A ‘Block-booster’ State of the Union

A ‘Block-booster’ State of the Union

In his speech to the European Parliament, the president of the Commission gave Europe food for thought on its future. Though too ambitious, his proposals set the tone for a revival of European integration.

on 13 September 2017, Jean-Claude Juncker honoured a long-lasting tradition by delivering an inspired ‘State of the European Union’ (SOTEU) to the European Parliament (EP). Every year, the president of the Commission delivers this speech laying out the priorities of the EU executive arm for the coming year. At the same time, the president sent the presidencies of the European Parliament and the Council the draft working programme of the institutions. Pursuant to the Interinstitutional agreement on better law-making of 12 May 2016 (O.J. L 123/1), the Commission will now consult both lawmakers before releasing the final working programme for 2018.

The most politically sensitive proposals made by president Juncker concerned the institutional structure of the Union, and these might require treaty changes. He particularly suggested ‘merging’ the positions of president of the European Commission and president of the European Council to reflect ‘both a Union of states and a Union of citizens’ and make the EU more understandable from the outside. He also took the opportunity to endorse the idea of transnational lists for elections to the European Parliament, currently discussed in the EP constitutional affairs committee. President Juncker also asked for the end of unanimity in internal market (particularly taxation) matters and foreign policy by 2025. The passage to qualified majority voting in the Council would be possible without treaty change if the European Council agrees unanimously, pursuant to the passerelle clauses provided in Article 31 and 48 of the Treaty of the European Union (TEU). More classically, a few reforms for the Eurozone were proposed. If Juncker rejects Macron’s proposals for a Eurozone budget and parliament, which could pave the way for a multispeed Europe, the president of the European Commission sees, rather, a merger (again) of the positions of president of the Eurogroup and the commissioner in charge of economic and monetary affairs to form a ‘European Minister of Economy and Finance’. The European Stability Mechanism should also be transformed into a European monetary fund, although there were no details of what this fund should do.

More substantive issues were also extensively addressed.

Trade was first mentioned by President Juncker, as negotiations with Australia and New Zealand should soon begin. Although the media have reported the intention of the European Commission to ‘fast-track’ trade negotiations, it was not mentioned in the State of the Union, nor included in the draft working programme of the Commission. This new process, if later confirmed, would split up trade negotiations, so that investment issues are addressed separately. This would enable a ‘clean’ agreement, which enters entirely within the EU exclusive competence as interpreted by the European Court of Justice in its Opinion on the EU-Singapore Trade Agreement Opinion (Opinion 2/15 of 16 May 2017, ECLI:EU:C:2017:376). National parliaments would then only have a say on the agreement in terms of investment. What was addressed in the speech, however, was the future policy of the Commission to publish the draft negotiating mandates for trade agreements, as proposed to the Council. Furthermore, President Juncker announced a framework for screening investment to enhance transparency of foreign takeovers by state-owned companies. Although the Commission should not be able to block a takeover, the framework would support stronger and more uniform criteria for national authorities reviewing investment. It would enhance cooperation and information sharing between member states, allowing individual states to raise an objection against a takeover taking place somewhere else in the EU. The European Commission would also be able to give a non-binding opinion on the investment decision. The draft working programme finally included the decision to move towards a multilateral court system for investment, which ought to replace the (in)famous Investor-State Dispute Settlement (ISDS) system in trade agreements.

Security was also given a prominent place in the speech. President Juncker raised the issue of cyberattacks, ‘more dangerous for the stability [of the EU] than guns and tanks’. He proposed transforming the EU Agency for Network and Information Security Agency (ENISA) into a European Cybersecurity Agency to support the member states’ defence capacities against cyberattacks. Terrorism was not neglected, one month after the attack in Barcelona. An old chestnut of public debate since the Paris attacks of November 2015, the president of the European Commission called for automatic information sharing between national intelligence agencies and police services, supported by a European intelligence unit. After twenty member states agreed last June to enhanced cooperation to establish a European public prosecutor office (EPPO) to fight fraud against the EU budget, the Commission wants to build on this success and extend the scope of the EPPO to cross-border terrorist crimes by 2025. This would require a unanimous decision by the European Council, pursuant to Article 86 of the Treaty on the Functioning of the European Union (TFEU). The SOTEU also dealt with the issue of illegal migration and the Commission is expected to make proposals for more effectiveness in the application of the returns directive (Dir. 2008/115/EC of 16 December 2008, O.J. L 348/98).

On the subject of the internal market, President Juncker focused on social issues. Amid a very sensitive debate on the renegotiation of the posted workers’ directive, he reaffirmed the Commission’s take that ‘workers should earn the same pay for the same work in the same place’. Since the fight against social security fraud is the main issue raised by some member States, the Commission will propose the creation of a European Labour Authority to strengthen cooperation in inspection and enforcement capacities between member states. Differences across the internal market in food quality should also be tackled by equipping national authorities with ‘stronger powers to cut out any illegal practice’. The Commission also called for a quick agreement on the so-called European Pillar of Social Rights intended to create a union of social standards, although this Pillar does not take the form of a binding instrument. Finally, the Commission submitted a proposal to ensure the ‘Fifth freedom’, the free flow of data in the Union.

The president of the European Commission concluded the 2017 State of the Union with the hope that these reforms would ‘sail away from the harbour’ by mid-2019. The odds are certainly not in favour of this catalogue of good intentions, given the remaining divisions between member states on many of these issues. But there would be little courage to defend uncontroversial ideas. What President Juncker attempted was to build on the momentum of post-Brexit unity between the Twenty-Seven and the reflux of Euroscepticism following the election of Emmanuel Macron at the French presidency. However bold and unrealistic some of them may have seemed, the ideas detailed in the SOTEU remain nevertheless very concrete proposals to set the tone for an ‘ever closer Union’.

A number of proposals and communications related to SOTEU can be found here.


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