the Council of the European Union is the institution which represents the Member States of the European Union. It provides a forum where representatives of Member State governments put forward their own national interests and seek to reach compromises. National viewpoints are aired at Council meetings, but the Council is also the institution responsible for identifying the general interests of the Community and translating them into acts. For this reason, the Council plays a very significant role in European integration.

The idea of creating a Council of Ministers did not appear until the negotiations on the Treaty establishing the European Steel and Coal Community (ECSC). Certain Member States, particularly the smaller ones, wanted to counterbalance the weight of the High Authority through an intergovernmental committee.

The principle underpinning the Council of Ministers was the result of a compromise. The issues relating solely to coal and steel fell exclusively within the remit of the High Authority. Decisions on issues relating to other areas could be taken only with the Councils agreement. In this way, the Council both scrutinised and acted as an intermediary between the common market and the national economies. The Special Council of Ministers named thus in the ECSC Treaty was the link between the supranational dimension of the ECSC and the economies of the various Member States.

In 1957, the Council of the European Economic Community (EEC) and the Council of the European Atomic Energy Community (EAEC or Euratom) were established by the Treaties of Rome. The Councils of the three Communities continued to exist as they were until the merging of the executive bodies by the Treaty which was signed on 8 April 1965 and which entered into force on 1 July 1967, establishing a Single Council and Single Commission of the European Communities. The Council of the European Communities replaced the EEC and Euratom Councils, as well as the ECSC Special Council of Ministers, but the division of powers remained intact.

The Councils position was strengthened by the 1992 Treaty on European Union. The Council of the European Union was invested with decision-making powers and also entrusted with implementing powers. It oversees the coordination of the Community activities and is responsible for intergovernmental cooperation.

Composition of the Council of the European Union

The Council consists of the representatives of the Member States.

Initially, the Special Council of Ministers of the European Coal and Steel Community (ECSC) consisted of the Foreign Ministers delegated by each Member State government. There were several reasons for this:

The pre-eminence of the Foreign Ministers resulted from their role in the negotiations on the ECSC Treaty.

Conventional diplomatic strategies were the only known mechanisms for discussing certain issues.

Given the strategic importance of coal and steel, it seemed logical for politically sensitive decisions to be taken by the Foreign Ministers.

Nevertheless, as time passed, the Ministers for Economic Affairs, Industry, Trade, and Energy replaced the Foreign Ministers, particularly when discussing technical points. The Foreign Ministers continued to debate the more political issues.

The composition of the EEC and Euratom Councils also changed according to which Ministers were appointed as representatives, following the conventions of each Government: Ministers for Foreign Affairs, Economic Affairs, Agriculture, Transport, Energy, etc.

The merging of the executive bodies in 1967 did not affect the composition of the Council. The Council of the European Communities continued to be composed of representatives from the Member States.

The provisions in the basic Treaties (Articles 146 of the EEC Treaty, Article 116 of the EAEC Treaty and Article 27 of the ECSC Treaty, which expired on 23 July 2002) was amended by the 1992 Treaty on European Union which states: The Council shall consist of a representative of each Member State at ministerial level, authorised to commit the government of that Member State. The aim of this amendment was to permit a member of a Regional Executive to attend the Council in those areas for which in National Law he was responsible. This Treaty also introduced the possibility for the Council to meet at Heads of State or Government level in order to take certain decisions. The Treaty de Nice of 26 February 2001 did not introduce any changes to Article 203 of the Treaty establishing the European Community or to Article 116 of the Treaty establishing the European Atomic Energy Community.

In practice, nothing changed. The composition of the Council varies according to the agenda for each meeting. It meets in different configurations according to the issues being discussed. On the basis of the conclusions of the June 2002 Seville European Council, the Council decided to amend the Rules of Procedure on 22 July 2002, fixing a list of its configurations in order to improve the modus operandi of the Council with the prospect of enlargement. The list is as follows:

General Affairs and External Relations,

Economic and Financial Affairs,

Justice and Home Affairs,

Employment, Social Policy, Health and Consumer Affairs,

Competitiveness (Internal Market, Industry and Research),

Transport, Telecommunications and Energy,

Agriculture and Fisheries,

Environment,

Education, Youth and Culture.

The General Affairs Council holds two separate meetings, covering respectively the following two main areas of activity: on the one hand, preparation for and follow-up to the European Council meetings, institutional and administrative questions, overall coordination of Union policies as well as the processing of any dossier entrusted to it by the European Council, and on the other, the conduct of the whole of the Union's external action.

The various configurations of the Council can meet at the same time to deal with questions concerning several areas of activity; this takes place in the Council commonly known as Jumbo. Despite the number of different configurations, the unity of the Council, qua institution, remains intact.

The Presidency

The Presidency of the Council follows a rota. It is held in turn by each Member State. The ECSC Treaty laid down a three-month term for the Special Council of Ministers, but experience showed that the rotation was too fast, and so the 1957 Treaties of Rome extended the term to six months for the EEC and Euratom Councils. The same term which has not been changed since was retained for the Presidency of the Single Council established by the Treaty of 8 April 1965.

Initially, the rotation followed the alphabetical order of the names of the Member States in their respective national languages. This situation remained unchanged until 1995. One of the changes introduced by the 1992 Treaty on European Union was that the order of the Presidency be determined by the Council itself.

The Presidency of the Council plays a vital role in organising the work of this institution, notably as the driving force behind the legislative process. The Council meets when convened by the President. The Presidency organises and chairs meetings and establishes the provisional agenda for each meeting. It is also called upon to seek consensuses within the Council and plays an important role in relations with the other Community institutions and in the Communitys external relations.

The Presidency is assisted by the representative of the Member State that will hold the following Presidency. At the request of the Presidency, and on its instructions, the representative replaces the Presidency, and where appropriate, takes on certain administrative tasks and ensures the continuity of the work of the Council.

Under the Common Foreign and Security Policy (CFSP), the Presidency of the Council represents the European Union in matters falling within this policy area. The Presidency is responsible for implementing decisions taken on these matters; in that capacity, in principle, it expresses the Unions position in international organisations and at international conferences. Following entry into force of the 1997 Treaty of Amsterdam, the Presidency is assisted in these tasks by the Secretary-General of the Council (High Representative for the CFSP) and, where necessary, by the Member State which will hold the subsequent Presidency. The Commission is fully involved in these tasks (Article 18 of the Treaty on European Union). This configuration, commonly known as the Troïka, has therefore been changed and the Presidency of the Council is no longer assisted by the Member State which held the previous Presidency.

Under the third pillar of the Union, the Presidency is required regularly to inform the European Parliament of the work carried out in the areas of police and judicial cooperation in criminal matters (Article 39 of the Treaty on European Union).

Under Article 48 of the Treaty on European Union, the President of the Council is responsible for convening a conference of representatives of the governments of the Member States for the purpose of determining by common accord the amendments to be made to the Treaties.

Organisation of the Council of the European Union

The 1951 Treaty establishing the European Coal and Steel Community (ECSC) did not include any provision regarding the organisation of the Special Council of Ministers. However, the complexity of its working methods led the Council to create a Coordinating Committee, consisting of senior civil servants, which was responsible for preparing all the work of the Council.

The experience was so positive that the 1957 Treaties establishing the European Economic Community (EEC) and the European Atomic Energy Community (EAEC or Euratom) included a provision for the creation of a Committee, consisting of representatives of the Member States, whose tasks and powers were to be determined by the Council (Article 151 of the EEC Treaty and Article 121 of the Euratom Treaty.)

The creation of the Committee of Permanent Representatives of the Member States (Coreper) was determined by the Council in January 1958, and its existence was confirmed by the EEC Councils provisional Rules of Procedure of 1 March 1958. Coreper was given responsibility for preparing the work of the Council and carrying out the tasks assigned to it by the Council.

Coreper became common to the three Communities after the entry into force of the Merger Treaty of 8 April 1965, which established a Single Council.

The extent of Corepers powers and those of the ECSC Coordinating Committee until 1967 led to the establishment of working parties to facilitate preparatory and research work. Other groups or committees were created by the Council itself, and in addition, the basic Treaties established certain specific committees responsible for coordinating the work of the Council in a particular area.

The second pillar of the organisation of the Council is the General Secretariat, which is headed by a Secretary-General and is responsible for assisting the Council.

At their first meeting, on 25 and 26 January 1958, the EEC and Euratom Councils decided that the same body of civil servants that had assisted the ECSC Council would also form the secretariat of the two new Councils. The General Secretariat of the Councils was created in this way and became the General Secretariat of the Council with the entry into force of the Merger Treaty in 1967.

Coreper, committees and working parties within the Council of the European Union

Preparatory work for the Council is carried out by several bodies, each of which holds a specific rank in the order of importance: Coreper is at the top of the pyramid, and at the bottom are the numerous working parties; in the middle are the committees with responsibility for specific areas.

The Committee of Permanent Representatives (Coreper) guarantees the permanent presence of Member States at the European Unions headquarters. It prepares the work issues of the Council and carries out the tasks assigned to it by the Council.

Coreper ensures the consistency of the Unions policies and actions, as well as compliance with the following principles and rules:

(a) the principles of legality, subsidiarity, proportionality and justification for acts;

(b) rules establishing the powers of the European Unions institutions and bodies;

(c) budgetary provisions;

(d) rules on procedure, transparency and the quality of drafting.

Following the entry into force of the 1997 Treaty of Amsterdam, the Committee may take procedural decisions in cases provided for in the Councils Rules of Procedure [Article 207 of the Treaty establishing the European Community (EC) and Article 121 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom)].

Coreper sits in two parts:

Part I (Coreper I) consists of Deputy Permanent Representatives and deals with technical rather than political issues;

Part II (Coreper II) consists of Permanent Representatives and deals with institutional issues and issues related to economic affairs, finance, external relations and international negotiations.

In addition to the permanent representation of Member States at the European Unions headquarters, Coreper oversees the coordination of committees or working parties that were established by it, or with its approval, to carry out certain preparatory work or studies. Every item on the agenda of a Council meeting is reviewed in advance by Coreper, unless it decides otherwise. Coreper ensures the appropriate presentation of dossiers to the Council and, where appropriate, submits guidelines, options or suggested solutions to the Council.

A number of specific committees are responsible for preparing the work and coordinating the activities of the Council in a particular area. The most important among them are:

Special Committee on Agriculture (SCA)

Economic and Financial Committee

Article 133 Special Committee

Budgetary Committee

Political and Security Committee (PSC)

Article 36 Coordinating Committee.

The working parties are responsible for preparatory work relating to the Council. They meet whenever necessary, and according to the issues to be discussed, with a view to the drawing up of reports for the attention of Coreper (or the SCA). Ad hoc groups are established, for a particular fixed-term operation, as well as regular sectoral groups.

A list of the Councils preparatory bodies is regularly updated and published by the General Secretariat.

The General Secretariat of the Council of the European Union

The Council is assisted by a General Secretariat which is responsible for all the work required to underpin the activities of the Council, Coreper and all the committees and working parties created by the Council. The General Secretariat is headed by a Secretary-General, who is also the High Representative for the common foreign and security policy (CFSP). He is assisted by a Deputy Secretary-General who is responsible for the day-to-day management of the General Secretariat. Both are appointed by the Council acting by qualified majority [Article 207 of the Treaty establishing the European Community (EC) and Article 121 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom), as amended by the 2001 Treaty of Nice].

The positions of High Representative for the CFSP and Deputy Secretary-General were introduced by the 1997 Treaty of Amsterdam.

The Secretary-General and the Deputy Secretary-General are responsible for taking any measures required to ensure the smooth running of the Secretariat.

The General Secretariat is closely and permanently involved in the organisation, the coordination and the supervision of the consistency of the Councils work. It assists the Presidency in seeking solutions.

The Secretary-General assists the Council and the Presidency with issues relating to the CFSP. Where necessary, he may ask the Presidency to convene a committee or working party meeting, with particular regard to the CFSP, or to enter an item on the agenda of a committee or working party.

The Secretary-General or the Deputy Secretary-General submits to the Council the draft estimates on its expenditure. Assisted by the Deputy Secretary-General, the Secretary-General is totally responsible for the management of the appropriations entered in Section II Council of the budget and takes all the necessary steps to ensure sound financial management.

The Council determines the organisation of the General Secretariat. Its structure has been changed over the years. Financial Control, the Press Office Newsroom, the Security Office, the Legal Service and several directorates-general are entities subordinate to the General Secretariat.

Operation of the Council of the European Union

The Council meets when convened by the President, on his initiative or at the request of one of its Members or of the Commission, and in accordance with the calendar of meetings submitted by the Presidency seven months before the beginning of its term of office.

The frequency of meetings varies according to the various configurations. The General Affairs, Economic and Financial Affairs, and Agriculture Councils meet once a month, while the others meet between two and four times a year.

On the basis of information at his disposal at least sixteen days before the beginning of the meeting, the President draws up the provisional agenda for the meeting. It is divided into Part A, comprising items which the Council may approve without debate, and Part B, comprising items that will require discussion by the Council. The agenda is adopted by the Council at the beginning of each meeting.

Council meetings are not open to the public, with the exception of the public policy debate on the current Presidencys work programme, and where appropriate, the Commissions annual work programme. Similarly, the Council holds at least one public debate on important new legislative proposals. The Council or Coreper may, on a case by case basis, reach a unanimous decision that other debates will be publicly broadcast. Public debates are broadcast using audiovisual media.

Voting procedures

Rules governing voting in the Council are laid down in Article 205 of the Treaty establishing the European Community (EC) (Article 118 of the Treaty establishing the European Atomic Energy Community). The procedures are as follows:

simple majority;

qualified majority;

unanimity;

4/5 majority.

Simple majority

Simple majority is presented as the procedure for which general provision was made in the Treaties of Rome, but it is used only in limited areas of minor importance (Articles 207, 208, 209 and 284 of the EC Treaty).

Qualified majority

Unanimity is the procedure most often provided for in the 1957 Treaties of Rome. However, each time that the Treaties have been reformed the number of areas where decisions are taken by qualified majority has increased. This is the most commonly used voting procedure at present. The calculation of a majority is currently based on the votes allocated to each Member State by Article 205(2) of the EC Treaty and by Article 118(2) of the EAEC Treaty, but the system of weighted votes has changed over the years and with successive enlargements.

In 1958, one sole vote was allocated to the smallest country and 4 to the larger countries. From 1973 to October 2004, the number of votes ranged from 2 to 10. As from November 2004, the minimum number of votes is 3 and the maximum is 29. The number of votes required to secure a qualified majority has gone from 12 in 1958 to 232 today.

Fear of losing the power to block a decision has often involved States in difficult negotiations when the number of subjects requiring a decision by qualified majority has been increased and when enlargements have taken place. In this context, the Luxembourg compromise and that of Ioannina are especially important.

The EEC Treaty provided for the introduction of majority voting by the end of 1965. However, on 30 June of that year, the French Government opposed its implementation and made clear its intention not to take its seat in the Council until a solution which satisfied its interests was found. This was the empty chair crisis. The crisis was overcome by the adoption of the Luxembourg compromise. Under the terms of this policy statement, [w]here, in the case of decisions which may be taken by a majority vote on a proposal from the Commission, very important interests of one or more partners are at stake, the members of the Council will endeavour, within a reasonable time, to reach solutions which may be adopted by all the Members of the Council, while respecting their mutual interests and those of the Community, in accordance with Article 2 of the Treaty.

The practical consequence of the Luxembourg compromise was the use of unanimity as the normal decision making procedure from 1966 until 1985. During that period, the Council endeavoured to find a solution acceptable to all the Members in every case.

The Ioannina compromise, set out in the Council Decision of 29 March 1994, laid down a procedure that helped increase consensus on a proposal, when members of the Council representing a number of votes very close to the blocking minority opposed a decision. The Ioannina compromis has no longer been applicable since the Treaty of Nice came into force.

Based on principles expressed in the Declaration on the enlargement of the European Union, annexed to the 2001 Treaty of Nice, the system now in force, created by the Accession Treaty of 10 new Member States and signed in Athens on 16 April 2003, laid down the following weighting that came into force on 1 November 2004:

Belgium 12

The Czech Republic 12

Denmark 7

Germany 29

Estonia 4

Greece 12

Spain 27

France 29

Ireland 7

Italy 29

Cyprus 4

Latvia 4

Lithuania 7

Luxembourg 4

Hungary 12

Malta 3

Netherlands 13

Austria 10

Poland 27

Portugal 12

Slovenia 4

Slovakia 7

Finland 7

Sweden 10

The United Kingdom 29.

A qualified majority is secured under two conditions:

there is a minimum number of votes in favour of a decision (232, the threshold of the qualified majority),

Acts are adopted which gain the votes of at least a majority of the Member States, if acts are to be adopted on a proposal from the Commission, and of at least two-thirds of the members in other cases.

A third condition also exists which envisages that the votes in favour represent at least 62 % of the population of the Member States. However, this condition is only applicable if a member of the Council requests verification that it has been fulfilled.

When calculating the qualified majority, abstention by a State representative does not lower the threshold, but is considered as a negative vote.

Unanimity

Unanimity is required for certain policies or certain sensitive areas within the framework of the EC Treaty. In general, unanimity is required if the Council wishes to diverge from a Commission proposal (subject to Article 251 in the codecision procedure and other articles which require a qualified majority for the adoption of acts).

In principle, and save in the case of derogation, the Council acts unanimously when adopting decisions relating to the common foreign and security policy (CFSP) and police and judicial cooperation in criminal matters (Articles 23 and 34 of the Treaty on European Union).

Abstention by Members, either present or represented, does not prevent the adoption of decisions taken by the Council acting unanimously.

Even where it was not required, the Council has frequently sought unanimity in the spirit of the Luxembourg compromise of 29 January 1966. In practice, unanimous voting was the standard Council decision making procedure from 1966 until 1985. During this period, the Council tried hard to find a solution that all its members would agree to in all cases.

The 1986 Single European Act provided for more frequent use of majority voting and established qualified majority voting for decisions concerning the establishment of the internal market. The Act left the compromise pending by revitalising this decision making procedure in the Council.

For the first time, the 1997 Treaty of Amsterdam introduced provisions that reiterated the spirit of the Luxembourg compromise. A right of veto on important national policy grounds was established in order to prevent the adoption, by qualified majority, of Council decisions relating to the CFSP. If a Member of the Council declares that it intends to oppose the adoption of such a decision, it is not put to the vote, and the Council may request that the matter may be referred to the European Council for a decision by unanimity (Article 23(2) of the Treaty on European Union).

The same safeguard clause which Member States and their national policies enjoy exists in the area of enhanced cooperation, in the first pillar (Article 11 of the EC Treaty and in the third pillar (Article 40 of the Treaty on European Union). The issue is referred, for a decision by unanimity, to the Council meeting in the composition of the Heads of State or Government, if it relates to the first pillar, and to the European Council, if it relates to the third pillar.

The shift from unanimity to qualified majority voting in the Amsterdam Treaty was very limited in comparison to what had been envisaged at the opening of the 1996 Intergovernmental Conference.

Following entry into force of the 2001 Treaty of Nice, 27 new provisions passed wholly or in part from unanimity to qualified majority voting

The four-fifths majority vote

If the Council is called on to determine that there is a clear risk of a serious breach by a Member State of democratic principles, it acts by a majority of four fifths of its members after obtaining the assent of the European Parliament (new paragraph 1 of Article 7 of the Treaty on European Union introduced by the Treaty of Nice).

Voting process

The Council is called upon to vote by the President. The President must also open a voting procedure on the initiative of a Member of the Council or the Commission, provided that a majority of the Councils Members so decides.

The Members of the Council vote in the order of Member States laid down in Article 203 of the Treaty establishing the European Community (EC) [Article 116 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom)], beginning with the Member who follows the Member holding the Presidency. Proxy voting is admissible only when another Member acts on behalf of the Member not voting. The presence of a majority of Members entitled to vote is required for the Council to take a vote.

Results of votes and explanations of vote are made public:

when the Council acts in its legislative capacity;

when the Council adopts a common position under the codecision and cooperation procedures (Articles 251 and 252 of the EC Treaty). The same rule applies to votes and explanations of votes by Members of the Council or their representatives on the Conciliation Committee;

when the Council establishes a convention under Title VI of the Treaty on European Union.

Results of votes are made public:

when the Council acts under Title V of the Treaty on European Union by unanimous decision of the Council or Coreper, taken at the request of one of their Members;

when the Council adopts a common position under Title VI of the Treaty on European Union, by unanimous decision of the Council or Coreper, taken at the request of one of their Members;

in other cases, by decision of the Council or Coreper, taken at the request of one of their Members.

In all three cases, the explanations of votes made when the vote was taken are also published, at the request of the Council Members concerned, with due regard for the rules of procedure, legal certainty and the interests of the Council.

Written vote

Council decisions on urgent matters can be taken by written vote when the Council or Coreper unanimously so decides. Under certain circumstances, the President may also propose the use of the written vote. In such a case, the agreement of all Members of the Council is required. The Commission must also agree when the written vote to be taken involves a matter which the Commission has brought before the Council.

For the purpose of the common foreign and security policy (CFSP), the Council may act by simplified written procedure (COREU) on the initiative of the Presidency. The proposal is deemed to be adopted on expiry of the period set by the Presidency, except where a Member of the Council objects.

On the initiative of the President, the Council may also act by streamlined written procedure in all cases where the consultation of other institutions or bodies is required by Community law.

Task of coordination of the Council of the European Union

Coordinating the actions of the Member States and of the European Communities is the primary task assigned to the Council by the founding Treaties.

Under Article 26 of the 1951 Treaty establishing the European Coal and Steel Community (ECSC) expired on 23 July 2002, the principal role of the Special Council of Ministers was to harmonise the actions of the High Authority and that of the governments which were responsible for the general economic policy in their countries.

That task was also set out in the1957 Treaties of Rome. Under the Treaty establishing the European Economic Community (EEC), the Council ensures coordination of the general economic policies of the Member States (former Article 145, new Article 202 of the Treaty establishing the European Community).Under the Treaty establishing the European Atomic Energy Community (EAEC or Euratom), the Council was to take all measures within its powers to coordinate the actions of Member States and of the Community (Article 115).

The substance of the powers of the Council in the area of coordination is very extensive and applies to all aspects of economic policy. In this area, the Council adopts recommendations, encourages consultation, and takes decisions regarding the creation of committees or of other bodies to facilitate concerted action.

Role of consultation of the Council of the European Union

The 1951 Treaty establishing the European Coal and Steel Community (ECSC) expired on 23 July 2002 assigned an advisory role to the Council. In some cases, the opinions delivered by the Council must constitute assent, but it rarely has the authority to adopt decisions. Where the Council is consulted by the Commission, it deliberates without necessarily taking a vote. In certain cases, the ECSC Treaty requires unanimous opinion (Article 28 of the ECSC Treaty).

The Council and the Commission exchange information and consult each other [Article 26 of the ECSC Treaty, Article 218 of the Treaty establishing the European Community (EC) and Article 131 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom)].

The decision-making powers of the Council of the European Union

In the European Coal and Steel Community (ECSC), which was established in 1951 and wound up on 23 July 2002, the High Authority had the power of decision. The Special Council of Ministers was called upon to deliver an opinion on certain decisions taken by the High Authority.

The 1957 Treaties of Rome conferred the power of decision on the Council, making it the central institution of the Communities [Article 145 of the Treaty establishing the European Economic Community (EEC) and Article 115 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom)]. For the majority of Community acts, the decision-making procedure of the Council, following a Commission proposal and, where appropriate, after consultation with the European Parliament, is the procedure ordinarily laid down in the Treaties.

Initially, the Council had exclusive decision-making powers in all areas of activity of the Communities. Nevertheless, increasing Community integration changed the decision-making process, and the European Parliament became a legislator on an equal footing with the Council. The introduction of the cooperation procedure under the 1986 Single European Act and, even more importantly, the introduction of the codecision procedure under the 1992 Treaty on European Union were milestones in this development. The 2001 Treaty of Nice extended the scope of the codecision procedure to most of the legislative measures that required the Council to act by qualified majority.

The budgetary power of the Council of the European Union

The Council is one of the two arms of the budgetary authority.

Under the European Coal and Steel Community (ECSC), which was wound up on 23 July 2002, the Council acquired the power to take decisions on the administrative budget, with the creation of a single budget by the Merger Treaty of 8 April 1965 and the harmonisation of budgetary procedures with those laid down in the Treaties of Rome. The ECSC budget had previously been drawn up by the Committee of Presidents of the ECSC Institutions.

Under the terms of the Treaties of Rome, the Council, the legislative authority, was also the budgetary authority until the Treaty of 22 April 1970, which amended certain budgetary provisions set out in the basic Treaties and in the 1965 Merger Treaty. The 1970 Treaty granted the European Parliament the right to adopt formally the budget of the Communities and to have the final say on non-compulsory expenditure.

Since 1975, when the new procedure provided for in the 1970 Treaty came into force, the Council and the European Parliament have held complementary decision-making powers in the area of budgetary procedure.

Executive power of the Council of the European Union

The Council confers on the Commission powers for the implementation of the rules it lays down. It may impose certain requirements in respect of the exercise of those powers. In specific cases, it may reserve the right to exercise implementing powers directly (Article 202 of the Treaty establishing the European Community). This provision was introduced into the Treaty by the 1986 Single European Act.

The delegation of implementing powers to the Commission is subject to a complex system of intervention by committees consisting of representatives of Member States (commitology). The procedures were laid down by the Council Decision of 28 June 1999.

Conclusion of international agreements by the Council of the European Union

The Council decides on the signing and conclusion of agreements between the Community and one or more States or international organisations, subject to the powers conferred on the Commission in this area.

Negotiations are conducted by the Commission, with the authorisation of the Council, in consultation with special committees appointed by the Council to assist it and on the basis of directives issued to it by the Council.

The Council acts by qualified majority on a proposal from the Commission. However, it acts unanimously when the agreement covers a field for which unanimity is required for the adoption of internal rules and for association agreements. As a general rule, the Council concludes agreements after consultation with or with the assent of the European Parliament (Article 300 of the Treaty establishing the European Community).

Under the Treaty establishing the European Atomic Energy Community (EAEC or Euratom), agreements or conventions with third States, an international organisation or a national of a third State are also negotiated by the Commission in accordance with Council directives. They are concluded by the Commission with the approval of the Council, but they may be negotiated and concluded by the Commission, provided that the Commission keeps the Council informed (Article 101). The Council concludes association agreements after consulting the European Parliament (Article 206).

The Councils role in the second and third pillars of the Union

The role of the Council is essential under Titles V and VI of the Treaty on European Union (TEU). The former is concerned with the common foreign and security policy (CFSP), the latter with the areas of justice and home affairs (JHA), limited to police and judicial cooperation in criminal matters by the Treaty of Amsterdam of 2 October 1997.

The second pillar

With regard to the CFSP, the Treaty of Amsterdam clarifies the distinction between the powers and responsibilities of the European Council and those of the Council of the European Union. In so doing, it strengthens the decision-making powers of the latter. Under Article 13 of the TEU, the Council:

takes the decisions necessary for defining and implementing the common foreign and security policy, on the basis of general guidelines defined by the European Council;

recommends common strategies to the European Council and implements them, in particular by adopting joint actions and common positions;

ensures the unity, consistency and effectiveness of action by the Union.

The Member States inform and consult one another within the Council in order to ensure that the Unions influence is exerted as effectively as possible by means of convergent action (Article 16 of the TEU).

With regard to the security of the Union, the Council is responsible for taking decisions regarding Community defence policy and for recommending to Member States the adoption of a decision with defence implications (Article 17 of the TEU).

The Council is assisted by a Political Committee (Article 25 of the TEU). The Treaty of Amsterdam develops three other structures for assisting the Council: the Secretary-General of the Council, in his role as High Representative for the CFSP (Article 26 of the TEU), the policy planning and early warning unit (Declaration No 6) and the special representatives with mandates in relation to particular policy issues (Article 18 of the TEU).

The Treaty of Amsterdam confers on the Union the power to conclude international agreements in all areas of the CFSP (Article 24 of the TEU). The Council authorises the Presidency, assisted by the Commission, where appropriate, to negotiate agreements. On a recommendation from the Presidency, the Council concludes agreements acting unanimously. The same provision applies to matters coming under the third pillar of the Union.

The third pillar

In the area of police and judicial cooperation in criminal matters, Member States inform and consult one another within the Council with a view to coordinating their action. The Council takes measures and promotes cooperation. It may adopt common positions, framework decisions and decisions and may establish conventions which it recommends to the Member States for adoption (Article 34 of the TEU). It is assisted by a Coordinating Committee consisting of senior officials (Article 36 of the TEU).

The Council authorises the establishment of closer cooperation between Member States and decides on the incorporation into the Community pillar (Title IV of the Treaty establishing the European Community) of action falling under Title VI of the TEU.

EUROPEAN COMMISSION

Composition before 1967

On 9 May 1950, the French Foreign Affairs Minister, Robert Schuman, proposed the creation of the High Authority, the executive body of the European Coal and Steel Community (ECSC). During the negotiations preceding its creation, the Member States agreed to a limited number of members in order to ensure the cohesion and the efficiency of the institution. It was ultimately decided that the Commission be composed of nine members (Article 9 of the ECSC Treaty).

The composition of the two new executive bodies provided for in the Treaties of Rome of 25 March 1957 fulfilled the same requirements:

the Commission of the European Economic Community (EEC) was composed of nine members (Article 157 of the EEC Treaty);

the Commission of the European Atomic Energy Community (EAEC or Euratom) was composed of five members (Article 126 of the Euratom Treaty).

Composition after 1967

On 1 July 1967, these three institutions were replaced by a Single Commission under the Merger Treaty. The composition of this new Commission was a divisive issue, as governments sought to defend their respective interests. They eventually reached agreement on a transitional solution whereby, until the entry into force of the Treaty establishing a Single European Community, or until three years after the appointment of its members, whichever was the earlier, the Commission would consist of 14 members (Article 32 of the Merger Treaty). Among these members were several who had already served in the Commission of the European Economic Community. The Commission would have 14 members until 1 July 1970. At the end of that term of office, its composition would be determined by Article 10 of the Merger Treaty, which specified nine Commission members.

The number of members of the Commission has been amended by the Council as a result of the accession of new Member States. Accordingly, the number of members has gradually increased:

14 members (6 July 1967)

9 members (1 July 1970)

13 members (6 January 1973)

14 members (6 January 1981)

17 members (1 January 1986)

20 members (23 January 1995).

30 members (1 May 2004)

25 members (1 November 2004).

Only nationals of the Member States may be members of the Commission, which must comprise at least one national from each Member State, but not more than two members holding the nationality of the same State. In practice, the distribution of seats among Member States does not follow a written rule, however France, Germany, Italy, Spain and the United Kingdom have two members, whereas other Member States have only one.

The composition of the Commission nevertheless remains a widely debated issue, since many people are of the opinion that there are too many members. The Treaty of Amsterdam of 2 October 1997 included a protocol on the institutions with a view to the enlargement of the European Union. It set out institutional conditions to be fulfilled before the first wave of Union enlargement takes place: to reduce the number of Commissioners to one national per Member State, provided that the weighting of votes within the Council is amended in such a way that is acceptable to all Member States.

Each of the ten States that acceded to the European Union on 1 May 2004 has a Commissioner for the period between their accession date and 31 October 2004. From 1 November 2004, the Commission consists of one member per Member State. Following the accession of the 27th Member State, the Commissioners will be fewer in number than the number of the States, and they will be chosen using a rotation system based on the principle of equality.

Organisation of the European Commission

Organisation before 1967

The High Authority had a President and a Vice-President, appointed by the governments of the Member States for a two-year term of office (Article 11 of the Treaty establishing the European Coal and Steel Community (ECSC)). In fact, two Vice-Presidents were appointed. The President was responsible for:

ensuring the smooth functioning of the administration;

ensuring that decisions taken by the High Authority were carried out;

establishing the draft agenda for meetings;

liasing with the other ECSC institutions.

The High Authority was organised on the basis of the principle of collective responsibility. The High Commissioners constituted a body, and that body took decisions and was accountable for those decisions to the Common Assembly. Although decisions were taken collectively, that did not mean that all decisions were unanimous. Although a consensus was always sought, a decision might be taken by a simple majority of members.

Initially, all High Authority members dealt with all spheres of activity. However, as time went on, the members began to specialise more and more in a particular field, although a division of tasks never became official. This specialisation only related to the study and the preparation of an issue: the decision was still taken collectively.

With regard to the division of work, the ECSC Treaty provided for the setting-up of study committees, including an economic study committee (Article 16).

In order to perform its duties, the High Authority had to establish a suitable administrative structure. The creation of working parties, responsible for preparing the deliberations of the High Authority and for coordinating the work of the various departments, led to a streamlining of the institutions work. At the end of 1953, there were six working parties, each comprising four members of the High Authority: Market, Mergers and Transport; General Objectives; Social Problems; Investment, Production and Finances; External Relations; Administrative Matters.

The High Authority was organised into departments, and it introduced all the internal measures required to ensure the smooth functioning of those departments. The first Rules of Procedure and the General Organisational Rules were adopted on 5 November 1954.

Until the Merger Treaty of 8 April 1965, the High Authority was deemed to be a relatively coherent and homogenous institution. This was also the result of Jean Monnets wish to create a small group able to establish close contacts with national authorities and experts but which transcended national expertise in the common European interest.

In 1958, after the entry into force of the Treaties of Rome of 25 March 1957 establishing the European Economic Community (EEC) and the European Atomic Energy Community (EAEC or Euratom), the new Commissions were established.

The EEC Commission had one President and two Vice-Presidents, while the Euratom Commission had one President and just one Vice-President. They were appointed for a period of two years, and their term of office was renewable (Article 161 of the EEC Treaty and Article 130 of the Euratom Treaty).

The organisation and administration of the departments of both Commissions were governed by their Rules of Procedure (EEC Commission Rules of Procedure of 9 January 1963 and Euratom Commission Rules of Procedure of 8 June 1960).

Following the example of the High Authority, the two new Commissions divided up the work into areas or specific sectors of activity, which were assigned to the members. Similarly, the Commissions appointed members to form working parties, and those members were permitted to establish private offices with the task of assisting them. The EEC Commission also had an executive secretary who helped the President to prepare the meetings.

As regards administrative structures, the High Authority endeavoured to establish efficient cooperation with the EEC Commission and the Euratom Commission in order to avoid administrative and technical duplication of efforts. The three executives decided to create common services: a common legal service, a common statistical service, and a common press and information service.

From 1960, the departments of the High Authority were structured into directorates-general, in the same way as the EEC Commission, whose Rules of Procedure set out that the directorates-general were to be broken down into directorates, with the directorates being further broken down into divisions. The basic unit in the administrative structure was the division.

The general organisation of the High Authority and the EEC and Euratom Commissions was maintained, with a few changes here and there, until the executives merged in July 1967.

Organisation after 1967

In 1967, the ECSC High Authority, the EEC Commission and the Euratom Commission were replaced by a Single Commission by virtue of the Merger Treaty of 8 April 1965. The Treaty established the principle of the single administration of the Communities (Article 24).

The Single Commission decided to maintain the administrative structures of the three institutions until a unified structure was created on 28 March 1968. In practice, there is a large degree of continuity with the structure of the previous executives, particularly the EEC Commission.

As before, the Commission of the European Communities remains organised, and acts, as a body in compliance with the measures set out in the Rules of Procedure (Provisional Rules of Procedure of 6 July 1967, repealed by the Rules of Procedure of 17 February 1993, which were also repealed by the Rules of Procedure of 18 September 1999).

The Commission has a President. The Commission may appoint one or two Vice-Presidents from amongst its Members. The Merger Treaty as amended by the Act of Accession of Spain and Portugal in 1986 provided for the appointment of six Vice-Presidents, but the 1992 Treaty on European Union restricted this number to a maximum of two. Similarly, the Presidents term of office, which the Merger Treaty laid down at two years, became five years, thereby coming into line with the term of office of the Members of the Commission.

The role of the President was reinforced by the 1997 Treaty of Amsterdam: it defined the political guidelines that the Commission must follow when carrying out its task (Article 219 of the EC Treaty). The President represents the Commission.

The principle of collective responsibility does not exclude the division of tasks, so the President assigns to Members of the Commission particular areas of activity (portfolios) for which they bear special responsibility in terms of preparing work and executing decisions. The number of portfolios, their substance and their importance have varied over the years.

To ensure an optimum division between conventional portfolios and specific tasks, Declaration 32 annexed to the Treaty of Amsterdam provides for the President of the Commission to enjoy broad discretion in the allocation of tasks within the college, as well as in any reshuffling of those tasks during a Commissions term of office. The Declaration also notes the Commissions intention to reorganise its departments and notes the desirability of placing external relations under the responsibility of a Vice-President.

The President forms working parties from amongst the members of the Commission (known as Groups of Commissioners) and he appoints the chairmen thereof. These groups can be permanent or ad hoc. The Commission President determines their composition and their mandate, and he retains the right to chair any group of which he is not a member.

Commission Members appoint private offices (cabinets) which are responsible for assisting them in the performance of their tasks and in the preparation of the Commissions decisions. To this end, the Commission Member responsible gives instructions to the departments concerned.

The Commission has a Secretary-General whose role is vast. He assists the President in the preparation of Commission activities and meetings; he also assists the chairmen of the working parties in preparation for and the holding of meetings; he ensures that the proper of procedures are implemented and monitors the execution of decisions. He ensures coordination between departments and checks that the rules governing the layout of documents submitted to the Commission are observed. He takes measures to ensure the notification and publication of Commission acts in the Official Journal of the European Union, (which was known as the Official Journal of the European Communities until 2003) and the forwarding to other Community institutions of documents drawn up by the Commission and its departments. In general, he is responsible for official relations with the other institutions of the European Communities; he monitors their work and reports back to the Commission.

The Commission is composed of many departments, organised into directorates-general and equivalent services. In principle, the directorates-general and the equivalent services are broken down into directorates, and these are then broken down further into units.

In order to respond to specific needs, the Commission may create specific structures responsible for particular assignments, and it determines their powers and their operating methods.

A certain number of decentralised bodies (agencies), set up by regulations adopted by the Council acting on proposals from the Commission, exercise various powers in particular areas.

Operation of the European Commission

Decision-making

Commission decisions are taken: (a) in meetings, or (b) by written procedure, or (c) by delegation procedure.

(a) Meetings.

As a general rule, the Commission meets at least once a week on Wednesday mornings and another whenever necessary. The agenda for the meetings are drawn up on Monday afternoons by Heads of Cabinets in meeting. The Commission is convened by the President. Members of the Commission must attend all meetings. The number of Members who must be present for the deliberations to be valid is equal to the majority of the number of Members specified in the Treaty.

The Commission establishes its priorities and adopts an annual work programme every year, taking into account the political guidelines laid down by its President. With particular reference to this programme, the President establishes the agenda for each meeting.

The Commission takes decisions on the basis of a proposal from one or more of its Members, and it holds a vote if a Member so requests. The decisions are adopted if a majority of the number of Members specified in the Treaty vote in favour.

The meetings are not open to the public: debates and votes are confidential.

Unless otherwise decided, the Secretary-General attends the meetings. If a Commission Member is absent, his Chef de cabinet (Head of his Private Office) may attend the meeting and speak on the absent Members behalf. The Commission may decide to hear any other speaker.

Minutes are drawn up for every meeting.

(b) Written procedure.

The agreement of the Commission Members on a proposal submitted by one or more Members may be recorded by written procedure, provided that the proposal has been approved by the directorates-general directly concerned and has been endorsed by the Legal Service.

Any Commission Member may ask for the proposal to be debated by submitting a reasoned request to the President.

A proposal to which no Commission Member has objected by the expiry of the time-limit laid down for a written procedure stands adopted by the Commission. Proposals adopted are recorded in a daily note, which is referred to in the minutes of the next Commission meeting.

(c) Delegation procedure.

While upholding the principle of collective responsibility, the Commission may empower one or more of its Members to take clearly defined management and administrative measures on its behalf and, in particular, acts preparatory to a decision to be taken by the Commission. It may also instruct one or more of its Members to adopt the definitive text of an act or of a proposal to be submitted to the other institutions, the substance of which has been defined during its deliberations.

The decisions adopted are recorded in a daily note, which is referred to in the minutes of the next Commission meeting.

In principle, such delegated responsibilities may not be sub-delegated.

Guardian of the Treaties

The Commission oversees the application of the provisions of the Treaties and the measures taken by the institutions pursuant thereto (Article 211 of the EC Treaty and Article 124 of the Euratom Treaty). In this area, it has powers of investigation, prevention, sanction and authorisation.

Power of investigation

Within the context of its monitoring role, the Commission may secure any information and carry out any checks required for the performance of its duties. Thanks to its resources, the Commission may obtain information on the situation in and conduct of Member States and companies. These powers of investigation are particularly important in the field of competition law (Articles 81 et seq. of the EC Treaty).

Power of prevention

The Commission acts to prevent infringements of the Treaty in various ways: informal meetings to encourage compliance with Community law, opinions or recommendations or even binding acts such as directives or decisions.

Power of sanction

The Commission also has the power to impose sanctions (fines or penalties) principally on Member States and companies breaching the rules on competition.

Power of authorisation

The Commission is also the institution responsible for authorising a temporary suspension of the application of the Treaty by the Member States through safeguard clauses. The basic Treaties include provisions allowing protective measures to be adopted, both in the field of economic and monetary policy (Articles 119 and 120 of the EC Treaty) and in the area of the common commercial policy (Article 134 of the EC Treaty).

This monitoring task applies in particular in the event of a Member States failure to meet Community obligations.

The basic Treaties (Articles 226 of the EC Treaty and 141 of the Euratom Treaty; see also Article 88 of the ECSC Treaty) confer powers upon the Commission to institute proceedings before the Court of Justice if it considers that a Member State has failed to fulfil an obligation under the Treaty.

If the Commission notes such failure, the State concerned must submit its observations. The Commission then delivers a reasoned opinion, with which the State must comply within the time-limit laid down by the Commission. If the State in question does not comply, the Commission may bring the matter before the Court of Justice.

The ECSC Treaty (until its expiry on 23 July 2002) provided for a more complex procedure whereby the Commission itself was empowered to record the failure in a reasoned decision, against which the Member State concerned had unlimited jurisdiction before the Court.

The main aim of this infringement procedure is to encourage a Member State to return to a situation that complies with Community law. In practice, the initiation of proceedings is generally preceded by negotiations between the Commission and the Member State, which then lead to a gradual regularisation of infringements without the intervention of the Court.

The European Commissions right to propose legislation

The Treaty establishing the European Coal and Steel Community (ECSC) which expired on 23 July 2002 conferred the power of decision principally on the Commission. However, in the Treaties establishing the European Community (EC) and the European Atomic Energy Community (EAEC), the Council and the European Parliament share this power, and the Commission participates through its right to propose legislation in the shaping of Community acts.

Under Article 211 of the EC Treaty and Article 124 of the EAEC Treaty, the Commission has its own power of decision and participates in the shaping of measures taken by the Council and European Parliament in the manner provided for in the Treaties. It draws up recommendations or delivers opinions in the areas covered by the Treaty, if the Treaty expressly provides for this or if the Commission deems it necessary.

Drafting of proposals

By virtue of its right to propose legislation, the Commission draws up legislative proposals which it presents to the Council and, where the codecision procedure is applicable, to the European Parliament.

In its proposals, the Commission defends Community interests without favouring sectoral or national interests whilst respecting the principle of subsidiarity. When it draws up its proposals, the Commission holds preliminary meetings in order to secure the opinions of government representatives, members of parliament, professional and trade union organisations, specific interest groups, and independent experts.

In principle, the Council may amend a proposal only by acting unanimously. The Commission may amend its proposal at any time during the procedure for the adoption of a Community act, as long as the Council has not already acted (Article 250 of the EC Treaty).

Under the cooperation procedure (Article 252 of the EC Treaty), the Commission re-examines its proposal after the Council has adopted a common position, by taking into account the amendments proposed by the European Parliament. The Commission submits its re examined proposal to the Council, together with the amendments that it has not accepted, and it expresses its opinion on them. The Council may amend this proposal only if it acts unanimously.

The Council may ask the Commission to undertake any studies that the Council considers desirable and to submit to it any appropriate proposals (Article 208 of the EC Treaty and Article 122 of the EAEC Treaty). The European Parliament may also, acting by a majority of its Members, ask the Commission to submit to it any appropriate proposals (Articles 192 of the EC Treaty and Article 107a of the EAEC Treaty).

The Commissions right to propose legislation was extended by the 1997 Treaty of Amsterdam, which introduced new provisions into the EC Treaty. It also introduced the Communitisation of certain areas that were previously subject to intergovernmental cooperation (justice and home affairs), where the Commission would have the sole right to propose legislation after a five-year transitional period following the entry into force of the Treaty. During that period, the right would be shared with the Member States (Article 67 of the EC Treaty).

Power of decision

Under the EC Treaty, in addition to drawing up proposals, the Commission has its own power of decision in the area of competition law in order to ensure application of the principles set out in Articles 81 and 82 (Article 85), to ensure application of the Treaty to public undertakings and undertakings with special or exclusive rights (Article 86), or to examine State aid schemes (Article 88).

Under the ECSC Treaty, which expired on 23 July 2002, the Commissions independent power of decision was even more marked. Thus, for example, the autonomy of the ECSC operational budget accounted for a separate procedure whereby the Commission was empowered to procure the funds it required by imposing levies on production and by contracting loans (Article 49).

Executive body

The Commission exercises the powers conferred on it by the Council for the implementation of the rules laid down by the Council (Article 211 of the EC Treaty and Article 124 of the Euratom Treaty).

The Council may subject the exercise of implementing powers to certain procedures. In specific cases, it reserves the right to exercise those powers directly. Implementing procedures must comply with the principles and rules laid down in advance by the Council, acting unanimously on a proposal from the Commission and after obtaining the Opinion of the European Parliament (Article 202 of the EC Treaty).

The delegation of powers from the Council to the Commission is subject to the involvement of committees consisting of Member State representatives and chaired by a Commission representative.

The Council Decision of 28 June 1999 laying down the conditions for the exercise of implementing powers conferred on the Commission (the new Commitology Decision replacing Decision 87/373/EEC), established four procedures: the advisory procedure, the management procedure, the regulatory procedure, and finally, the safeguard procedure. The Decision also defines the (non-binding) criteria relevant to the choice of procedure.

The scope of the implementing powers is vast and covers almost all the areas of Community activity.

Pursuant to Article 274 of the EC Treaty (first paragraph of Article 179 of the Euratom Treaty and see also first paragraph of Article 78c of the ECSC Treaty, which expired on 23 July 2002), the Commission is responsible for implementing the budget on its own responsibility and in accordance with the provisions of the Financial Regulation adopted by the Council.

As an executive body, the Commission also manages Community funds, such as:

the European Social Fund (ESF);

the European Agricultural Guidance and Guarantee Fund (EAGGF);

the Financial Instrument for Fisheries Guidance (FIFG);

the European Regional Development Fund (ERDF);

the Cohesion Fund;

the European Development Fund (EDF).

Negotiation and representation in external relations

The basic Treaties establishing the European Communities include provisions relating to the conclusion of international agreements.

In cases where the Treaty establishing the European Community (EC) provides for the conclusion of agreements between the Community and one or more States or international organisations, the Commission makes recommendations to the Council, which authorises the Commission to open the necessary negotiations. The Commission conducts these negotiations in consultation with special committees appointed by the Council and within the framework of such directives as the Council may issue to it. The signing and the conclusion of agreements are determined by the Council on a proposal from the Commission, but the Commission may be empowered by the Council to approve modifications on behalf of the Community (Article 300).

The Commission negotiates agreements in the following areas covered by the EC Treaty:

economic and monetary policy: formal agreements on an exchange-rate system for the ECU in relation to non-Community currencies (Article 111);

common commercial policy: tariff and trade agreements (Article 133);

research and technological development (Article 170);

the environment (Article 174);

development cooperation (Article 181),

association agreements (Article 310).

Agreements or conventions with a third State, an international organisation or a national of a third State provided for under the Treaty establishing the European Atomic Energy Community (EAEC or Euratom) are also negotiated by the Commission in compliance with Council directives; they are concluded by the Commission with the approval of the Council. However, if their implementation does not require action by the Council and can be effected within the limits of the relevant budget, they are negotiated and concluded by the Commission, provided that the Council is kept informed (Article 101). Article 206 does not provide for Commission participation in the conclusion of association agreements.

Another aspect of Community representation in external relations is participation in international organisations. The Commission is responsible for maintaining relations with the organs of the United Nations and its specialised agencies and such relations as are appropriate with all international organisations (Article 302 of the EC Treaty and Article 199 of the ECSC Treaty; see also Article 93 of the EAEC Treaty, which expired 23 July 2002).

Commission involvement may take different forms depending on the degree of cooperation that is established. Accordingly, the European Communities may have observer status (for example, at the United Nations General Assembly), consultative status (being able to participate in sessions of United Nations subsidiary bodies), or contracting party status (in the World Trade Organisation WTO). Given that powers are very often shared by the Community and the Member States, joint representation is provided by the Commission (for issues falling within the sphere of activities of the Community) and by the Presidency of the Council (for matters where common positions may be adopted).

The Commission's role in the second and third pillars of the European Union

The 1992 Treaty on European Union (TEU) provides for Commission intervention in the area of the common foreign and security policy (CFSP) and for cooperation in the fields of justice and home affairs (JHA), but its role is less extensive than the one it plays in the context of the European Communities.

The Commission is fully associated with the work carried out in the area of the CFSP (Article 27 of the TEU) and, in particular, represents the Union and is responsible for the implementation of decisions taken under this Title, and other tasks of the Presidency (Article 18 of the TEU). It may refer to the Council any question relating to the CFSP and may submit proposals to the Council (Article 22(1) TEU). The Council may also request the Commission to submit to it any appropriate proposal relating to the CFSP in order to ensure the implementation of a joint action (Article 14(4) TEU, introduced by the 1997 Treaty of Amsterdam).

Within the context of JHA reduced to police and judicial cooperation on criminal matters after the 1997 Amsterdam reform the Commission shares a right of initiative with Member States (Article 34 TEU) and elsewhere, it is fully associated with the work in the areas referred to in this Title (Article 36(2) TEU).

COMPOSITION OF THE COURT OF JUSTICE, THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES AND OF THE CIVIL SERVICE TRIBUNAL

Initially, the Court of Justice of the European Coal and Steel Community (ECSC) consisted of seven Judges (Article 32 of the ECSC Treaty, which expired 23 July 2002).

In the eyes of the founding fathers of the ECSC, seven seemed an ideal number. Without there being too many, this number allowed for a representative of each Member State to be appointed to the Court, even though the ECSC Treaty does not include this particular distribution; the Treaty includes no provision relating to the nationality of the Judges. The seventh Judge was elected by representatives of the trade unions in the coal and steel industries. One judge more than the number of Member States ensured the representation of each national legal order and, at the same time, underlined the Courts independence vis à vis the Member States.

The Judges were elected from among persons whose independence and expertise was beyond doubt, by common accord of the governments of the Member States for a period of six years, which was renewable. Every three years, either four or three Judges were replaced.

The Court of Justice of the ECSC also had two Advocates-General and one Registrar (Article 10 of the Statute). The Advocates-General were in charge of publicly presenting, totally impartially and independently, oral and reasoned conclusions on proceedings brought before the Court. They were elected for a period of six years under the same conditions as the Judges.

The Single Court of Justice established in 1958 also consisted of seven Judges, assisted by two Advocates-General. It appoints its Registrar [Articles 165, 166 and 168 of the Treaty establishing the European Economic Community (EEC) and Articles 137, 138 and 140 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom); see also Articles 32 and 32a and 32c of the ECSC Treaty].

The number of Members of the Court has increased in line with the enlargement of the European Communities. In 1973, after the accession of Denmark, Ireland and the United Kingdom, and until 1 April 1981, the Court consisted of nine Members, a number equal to that of the Member States. By Decision of the Council of 30 March 1981, the number was increased to eleven. In 1986, following the accession of Spain and Portugal, it was increased to thirteen. The number of Advocates-General was increased to four (1973), then to five (1981) and, finally, to six (1986).

After 1995, the year of accession of Austria, Finland and Sweden, the Court of Justice consisted of fifteen Judges, assisted by eight Advocates-General. A ninth Advocate-General was appointed to serve from 1 January 1995 to 6 October 2000.

The 2001 Treaty of Nice introduced the formula one Judge per Member State in order to determine the composition of the Court of Justice (Article 221 of the EC Treaty and Article 137 of the Euratom Treaty). Therefore, since 11 May 2004, the Court has been made up of 25 Judges in order to take account of the accession of ten new Member States to the European Union: the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovenia and Slovakia.

The number of Advocates-General may be increased by a Decision of the Council should the Court of Justice so request (Article 222 of the EC Treaty and Article 138 of the Euratom Treaty, as amended by the Treaty of Nice).

The Judges and the Advocates-General are appointed by common accord for a period of six years by the Governments of the Member States. They are chosen from persons whose independence is beyond doubt and who possess the ability required for appointment to the highest judicial offices in their respective countries or who are jurisconsults of recognised competence. There is a partial replacement of Judges and Advocates-General every three years. Judges and Advocates-General may be re-appointed (Article 223 of the EC Treaty and Article 139 of the Euratom Treaty).

COURT OF FIRST INSTANCE

When established in 1988, the Court of First Instance consisted of twelve Judges, one for each nationality.

The Treaty of Nice stipulates that the Court of First Instance should include at least one Judge per Member State. The number of Judges is laid down in the Statute of the Court of Justice (Article 224 of the EC Treaty and Article 140 of the Euratom Treaty). It is therefore possible to increase the number of Judges without having to amend the Treaties. Following enlargement of the European Union to include 10 new Member States in May 2004, the Court of First Instance is made up of 25 Judges, like the Court of Justice.

The Court of First Instance appoints its own Registrar and lay down the rules governing his service.

Any Judge, apart from the President, may perform the functions of Advocate General in a particular case. The Court of First Instance is assisted by an Advocate-General when it sits in plenary session and, if the legal difficulty or the complexity of the matter so demands, when it sits in Chambers.

In addition to entitling the members of the Court of First Instance to perform the functions of Advocate-General, since the entry into force of the Nice Treaty on 1 February 2003, the Statute of the Court of Justice also allows the Court of First Instance to be assisted by Advocates-General.

The Members of the Court are elected by common accord for a period of six years by the governments of the Member States. They are elected from persons whose independence is beyond doubt and who possess the ability required for appointment to high judicial office. The requirements are slightly less formidable than those for the Court of Justice. A partial replacement takes place every three years. Outgoing members may be re-elected.

Composition of the Civil Service Tribunal

Article 2 of Annex I of the Statute of the Court of Justice (amended by the Council decision of 2 November 2004) provides that the Civil Service Tribunal shall consist of seven Judges. Should the Court of Justice so request, the Council, acting by a qualified majority, may increase the number of judges.

The Members of this judicial panel, attached to the Court of First Instance, are elected from persons whose independence is beyond doubt and who possess the ability required for appointment to high judicial office. The appointment procedure is different insofar as Judges are appointed by the Council acting unanimously following consultation with a committee. Article 3 of Annex I of the Statute of the Court of Justice provides that this committee, comprising seven independent persons, shall give an opinion on candidates' suitability to perform the duties of judge. This opinion has appended to it a list of candidates contain the names of at least twice as many candidates as there are judges to be appointed. In its appointments, the Council shall ensure a balanced composition of the Tribunal on as broad a geographical basis as possible from among nationals of the Member States and with respect to the national legal systems represented.

The judges shall be appointed for a renewable period of six years. The Civil Service Tribunal appoints its own Registrar and lays down the rules governing his service.

Statute of the Judges and of the Advocates-General

The Judges and the Advocates-General, must, before taking up office, swear to perform their duties in total impartiality and in full awareness of the fact that they must uphold the secrecy of the deliberations of the Court.

They may not hold any political or administrative office nor be involved in any professional activity, save by special derogation. After taking up office, immediately after having taken oath, they sign a declaration by which they solemnly swear to respect, throughout their term of office and after termination thereof, the commitments arising from their duties, in particular their duty of honesty and sensitivity as to the acceptance of certain appointments or certain advantages after they have left office.

They enjoy legal immunity, and no criminal charges may be brought against them. The Court may waive their immunity.

Apart from periodic renewals and death, the office of Judge and Advocate-General ends individually by resignation.

Organisation of the Court of Justice and the Court of First Instance of the European Communities

The Presidency

The Judges elect the President of the Court of Justice from among their number for a term of three years. He may be re-elected. He directs the judicial business and the administration of the Court; he presides at hearings and deliberations in chambers. He assigns the cases to one of the chambers for any preparatory inquiries and appoints a Judge from the chamber to act as rapporteur. He sets the dates and timetable for the sessions of the Grand Chamber and of the full Court. The President also personally takes a decision on requests for the application of interim measures.

Advocates-General

The Advocate-General has the role of publicly presenting reasoned submissions on cases that require his intervention, acting totally impartially and independently. The First Advocate-General, appointed by the Court for the period of one year, determines the allocation of cases to the Advocates-General as soon as the President has appointed the Judge-Rapporteur.

Registry

The Court appoints the Registrar for a period of six years, after which he may be reappointed. The Court may also appoint one or more Assistant Registrars. He helps the Court, the Chambers, the President and the Judges in all their official functions. He is responsible for the Registry as well as for the receipt, transmission and custody of documents and pleadings which have been entered in a register initialled by the President. He is Guardian of the Seals and is responsible for the Courts archives and publications. The Registrar is responsible for the administration of the Court, its financial management and its accounts, and he is helped by an administrator.

The operation of the Court is in the hands of officials and other servants who are responsible to the Registrar under the authority of the President. The Court administers its own infrastructure; this includes the language service, which plays a particularly important role.

Assistant Rapporteurs

Assistant Rapporteurs may be appointed by the Council, on a proposal from the Court, particularly to assist the President in applications for the adoption of interim measures and to assist Judge-Rapporteurs in the performance of their duties.

Organisation of the Court of First Instance

The Members of the Court of First Instance appoint the President of the Court from among their number for a term of three years. He may be re-elected. His duties are analogous to those of the President of the Court of Justice.

The Court of First Instance appoints its own Registrar to hold office for a renewable term of six years. His duties are also comparable to those of the Registrar of the Court. It must be stressed that the administration of the Court of First Instance, its financial management and accounts are the responsibility of the Registrar, who may, however, use the services provided by the Court of Justice in the manner determined by common accord between the Presidents of the two bodies. The officials and other servants whose task is to help the President, the Judges and the Registrar are responsible to the Registrar under the authority of the President of the Court of First Instance.

Operation of the Court of Justice and the Court of First Instance of the European Communities

Operation of the Court of Justice

The Court of Justice is permanently in session.

The Court of Justice may sit in Chambers, in Grand Chamber or in plenary session.

The number and composition of the Chambers have been changed over the years. The Court of Justice of the European Coal and Steel Community (ECSC) established two Chambers consisting of three Judges. The Court of Justice of the European Communities also decided, at its session of 21 October 1958, to set up two Chambers consisting of three Judges

The basic Treaties made provision for the possibility of Chambers being formed of three or five Judges (Article 165 of the Treaty establishing the European Economic Community, Article 137 of the Treaty establishing the European Atomic Energy Community and Article 32 of the ECSC Treaty). After the Rules of Procedure were amended in 1979, the Court determines the number and composition of the Chambers as it sees fit. In 1995, following the Act of Accession of Austria, Finland and Sweden, the text of the Treaties was amended so as to enable the formation of Chambers consisting of three, five or seven Judges.

Since entry into force of the Statute of the Court of Justice adopted in Nice on 26 February 2001, the formations of the Court are the following:

Chambers composed of five or of three Judges;

the Grand Chamber composed of eleven Judges;

a plenary session composed of all the Judges.

As a result of the increase in the number of the Judges that followed the 2004 enlargement, the Grand Chamber has been made up of thirteen Judges since 1 May 2004.

The Judges elect from amongst themselves the Presidents of the Chambers composed of three Judges for one year and the Presidents of the Chambers with five Judges for a term of three years renewable once. The Chambers of three Judges and of five Judges are, for each case brought before them, composed of the President of the Chamber, the Judge-Rapporteur and the number of Judges needed to make up the number to three and five Judges respectively.

For each case brought before the Grand Chamber, it is composed of the President of the Court, the Presidents of the Chambers of five Judges, the Judge-Rapporteur and the number of Judges needed to make up the number to thirteen. The Court sits in the Grand Chamber if a Member State or an institution of the Communities that is a party to the proceedings so requests.

The Court decides which Judges shall be attached to the various Chambers. Their composition is published in the Official Journal of the European Union.

The Court sits in plenary session when it hears cases concerning compulsory retirement of the Ombudsman, of Members of the Commission and of Members of the Court of Auditors, as well as the forfeiture to the right to a pension or other benefits in its stead. In addition, the Court may decide to refer cases of exceptional importance to the Court sitting in plenary session.

The Court deliberates in closed session. Decisions of the Court are valid only when an uneven number of its members is sitting in the deliberations. Decisions of the Court in plenary session are valid if fifteen Judges are sitting; decisions of the Chambers consisting of three or five Judges are valid only if three Judges are sitting; decisions of the Grand Chamber are valid only if nine Judges are sitting.

The Court may choose to hold one or more sittings in a place other than that in which the Court has its seat.

Operation of the Court of First Instance

The Court of First Instance sits in Chambers of three or five Judges, and in Grand Chamber, composed of thirteen Judges. The composition of the Chambers is published in the Official Journal of the European Union. The Court may sit in plenary session, and since 1 July 1999, may sit in session constituted by a single Judge in specific cases defined by the Rules of Procedure.

Whenever the legal difficulty or the importance of the case or special circumstances so justify, a case may be referred to the Court of First Instance sitting in plenary session, to the Grand Chamber or to a Chamber composed of a different number of Judges. Similarly, certain types of cases assigned to a Chamber composed of three Judges may be heard and determined by the Judge Rapporteur sitting as a single Judge where, having regard to the lack of difficulty of the questions of law or fact raised, to the limited importance of those cases and to the absence of other special circumstances, they are suitable for being so heard and determined.

The Judges elect from amongst themselves the Presidents of the Chambers of three Judges for a set period and the Presidents of the Chambers of five Judges for a term of three years renewable once.

The Court deliberates in closed session. The quorum for a plenary session is half the Judges plus one, for the Grand Chamber nine Judges, and for a Chambers session three.

Like the Court of Justice, the Court of First Instance may choose to hold one or more sittings in a place other than that in which the Court has its seat.

Proceedings before the Court of Justice and the Court of First Instance of the European Communities

Proceedings before the Court of Justice

Once the case has been brought before the Court of Justice, the President of the Court assigns it to one of the Chambers and designates the Judge-Rapporteur. Cases are allocated among the Chambers according to criteria established by the Court.

The language of the case is normally chosen by the applicant, but certain exceptions are provided for.

Proceedings before the Court of Justice consist of a written stage and an oral stage.

Written proceedings begin with the submission of an application. After it has been entered in the Registry by the Registrar, a notice is published in the Official Journal of the European Union, indicating the date of entry, the names and addresses of the parties involved, the substance of the dispute, the conclusions of the application, the grounds and the main arguments put forward.

The application is notified to the defendant who lodges a defence memorandum. In addition, the applicant may submit a reply and the defendant a rejoinder.

The Judge-Rapporteur submits a preliminary report to the Court. The Court may decide to open a preparatory inquiry and assign it to a chamber, if it decides not to hear the application itself, or set a date for a public hearing.

After pleadings have been submitted, the Judge-Rapporteurs report has been delivered and the Advocate General heard, the Court may decide not to proceed to the oral stage, if none of the parties lodges an application indicating why he hopes to be heard.

The inquiry proceedings require the personal appearance of the parties, a request for information and production of documents, witness testimony, the commissioning of an experts report and inspection of the matter or place in question.

The oral procedure is opened on the date set by the President who chairs the debate and is responsible for the proper conduct of the hearing. The procedure involves the Court hearing of agents, advisers, lawyers and of the conclusions of the Advocate-General and, where necessary, the hearing of witnesses and experts. After hearing the Advocate-Generals conclusions, if any, the President declares the oral procedure closed. The Registrar draws up minutes of the hearing. The hearing takes place in open court unless decided otherwise by the Court, either without consultation or on a request from the parties, for serious reasons.

On application by the applicant or the defendant, the President may, exceptionally, on a proposal from the Judge-Rapporteur, after hearing the other parties and the Advocate General, decide to adjudicate under an expedited procedure, if the particular urgency of the case requires that the Court give a decision in the shortest possible time.

The deliberations of the Court are and remain secret.

The Court gives its decision in the form of a judgment. Once the parties have been summoned, reasons for the judgment are given, then it is signed by the President and the Registrar and delivered in public. It enters into force on the same day it is pronounced.

Judgments are published in Reports of Cases before the Court of Justice and the Court of First Instance.

Interim measures

An application to suspend the operation of any measure adopted by an institution (Article 242 of the EC Treaty and Article 157 of the EAEC Treaty) is admissible only if the applicant is challenging that measure in proceedings before the Court of First Instance. An application for the adoption of any other interim measure (Article 243 of the EC Treaty and Article 158 of the EAEC Treaty) is admissible only if it is made by a party to a case before the Court of First Instance and relates to that case.

The President takes a decision by reasoned order not subject to appeal or he may refer the matter to the Court of First Instance.

Exceptional review procedures

The provisions for the submission of an application are also applicable, with the necessary adaptations, to applications initiating third party proceedings, to applications for revising judgments as well as to appeals against decisions of the Arbitration Committee and to applications for interpretation of judgments.

Preliminary rulings

The procedure for preliminary rulings includes some unusual features. It is a non-contentious procedure excluding any initiative of the parties.

The preliminary request is recorded at the Registry; it is the subject of an acknowledgement of receipt addressed to the national court; it is served on the parties in the case before the national court, the Member States and the Commission, as well as to the Council or the European Central Bank, if the act in question is issued by the either of these, and to the European Parliament and the Council, if the act in question has been adopted jointly by the two institutions. On receipt of the notification, the parties, Member States, the institutions and the European Central Bank may submit memoranda or written observations.

The Court, having heard the interested parties and the Advocate General, may give its decision by reasoned order where a question referred to it for a preliminary ruling is identical to a question on which it has already ruled, where the reply to such a question may be deduced from case-law or where the reply to the question leaves no room for reasonable doubt.

The proceedings also consist of an oral stage. Nonetheless the Court, following submission of the above-mentioned pleadings or written observations and delivery of the Judge-Rapporteurs report and having informed the interested parties, may cancel it if none of the parties lodges an application indicating why he hopes to be heard and once the Advocate General has been heard.

In addition, the Court may seek clarification from the national court once the Advocate General has been heard.

On application by the national court, the President may, exceptionally, on a proposal from the Judge-Rapporteur and after hearing the Advocate General, decide to submit a preliminary ruling to an expedited procedure, derogating from the provisions of the Rules of Procedure, if the circumstances invoked justify an urgent decision. In this case, the President immediately lays down the date of the hearing, which will be served on the parties and to all others involved together with notice of the decision to refer. The period within which pleadings or possible observations may be submitted is prescribed by the President, who may also suggest that the parties and all others involved limit their pleadings or written observations to those essential points of law raised by the preliminary ruling.

The national court in question is notified of the judgment by the Registrar.

Special forms of procedure referred to in Articles 103 to 105 of the EAEC Treaty

Whilst an expedited procedure is applied in the case provided for in Article 103 of the EAEC Treaty, which concerns the compatibility of proposals for agreements and conventions, the usual procedure is used in the cases provided for in Articles 104 and 105 of the same Treaty, which concern agreements and conventions that already exist.

Opinions

A request for an initial opinion (Article 300 of the EC Treaty) submitted by the European Parliament is notified to the Council, the Commission and to the Member States. A request submitted by the Council is notified to the Commission and to the European Parliament. A request submitted by the Commission is notified to the Council, the European Parliament and to the Member States. A request submitted by one of the Member States is notified to the Council, the Commission, the European Parliament and to the other Member States.

The opinion is concerned as much with the compatibility of the Agreement with the provisions of the EC Treaty as with the power of the Community or of one of its institutions to conclude the Agreement.

The President designates the Judge-Rapporteur and the Court gives its reasoned opinion in the Council Chamber, after the Advocates-General have been heard.

The opinion is notified to the Council, the Commission, the European Parliament and to the Member States.

Applications for interpretation of a judgment referred to in Article 68 of the EC Treaty

After notifying the interested parties, the President lays down a deadline for them to submit their written observations and designates the Judge-Rapporteur. The first Advocate General assigns, on his side, the application to an Advocate General.

The procedure includes an oral stage when a Member State or one of the institutions requests it.

The Court gives its decision in the form of a judgment, after submission of the Advocate Generals conclusions.

The settlement of disputes referred to in Article 35 of the EU Treaty

The procedure regarding applications for interpretation of a judgment referred to in Article 68 of the EC Treaty is applicable mutatis mutandis.

Appeals

Within two months from the service of the judgment of the Court of First Instance, any party which has been unsuccessful, in whole or in part in its submissions at first instance, interveners when directly affected by the decision, and the Member States and the institutions, even if they are neither parties nor interveners at first instance, may bring an appeal before the Court of Justice. The Court is limited to judging points of law on grounds of lack of competence of the Court of First Instance, a breach of procedure or the infringement of Community law. The ordinary procedure, except for some necessary changes, is applicable.

The Court may indicate interim measures.

The Court may reject the appeal, in whole or in part, by means of a reasoned order if the appeal is clearly inadmissible or unfounded.

Where the appeal is well founded, the Court may annul the decision of the Court of First Instance and itself give a definitive ruling on the dispute or refer the case back to the Court of First Instance for a ruling. It may also define the legal effects of the annulled judgment, which must be regarded as definitive.

Procedures provided for by the Agreement creating the European Economic Area (EEA)

In the case governed by Article 111(3) of the EEA Agreement, the matter is brought before the Court by a request submitted by the Contracting Parties to the dispute. The request is served on the other Contracting Parties, on the Commission, on the European Free Trade Association (EFTA) Surveillance Authority and, where appropriate, on the other persons to whom a reference for a preliminary ruling raising the same question of interpretation of Community legislation would be notified.

The request is made in one of the official languages of the Community.

The Court gives a reasoned decision on the request.

In the case of the preliminary ruling procedure governed by Article 1 of Protocol 34 to the EEA Agreement, the request of a court or tribunal of an EFTA State is served on the parties to the case, on the Contracting Parties, on the Commission, on the EFTA Surveillance Authority and, where appropriate, on the other persons to whom a reference for a preliminary ruling raising the same question of interpretation of Community legislation would be notified.

If the request is not submitted in one of the official EC languages, it is accompanied by a translation into one of those languages.

Proceedings before the Court of First Instance

Proceedings before the Court of First Instance are similar to those before the Court of Justice, and the rules applicable to it do not depart more than necessary from the rules relating to proceedings before the Court of Justice. However, the unique nature of the Court as a court of first instance requires changes to proceedings in order to ensure sufficient protection in cases involving detailed examination of the facts.

Proceedings before the Court of First Instance are unusual in that organisational measures exist which aim to ensure that cases are prepared for hearing, proceedings carried out and disputes resolved. Those measures may consist in putting questions to the parties, inviting the parties to comment on certain aspects of the proceedings, asking the parties or third parties for information or particulars, asking for documents to be produced, and summoning the parties agents or the parties in person to meetings.

All parties concerned, as well as the Member States and Community institutions, even if they did not take part in the dispute, are informed of the Courts decisions by the Registrar.

Removal of a case from the Court of First Instance

Where the Court of Justice and the Court of First Instance are seised of cases in which the same relief is sought, the same issue of interpretation is raised or the validity of the same act is called in question, the Court of First Instance may, after hearing the parties, stay the proceedings before it until such time as the Court of Justice has delivered judgment or, in cases governed by Article 230 of the EC Treaty or by Article 146 of the EAEC Treaty, the Court of First Instance may also decline jurisdiction in order that the Court of Justice may rule on such applications. In the same conditions, the Court of Justice may also decide to stay the proceedings before it until such time as the Court of First Instance has delivered judgment.

Accelerated procedures

If the particular urgency and the circumstances of the case so demand, the Court of First Instance may, on application by the applicant or the defendant, decide to adjudicate under an expedited procedure after hearing the other parties and the Advocate General.

The contribution made by the case-law of the Court of Justice of the European Communities

The Court of Justice has contributed significantly to the Community legal system. Its creative case-law has remedied any shortcomings in the basic Treaties by supplementing and clarifying the provisions thereof.

Acknowledgement of basic principles, such as the direct applicability of Community law (judgment of 5 February 1963 in the Van Gend en Loos case, 26/62) and the primacy of Community law over national law (judgment of 15 July 1964 in the Costa/ENEL case, 6/64), has constituted its most significant contribution to European integration. On the basis of these principles, individuals may invoke Community law before national courts and seek the non-application of any national law which is contrary to Community law.

Since there is no written catalogue of fundamental rights in the Treaties, and in order to safeguard the primacy and uniform application of Community law, the Court was obliged to establish a system for the protection of those rights on the basis of the general principles of Community law. Starting from the constitutional traditions common to the Member States and international instruments for the protection of human rights, the Court ensures the safeguarding of fundamental rights in the field of application of Community law (judgments of 12 November 1969, 29/69, in the Stauder case and of 17 December 1970 in the Internationale Handelsgesellschaft case, 11/70).

To ensure the complete effectiveness of Community legislation and the protection of the rights of individuals, the Court has declared that the national authorities are financially liable, where a breach of Community law is attributable to the Member States, and must pay damages (judgment of 19 November 1991 in the Francovich case, C6/90 and C9/90).

The Court of Justice has had to take decisions on the demarcation of the Communitys powers and responsibilities. In its judgment of 31 March 1971 in the Commission/Council case concerning an international agreement on road transport (AETR 22/70), the Court established the principles of parallel internal and external powers, according to which the power to define a common policy implies the power to conclude international agreements in this sphere. The system of internal Community measures is linked to its external relations (Opinion 1/76 of 26 April 1977). The Court hereby acknowledges the principle of the evolutionary nature of Community powers and responsibilities in external relations.

As well as the extensive interpretation of provisions relating to Community powers and responsibilities, the Court monitors the exercise of powers by the Member States under the Treaties. Accordingly, the way in which the States use their powers to derogate from the provisions relating to freedom of movement are subject to other Treaty rules and to legal scrutiny (judgment of 28 October 1975 in the Rutili case, 36/75) and cannot be used to reserve certain policy areas to the jurisdiction of the Member States (judgment of 9 March 1978 in the Simmenthal case,70/77). This case-law has strengthened the Community.

The importance of the Courts case-law as a source of law is also evident in relation to Community policies. The Court had to define the concepts in the Treaty establishing the European Community (EC) such as measures having equivalent effect to quantitative restrictions on imports (Article 28) or concerted practices between undertakings and the dominant position within the common market in the field of competition (Articles 81 and 82).

With regard to the free movement of goods, the Court has extended the scope of Article 28. It deemed that measures having equivalent effect to quantitative restrictions on imports to be any measure capable of directly or indirectly, actually or potentially hindering intra-Community trade (judgment of 11 July 1974 in the Dassonville case, 8/74). In the Cassis de Dijon case (judgment of 20 February 1979 in the Rewe-Zentral case, 120/78), the Court established the principle whereby goods lawfully manufactured and marketed in a Member State, in accordance with the fair and traditional rules and methods of production of that country, should be admitted into any other Member State without restriction (principle of mutual recognition of national regulations). Nevertheless, the Court excluded from the scope of Article 28 any national law prohibiting resale at a loss, providing that it was applicable to all relevant traders operating in the national territory and providing that it was applicable to the marketing of national products and of those from other Member States (judgment of 24 November 1993 in the Keck and Mithouard case, C267 et C268/91).

The judgment of 4 December 1974 in the Van Duyn case (41/74) confirmed the direct applicability of free movement of workers (Article 39 of the EC Treaty). In the Bosman ruling of 15 December 1995 (C415/93), the Court found that free movement of workers constituted a fundamental freedom in the Community system and declared that Article 39 was contradictory to the application of rules laid down by sports associations whereby football clubs might field only a limited number of professional players who were citizens of other Member States.

In the judgment of 21 June 1974 in the Reyners case (2/74), the Court ruled that Article 43 of the EC Treaty (right of establishment) included a ban on discrimination on grounds of nationality which might be directly invoked by individuals. The direct effect of freedom to provide services was acknowledged by the Court in the judgment of 3 December 1974 in the Van Binsbergen case (33/74).

Article 141 of the EC Treaty (principle of equal pay for male and female workers for equal work) was interpreted as a provision, conferring on individuals rights which they might invoke directly before the courts (judgment of 8 April 1976 in the Defrenne case, 43/75).

Since it was established, the Court of Justices overall activity has been nothing but positive. Its case-law has enabled integration to proceed, whilst safeguarding the acquis communautaire (the body of Community legislation adopted to date) and making the European Community into a Community based on the rule of law (judgment of 23 April 1986 in the Les Verts case, 294/83).

The Court of Auditors is made up of one Member from each EU Member State. Initially, there were nine Members.

The Members of the Court of Auditors are chosen from among persons who belong or have belonged to external audit bodies in their respective countries or who are especially qualified for this office. Their independence must be beyond doubt.

Their term of office lasts for six years. However, when the first Members of the Court were appointed in 1977, in order to avoid replacing the entire body, four Members chosen by lot were given a reduced mandate of four years. As a result of the modifications made by the Treaty de Nice, the Council, after consultation with the European Parliament, adopts by qualified majority the list of Members drawn up in accordance with the proposals made by each Member State. The term of office is renewable.

The Members of the Court, in the general interest of the Community, are completely independent in the performance of their duties. They must neither seek nor take instructions from any government or any other body, and they must refrain from any action incompatible with their duties. During their term of office, the Members of the Court may not engage in any professional activities. When appointed, they must give a solemn undertaking to respect the obligations arising from their duties, both during and after their term of office.

Apart from normal replacement, the duties of an individual Member end when he/she resigns or is compulsorily retired by a ruling of the Court of Justice. In both cases, the Member concerned is replaced for the remainder of the term in office.

The conditions of employment and particularly the salaries, allowances and pensions of Members of the Court, as well as all payments made instead of remuneration, are determined by the Council.

The provisions of the Protocol on the privileges and immunities of the European Communities applicable to Judges of the Court of Justice also apply to Members of the Court of Auditors.

Organisation of the European Court of Auditors

The Court of Auditors is organised and operates as a body. This does not prevent the internal allocation of duties between its Members. However, the Treaty of Nice authorises the establishing of internal chambers in order to adopt certain categories of reports or opinions under the conditions laid down by its Rules of Procedure.

(a) The Presidency

The President of the Court is elected by the Members of the Court for a term of three years. This term of office is renewable. He is appointed by secret ballot of the Members who have applied for the post, by a majority of two-thirds of the votes cast. The President carries out the following duties:

convening and chairing the meetings of the Court, and ensuring that debates run smoothly;

ensuring that decisions taken by the Court are implemented;

ensuring that departments run smoothly and that the various Court activities are soundly managed;

appointing a representative of the Court in contentious proceedings in which it is involved;

representing the Court in external relations.

The President may delegate these tasks to one or more Members of the Court.

(b) Audit groups

These groups have a preparatory role and are created by special implementing decisions of the Court which lay down their respective powers. On a proposal from the President, the court assigns each of its Members to an audit group.

The vertical audit groups allocate the tasks which fall within their jurisdiction between their members while ensuring a balanced allocation of the overall workload.

Horizontal audit groups are composed of the Member to which the Court has entrusted responsibility for a horizontal task, a representative of each vertical audit group and, where necessary, other Members that the Court may assign to them.

According to the powers laid down on 12 September 2002, there exist four vertical audit groups (Audit Groups I, II, III and IV) and one horizontal group (divided into two sectors, one sector known as ADAR, which is responsible for coordination of the procedure for drawing up reports, and the other as DOS, which coordinates work on the Statement of Assurance).

(c) The Secretariat-General

The Court elects the Secretary-General by secret ballot. He draws up draft minutes of meetings and keeps archives of all decisions, letters from the President, all Court and audit group decisions and minutes of the meetings of the Court and of the audit groups. He takes steps to ensure the notification and publication of Court documents in the Official Journal of the European Union. He assists the President in undertaking preparations for the meetings of the Court and in ensuring compliance with procedures and the proper implementation of Court decisions. He is responsible for personnel management and for Court administration.

Operation of the European Court of Auditors

In general, the Court of Auditors takes its decisions in session. It is convened by the President in accordance with the established timetable of meetings, additional meetings being organised on the initiative of the President or at the request of at least two Members.

The quorum of Members present required for deliberations to be valid is ten.

Most Court decisions are adopted by a majority of its Members.

Court sittings are not held in public. The Court may deliberate in restricted session when, in the opinion of the President, the confidential nature of the subjects under discussion so justifies.

Procedures in the European Court of Auditors

The Court of Auditors appoints one Member as rapporteur for each of the audits that it carries out. Where it is required to deliver an opinion, the Court appoints the rapporteur(s) responsible for considering the matter and for preparing the draft opinion. For the presentation of observations, the rapporteur is the Member responsible for the audit sector involved. For horizontal aspects of the audit, it is the Member specifically appointed to this role by the Court.

After it has been considered by the audit group, the draft report prepared by the rapporteur is reviewed by the Court as a body. The Court may order that the file be closed, be further investigated, or be pursued through its inclusion in the annual report or by the presentation of observations. Where the Court decides to pursue an issue before definitively adopting its observations and to include them in annual or special reports, it gives the institutions under audit the opportunity to formulate replies. Once adopted by the Court and signed by the President, the definitive texts of acts of the Court (reports, opinions, observations and statements of assurance) are forwarded to the various institutions. The Court decides on a case-by-case basis whether to publish the acts in the Official Journal of the European Union. Replies from the institutions under audit are published together with the observations of the Court.

Power of audit of the European Court of Auditors

The basic Treaties entrusted to the Court of Auditors the general remit of auditing. The Court of Auditors shall carry out the audit (Article 246 of the EC Treaty and Article 160a of the EAEC Treaty; see also Article 45a of the ECSC Treaty, which expired on 23 July 2002).

Nature and scope of the audit

The Court of Auditors carries out an external audit of the correct implementation of the budget. It should be noted that external audits as opposed to internal audits are carried out by institutions different from those responsible for the implementation of the budget. Therefore, while the Commission is the institution primarily responsible for implementation of the budget, and internal audits are carried out by its financial controllers, external audits are carried out by the European Parliament and the Court of Auditors.

The Court of Auditors examines the accounts of all revenue and expenditure of the Community and of all bodies set up by the Community insofar as the relevant constituent instrument does not preclude such examination (Article 248(1) of the EC Treaty and Article 160c of the EAEC Treaty; see also Article 45c of the ECSC Treaty). The audit is therefore an ex post audit of financial transactions involving expenditure and revenue already undertaken.

Under the treaties, the Court of Auditors both examines whether revenue has been received and expenditure incurred in a lawful and regular manner and whether the financial management has been sound.

With regard to the examination for legality and regularity, it should be noted that the Court of Auditors does not enjoy any jurisdictional power nor the power to impose sanctions. The Court undertakes the task of financial auditing by ensuring that transactions comply with budgetary and accounting rules. Since the entry into force of the Treaty of Amsterdam, the Court must report any irregularity uncovered during its audits (Article 248(2) of the EC Treaty and Article 160c(2) of the EAEC Treaty; see also Article 45c(2) of the ECSC Treaty).

In addition to its main task of auditing, the Court also guarantees sound financial management, by ensuring that transaction objectives match the resources allocated to attain them. In order to do this, the Court examines whether the principles of budgetary law, such as economy, effectiveness and efficiency, have been respected.

The EC Treaty provides for the Court of Auditors to assist the European Parliament and the Council in exercising their powers of control over the implementation of the budget. The Courts role of assistance is provided mainly as part of the procedure for giving discharge in respect of the implementation of the budget. Every year, the Court of Auditors presents its annual report relating to the preceding financial year to the discharge authority. The European Parliament, on a recommendation from the Council, then gives discharge in respect of the implementation of the budget.

Audit methods

The audit is based on records, and where necessary, may be performed on the spot in the other European Institutions and in the Member States. After their amendment by the Treaty of Amsterdam, the treaties provide that on-the-spot audits may take place on the premises of any body which manages revenue and expenditure on behalf of the Community and of any natural or legal person in receipt of payments from the Community budget. Community and national institutions, audit bodies or departments and natural or legal persons must, upon request, forward to the Court any document or information necessary to carry out its task.

Accordingly, audits in Member States are carried out in collaboration with national audit institutions (NAIs) or competent national departments. To that end, cooperation in a spirit of trust and respect for independence is envisaged between the European Court of Auditors and the national audit institutions of the Member States. Given that the powers of the national authorities to manage Community policies are always more extensive, such close cooperation is essential to ensure the effectiveness of the audit. Cooperation is particularly vital in combating fraud. The Contact Committee of the Heads of the Supreme Audit Institutions (SAIs) of Member States meets annually, alternating between Luxembourg and the capital city of one of the Member States. Furthermore, since 1993, an annual meeting with the heads of the SAIs of the Countries of Central and Eastern Europe (CEECs), Cyprus and Malta has been held as part of the preparations for their accession to the European Union.

Audit results: drawing up reports

The Courts observations are recorded in annual and special reports.

After the close of the financial year, the Court draws up its annual report, which is forwarded to the other Community institutions and published in the Official Journal of the European Communities, together with the replies of the institutions to the Courts observations. The report focuses on activities relating to the general budget and to the European Development Fund (EDF).

In addition, the Court draws up specific annual reports:

the report on the annual accounts of the Euratom Supply Agency;

the report on the accounts of the Joint Undertaking: JET;

the report on the accounts of the European Schools;

the report on the annual accounts of satellite bodies of the European Union in respect of which the Court carries out the external audit;

the report on the review of the management efficiency of the European Monetary Institute

and of the European Central Bank since its establishment (Article 27 of the Protocol on the Statute of the European System of Central Banks and of the European Central Bank);

the specific annual report on the annual accounts relating to the management, by the Secretary-General/High Representative of the Council, of contracts concluded by him as a representative of certain Member States, concerning the installation and functioning of the Help Desk Server of the Management Unit and of the Sirene Phase II network (Schengen Contracts).

In addition, the Court may, at any time, submit observations on specific issues in the form of special reports.

The annual report and the relevant special reports are considered by the European Parliament, acting on a recommendation from the Council, with a view to giving a discharge to the Commission in respect of the implementation of the budget (Article 276 of the EC Treaty and Article 180b of the EAEC Treaty; see also Article 78g of the ECSC Treaty).

Since the entry into force of the Maastricht Treaty, the Court of Auditors must also provide 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. This procedure, which requires the Court of Auditors to endorse the entire budget, was used for the first time in 1994. Since the Treaty of Amsterdam, the Statement of Assurance, together with a special report enlarging on each of the points in the Statement of Assurance, have been published in the Official Journal of the European Communities (which became the Official Journal of the European Union in 2003).

Consultative powers of the European Court of Auditors

The opinion of the Court of Auditors must be sought by the Council before the adoption of legislative provisions with financial implications (Article 279 of the EC Treaty and Article 183 of the EAEC Treaty; see also Article 78 of the ECSC Treaty, which expired on 23 July 2002). This mandatory consultation of the Court of Auditors applies in three instances: when the Council decides on financial regulations, when the budget revenue provided under the arrangements relating to the Communitys own resources is made available to the Commission, and when the Council lays down rules concerning the responsibility of financial controllers, authorising officers and accounting officers. Following the Amsterdam reform, Article 280(4) of the EC Treaty also provides for the mandatory consultation of the Court before the adoption of any legislation in the fields of the prevention of and the fight against fraud.

Furthermore, the Court of Auditors may deliver an opinion at the request of one of the other institutions of the Community (the second subparagraph of Article 248(4) of the EC Treaty and the second subparagraph of Article 160c(4) of the EAEC Treaty; see also the second subparagraph of Article 45c(4) of the ECSC Treaty). These optional opinions may be published in the Official Journal of the European Union, by a decision of the Court after consulting the institution which requested the opinion or the institution concerned by the Courts analysis. However, some opinions are private documents: they are not published and may not be consulted.

The opinion of the Court of Auditors is never binding.

COMPOSITION OF THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND OF THE ECSC CONSULTATIVE COMMITTEE

The Economic and Social Committee (ESC) consists of representatives of the various categories of economic and social activity in organised civil society; in particular, representatives of producers, farmers, carriers, workers, dealers and craftsmen, professional occupations, consumers and representatives of the general public.

When it was established, the ESC consisted of 101 members [Article 194 of the Treaty establishing the European Economic Community (EEC) and Article 166 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom)].

The number of members of the ESC has been changed in the wake of successive enlargements of the European Communities. On 1 January 1973, on the occasion of the first enlargement (Denmark, Ireland and the United Kingdom), the number was raised to 144. The second enlargement (Greece), on 1 January 1981, entailed the appointment of 12 new members, and, on 1 January 1986, the ESC was supplemented by a further 33 members (the third enlargement, to include Spain and Portugal). Following the accession of Austria, Finland and Sweden, which took place on 1 January 1995, the ESC comprised 222 members.

The Treaty of Nice of 2001, which entered into force on 1 February 2003, stipulated that the number of its members should not exceed 350. Declaration No 20 of the Accession Treaty for the new Member States, signed in Athens on 16 April 2003, provides for a new allocation per Member State, applicable from 1 May 2004:

Germany 24

Italy 24

France 24

United Kingdom 24

Spain 21

Poland 21

Austria 12

Belgium 12

Hungary 12

Netherlands 12

Sweden 12

Portugal 12

The Czech Republic 9

Denmark 9

Greece 12

Ireland 9

Finland 9

Slovakia 9

Cyprus 6

Luxembourg 6

Malta 5

Since its establishment, ESC members, known as advisers, must belong to three groups:

Group I: Employers

Group II: Workers

Group III: Various Interests

However, it may happen that some members decline to belong to one of these groups. In particular, this is the case for representatives of certain corporative organisations.

Appointment

Members of the ESC are appointed by the Council for a term of four years. They may be reappointed.

As a result of the modifications made by the Treaty de Nice, the Council adopts by qualified majority the list of Members drawn up in accordance with the proposals made by each Member State. Previously, each Member State submitted to the Council, which took decisions unanimously, a list containing twice as many candidates as there were seats allotted to its nationals.

The Council consults the Commission regarding the proposals made by the Member States. It may also seek the opinions of European organisations which represent the various spheres of economic and social activity concerned by the Communitys activities.

Status of the members

ESC members may not be bound by any mandatory instructions. They carry out their duties in complete independence, in the general interest of the Community.

In the performance of their duties, and during the course of their travel to and from the venues for meetings, members and deputies of the ESC enjoy the customary privileges, immunities and facilities, in accordance with Article 11 of the Protocol on the privileges and immunities of the European Communities.

The end of the members mandate

The mandate of ESC members expires at the end of the four-year term, as fixed by the Council, at the moment that the Committee is replaced.

The mandate ends on resignation, removal from office, death, force majeure or should an incompatibility arise.

The duties of an ESC member are incompatible with those of a member of a government, of a national parliament, or of one of the Community institutions. A member may belong neither to the Committee of the Regions nor to the Board of Directors of the European Investment Bank, nor may he/she be an official or other servant of the Communities.

The ECSC Consultative Committee

The composition of the ECSC Consultative Committee had certain distinctive features.

Unlike the ESC, it was a joint body in that it comprised equal numbers of producers, of workers and of consumers and dealers (Article 18 of the ECSC Treaty).

Originally, the ECSC Consultative Committee consisted of 51 members the Treaty provided for no fewer than 30 members and no more than 51 . The ECSC Consultative Committee has increased in size progressively, following the accession of further Member States to the Community. The number of members, as a result of changes introduced in 1995, was to be no fewer than 84 and no more than 108. For its last term, 20012002, it had 108 members.

Members of the ECSC Consultative Committee were appointed by the Council by a majority decision for a two-year term. Moreover, the appointment procedure did not involve the Member States: the Council designated the organisations representing producers and workers, between whom the seats to be filled were divided. The organisations were asked to draw up lists with twice the number of candidates as there were seats to be allotted. Appointments were made on the basis of these lists.

Organisation of the European Economic and Social Committee and of the ECSC Consultative Committee

The Economic and Social Committee (ESC) operates in four-yearly terms. Every four years, after each replacement, it is convened by the oldest member no more than one month after members of the Committee have been notified of their appointment by the Council.

The members of the Committee are divided into groups. They contribute to the organisation of the Committees work by preparing their members for the meetings of the various bodies.

The Committee bodies, the composition of which takes into account both the population size of the Member States and the various categories of economic and social activity represented on the Committee, are the following: the Assembly, the Bureau, the President and the specialised sections.

In addition, the ESC can set up study groups, subcommittees, observatories as well as advisories.

From among its members, the Committee elects its President, its two Vice-Presidents and the members of the Bureau other than the Presidents of the groups and of the sections, for a term of two years.

Groups and categories

The members of the ESC may, on a voluntary basis, form groups representing employers, workers and other categories of economic and social activity in organised civil society.

Groups elect their Presidents and Vice Presidents and participate in the preparation, organisation and coordination of the work of the Committee and of its bodies. They have a secretariat. In practice, there are three groups:

Group I: Employers

Group II: Workers

Group III: Various Interests

The General Secretariat gives ESC advisers that do not belong to any group the material and technical assistance necessary to the exercise of their duties.

Similarly, advisers belonging to different groups in the ESC can regroup crosswise as representatives of various categories of economic and social activity in organised civil society.

Decision-making bodies

Plenary Assembly

The Assembly, composed of all ESC members, meets during the various sessions. In theory, these sessions take place during the last seven days of each month, in accordance with the calendar established by the Bureau. In general, there are ten sessions each year. Opinions are adopted during a plenary session, on the basis of the opinion of the section or of the subcommittee responsible for their preparation.

Bureau

The 2002 Rules of Procedure, as last amended after the 2004 enlargement, lay down that the Bureau of the ESC is composed of 37 Members. Each Member State must be represented in it. It is made up of:

a President, his two Vice-Presidents and 25 members, directly elected by the Assembly

the Presidents of the six specialised sections;

the Presidents of the groups.

The President is chosen in rotation from amongst the members representing employers, workers and the other categories of economic and social activity. The Vice-Presidents are chosen from amongst the groups to which the President does not belong.

The Bureau is convened by its President, either automatically or at the request of ten of its members.

The Bureau has within it a budget group charged with assisting it in the exercise of its prerogatives regarding financial and budgetary matters.

The main roles of the Bureau are:

to be politically responsible for the general management of the Committee. It ensures that the activities of the Committee, of its bodies and of its staff comply with its institutional role;

to organise and to coordinate the work of the Committee and of its bodies. It is responsible for the management of the human, budgetary or technical resources used in the carrying out of its duties. It has a role in the budgetary procedure and in the organisation of the secretariat;

to interpret the Rules of Procedure and its Rules of Application upon request from a Member or from the Secretary General;

to consider the steps to be taken following an Opinion given by the Committee.

Presidency

The main roles of the President of the ESC are:

to preside over the work of the Committee;

to represent the Committee in its external relations;

to give an account to the Committee of steps taken and progress achieved on its behalf between sessions;

In the event of absence, the President is replaced by the Vice-President belonging to the group which will hold the next Presidency.

Bodies for preparatory work

Specialised sections

The ESC is composed of 6 specialised sections. Other sections can be formed by the plenary Assembly on a proposal from the Bureau in all areas covered by the treaties. The sections are formed after each four yearly replacement. When such renewals take place, the list and the responsibilities of the specialised sections can be examined. The number of members and the general composition of the sections are determined by the Committee on a proposal from the Bureau.

The Rules of Procedure list the following sections:

Economic and Monetary Union and Economic and Social Cohesion (ECO)

The Single Market, Production and Consumption (INT)

Transport, Energy, Infrastructure and the Information Society (TEN)

Employment, Social Affairs and Citizenship (SOC)

Agriculture, Rural Development and the Environment (NAT)

External Relations (REX).

Every Committee member, with the exception of the President, must be member of at least one section. Save by way of derogation, no member may belong to more than two sections.

Section members are appointed by the Committee, according to their specific area of expertise, for a renewable period of two years.

The bureau of a section comprises 12 members, including a President and two Vice-Presidents.

The task of the sections is to draw up an opinion or an information report on the problems which have been referred to them. To deal with these questions, the sections may set up internal study groups, drafting groups, or appoint a single rapporteur.

Subcommittees and rapporteurs general

The Committee may set up internal subcommittees whose role is to draw up, on general questions or on certain issues relating to the powers and responsibilities of several sections, draft opinions or information reports.

Observatories, auditions, experts

The Committee may set up observatories wherever the nature, scale and specific character of the subject in hand requires particularly flexible working methods, procedures and instruments.

In 1994, the ESC set up a Single Market Observatory (SMO), thus allowing it, with the support of other Community Institutions, to organise actions designed to improve relations between European citizens and the European institutions.

If the importance of a question on a particular subject warrants it, the various bodies and working structures in the ESC may hear eminent persons from the outside.

The President may appoint experts on his own initiative, as a result of a proposal from the groups, the specialised sections or the rapporteurs, where this proves necessary.

Consultative Commissions

The Committee has the power to form Consultative Commissions composed of members of the ESC and of delegates from areas within the organised civil society. The first Consultative Commission to be created was the Consultative Commission on Industrial Change (CCIC). The CCIC is composed of 24 members of the ESC and of 30 external delegates who come from social and occupational organisations in the coal and steel sectors. This make up will gradually be extended to cover other sectors concerned with the problems of modernising the economy, and all the interests linked thereto.

Therefore the ESC is, for the first time, in a position to draw up opinions in the framework of a structured dialogue between its members and representatives of the sectors and interest groups concerned with industrial change, as it examines various issues as much from the point of view of its social and economic partners as that of environmental protection or of sustainable development.

Dialogue with economic and social organisations in the Union and non member countries

The ESC can maintain structured relationships with economic and social committees and similar institutions, as well as with organisations concerned with economic and social activity in European Union and non member countries. It can also appoint delegations to maintain relations with the various categories of economic and social activity in organised civil society in those States or associations of States that belong outside the European Union.

In the case of candidate countries, such cooperation is exercised by a joint consultative committee or by contact groups.

Secretariat-General

The ESC is served by a Secretariat-General headed by a Secretary-General. He carries out his duties under the authority of the President representing the Bureau and takes a solemn oath before the Bureau that he will perform his duties conscientiously and with absolute impartiality.

The Secretary-General plays no more than an advisory role at Bureau meetings, of which he takes the minutes. He ensures that decisions taken by the Assembly, the Bureau and the President are duly executed and submits a written report, every three months, to the President concerning administrative or organisational problems as well as staff issues.

With regard to the structure of the Secretariat-General, the Economic and Social Committee and the Committee of the Regions had a common organisational structure (COS), in application of Protocol No 16 annexed to the EC Treaty by the 1992 Treaty on European Union. The 1997 Treaty of Amsterdam (Article 2.59) repealed this Protocol, conferring on the two Committees administrative autonomy and separate budgets. A cooperation agreement between the two bodies, approved by their respective Bureaux in AprilMay 1999, laid down a new form of cooperation, to be set up in the context of a more general cooperation between the Community institutions and based on the autonomy of a certain number of departments (Finances, Financial Control, Staff Support Services except for the medical and welfare departments and the Staff Representation Secretariat) and the joint operation of the other departments of the former COS.

The Secretariat of the President

The President of the ESC has a private office.

The ECSC Consultative Committee

Like the ESC, the ECSC Consultative Committee was made up of three groups, composed of representatives of producers, of workers and of consumers and dealers in the coal and steel sectors.

The Consultative Committee also had a Plenary Assembly, a Bureau and a President. The Bureau was made up of a President, two Vice-Presidents and 12 other members. It was responsible for the organisation of the Committees work and for establishing the agenda for its sessions.

The Committee was able to set up subcommittees whose role was to prepare its work. There were three permanent subcommittees (Markets and Forward Studies, Labour Problems and Research Projects) and, for the period of 20002002, one ad hoc special subcommittee (Central and Eastern European Countries). Each subcommittee had its own bureau, made up of a minimum of three and a maximum of 15 members. The subcommittees bureaux were responsible for organising the work of the subcommittee.

In general, the acts of the Consultative Committee were drawn up by technical working parties before being submitted to the subcommittees and then the plenary session.

The Consultative Committee had a secretariat headed by a secretary who was appointed by the European Commission in agreement with the Bureau of the Committee.

The operation of the European Economic and Social Committee and of the ECSC Consultative Committee

The Economic and Social Committee (ESC) is convened by its president in order to draw up opinions as requested by the Council, the Commission or the European Parliament. On receipt of a request for an opinion, the president, together with the bureau, arranges the work of the Committee taking account, as far as possible, of the time limit within which the opinion is to be delivered.

It may also be convened, on a proposal from the bureau and with the agreement of the majority of its members, to deliver opinions on its own initiative regarding all questions relating to the tasks entrusted to the European Union.

On a proposal from the bureau, the ESC may decide to draw up an information report in order to consider any question relating to European Union policies.

Procedures

The work of the specialised sections

In order to draw up an opinion or an information report, the bureau decides which section is to be responsible for the preparatory work. If the subject comes unequivocally within the competence of a specialised section, this decision is taken by the president, who then informs the bureau.

The specialised section may hold joint meetings with a Committee of the European Parliament, of the Committee of the Regions or with another specialised section of the ESC. If the specialised section so requests, or if the CCIC wishes to comment on an opinion, the CCIC may be authorised by the bureau to issue a supplementary opinion.

The sections sitting is valid only when more than half of its full members are present. If the sitting is not quorate, the president closes the meeting and, during the same day, calls a new sitting which will be valid regardless of the number of members present.

Once the preparatory work is finished, which generally takes place within a study group, the section draws up an opinion on the basis of a draft opinion prepared by the rapporteur, and if need be, by the co-rapporteur. The opinion of the section, with the attached documentation, is forwarded by the president of the section to the president of the Committee and is submitted to the Committee by its bureau as soon as is possible.

When the president, in agreement with the bureau or the assembly, believes that the rules concerning the procedure for drawing up an opinion have not been respected, or further studies prove necessary, he may ask the specialised section to examine the matter anew.

The work of the plenary sessions

An ESC sitting is valid only when more than half of its members are present. If a quorum is not reached, the president closes the sitting and, during the same session, calls a new sitting during which the Committees decisions are valid, irrespective of the number of members present.

The president opens the sitting, leads the debates and ensures compliance with the Rules of Procedure. He is assisted by the vice-presidents.

The Committee deliberates on the basis of the work of the section responsible for reporting to the assembly. Where the opinion has been adopted unopposed in the section, the bureau may propose to the assembly that a vote be taken without debate. If there are no objections, this is then implemented.

After the debate, the Committee proceeds to a paragraph-by-paragraph consideration of the opinion. It is then adopted on the basis of the text drawn up by the section and any amendments adopted. If the opinion is rejected, the president of the Committee, with the agreement of the assembly, may refer the opinion back to the relevant section for a further review, or it may name a general rapporteur who presents a new draft opinion.

The opinions adopted by the Committee, the opinions of the sections and the minutes of the plenary session are forwarded to the Council, to the Commission and to Parliament.

Voting methods

A valid vote must be for, against or abstention. The texts and decisions of the ESC and its bodies are adopted, unless otherwise agreed, by the majority of votes cast either for or against.

Votes are taken by open ballot, by roll call or by secret ballot.

As a general rule, the president of the Committee, or the president of the section, does not take part in the vote. However, should there be an equal number of votes for and against, he has the casting vote.

Urgency procedure and written procedure

Urgency procedure may be applied if the president finds that, resulting from a deadline being imposed on the Committee for the submission of its opinion, such procedure is necessary to enable the opinion to be adopted in good time.

In cases of urgency at Committee level, the president may, without consulting the bureau beforehand, take all requisite steps to enable the CES to carry out its work. The steps taken by the president must be submitted to the following session of the ESC for confirmation.

Where the urgency results from a deadline imposed on a specialised section, the president of that section may, with the agreement of the president of the Committee and in consultation with the specialised section bureau, organise the work otherwise than as provided in these Rules.

Certain opinions which are the subject of a mandatory referral by the Council or the Commission but only require a formal opinion may be adopted by a written procedure by decision of the bureau on a proposal from the specialised section concerned.

Public relations

The ESC publishes its opinions in the Official Journal of the European Union in accordance with the procedure laid down by the Council and the Commission after consultation of the Committee bureau.

The plenary sessions of the Committee and meetings of the specialised sections are open to the public. Certain debates that do not concern consultative work may be declared confidential. All other meetings are closed to the public.

ECSC Consultative Committee

The Consultative Committee was convened by its president following a request from the Commission or from a majority of the Committees members.

The Committee bureau established the agenda at least three weeks in advance of the session of the plenary assembly. The sessions were prepared by the president, together with the other members of the bureau. It was the duty of the bureau to decide if initial consideration of the issue by a subcommittee was necessary and, should this be the case, whether the question fell within the remit of of an existing permanent subcommittee or of a special subcommittee.

In general, the acts of the Consultative Committee were drawn up by technical working parties before being considered by a subcommittee, and they were then adopted during a plenary session. This meant, in practice, a three-stage procedure.

The subcommittees bureaux appointed the rapporteurs to the plenary assembly and, possibly, the drafting committees who were to assist them.

The results of the subcommittees work were forwarded by the bureau of the subcommittee to the bureau of the Committee for the information of the plenary assembly. They might take the form of a report by the subcommittee or of a draft report, opinion or resolution.

Decisions of the Committee were valid only when more than half of its members were present at the plenary session. The rapporteur for the subcommittee responsible for the initial consideration of the item on the agenda gave a summary of the debates of the subcommittee and outlined the document that it had drawn up. The Committee then proceeded to a general debate on this document.

Votes were held either by a show of hands, by standing or sitting, or by roll call. Opinions and resolutions gave a summary of only those texts that had been put to the vote and adopted unanimously or by the majority of votes cast.

The reports, opinions and resolutions of the Committee were forwarded to the Presidents of the European Commission and of the Council of the European Union. They could then be published in the Official Journal of the European Communities.

Powers and responsibilities of the European Economic and Social Committee and of the ECSC Consultative Committee

Consultative role

The Economic and Social Committee (ESC) delivers opinions following consultation, which may be either mandatory or optional. Pursuant to Article 262 of the Treaty establishing the European Community (EC) and Article 170 of the Treaty establishing the European Atomic Energy Community (EAEC or Euratom), consultation by the Council or by the Commission is mandatory where provided for by the Treaties. Moreover, it may be consulted by these institutions in all cases in which it is considered appropriate. Following the Treaty of Amsterdam of 1997, the ESC may be consulted by the European Parliament. Finally, the 1992 Maatricht Treaty granted the Committee the right to deliver opinions on its own initiative in cases in which such action is considered appropriate (this right had been recognised in 1974 by a change to the Committees Rules of Procedure). Through the opinions which it delivers on matters referred to it, the ESC participates in the Community decision-making process.

The ESC must be consulted on the following subjects:

common agricultural policy (Article 37 of the EC Treaty);

free movement of workers (Article 40 of the EC Treaty);

right of establishment (Article 44 of the EC Treaty);

freedom to provide services (Article 52 of the EC Treaty);

transport (Articles 71, 75 and 80 of the EC Treaty);

harmonisation of tax legislation (Article 93 of the EC Treaty);

approximation of laws (Articles 94 and 95 of the EC Treaty);

employment (Articles 128 and 129 of the EC Treaty);

social policy (Articles 137, 140 and 144 of the EC Treaty);

equal treatment (Article 141 of the EC Treaty);

European Social Fund (Article 148 of the EC Treaty);

education, vocational training and youth (Articles 149 and 150 of the EC Treaty);

public health (Article 152 of the EC Treaty);

consumer protection (Article 153 of the EC Treaty);

Trans-European networks (Article 156 of the EC Treaty);

industry (Article 157 of the EC Treaty);

economic and social cohesion (Articles 159, 161 and 162 of the EC Treaty);

technological research and development (Articles 166 and 172 of the EC Treaty);

environment (Article 175 of the EC Treaty).

The Council and the Commission may lay down a time limit within which the Committee must present its opinion. This may not be less than one month. Upon expiry of this time limit, the absence of an opinion may not prevent further action.

The development of what are known as exploratory opinions, drawn up at the request of the Commission at an earlier stage of the consultation procedure, prior to publication by the Commission of proposals on any given subject, should reinforce the advisory role of the Committee.

The opinions of the ESC are not legally binding.

Information role

The Economic and Social Committee has developed an information role through its own-initiative opinions and the information reports produced by its sections. In this way, it may consider any question relating to the tasks entrusted to the European Union.

The Committees role within the European Union has thus been extended to cover a wider range of duties than those stated in the Treaties. In its capacity as a debating chamber for the internal market, the Committee, with the support of other Community Institutions, organises actions designed to improve relations between European citizens and the European institutions.

Pursuant to the ESCs Rules of Procedure, its right of initiative should enable the Committee to anticipate some of the Commissions proposals, to reach decisions on problems of general concern on which it would not be consulted, and to make known its opinion on topical and politically important problems.

The ECSC Consultative Committee

The ECSC Treaty provided for both mandatory and optional consultation of the ECSC Consultative Committee (Article 19).

In cases of mandatory referral, the Commission was obliged to consult the Consultative Committee where consultation was stipulated by the ECSC Treaty (financial arrangements of Member States, financing of research activities, difficulties in re-employing workers, introduction of a quota system, serious shortages of products, publication of price lists and conditions of sale, compensation, imbalance in the conditions of competition, abnormally low salaries, etc.).

The Commission also submitted general objectives and forward programmes to the Consultative Committee, with particular regard to production, and kept it informed of the guidelines of its actions in accordance with Articles 54, 65 and 66 (financial assistance for investment, agreements and mergers likely to restrict competition).

Where consultation was optional, the Commission could consult the Committee on any matter where it considered such consultation to be appropriate.

The Committee issued own-initiative resolutions on issues falling within its remit.

The acts of the Consultative Committee were not legally binding.

Composition of the Committee of the Regions

The number of members of the Committee of the Regions is laid down by Article 263 (ex Article 198a) of the Treaty establishing the European Community (EC). The Committee originally consisted of 189 members and an equal number of alternate members, this number being increased to 222 following the accession of Austria, Finland and Sweden on 1 January 1995. The 2001 Treaty of Nice stipulates that the number of its members may not exceed 350. Declaration No 20 of the Treaty of Nice, as modified by the Accession Treaty of the ten new Member States, signed in Athens on 16 April 2003, signed in Athens on 26 February 2001, provides that the number of members shall be as follows:

Germany 24

Italy 24

France 24

United Kingdom 24

Spain 21

Poland 21

Austria 12

Belgium 12

Hungary 12

Netherlands 12

Sweden 12

Portugal 12

Czech Republic 9

Denmark 9

Greece 12

Ireland 9

Finland 9

Slovakia 9

Cyprus 6

Luxembourg 6

Malta 5

The members and alternate members are appointed for four years by the Council acting unanimously on proposals from the respective Member States. Their term of office is renewable. Until the entry into force of the Treaty of Nice in 2003, the Council decision concerning the appointment of members and alternate members was adopted unanimously.

No member of the Committee may at the same time be a Member of the European Parliament. This incompatibility was introduced by the 1997 Treaty of Amsterdam.

The members of the Committee may not be bound by any mandatory instructions. They are completely independent in the performance of their duties, in the general interest of the Community.

The members of the Committee and their alternates are representatives of regional and local bodies pursuant to Article 263 of the EC Treaty. Prior to the reform introduced by the Treaty of Nice, the EC Treaty did not specify whether they should be elected. However, the European Commission and, in particular, the European Parliament had called for the democratic legitimacy of these representatives. The Committee of the Regions itself had repeatedly requested that its members either hold a regional or local authority electoral mandate or are politically accountable to an assembly elected by direct universal suffrage. Sitting on the Committee of the Regions now depends on holding a regional or local authority electoral mandate or being politically accountable to an elected assembly.

As for the distribution of seats between the different levels of regional and local authorities, the composition of the Committee reflects the great diversity of regional, local and intermediary structures, the procedure for selecting members being different for each Member State.

The term of office of a member or alternate is terminated by resignation or death. A successor is appointed by the Council for the remainder of the term. Article 263 of the EC Treaty as modified by the Treaty of Nice also stipulates that when the mandate on the basis of which they were proposed comes to an end, the term of office of members of the Committee terminates automatically.

The members and their duly mandated alternates enjoy, in the performance of their duties and during their travel to and from the place of meeting, the customary privileges, immunities and facilities in accordance with Article 11 of the Protocol on the Privileges and Immunities of the European Communities of 8 April 1965.

Organisation of the Committee of the Regions

The constituent bodies of the Committee of the Regions are the Plenary Assembly, the President, the Bureau and the commissions. The Committee is assisted by a Secretariat-General.

Plenary Assembly

The Committee meets as a Plenary Assembly. It brings together all the members of the Committee, and its main tasks are as follows:

to adopt opinions, reports and resolutions;

to adopt the draft estimates of expenditure and revenue of the Committee;

to adopt the political programme of the Committee at the beginning of every term;

to elect the President, the first Vice-President and the remaining members of the Bureau;

to set up commissions;

to adopt and revise the Rules of Procedure of the Committee.

The Plenary Assembly is convened by the President of the Committee at least once every three months. The dates of the Plenary Sessions are fixed by the Bureau during the third quarter of the previous year. A Plenary Session can meet on one or more days.

At the written request of at least one quarter of the members, the President is obliged to convene an extraordinary Plenary Session, which must take place not sooner than one week and not later than one month after the date of the request. The written request must state the subject matter which is to be discussed. No other matter may be dealt with.

Presidency

The Committee is represented by the President. He directs the work of the Committee. If the President is absent or unable to attend, he is represented by the first Vice-President; if the first Vice-President is absent or unable to attend, the President is represented by one of the other Vice-Presidents.

The Committee elects its President from among its members for a term of two years

The election of the President of the Committee is held under the chairmanship of the interim president. He is elected by a majority of more than 50 % of the votes cast by secret ballot. If no candidate obtains the required majority in the first ballot, a second ballot is held in which the candidate receiving the highest number of votes is deemed to be elected. In the event of a tied vote, a decision is taken by drawing lots.

Bureau

The Bureau is elected by the Plenary Assembly for two years. It consists of the President, the first Vice-President, one Vice-President per Member State, 25 other members and the chairmen of the political groups.

One member per country has the title of Vice-President.

Apart from the seats of the President and the chairmen of the political groups, the Bureau seats are allocated as follows among the national delegations:

3 seats: France, Germany, Italy, Poland, Spain, United Kingdom;

2 seats: Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Hungary, Ireland, Lithuania, the Netherlands, Portugal, Slovakia, Sweden;

1 seat: Cyprus, Estonia, Latvia, Luxembourg, Malta, Slovenia.

The Bureau has the following tasks:

establishment of the policy programme at the beginning of each term, monitoring of its implementation, and presentation of an impact assessment annually and at the end of each term;

preparation, organisation and coordination of the work of the Plenary Assembly and the commissions;

overall responsibility for financial, organisational and administrative matters concerning members and alternates; internal organisation of the Committee, its Secretariat-General, including the establishment plan, and its constituent bodies;

engagement of the Secretary-General and the officials and other servants of the European Communities;

submission of the draft estimates of expenditure and revenue to the Plenary Assembly;

authorisation of meetings away from the usual place of work;

drawing-up of provisions for the membership and working methods of working groups and of joint committees with applicant countries.

The Bureau is convened by the President. It meets at least once every three months, or within 14 days following receipt of a written request by at least one quarter of its members. A quorum exists if at least one half of its members are present. As a general rule, the Bureau decides by a majority of the votes cast.

Commissions

At the beginning of each four-year term, the Plenary Assembly sets up commissions to prepare its work. It decides on their composition and powers.

The compositions of the commissions must reflect the national composition of the Committee.

In principle, members of the Committee belong to at least one commission but may not belong to more than two.

For the 20022006 term, the Committee of the Regions has six commissions:

Commission for Territorial Cohesion Policy (COTER)

Commission for Economic and Social Policy (ECOS)

Commission for Sustainable Development (DEVE)

Commission for Culture and Education (EDUC)

Commission for Constitutional Affairs and European Governance (CONST)

Commission for External Relations (RELEX)

Each commission appoints from among its members a chairman, a first vice-chairman and no more than two vice-chairmen.

The commissions draw up the draft versions of opinions and resolutions. These drafts are submitted to the Plenary Assembly for adoption.

Secretariat-General

The Committee is assisted by a Secretariat-General headed by a Secretary-General.

The Bureau ensures the efficient functioning of the Committee and its constituent bodies and helps the members of the Committee in the performance of their duties. It draws up the minutes of the meetings of the Committees constituent bodies.

The Secretary-General is responsible for giving effect to the decisions taken by the Bureau or the President. He attends the meetings of the Bureau in an advisory capacity and keeps the minutes of those meetings. In preparation for the Bureau decisions, the Secretary-General draws up discussion documents and recommendations for a decision on each item to be discussed.

The Secretary-General discharges his duties under the direction of the President, representing the Bureau.

As for the structure of the Secretariat-General, the Committee of the Regions and the Economic and Social Committee have a common organisational structure (COS) pursuant to Protocol No 16 annexed to the Treaty establishing the European Community (EC) by the 1992 Treaty on European Union. The 1997 Amsterdam Treaty repealed this Protocol [Article 2(59)] by granting each Committee its own administrative and budgetary autonomy. A cooperation agreement between the two bodies, approved by their respective Bureaux in AprilMay 1999, provides for new cooperation which falls within the general framework of interinstitutional cooperation and which is geared towards independence in several areas (Finances, Financial Control, Staff Support with the exception of the Medical/Welfare Department, and Secretariat for Staff Representation) and the common functioning of other departments of the former COS.

National delegations

The members and alternates from each Member State form a national delegation. Each national delegation adopts its own internal rules and elects a chairman.

The Secretary-General makes arrangements, within the Committees administration, for national delegations to receive assistance. Specifically, the Secretary-General provides them with suitable means for holding meetings immediately before or during Plenary Sessions.

Political groups

Members and alternates may form groups which reflect their political affinities. These groups provide a forum for Committee members to discuss key political issues and reach common positions. They may meet immediately before or during Plenary Sessions. They may hold two extraordinary meetings each year.

The political groups represented in the Committee of the Regions are as follows:

European Peoples Party (EPP);

Party of the European Socialists (PES);

Union for Europe of the Nations European Alliance (UEN EA)

Group of the Alliance of Liberals and Democrats for Europe (ALDE).

Each group is assisted by a secretariat staffed by Secretariat-General personnel. The Secretariat-General provides the political groups with adequate resources for meetings, activities and publications and for the work of their secretariats.

Non-attached members are provided with administrative support.

Interregional groups

Members and alternates may also form interregional groups.

Operation of the Committee of the Regions

The Committee of the Regions is convened by its President at the request of the Council or the Commission. It may also meet on its own initiative (Article 264 of the Treaty establishing the European Community).

The work of the commissions

The Bureau assigns to the responsible commission requests for opinions provided for in the annual work programme as well as requests for opinions received from the Council, Commission or European Parliament on documents which are not contained in the work programme. In urgent cases, the President may designate the responsible commission; when this is the case, the Bureau is informed at its next meeting.

If the subject of an opinion concerns more than one commission, the Bureau designates a lead commission and, where necessary, one or more supplementary commissions.

The Bureau gives the responsible commission a deadline for submission of its draft opinion.

If the commission concerned cannot draw up a draft opinion by the deadline set, the Bureau may propose that the Plenary Assembly appoint a rapporteur-general, who submits his draft opinion straight to the Plenary Assembly. When a deadline does not give the Plenary Assembly time to appoint a rapporteur-general, the rapporteur-general may be appointed by the President.

Applications for own-initiative opinions may be submitted to the Bureau by three of its members, by a commission via its chairman or by 32 members of the Committee. The Bureau decides on applications for own-initiative opinions by a majority of its members and refers the opinions to the relevant commissions. The President informs the plenary assembly of all Bureau decisions approving and allocating own-initiative opinions.

Draft resolutions or applications for the drafting of a resolution may be submitted to the Committee by at least 32 members or a political group. If the Bureau decides that the Committee is to discuss a draft resolution or an application for the drafting of a resolution, it may either put the draft resolution on the Plenary Session preliminary draft agenda or appoint a commission to draw up a draft resolution under the procedure used for drawing up draft opinions.

A commission is convened by its chairman. At the written request of at least one quarter of its members, the chairman is obliged to convene an extraordinary commission meeting. As a general rule, the proceedings of the commissions are open to the public. A quorum exists if more than one half of its members are present. Decisions are taken by a majority of the votes cast.

The commissions present their draft opinions within the time limit set by the Bureau. In exceptional cases, the Bureau may extend the time limit for the presentation of the draft.

Where the commission considers that a document referred to it by the Bureau has no regional or local interest, or is not of political importance, it may decide not to draw up an opinion.

Plenary Session

The draft opinion (or draft resolution) drawn up by the commission responsible is debated and voted on during the Plenary Assembly.

A quorum exists at a Plenary Session if a majority of the members is present. The quorum is verified only during the meeting and only if at least 10 members so request. If the verification of a quorum is not requested, all votes are valid regardless of the number of voters. If it is established that there is no quorum, all items on the agenda which require voting are postponed until the following meeting day, when the Plenary Assembly may hold a valid vote on these items whatever the number of members present.

As a general rule, the Plenary Assembly decides by a majority of the votes cast. In calculating the majority, only the votes cast for and against are taken into account. In the event of a tied vote, the text or proposal is deemed rejected. Votes relating to persons are by secret ballot.

In urgent cases where a deadline cannot be met under the normal procedure and the relevant commission has adopted its draft opinion unanimously, the President transmits this draft opinion to the Council, Commission and European Parliament for information. The draft opinion is submitted to the following Plenary Session for adoption without amendment.

Draft opinions adopted unanimously by a commission in the presence of a majority of its members is adopted by the Plenary Assembly without debate unless at least 32 members table an amendment (simplified procedure).

The Committees opinions, as well as any communication relating to the use of a simplified procedure or a decision not to draw up an opinion, are addressed to the Council, Commission and European Parliament. As in the case of resolutions, they are forwarded by the President.

The opinions and resolutions of the Committee are published in the Official Journal of the European Communities.

Powers and responsibilities of the Committee of the Regions

The Committee of the Regions adopts its opinions pursuant to Article 265 of the Treaty establishing the European Community (EC):

on the basis of a referral from the Commission or the Council in the cases provided for in the EC Treaty or on the basis of a referral from these institutions or the European Parliament in all other cases in which these institutions consider it appropriate;

when, in the event of the Economic and Social Committee being consulted under Article 262 of the EC Treaty, it considers that specific regional interests are involved;

on its own initiative in cases in which it considers such action appropriate.

The Council or the Commission may set the Committee, for the submission of its opinion, a time limit which may not be less than one month from the date on which the chairman receives notification to this effect. Upon expiry of the time limit, the absence of an opinion does not prevent further action.

The opinion of the Committee, together with a record of the proceedings, is forwarded to the Council and to the Commission.

Consultation by the European Parliament was introduced by the 1997 Treaty of Amsterdam.

Mandatory consultation

Since its establishment, the Council or the Commission are required to consult the Committee in the following areas:

education (Article 149 of the EC Treaty);

culture (Article 151 of the EC Treaty);

public health (Article 152 of the EC Treaty);

trans-European networks (Article 156 of the EC Treaty);

economic and social cohesion (Articles 159, 161 and 162 of the EC Treaty).

Since the entry into force of the Treaty of Amsterdam in 1999, the mandatory fields of consultation have been expanded to include the following areas:

transport (Article 71 of the EC Treaty);

employment (Articles 128 and 129 of the EC Treaty);

social policy (Article 137 of the EC Treaty);

European Social Fund (Article 148 of the EC Treaty);

vocational training (Article 150 of the EC Treaty);

environment (Article 175 of the EC Treaty).

Optional consultation

The Committee of the Regions may be consulted in all cases in which the Council, Commission or European Parliament considers it appropriate.

Opinions involving specific regional interests

In the event of the Economic and Social Committee being consulted, the Committee of the Regions is informed by the Council or the Commission of the request for an opinion. Where it considers that specific regional interests are involved, the Committee of the Regions may issue an opinion on the matter.

This provision allows the Committee of the Regions the possibility of commenting where it considers that a Community instrument has implications for regional or local bodies in areas where it is not consulted. Accordingly, in addition to the provisions providing for the consultation of both bodies, the Council or the Commission are required to consult the Economic and Social Committee in the following areas:

common agricultural policy (Article 37 of the EC Treaty);

free movement of workers (Article 40 of the EC Treaty);

right of establishment (Article 44 of the EC Treaty);

freedom to provide services (Article 52 of the EC Treaty);

transport (Articles 75 and 80 of the EC Treaty);

harmonisation of tax legislation (Article 93 of the EC Treaty);

approximation of laws (Articles 94 and 95 of the EC Treaty);

social policy (Articles 140 and 144 of the EC Treaty);

equal treatment (Article 141 of the EC Treaty);

consumer protection (Article 153 of the EC Treaty);

industry (Article 157 of the EC Treaty);

research and technological development (Articles 166 and 172 of the EC Treaty).

Accordingly, the areas of intervention of the Committee of the Regions have been expanded.

Own-initiative opinions

The Committee of the Regions may issue an opinion on its own initiative in cases in which it considers such action appropriate.

Unlike the Economic and Social Committee, the right of initiative was recognised by the EC Treaty at the same time as the establishment of the Committee of the Regions, enabling the Committee to carry out its advisory task in all areas of Community competence.

The exercise of its power of initiative is extremely important in practice, for it enables the Committee to assume its role as representative and champion of the regional and local bodies of the EU Member States in all Community matters of concern to them. The own-initiative opinion also constitutes an instrument which enables the Committee to express its demands relating to policy and institutional discussions.

The Committee of the Regions has emerged as the guardian of the three basic principles of the European Union:

The principle of subsidiarity. The principle of subsidiarity, which was inserted into the EC Treaty (Article 5) by the 1992 Treaty on European Union, stipulates that that the Community may take action in areas which do not fall within its exclusive competence only if and insofar as the objectives of the proposed action cannot be sufficiently achieved by the Member States. Subsidiarity implies that decisions should be taken as closely as possible to the citizen (Preamble to the Treaty on European Union). It is therefore very important that the regional and local bodies are consulted.

The principle of proximity to citizens in the implementation of Community policies by regional and local players at various levels (subnational, national, Community, etc.). The Treaty on European Union marks a new stage in the process of creating an ever closer union among the peoples of Europe, in which decisions are taken as closely as possible to the citizen (Article 1 of the Treaty on European Union). Complementing the principle of subsidiarity, proximity likewise implies the involvement of local representatives in the Community decision-making process and the enhancement of transparency within the European Union.

The principle of partnership between the various levels of responsibility (local, regional, national, European, etc.) in the decision-making process and the implementation of Community policies.

EUROPEAN INVESTMENT BANK

The European Investment Bank (EIB) is the financing institution of the European Union. The EIB was created on 25 March 1957 by the Treaty of Rome establishing the European Economic Community (EEC) and enjoys its own legal personality and financial autonomy within the Community system.

The Bank has decision-making bodies and its own administrative structure and is the only institution that is not common to the three Communities, falling within the scope of only the Treaty establishing the European Community (EC) [Articles 266 and 267 and the Protocol (No 10) on the Statute of the European Investment Bank].

Its task is to contribute to the balanced and steady development of the common market by financing investment projects on a non-profit-making basis. It likewise contributes to economic integration, the strengthening of economic and social cohesion and the implementation of development cooperation operations.

The idea of creating a financial structure for European regional development projects came about in the period following the Second World War under the Organisation for European Economic Cooperation (OEEC). The Treaty establishing the European Coal and Steel Community (ECSC) of 18 April 1951 which expired on 23 July 2002 provided for the carrying out of investment programmes by granting loans and giving guarantees to undertakings through only the High Authority (Articles 54 to 56). The Foreign Ministers of the Six, meeting in Messina from 1 to 3 June 1955, reached agreement on the objective of creating a European Investment Fund. The Spaak Report of 21 April 1956 emphasised the creation of an investment fund, but the formula ultimately adopted was the idea of setting up a bank, a solution which was in keeping with the interests of the majority of the Member States.

The European Investment Bank is the subject of Title IV of Part Three of the EEC Treaty entitled Community policies. Article 129 establishes the Bank and Article 130 defines its task. Its Statute is laid down in a protocol annexed to the Treaty. Under Article 3 (j) of the Treaty, the establishment of the Bank is intended to facilitate the economic expansion of the Community through the creation of new resources.

As a public body governed by Community law, the EIB has a legal personality distinct from that of the Community itself (Article 210 of the EEC Treaty). The EIB is modelled on the International Bank for Reconstruction and Development (IBRD) and the intention of the authors of the EEC Treaty was to ensure that the Bank has operational and institutional autonomy in carrying out its tasks on the capital markets, as is the case for any other bank. Nevertheless, as clearly set out by the Court of Justice, [] the fact that the Bank has that degree of operational and institutional autonomy does not mean that it is totally separated from the Communities and exempt from every rule of Community law. It is clear [] that the Bank is intended to contribute towards the attainment of the Communitys objectives and thus [] forms part of the framework of the Community (Judgment of the Court of 3 March 1988, Commission of the European Communities v Board of Governors of the European Investment Bank, C 85/86, Rec. 1988, p. 1281).

Provisions relating to economic and social cohesion included in the Single European Act of 17 and 28 February 1986 (Articles 130a and 130b of the EEC Treaty) clearly lay down the task of the EIB with regard to promoting the overall harmonious development of the Community.

The Treaty on European Union (TEU) of 7 February 1992 introduces a new Article 4b under Part One entitled Principles of the EC Treaty which establishes the EIB as a European Community body further to the institutions and bodies of Article 4 and the institutions of economic and monetary union (European System of Central Banks and European Central Bank) laid down in Article 4a. Provisions relating to the EIB are similarly included under the institutional provisions of Part Five of the EC Treaty entitled Institutions of the Community. The Protocol on economic and social cohesion reaffirms that the European Investment Bank should continue to devote the majority of its resources to the promotion of economic and social cohesion and declares that the Member States are willing to review the capital needs of the Bank for that purpose. This firmly establishes the EIB as the European bank for regional development.

The Edinburgh European Council of 11 and 12 December 1992 resolved to give urgent consideration to the creation of a EUROPEAN INVESTMENT FUND with a view to promoting economic recovery in Europe. Accordingly, the Member States of the Community decided by way of an Act signed in Brussels on 25 March 1993 to amend the statute of the EIB for the purpose of empowering the Bank to establish the Fund.

The European Investment Fund (EIF) was created by decision of the EIB Board of Governors of 25 May 1994. The Fund has legal personality and financial autonomy and its task is to contribute to the achievement of Community objectives. The relationship between the EIB bodies and those of the EIF is laid down in the Funds Statute. The Bank is entitled to participate in the management of the Fund and to contribute to its subscribed capital. This capital is distributed among the Funds members as follows: the EIB (60.5 % of the capital), the European Community (30 %) and the European financial institutions (9.5 %).

Following the Lisbon European Council of 23 and 24 March 2000, which called for the creation of a friendly environment for starting up and developing innovative businesses, in particular small and medium-sized enterprises (SMEs), the EIB Board of Governors reached agreement in June 2000 on the constitution of the EIB Group, consisting of the EIB and the EIF and under which the Bank grants medium- and long-term loans and the Fund specialises in venture-capital operations and the provision of guarantees to SMEs.

Each Member States share of the capital has been determined by the authors of the Banks Statute on the basis of socio-economic (population, energy, national production) and political criteria.

Initially, the capital of the EIB amounted to 1 000 million units of account, one unit of account being equivalent to 0.88867088 gramme of fine gold. The shares of the Member States in the subscribed capital.

The Banks Statute lays down the terms and conditions for an increase in the subscribed capital. The admission of a new member entails an increase in the subscribed capital corresponding to the capital brought in by the new member. Similarly, the Board of Governors may, acting unanimously, decide to increase the subscribed capital.

Accordingly, the EIBs capital was increased as a result of enlargements of the European Communities in 1973, 1981 and 1986 and of the European Union in 1995 and 2004. Furthermore, the Board of Governors has decided on several occasions to increase the subscribed capital in order to finance developments in the Banks activities.

As from 1 January 2003, the subscribed capital is paid in by Member States to the extent of 5 % on average of the amounts laid down (Article 5 of the EIB Statute, amended by Decision of the Board of Governors of 4 June 2002). The capital paid up by the Member States is one of the own resources available to the EIB to ensure its funding, alongside funds borrowed on the financial markets, which constitute the Banks primary resource.

Capital subscribed and not paid up serves, together with the reserves and the reliability of the Banks portfolio of assets, as a guarantee against loans contracted by the EIB on the capital markets. The Member States are liable only up to the amount of their share of the capital subscribed and not paid up. The share of a member in the subscribed capital may not be transferred, pledged or attached (Article 4 of the Statute).

The EIB Board of Directors may require payment of the balance of the subscribed capital, to such extent as may be required for the Bank to meet its obligations towards those who have made loans to it (Article 5 of the Statute).

Organisation of the European Investment Bank

The European Investment Bank (EIB) is directed and managed by a Board of Governors, a Board of Directors and a Management Committee. It also has an Audit Committee.

The Banks Secretary-General provides secretarial services for the Board of Governors, the Board of Directors, the Management Committee and the Audit Committee.

The Banks services are organised into Directorates-General and independent Departments which prepare and implement the decisions of the Banks Management Committee.

The Board of Governors

The Board of Governors consists of Ministers designated by each of the Member States, usually Ministers for Finance, Economic Affairs or the Treasury. It lays down general directives on the credit policy of the Bank and ensures that these directives are implemented. It decides on increases in the subscribed capital and on the Banks participation in financing operations outside the European Union and approves the annual report, the annual balance sheet, the profit and loss account and the Banks Rules of Procedure. It appoints the members of the Board of Directors, the Management Committee and the Audit Committee. It is competent to take any decision concerning the suspension of the operations of the Bank and, should the event arise, its liquidation.

Decisions of the Board of Governors are usually taken by a majority of its members. This majority must represent at least 50 % of the subscribed capital. Voting by the Board of Governors is in accordance with the provisions relating to acts of the Council of the European Union (Article 205 of the Treaty establishing the European Community).

The chairmanship of the Board of Governors rotates between the members of the Board, according to the alphabetical order of the Member States.

The Board of Governors meets when convened by its Chairman on his own initiative or at the request of one of its members. The Banks President may, on his own initiative or at the request of the Board of Directors, ask the Chairman of the Board of Governors to convene the Board. The Board of Governors holds an Annual General Meeting, no later than 30 April, in order to review the annual report, the balance sheet and the profit and loss account.

The Board of Directors

The Board of Directors originally consisted of 12 directors and 12 alternate directors; following enlargement of the European Union in 2004, the Board consists of 26 directors and 16 alternate directors. The directors are appointed by the Board of Governors for a renewable period of five years, one nominated by each Member State, and one nominated by the Commission.

The alternate directors are appointed by the Board of Governors for a renewable period of five years as shown below:

two alternates nominated by each of the following Member States: Germany, France, Italy and the United Kingdom,

one alternate nominated by common accord of Spain and Portugal,

one alternate nominated by common accord of the Benelux countries,

one alternate nominated by common accord of Denmark, Greece and Ireland,

one alternate nominated by common accord of Austria, Finland and Sweden,

three alternates nominated by common accord of the remaining Member States,

one alternate nominated by the Commission.

The members of the Board of Directors are chosen from persons whose independence and competence are beyond doubt; they are responsible only to the Bank.

The Board of Directors is responsible for:

taking decisions in respect of granting loans and guarantees and raising loans (sole power),

fixing the interest rates on loans granted and the commission on guarantees,

seeing that the Bank is properly run, and

ensuring that the Bank is managed in accordance with the provisions of the Treaty and of the Statute and with the general directives laid down by the Board of Governors.

At the end of the financial year, the Board of Directors must submit a report to the Board of Governors. If the annual report is not approved, the Board of Directors must resign.

Each Director has one vote on the Board of Directors. Decisions of the Board of Directors are usually taken by a simple majority of the members entitled to vote. A qualified majority requires 18 votes in favour. The Rules of Procedure of the Bank specify that 18 members of the Board of Directors constitute the quorum needed for the adoption of decisions.

The Board of Directors meets at least six times a year and at each meeting it determines the date of the next meeting. The President of the Management Committee or, in his absence, one of the Vice-Presidents, presides over meetings of the Board of Directors but does not vote.

Following the entry into force of the Treaty of Nice of 26 February 2001, the Council may, acting unanimously, alter the composition of the Board of Directors and its rules on decision-making.

The Management Committee

The Management Committee consists of a President and six Vice-Presidents originally there were only two Vice-Presidents appointed for a period of six years by the Board of Governors on a proposal from the Board of Directors. Their appointments are renewable.

As the EIBs collegiate executive body, the Management Committee is responsible for the current business of the Bank, under the authority of the President and the supervision of the Board of Directors. It prepares the decisions of the Board of Directors, in particular decisions on the raising of loans and the granting of loans and guarantees, and it ensures that these decisions are implemented.

The Management Committee establishes the Banks administrative Rules of Procedure.

The President or, if he is prevented, a Vice-President represents the Bank in judicial and other matters.

The officials and other employees of the Bank are under the authority of the President. They are engaged and discharged by him.

The Management Committee and the staff of the Bank are responsible only to the Bank and are completely independent in the performance of their duties.

The Management Committee meets as required for the management of the Bank. At least five of its members must be present for decisions taken by the Committee to be valid.

The Audit Committee

The Audit Committee consists of three members, appointed on the grounds of their competence by the Board of Governors for a renewable term of office of three consecutive years. One member of the Committee is replaced each year.

The Audit Committee annually verifies that the operations of the Bank have been conducted and its books kept in a proper manner. It forwards to the Banks President a written opinion on whether the balance sheet and profit and loss account are in agreement with the accounts and faithfully reflect the position of the Bank in respect of its assets and liabilities.

The Committee meets at least once a week with the Management Committee to discuss the outcome of its activities during the previous financial year and its work programme for the current financial year.

The Committee must submit a comprehensive report to the Board of Governors on the outcome of its activities during the previous financial year. This report is forwarded to the Board of Governors together with the annual report of the Management Committee.

The Committee may only conduct its business validly when the majority of its members are present. Apart from the aforementioned statement and report, both of which must be adopted unanimously, all Committee decisions require the concurrence of the majority of its members. The Committee lays down all other rules of operation itself.

The responsibilities of the Committee members end on the day on which the Board of Governors approves the annual report, the balance sheet and the profit and loss account.

The office of Chairman of the Committee is held by the member whose appointment is to end on the day on which the Board of Governors approves the Banks annual report.

The Committee is assisted in the performance of its duties and responsibilities by an observer appointed by the Board of Governors for a renewable term of office of one year.

Operation of the European Investment Bank

The European Investment Bank (EIB) grants loans in support of investment projects that promote the achievement of the objectives of the European Union.Projects requiring funding may come from all sectors of the economy and the Banks borrowers may belong to either the public or the private sector.

Applications for loans or guarantees

Applications for loans or guarantees may be submitted to the EIB by: potential promoters (private or public companies), commercial banks, public authorities, international or national development finance institutions.

Applications for global loans are made directly to banks and financial intermediaries operating at national, regional or local level. Only applications for individual loans may be sent directly to the EIB without any particular formalities. The European Investment Fund (EIF) is the single point of contact for venture capital operations.

Project appraisal

Projects submitted to the Bank are examined for their eligibility and to evaluate their economic, technical and financial characteristics. This appraisal is confidential. As for the eligibility of a project, the Bank examines whether the project conforms to those Community objectives which the EIB is responsible for promoting. The appraisal also evaluates the value added to the project by the Banks funding.

The Banks evaluation likewise focuses on the following criteria:

the practical viability, economic interest and timetable for the implementation of the proposed investment,

respect for the environment and adherence to the regulations on calls for tenders,

the cost of the project, its funding scheme and the quality of the financial and technical partners involved in the project,

the financial situation of the promoter, the expected cash flow and the guarantees provided.

The financing decision

The EIB seeks the opinion of the Member State concerned and of the European Commission. These opinions must be delivered within two months and are a precondition for the signing of the finance contract. Following the appraisal phase, the project is submitted for examination and approval by the Management Committee and then by the Board of Directors, whose task is to take a financing decision. Where the Board of Directors or the Commission delivers an unfavourable opinion, the Management Committee may not grant the loan or guarantee concerned unless its decision is unanimous. Once the financing contract is signed by the promoter, the loan amount is paid in one or more tranches, depending on the funding requirements associated with the state of progress of the project.

Project monitoring

The EIB monitors projects throughout their implementation and operational phases. It monitors the loan servicing, examines whether the use of funds is consistent with objectives and forecasts and keeps abreast of the progress made by the promoter and its partners. The Bank then ensures that the practical implementation of the project is in conformity with the contract and evaluates the outcome of the investment.

Ex post evaluation

The EIBs Operations Evaluation Department evaluates projects financed by the Bank and in so doing contributes to improving current and future operations and enhancing transparency. Its recommendations are laid down in reports which are published for their general interest. Every project completed is subjected to ex post analysis by the Projects Directorate as part of the self-evaluation system set up by the Bank.

Powers and responsibilities of the European Investment Bank

Pursuant to Article 267 of the Treaty establishing the European Community (EC), the task of the European Investment Bank (EIB) is to contribute, by having recourse to the capital market and utilising its own resources, to the balanced and steady development of the common market in the interest of the Community. For this purpose, the Bank, operating on a non-profit-making basis, grants loans and gives guarantees which facilitate the financing of the following projects in all sectors of the economy:

(a) projects for developing less-developed regions;

(b) projects for modernising or converting undertakings or for developing fresh activities called for by the progressive establishment of the common market, where these projects are of such a size or nature that they cannot be entirely financed by the various means available in the individual Member States;

(c) projects of common interest to several Member States which are of such a size or nature that they cannot be entirely financed by the various means available in the individual Member States.

In carrying out its task, the Bank facilitates the financing of investment programmes in conjunction with assistance from the Structural Funds and other Community Financial Instruments.

Financing facilities

The EIB offers various financing facilities to support projects:

global loans: loans for small- and medium-sized enterprises (SMEs) through an intermediary;

direct loans (also known as individual loans);

venture capital;

Structured Finance Facility (SFF).

Global loans - Global loans are credit lines made available to banks or financial institutions, which onlend the proceeds for small or medium-scale investment projects, worth up to a maximum of EUR 25 million, undertaken by SMEs or by local authorities.

The EIB provides global loans up to a maximum of EUR 12.5 million for between 5 and 12 years, or 15 years in exceptional cases. To complement EIB financing, the intermediary also advances funds.

Individual loans - The EIB provides individual loans to promoters in both the public and private sectors.The amount is to be agreed directly with the Bank if the investment exceeds EUR 25 million. Maturities are up to 12 years in the industrial sector and 20 years, or more in exceptional cases, for infrastructure projects.

Venture capital - Since the Amsterdam European Council of June 1997, the EIB has been deploying throughout the European Union a venture capital facility designed to strengthen the equity base of high-technology SMEs and those with strong growth potential. Operations under this heading encompass financing for venture capital funds, security packages for such funds and conditional and subordinated loans.

On 7 December 2000, the EIB and the European Investment Fund (EIF) signed a Master Agreement providing for the transfer of the management of all existing EIB risk capital investments to the EIF.

Structured Finance Facility (SFF) - In order to match the types of funding to the requirements of projects with a high-risk profile and to pursue its equity financing and guarantee operations in favour of large-scale infrastructure schemes, the EIB has established a Structured Finance Facility (SFF). The aim of the SFF is to furnish value added for priority projects by complementing the commercial banks and capital markets.

Financing within the European Union

Within the European Union, projects considered for EIB financing must contribute to one or more of the following objectives:

the strengthening of economic and social cohesion and the economic development of the disadvantaged regions;

the improvement of health and education infrastructure and services (enrichment of human capital);

the development of transport, telecommunications and Trans-European Network (TEN) infrastructure of benefit to the Community;

the protection and improvement of the natural and urban environment;

securing the energy supply base and conserving energy;

increasing the competitiveness and integration of European industry;

the development of small- and medium-scale enterprises;

information technology and communication networks;

research and development;

diffusion of innovation.

Financing outside the European Union

The EIB participates in implementing measures in the sphere of economic and social development of the developing countries, their smooth and gradual integration into the world economy and the campaign against poverty (Articles 177 and 179 of the EC Treaty). The Bank participates in implementing development aid and cooperation policies through long-term loans from own resources or subordinated loans and risk capital from EU or Member States budgetary funds.

It operates in:

the countries of Central and Eastern Europe and some Mediterranean countries which have applied for accession;

the countries of the Euro-Mediterranean Partnership with sights set on the establishment of a Customs Union by 2010;

the African, Caribbean and Pacific (ACP) States, South Africa and the overseas countries and territories (OCTs);

Asia and Latin America;

the Western Balkans.

Seat of the European Investment Bank

The seat of the European Investment Bank (EIB) is in Luxembourg.

In accordance with Article 1 of the Protocol (No 10) on the Statute of the EIB annexed to the Treaty establishing the European Community, the seat of the Bank is determined by common accord of the governments of the Member States.

The Decision of the Representatives of the Governments of the Member States of 8 April 1965 had named Luxembourg as the Banks provisional place of work. In accordance with the Statute in force, the Decision taken by common accord of the Representatives of the Governments of the Member States of 12 December 1992 confirmed Luxembourg as the Banks permanent seat.

EUROPEAN CENTRAL BANK

The European Central Bank (ECB) is composed of its decision-making bodies: the Governing Council, which is the primary governing body, and the Executive Board, the executive body responsible for day-to-day management. A third decision-making body, the General Council, continues to operate since certain Member States have not yet adopted the euro.

The Governing Council comprises the members of the ECB Executive Board and the governors of the national central banks (NCBs) of the Member States which have adopted the single currency.

The Executive Board comprises a President, a Vice-President and four other members, all appointed by common accord of the governments of the Member States participating in the single currency, at the level of the Heads of State or Government, for a non-renewable period of eight years. They are chosen from among persons of recognised standing and professional experience in banking or monetary matters, who must be nationals of the Member States.

The General Council is composed of a President and a Vice-President together with the governors of the NCBs of the 25 Member States of the European Union.

Organisation and operation of the European Central Bank

Neither the European Central Bank (ECB), nor a national central bank (NCB), nor any member of their decision-making bodies may seek or take instructions from Community institutions or bodies, governments of the Member States or any other body. The institutional independence of the ECB is strengthened by its financial independence: the ECB has its own budget. The ESCB is governed by the decision-making bodies of the ECB, these being the Governing Council and the Executive Board. Given that certain Member States still have derogation, the Statute provides, in the transitional arrangements set out in Chapter IX, for the establishment of a General Council of the ECB as the third decision-making body.

The ECB Rules of Procedure of 7 July 1998 include provisions relating to the meetings of the Governing Council and of the Executive Board and to relations between those two bodies and the General Council, together with procedural provisions. The creation of ESCB committees is also envisaged.

Moreover, the ECB Rules of Procedure provide that the Executive Board may decide on the organisation of its meetings and that it may adopt supplementary rules relating to matters within its terms of reference. The Executive Board therefore has its own Rules of Procedure, adopted on 12 October 1999.

Pursuant to Article 46 of the Statute, the General Council adopts its Rules of Procedure. It did so on 1 September 1998.

Decision-making bodies

Governing Council

As the supreme decision-making body, the Governing Council has responsibility for adopting guidelines and taking the decisions required to ensure the performance of the tasks entrusted to the ESCB. It formulates the monetary policies of the Community and establishes the necessary guidelines for their implementation.

In particular, as defined by the Statute, the responsibilities of the Governing Council are to: take decisions concerning monetary objectives, including intermediary objectives, and decisions concerning key interest rates and the supply of reserves in the ESBC;

act in an advisory capacity, with particular regard to Community acts and national draft legislative provisions within its fields of competence;

adopt decisions in the area of international cooperation;

authorise the issue of banknotes within the Community;

take the necessary steps to ensure the respect of ECB guidelines and instructions by the NCBs, and request that they provide it with all necessary information;

set the minimum reserves that the credit institutions in the Member States must incorporate into the ECB and the NCBs, and define their methods of calculation;

decide on recourse to other operational methods of monetary control;

adopt regulations to ensure efficient and sound clearing and payments systems;

adopt the necessary regulations for standardising the accounting and reporting of operations undertaken by the NCBs;

set the amount of ECB capital to be held by the NCBs and the form in which the capital is paid;

take decisions relating to the transfer of foreign reserve assets by NCBs to the ECB; with regard to foreign reserve assets held in NCBs following transfers, adopt guidelines to facilitate asset-based transactions for NCBs, particularly those transactions relating to the fulfilment of their obligations vis-à-vis international organisations;

bring proceedings before the Court of Justice of the European Communities;

adopt Rules of Procedure setting out the internal organisation of the ECB and of its decision-making bodies;

adopt the annual report on the activities of the ESCB and on the monetary policy of both the previous and the current year.

Pursuant to Article 15 of the ECBs Rules of Procedure, the Governing Council adopts the ECB budget. The Governing Council meets at least 10 times per year. In principle, only the members of the Governing Council, the President of the Council of the European Union and a Member of the Commission of the European Communities may attend these meetings. As regards voting, each member of the Governing Council has a vote, save in respect of certain decisions set out in the Statute. Unless otherwise provided, decisions are taken by simple majority. The quorum is set at two-thirds of the members.

Executive Board

The Executive Board is the body responsible for the implementation of monetary policy in accordance with the guidelines and decisions laid down by the Governing Council. In this capacity, it issues the necessary instructions to national central banks. Furthermore, certain powers may be delegated to the Executive Board by decision of the Governing Council. It is the body responsible for the day-to-day management of the ECB. Accordingly, the ECBs Rules of Procedure lay down that all the Banks departments are under the authority of the Executive Board.

Moreover, the Statute sets out the following tasks:

the preparation of the meetings of the Governing Council;

the adoption and the publication of quarterly reports on the activities of the ESCB, on the consolidated weekly financial situation in the ESCB and on the consolidated balance sheet of the ESCB, as well as other reports;

the drawing up of the ECBs annual accounts.

Each member of the Executive Board present at meetings has the right to vote and may cast one vote. Unless otherwise provided, decisions are taken by a simple majority of the votes cast.

General Council

The General Council carries out the transitional tasks of the ECB, having taken over the duties of the former EMI with a view to steering the Member States not participating in the single currency towards the third phase of EMU. In this way, it makes a particular contribution to preparing the irrevocable fixing of exchange rates for the currencies of the Member States subject to a derogation in relation to the currencies, or to the single currency, of the participating Member States.

It also contributes to:

the advisory role of the ECB, also with regard to the prudential supervision of credit institutions and the stability of the financial system;

the collection of statistical information;

the drawing up of progress reports on the activities of the ECB;

the establishment of the rules required for standardising the accounting and reporting of operations undertaken by the national central banks;

the taking of all the other steps required for the application of the allocation scheme for subscription of the capital of the ECB;

the laying down of the conditions of employment of the staff of the ECB.

Members of the Executive Board (other than the President and the Vice-President), as well as the President of the Council and a Member of the Commission may attend meetings of the General Council.

ESCB committees

The Rules of Procedure provide for the creation of ESCB committees, composed of representatives of the ECB and the NCBs of the Member States participating in the achievement of their tasks. The NCB of each non-participating Member State may also appoint a representative to take part in meetings of a committee whenever it deals with matters which fall within the remit of the General Council. The Governing Council lays down the mandates of the ESCB committees and appoints their chairmen. Both the Governing Council and the Executive Board have the right to ask ESCB committees to draw up studies on specific subjects. In this way, the committees contribute to the preparation of the work of the decision-making bodies.

National central banks (NCBs)

Together with the ECB, the NCBs, which retain legal personality, are part of the ESCB. This is a system in which NCBs participate in decision-making which takes place at a centralised level within the ECB and where they can apply those decisions in a decentralised way in the Member States. The NCBs are the sole subscribers to and holders of ECB capital and their capital subscription is carried out in accordance with an allocation scheme for the subscription of capital which takes into account the proportion of each Member State in the population and GDP of the Community. The contribution of each NCB to the foreign reserve assets of the ECB is fixed proportionally to the share of ECB capital subscribed to it.

Pursuant to Article 109 of the EC Treaty, each Member State must ensure that its national legislation, including the statutes of its NCB, is compatible with the ECB Treaty and Statute. As a result, some Member States have been forced to alter the statutes of their central banks so that they conform to the principle of independence from government.

The NCBs continue to carry out functions other than those entrusted to them as part of the ESCB provided that these functions do not interfere with the objectives and the tasks of the System. Accordingly, the prudential supervision of credit institutions remains within the remit of Member States. In this area, the ECB contributes to the proper conduct of policies pursued by the competent authorities, is entitled to deliver opinions on relevant Community legislation and may carry out specific tasks in accordance with decisions of the Council.

The Economic and Financial Committee

The Economic and Financial Committee is not an ESCB body. However, it is part of the institutional structure of EMU. It is composed of a maximum of two representatives from each Member State, from the Commission and from the ECB.

At the beginning of the third phase of EMU, it replaced the Monetary Committee, a body created by the Treaty establishing the European Economic Community with a view to promoting coordination of the monetary policies of the Member States. From 1 January 1999, monetary policy has fallen within the remit of the ECB. As a result, the Committee no longer monitors the monetary and financial situation of the Member States and of the Community, but rather their economic and financial situation.

Its advisory role involves formulating opinions, either at the request of the Council, the Commission or on its own initiative, for submission to one of those institutions. Furthermore, it regularly reports to the Council and to the Commission on the economic and financial situation of the Community, and it contributes to the preparation of the work of the Ecofin Council.

Powers and responsibilities of the European Central Bank

Objectives of the ESCB

The primary objective of the European System of Central Banks (ESCB) is to maintain price stability. Without prejudice to this objective, the ESCB lends its support to general economic policies within the Community with a view to contributing to the achievement of the objectives laid down in Article 2 of the Treaty establishing the European Community (EC) (which include the promotion of harmonious, balanced and sustainable development of economic activities, a high level of employment and of social protection, and sustainable and non-inflationary growth). Finally, the ESCB acts in accordance with the principle of an open market economy with free competition, favouring an effective allocation of resources and in compliance with the principles set in Article 4 of the EC Treaty (stable prices, sound public finances and monetary conditions, and a sustainable balance of payments).

The objective of price stability prevails over the others in the event of a dispute. Moreover, its pursuit justifies the autonomy of the System vis-à-vis the political power. In this way, independence is viewed as being indispensable for achieving control over inflation, since it allows the ESCB to manage Community monetary policy without interference from the governments of the Member States or the Community institutions.

ESCB tasks

Article 3 of the Statute lays down the basic tasks to be carried out by the ESCB:

to define and implement Community monetary policy;

to conduct foreign exchange operations in accordance with Article 111 of the EC Treaty;

to hold and manage the official reserves of the Member States;

to promote the smooth operation of payment systems.

Duties of the ECB

With the aim of ensuring the performance of its tasks, the European Central Bank (ECB) carries out the following duties:

1. Monetary duties. The ECB may:

establish general principles for open market and credit operations;

impose the building up of compulsory reserves by credit institutions;

adopt regulations to ensure efficient and sound clearing and payment systems.

The ECB and the national central banks may:

open accounts for credit institutions, public entities and other market participants and accept assets as collateral;

operate in the financial markets;

conduct credit operations with credit institutions and other market participants;

agree on facilities relating to clearing and payment systems;

establish relations with central banks and financial institutions in third countries and with international organisations;

acquire and sell all types of foreign exchange assets and precious metals, and hold and manage those assets;

conduct all types of banking transactions with third countries and international institutions;

enter into operations for their administrative infrastructure or to benefit their staff.

Furthermore, the ECB (the Governing Council) has the exclusive right to authorise the issue of banknotes within the Community. The ECB and the NCBs may issue such notes, which are the only such notes to be legal tender within the Community.

2. Advisory functions. The ECB is consulted:

on any proposed Community act in its fields of competence;

by national authorities regarding any draft legislative provision in its fields of competence, but within the limits and under the conditions set out by the Council.

The ECB may submit opinions to the appropriate Community institutions or bodies or to national authorities on matters in its fields of competence.

Moreover, it may deliver opinions to and be consulted by the Council, the Commission and the competent authorities in the Member States on Community legislation concerning the prudential supervision of credit institutions and the stability of the financial system.

3. Collection of statistical information.

The ECB collects necessary statistical information from the competent national authorities or directly from the economic agents. It is assisted by the NCBs.

4. International cooperation.

The ECB decides on how the ESCB is to be represented in the field of international cooperation. The ECB and, subject to its approval, the national central banks may participate in the international monetary institutions.

The International Monetary Fund (IMF), where each of the NCBs belonging to the ESCB was represented, granted the ECB permanent observer status on 21 December 1998.

Legal acts - In order to carry out the tasks entrusted to the ESCB, the ECB:

adopts general regulations that are binding in their entirety and are directly applicable in all Member States;

takes decisions that are binding in all their aspects on those to whom they are addressed;

makes recommendations and delivers opinions which are not legally binding.

Under certain circumstances, the ECB may also impose fines and periodic penalty payments on undertakings for failure to comply with obligations under its regulations and its decisions.

The Governing Council adopts ECB regulations and guidelines.

ECB decisions and recommendations are adopted by the Governing Council or the Executive Board for areas in their respective fields of competence.

As a general rule, the Governing Council adopts the opinions of the ECB.

The Executive Board adopts the instructions issued by the ECB.

Relations with the other institutions

The President of the Council and a Member of the Commission may participate, without having the right to vote, in meetings of the Governing Council of the ECB.

The President of the Council may submit a motion for deliberation to the Governing Council of the ECB.

The President of the ECB is invited to take part in Council meetings when the Council is discussing matters relating to the objectives and to the tasks of the ESCB.

The ECB addresses an annual report on the activities of the ESCB and on the monetary policy of both the previous and current year to the European Parliament, the Council and the Commission, and also to the European Council. The President of the ECB presents this report to the Council and to the European Parliament, which may hold a general debate on that basis.

The President of the ECB and the other members of the Executive Board may, at the request of the European Parliament or on their own initiative, be heard by the competent committees of the European Parliament (Article 113 of the EC Treaty).