Step4all guide 1 The EU history: institutions and functioning

Short Guide 1
The European Union: History,
Institutions and Functioning
Circulation: Public
Authors: Step4All Consortium
Date: 04/03/2014
Doc. Ref. N°: STEP4ALL – SHORT GUIDE 1
Leonardo Da Vinci
2012-1-IT1-LEO04-02901 1

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COPYRIGHT
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DOCUMENT HISTORY
Version Date Comment
01 04/02/2014 Interim
02 04/03/2014 Final
03
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Contents
1 Introduction.......................................................................................................... 5
2 Brief History of the EU......................................................................................... 7
3 Main EU Institutions........................................................................................... 11
3.1 European Parliament................................................................................... 11
3.2 European Commission ................................................................................ 12
3.3 European Council........................................................................................ 13
3.4 Council of the EU......................................................................................... 13
3.5 Other EU Institutions ................................................................................... 14
4 Structure of the European Commission............................................................. 17
4.1 The European Commission ......................................................................... 17
4.2 What does the Commission do?.................................................................. 17
4.3 Role of the European Commission.............................................................. 17
4.4 The Structure of the European Commission................................................ 18
4.5 Education, Audiovisual, and Culture Executive Agency (EACEA)............... 19
5 EU 2020 - the EU’s Ten-year Growth Strategy.................................................. 22
5.1. Priorities....................................................................................................... 22
5.2. Targets ........................................................................................................ 23
5.3. Flagship Initiatives....................................................................................... 24
5.4. Other tools for growth and jobs.................................................................... 26
6 European Union Legal Acts............................................................................... 28
6.1 Regulation ................................................................................................... 28
6.2 Directive....................................................................................................... 28
6.3 Decision....................................................................................................... 28
6.4 Recommendation ........................................................................................ 28
6.5 Opinion........................................................................................................ 28
7 Policy and Strategy Documents......................................................................... 30
7.1 Green Papers .............................................................................................. 30
7.2 White Papers............................................................................................... 30
8 Bibliography....................................................................................................... 33
9 Glossary ............................................................................................................ 36

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1 Introduction
The official website of the European Union contains overall descriptions on the
operation of the EU, the applied law as well as the EU policy. However, understanding
the relationship and correspondence among plans, measures, treaties, and bodies is not
easy, even for a European citizen.
The main aim of the present document is to provide a general overview on the most
important topics related to the past, present, and future of the integration including the
brief history of the EU along with the crucial legal acts and policy and strategy
documents. The guide also presents the main EU institutions, particularly the operation
of the European Commission, and the EU’s ten-year growth strategy setting the
identified priorities, targets, and flagship initiatives.
In order to help with the grasping of the text, the guide is supported by a glossary
containing the short definitions of the commonly used EU terms.
To achieve the above mentioned goals, the experts of STEP4All’s project team selected
the most relevant information which is indispensable for the confident orientation in the
EU’s world. At the same time, the present guide provides the basis for the second and
third guides which present the principal programmes managed by the European
Commission and the tricks and methods of project management covering the process of
project generation from the very first steps to the closure of the project. Accordingly, in
compliance with the EU’s awareness raising measures, this guide can be considered as
the first step of the way which leads the reader to be able to manage their own projects.

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2 Brief History of the EU
1945 – 1959
A peaceful Europe – the beginnings of cooperation
1949: After WW2 Western European Cities create the “Council in Europe“. Robert
Schuman (French Foreign Minister) presents a Schuman Plan to deepen the Coal and
Steel Industry in Europe.
A treaty was signed under a common management. This treaty ensured that the six
participating countries could not start to build weapons to turn against one another.
The founding Member States were Germany, France, Italy, the Netherlands, Belgium, and
Luxembourg.
1957: The Coal and Steel Treaty is successful and another treaty, i.e., the European
Economic Community (EEC) is signed.
The EEC made sure that people, goods, services, and money can move as freely within
the EU as in their own country.
1960 - 1969
The ‘Swinging Sixties’ – a period of economic growth
1962: EU starts Common Agriculture Policy, which enables farmers to be able to receive
equal payments for their products and the countries obtain joint control over food
production.
This created an enormous economic growth and even the overproduction of food.
1968: The six participating countries remove custom duties for goods imported from
one another.
This was combined with charging the same import duties for other countries, made the
EU the world’s biggest trading group.
1970 - 1979
A growing Community – the first Enlargement
1973: Denmark, the UK, and Ireland join the EU.
1974: The European Regional Development Fund (ERDF) is created to balance out the
gaps among the poorer and richer regions.
The ERDF can be used for instance to invest in infrastructure, to attract investment,
and/or to create jobs.
1979: EU citizens can directly elect the members of the European Parliament for the
first time.

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The Members used to be delegated by the national parliaments. Since then the influence
of the Parliament has been increasing.
1980 - 1989
The changing face of Europe - the fall of the Berlin Wall
Greece became the 10th member of the EU in 1981. Spain and Portugal followed her five
years later. In 1986 the Single European Act was signed. This treaty provided the basis
for a vast six-year programme which was designed to solve the problems of the free-
flow of trade across EU borders and thus created the “Single Market”. There is a major
political upheaval on 9 November 1989 when the Berlin Wall was pulled down and the
border between East and West Germany was opened, which led to the reunification of
Germany in October 1990.
1990 - 1999
A Europe without frontiers
With the collapse of communism across Central and Eastern Europe, the Europeans
became closer neighbours. In 1993 the Single Market was completed with the “four
freedoms” of movement of goods, services, people, and money. The 1990s were also the
decade of two treaties, the Treaty of Maastricht in 1993 and the Treaty of Amsterdam in
1999. People were concerned about how to protect the environment and also how to act
together when it comes to security and defence matters. In 1995 three more new
members, Austria, Finland, and Sweden joined the EU. A small village in Luxembourg
gave its name to the Schengen Agreement that allowed people to travel without having
their passports checked at the borders.
2000 – 2009
Further expansion
The euro is the new currency for a number of Europeans. 11 September 2001 became
synonymous with the “War on Terror” after hijacked airliners had flown into buildings
in New York and Washington. The EU countries began to work much more closely
together to fight against crime. The political divisions between East and West Europe
were finally declared healed when no fewer than 10 new countries joined the EU in
2004, followed by two more in 2007. A financial crisis hit the global economy in
September 2008, leading to closer economic cooperation among the EU countries. The
Treaty of Lisbon was ratified by all EU countries before entering into force on 1
December 2009. It has provided the EU with modern institutions and more efficient
working methods.

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2010 – Today
A decade of opportunities and challenges
Not only did the new decade start with a severe economic crisis, but also with the hope
that investments in new green and climate-friendly technologies and closer European
cooperation would bring lasting growth and welfare.
Website: http://europa.eu/about-eu/eu-history/

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3 Main EU Institutions
3.1 European Parliament
The European Parliament is the only directly-elected EU body and one of the largest
democratic assemblies in the world. Its Members (often shortened to MEPs, Members of
the European Parliament) are there to represent the EU citizens. They are elected once
every five years by voters from across the EU Member States. The European Parliament
has been steadily gaining power over the recent decades and the entry into force of the
Lisbon Treaty has defined its role as co-legislator for nearly all EU laws. As all the
national Parliaments do, the European Parliament is also arranged in committees
(Agriculture, Economic Affairs, Environment, Foreign Affairs, etc.), national delegations
for relations with all third countries and, transversally to the previous two bodies,
political groups. These are the European political groups to whom each national party
refers and decides to belong to. The Plenary is chaired by the President of the European
Parliament and by 14 Vice-Presidents, each one committed on a specific issue governing
the Parliament activities and functioning. The President, elected with an alternated
principle by political groups every 2 years and a half (mid-term mandate), oversees all
the work of the Parliament and its constituent bodies (Bureau and Conference of
Presidents of political Groups). Twelve plenary part-sessions are held each year in
Strasbourg and six more in Brussels (the two seats of the Parliament, plus
administrative offices in Luxembourg).
The main powers of the European Parliament
are the following:
Legislative powers: the Parliament equally
shares this power together with the Council of
the EU Ministers, for over two-third of the EU
legislation, through the co-decision
procedure. It starts the discussion on a
legislative proposal written by the European
Commission. The competent Committee
discusses and amends it, then it is voted in
Plenary and the Council gives either its
agreement to the proposal, as modified by the
Parliament, or its refusal, thus opening for lecture in second reading. The Parliament, in
some limited cases, has the right of assent with regards to Council decisions (yes or no
position) or consultation (non-binding opinions).
Political powers: Being the expression of the European citizens and the only directly-
elected body, its political influence is very high. In their reports, recommendations, and
questions are addressed to the EU's various actors, MEPs exert influence, for example by
pressing the Commission and the Council to take measures on human rights. The
Parliament also adopts "own-initiative" reports which may call on the Commission to
bring forward legislation in a specific area or indicate, ahead of a concrete proposal, how
legislation should be drafted.
The EP Strasbourg Plenary

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Budgetary powers: The European Parliament is, together with the Council, responsible
for establishing the annual budget of the Union. The EU aims to set out longer-term
financial budgeting, which indicates the maximum levels of expenditure over a seven-
year-period (Framework Programmes). No deal on these financial perspectives can be
reached without the Parliament's approval that sets the maximum allocation on each
budget item and identifies prior policies. The Parliament is responsible for monitoring
the Union’s expenditure on a permanent basis and decides whether to grant discharge to
(or clear the accounts of) all EU institutions for the implementation of the budget.
Website: http://www.europarl.europa.eu/aboutparliament/en/00b3f21266/At-your-
service.html
3.2 European Commission
The European Commission’s seat is in
Brussels. It has offices also in Luxembourg,
representations in all EU countries, and
delegations in plenty of capital cities around
the world. It is made up of 28 Commissioners,
one from each Member State. The President of
the Commission is nominated by common
agreement of the Governments of the Member
States after consultation with the European
Parliament. Once the President has been
nominated, the Government of each Member
State nominates a Commissioner. Then the
Parliament has to either approve or refuse each Commissioner’ appointment.
Commissioners (and the President of course) are appointed for a renewable term of 5
years. They are given a portfolio which is his/her area of responsibility (Culture,
Transports, Environment, etc.). Each one of them has an attached Cabinet. The
Commission's personnel is organised into specialist departments called "Directorates
General" which are in turn divided into Directorates and then into Units. At the head of
each department, there is a General Director responsible to the relevant Commissioner.
Agencies also act under the responsibility of the European Commission as executive
bodies, which are located throughout Europe delivering specific services (see next
paragraph).
The Commission is very often indicated as the “executive” or “technical” body of the EU.
Its main (but not all) competencies are:
Legislative proposal: The Commission initiates legislation. The European Commission
has the exclusive right to propose new European legislation (of course also based on
political perspectives and observed societal needs). Then legislation proposals are
submitted to the European Parliament and the Council for approval.
Enforcing European law: It has the role to ensure that EU legislation is applied by all
the Member States, as it can institute proceedings against the Member States or
businesses that fail to comply with EU law. It can launch a procedure taking Member
Berlaymont building, the main EU Commission seat

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States to the Court of Justice in Luxemburg in case of breaching the EU law
(infringement procedure).
Implementing EU policies and the budget: It is responsible for implementing and
managing the EU budget and the EU funding programmes approved by the Parliament
and the Council. In this perspective, the Commission makes direct financial
contributions in the form of grants, to help develop an EU programme/ policy or to
support projects/organisations which are of further EU interests. Grants and funding are
awarded by the Commission Directorate-General, which directly responsible for the
policy in question, by the Commission offices and agencies around Europe, and/or by
other authorities (national or regional authorities, also in non-EU countries, etc.).
International role:
The Commission represents the EU on the international stage including trade
negotiations and cooperation agreements with non-EU countries.
Website: http://ec.europa.eu/index_en.htm
3.3 European Council
The European Council defines the general political direction and priorities of the
European Union representing the national Governments’ voice. It does not exercise any
legislative function. It comprises the heads of state or Government of the EU Member
States, along with the President of the European Commission and the President of the
European Council. The High Representative for Foreign Affairs also takes part in its
meetings. Except where Treaties provide otherwise, decisions of the European Council
are taken by consensus. In some cases, it adopts decisions by unanimity or by qualified
majority, depending on what the Treaty provides. The European Council elects its
President by qualified majority. The President's term of office lasts for two and a half
years, which is renewable only once.
The European Council usually meets in Brussels, in the Justus Lipsius building. It is
assisted by the General Secretariat of the Council. The meetings, commonly referred to
as EU summits, are chaired by its president and take place at least twice every six
months.
Website: http://www.european-council.europa.eu/home-page?lang=en
3.4 Council of the EU
The Council of the European Union is based on
an intra-governmental principle, i.e., it
represents the interests of all the Member
States participating at their national
Ministerial level. There are ten configurations
within the Council: General Affairs and
External Relations; Economic and Financial
Affairs; Cooperation in the fields of Justice and
The Justus Lipsius building

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Home Affairs; Employment, Social Policy, Health and Consumer Affairs;
Competitiveness; Transport, Telecommunications and Energy; Agriculture and
Fisheries; Environment; Education, Youth and Culture.
The meetings of the Council are led by the Member State holding the Presidency of the
Council of the European Union for a half-year term. The order of the Presidency
succession is determined beforehand. The presiding country designs the agenda and the
priorities of the Council, thus influences the course the entire Union will take. The main
seat of the Council is in Brussels for the formal summits but some meetings take place
also in Luxembourg. The informal meetings of the Council traditionally take place in the
presiding country.
The Council of the European Union has three essential functions:
The power to legislate. The Council shares this power with the European Parliament. In
most situations, the European laws are made by a co-decision procedure. This means
that the Council and the Parliament jointly adopt proposals for legislation issued by the
European Commission.
Co-ordination of the economic policies of the Member States. Every year the Council
drafts guidelines for the economic policies of the Member States. These are then made
into a recommendation and their implementation by the Member States is supervised by
the Council.
The power to approve the budget of the EU. This power is shared with the Parliament.
The Parliament supervises spending by the EU and it also adopts the annual budget for
the EU. It has the last word with regards to spending on the main EU funding
Programmes, which are the European Regional Development Fund, the European Social
Fund, cultural and educational programmes, humanitarian aid and refugee programmes,
etc.
Website: http://www.consilium.europa.eu/homepage.aspx?lang=en
3.5 Other EU Institutions
Court of Justice
The European Court of Justice (ECJ) is the highest court in the European Union judiciary
system. Its main responsibility is interpreting EU law and ensuring its equal application
across all EU Member States. The Court was established in 1952 and is based in
Luxembourg. The Court of Justice has one judge per EU country. The Court is helped by
eight advocates-general whose job is to present opinions on the cases brought before
the Court. Its seat is in Luxembourg.
Website: http://curia.europa.eu/jcms/jcms/j_6/
European Economic and Social Committee
The European Economic and Social Committee (EESC) is a consultative body of the
European Union. It provides the Parliament, the Council of the EU and the European
Commission with views, opinion and support mainly on the economic, employment,
competitiveness sectors. EESC has 353 members (employers, employees, group of
interests) drawn from across Europe. Its seat is in Brussels.

15
Website: http://www.eesc.europa.eu/?i=portal.en.home
Committee of the Regions
The Committee of Regions (CoR) is as an advisory body composed of nominated
representatives of Europe's regional and local authorities. When the legislation may
affect local and regional policies such as employment policy, the environment,
infrastructure, transport, education and health, it ensures that regional and local
identities and interests are respected within the EU. It is also in Brussels.
Website: http://cor.europa.eu/en/Pages/home.aspx
EU Central Bank
The EU Central Bank (ECB) is the monetary reference for the Euro Economic Area and it
administrates the Euro monetary system. Its primary goal, as established in the Treaty
of Amsterdam 1998, is to maintain price stability within the so-called Eurozone. Its
headquarters are in Frankfurt, Germany.
Website: http://www.ecb.europa.eu/home/html/index.en.html

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Structure of the European
Commission
4

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4 Structure of the European Commission
4.1 The European Commission
The European Commission was set up in the fifties under the founding treaties of the EU.
It is an executive body operating independently from the Member States because its
mission is to represent and defend the interests of the EU. It is headquartered in
Brussels and offers some services in Luxembourg as well as representation in all EU
Member States (http://ec.europa.eu/about/index_pt.htm).
Every five years, six months after the elections to the European Parliament, a new
Commission is appointed. Currently, the Commission is composed of 28 Commissioners,
each of them representing a Member State, and is chaired by José Manuel Barroso whose
mandate ends on 31st October 2014.
4.2 What does the Commission do?
Firstly, the EC is considered as the guardian of the Treaties. On the one hand, it prepares
proposals for new European laws which are presented to the European Parliament and
the Council. It is also responsible for implementing the decisions of the Parliament and
the Council by ensuring the application of policies, implementation of programmes, and
use of funds.
In short, the European Commission has four main functions
(http://ec.europa.eu/about/index_pt.htm):
1. Proposing legislation to the Parliament and the Council
2. Managing and implement the EU policies and the EU budget
3. Ensuring compliance with the EU law (jointly with the Court of Justice)
4. Representing the EU in international affairs
4.3 Role of the European Commission

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4.4 The Structure of the European Commission
Derived from the Commission’s performance in the various fields of the European
policies and initiatives, their establishment has a complex structure which is divided by
the General-Directories that act in conjunction with the general and specialised services.
General-directories as well as agencies and foundations established by the Commission
are listed below. All the information can be found in the following EU website
(http://www.etui.org): http://ec.europa.eu/about/ds_en.htm
1. General-Directories
General Services
Central Library
Communication (COMM)
European Anti-Fraud Office (OLAF)
Eurostat (ESTAT)
Historical archives
Joint Research Centre (JRC)
Publications Office (OP)
Secretariat General (SG)
Policies
Agriculture and Rural Development (AGRI)
Budget (BUDG)
Climate Action (CLIMA)
Competition (COMP)
Economic and Financial Affairs (ECFIN)
Education and Culture (EAC)
Employment, Social Affairs, and Inclusion (EMPL)
Energy (ENER)
Enterprise and Industry (ENTR)
Environment (ENV)
Health and Consumers (SANCO)
Home Affairs (HOME)
Information Society and Media (INFSO)
Internal Market and Services (MARKT)
Justice (JUST)
Maritime Affairs and Fisheries (MARE)
Mobility and Transport (MOVE)
Regional Policy (REGIO)
Research and Innovation (RTD)
Taxation and Customs Union (TAXUD)

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External Relations
Enlargement (ELARG)
EuropeAid Development & Cooperation (DEVCO)
Foreign Policy Instruments Service (EEAS)
Humanitarian Aid (ECHO)
Trade (TRADE)
Internal Services
Bureau of European Policy Advisers (BEPA)
European Commission Data Protection Officer
Human Resources and Security (HR)
Informatics (DIGIT)
Infrastructures and Logistics - Brussels (OIB)
Infrastructures and Logistics - Luxembourg (OIL)
Internal Audit Service (IAS)
Interpretation (SCIC)
Translation (DGT)
Legal Service (SJ)
2. Decentralised Agencies
There are over 30 agencies operating in different Member States, which play a key role
in reference to the implementation of public policies, and therefore require specialised
technical, scientific, and operational expertise. You can find a list of agencies as well as
their contacts and access links on the European Commission's website:
http://europa.eu/about-eu/agencies/regulatory_agencies_bodies/index_en.htm
3. Executive Agencies
The primary mission of the Executive Agencies is to support the European Commission
on the management of financing instruments that integrate community programmes.
Consequently, its operation is set for a limited time period. The Executive Agencies
which are currently active are given below:
4.5 Education, Audiovisual, and Culture Executive Agency (EACEA)
Avenue du Bourget, 1
B-1140 Brussels
Visiting address:
Rue Colonel Bourg, 135-139
B-1140 Brussels
Tel: +32 (0) 2 299 11 11
E-mail: eacea-info@ec.europa.eu
Internet: http://eacea.ec.europa.eu/index_en.php

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European Research Council Executive Agency (ERC)
COV2 24/164
BE-1049 Brussels
Tel: +32 (0)2 296 8870
Fax: +32 (0)2 299 3173
E-mail: erc-info@ec.europa.eu
Internet: http://erc.europa.eu
Executive Agency for Small and Medium-sized Enterprises (EASME)
Postal address:
European Commission
EASME
B-1049 Brussels
Visiting address:
Covent Garden Building
Place Rogier 16
B-1210 Brussels
Enquiries: http://ec.europa.eu/easme/contact_en.htm
Internet: http://ec.europa.eu/easme/
The Consumers, Health and Food Executive Agency (CHAFEA)
Visiting address:
DROSBACH building
12, rue Guillaume Kroll
L-1822 Luxembourg
Tel: +352 4301 32015
Fax: +352 4301 30359
E-mail: eahc@ec.europa.eu
Internet: http://ec.europa.eu/chafea/index.html
Research Executive Agency (REA)
COVE B-1049
B-1049 Brussels
Internet: http://ec.europa.eu/research/rea/index.cfm?pg=home
Innovation and Networks Executive Agency (INEA)
Visiting address:
Chaussée de Wavre 910
B-1049 Brussels
Internet: http://inea.ec.europa.eu/

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EU 2020 – the EU’s Ten-year
Growth Strategy
5

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5 Europe 2020 - the EU’s Ten-year Growth Strategy
5.1. Priorities
The ten-year growth strategy is not only covering the economic crisis that continues to
affect many countries but also the growth model that lacks in several parts in order to
create a smarter, more sustainable and more inclusive growth.
Since the current crisis has almost wiped out most of the advances this becomes even
more relevant. Europe must act:
Innovation: R&D spending in Europe is below 2%, compared to 2.6% in the US and
3.4% in Japan, mainly as a result of lower levels of private investments. It is not only the
absolute amount spent on R&D that counts – Europe needs to focus on the impact and
composition of research spending and to improve the conditions of the private sector
related to R&D in the EU. Our smaller share of high-tech firms explains half of our gap
with the US.
Education, training and lifelong learning: A quarter of all pupils have poor reading
competences, one in seven young people leaves education and training too early. Around
50% reach medium qualification level but this rate often fails to match the labour
market needs. Less than one person in three aged 25-34 has a university degree
compared to 40% in the US and over 50% in Japan. According to the Shanghai index,
only two European universities are in the world's top 20.
Digital society: The global demand for information and communication technologies is
a market worth € 2 000 billion, but only one quarter of this comes from the European
firms. Europe is also falling behind on high-speed internet, which affects its ability to
innovate, including in rural areas, as well as on the on-line dissemination of knowledge
and on-line distribution of goods and services.
Therefore, a strategy for smart, sustainable and inclusive growth has been formed.
Priorities of the strategy are to emerge from the economic crisis and to create
appropriate conditions for higher employment. This will be achieved via growth and
improving education and sustainability.
Growth is going to be:
Smart, through more effective investments in:
a) education by encouraging people to learn and acquire more skills
b) research and innovation by creating new products and services that assist growth
and improve jobs
c) digital society by using technologies to communicate and to gather information

23
Sustainable, through an economy which aims to improve energy efficiency and
production, to protect the environment is more competitive, and provides efficient
resources by:
a) reducing carbon emissions
b) developing ''green technologies''
c) introducing smart electricity grids
d) increasing the competitiveness of manufacturing SMEs through the utilisation of the
EU scale networks
e) improving the business environment
f) informing consumers in order to make better choices
Inclusive, through reduction of poverty and creation of new jobs by:
a) creating new and better jobs for women and elderly people, which will increase the
employment rate
b) helping people manage the changes by improving their skills and knowledge
c) making labour markets and welfare systems more modern
d) making sure that growth will reach the whole of Europe
Website:
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:2020:FIN:EN:PDF
5.2. Targets
In order to check the progress of the strategy, 5 targets have been set for the whole of
Europe.
Target
Category Target Values
Employment 75% of the 20-64-year-old
people to be employed
R&D 3% of the EU's GDP to be
invested in R&D
Climate change
and energy
sustainability
Reducing greenhouse gas
emissions by 20% compared to
the 1990’s (or even 30% if the
conditions are right)
20% of energy from
renewable energy
sources
20% increase
in energy
efficiency
Education
Reducing the rates of early
school leaving students below
10%
at least 40% of 30-
34–year-old
completing third
level education
Fighting
poverty and
Reducing the number of those
who are in risk of poverty and

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social exclusion social exclusion by 20 million
capita at least
Website:
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:2020:FIN:EN:PDF
5.3. Flagship Initiatives
Europe has identified 7 initiatives in order to enhance growth and creation of jobs.
1. Digital Agenda which aims to help people utilise digital technologies
Website: http://ec.europa.eu/digital-agenda/
2. Innovation Union which is beneficial for people through:
a) transforming Europe into a world-class science performer
b) the removal of the obstacles of innovation (like expensive patenting, market
fragmentation, slow standard-setting) which prevents the ideas from getting
onto the Market quickly
c) revolutionising the way on which public and private sectors work together,
notably through Innovation Partnerships among the European institutions,
national and regional authorities, and enterprises
Website: http://ec.europa.eu/research/innovation-union/index_en.cfm
3. Youth on the Move is an integrated package of policy initiatives on education
and employment for young people in Europe and aims to improve young
people’s education and employability to reduce the high rate of youth
unemployment and to increase the youth-employment rate by:
a) making education and training more adequate to young people's needs
b) encouraging more of them to take advantage of EU grants to study or to train
in another country
c) encouraging EU countries to take measures in order to simplify the transition
from education to work
Website: http://ec.europa.eu/youthonthemove/index_en.htm
4. Resource Efficient Europe provides a long-term framework for actions in plenty
of policy areas supporting policy agendas for climate change, energy, transport,
industry, raw materials, agriculture, fisheries, biodiversity, and regional
development. This is to increase certainty for investment and innovation and to
ensure that all relevant policies factor in resource efficiency in a balanced
manner.
Website: http://ec.europa.eu/resource-efficient-europe/index_en.htm
5. An industrial policy for the globalisation era in which the concept of national
sectors and industries is obsolete, coordinated European policy responses are
needed. Europe also needs an approach that looks at the whole value chain, from
infrastructure and raw materials to after-sales service.

25
Website: http://ec.europa.eu/enterprise/policies/industrial-
competitiveness/industrial-policy/index_en.htm
6. An Agenda for new skills and jobs that presents actions which will help:
a) stepping up reforms to improve flexibility and security in the labour market
b) equipping people with the right skills for today’s and tomorrow’s jobs
c) improving the quality of jobs and ensuring better working conditions
d) improving the conditions for job creation
Website: http://ec.europa.eu/social/main.jsp?langId=en&catId=958
7. European platform against poverty has 5 areas of actions:
1. Delivering actions across the whole policy spectrum such as the labour
market, minimum income support, healthcare, education, housing, and access
to basic banking accounts.
2. Better use of EU funds to support social inclusion.
3. Promoting robust evidence of what does work and does not work in social
policy innovations before implementing them more widely.
4. Working in partnership with civil society to support the implementation of
social policy reforms more effectively. The participation of people
experiencing poverty is now acknowledged as a catalyst for inclusion
strategies.
5. Enhanced policy coordination among EU countries has been established
through the use of the open method of coordination for social protection and
social inclusion (Social OMC) and the Social Protection Committee in
particular.
Website: http://ec.europa.eu/social/main.jsp?catId=961&langId=en
The following figure describes the above mentioned initiatives and activities:
SE VE N FLA G S HIPS
Smart Growth Sustainable
Growth
Inclusive
Growth
Innovation
Education
“Youth on the
Move”
Digital Society
Resource
Efficient Europe
An agenda for
new
Employment
and Skills
“An industrial
policy for the
globalisation
era”
European
Platform
Against Poverty

26
5.4. Other tools for growth and jobs
In addition, the full range of EU policies and instruments must be used in a more
effective way to achieve the Europe 2020 goals. This includes cross-cutting policies and
tools such as:
a) The single market:
Growth and job creation depend on healthy, well connected markets where competition
and consumer access stimulate business and innovation. Several obstacles still have to
be addressed which are routed to a large number of countries in the EU, the connectivity
network barriers, and the discrepancies in the regulations and rules of those countries.
In addition, entrepreneurship needs to be further developed since Europe is further
behind than the US.
b) The EU budget (including regional development, social and cohesion funds): EU
funding helps support:
● More and better jobs
● The development of new technologies
● Cutting edge research
● High-speed internet access
● Smart transport and energy infrastructure
● Energy efficiency and renewable energies
● Business development
● Skills and training
c) External policy tools:
The EU also intends to build strategic relationships with emerging economies, to
discuss issues of common concern, to promote cooperation on regulation and other
matters, and to resolve bilateral issues. In this context, the Commission presented its
trade strategy in November 2010.

27
European Union Legal Acts
6

28
6 European Union Legal Acts
6.1 Regulation
A "regulation" is a binding legislative act. It must be applied in its entirety across the EU.
For instance, when the EU wanted to protect the names of agricultural products coming
from certain areas such as Parma ham, the Council adopted a regulation.
6.2 Directive
A "directive" is a legislative act which sets out a goal that all EU countries must achieve.
However, it is up to the individual countries to decide how to achieve it. This was the
case with the working time directive, which stipulates that too much overtime work is
illegal. The directive sets out minimum rest periods and a maximum number of working
hours, but it is up to each country to devise its own laws on how to implement this.
6.3 Decision
A "decision" is binding on those to whom it is addressed (e.g., an EU country or an
individual company) and is directly applicable. For example, when the Commission
issued a decision fining the software giant Microsoft for abusing its dominant market
position, the decision applied to Microsoft only.
6.4 Recommendation
A "recommendation" is not binding. When the Commission issued a recommendation
that pays structures for financial-sector employees should not encourage excessive risk
taking, it did not have any legal consequences. A recommendation allows the institutions
to make their views known and to suggest a line of action without imposing any legal
obligation on those to whom it is addressed.
6.5 Opinion
An "opinion" is an instrument that allows the institutions to make a statement in a non-
binding fashion, in other words, without imposing any legal obligation on those to whom
it is addressed. An opinion is not binding. It can be issued by the main EU institutions
(Commission, Council, Parliament), the Committee of the Regions, and the European
Economic and Social Committee. While laws are being made, the committees give
opinions from their specific regional or economic and social viewpoints. For example,
the Committee of the Regions issued an opinion on how regions contribute to the EU’s
energy goals.
Website:
http://europa.eu/eu-law/decision-making/legal-acts/

29
Policy and Strategy
Documents
7

30
7 Policy and Strategy Documents
7.1 Green Papers
In the European Union, the United Kingdom, Commonwealth, Hong Kong, and the United
States, a green paper is a tentative government report and consultation document of
policy proposals for debate and discussion, without any commitment to action.
Accordingly, the green paper can be considered as a first step in changing the law. Green
papers may result in the production of a white paper.
Green Papers are documents published by the European Commission to stimulate
discussion on given topics at European level. They invite the relevant parties (bodies or
individuals) to participate in a consultation process and debate on the basis of the
proposals they put forward. Green Papers may give rise to legislative developments that
are then outlined in White Papers.
Green Papers on entrepreneurship in Europe (2003), on demographic change and a new
solidarity between the generations (2005). or more recently on a European strategy for
sustainable, competitive, and secure energy (2006) are examples of topics discussed.The
list on the official website of the EU contains all the Green Papers published since 1993
and some from even earlier.
References: http://en.wikipedia.org/wiki/Green_paper
http://ec.europa.eu/green-papers/index_en.htm
7.2 White Papers
A white paper is an authoritative report or guide helping readers to understand an issue,
to solve a problem, or to make a decision. White papers are used in two main spheres:
government and business-to-business marketing.
Commission White Papers are documents containing proposals for Community action in
a specific area. In some cases, they follow a green paper published to launch a
consultation process at European level. When a white paper is favourably received by
the Council, it can lead to an action programme for the Union in the area concerned.
Examples are the White Papers on Completion of the Internal Market (1985), on Growth,
Competitiveness, Employment (1993), and on European Governance (2001). More
recently, the White Paper on Services of General Interest (2004) and that on a European
Communication Policy (2006) have also moulded the development of Community
policies.
The list on the official website of the EU contains all the White Papers published since
1993 - and some from even earlier.

31
References: http://europa.eu/legislation_summaries/glossary/white_paper_en.htm
http://en.wikipedia.org/wiki/White_paper

33
8 Bibliography
Official webpages of institutions and organisations
 Agencies and other EU bodies
http://europa.eu/about-eu/agencies/regulatory_agencies_bodies/index_en.htm
 Committee of the Regions
http://cor.europa.eu/en/Pages/home.aspx
 Council of the European Union
http://www.consilium.europa.eu/homepage.aspx?lang=en
 Court of Justice of the European Union
http://curia.europa.eu/jcms/jcms/j_6/
 European Central Bank
http://www.ecb.europa.eu/home/html/index.en.html
 European Commission
http://ec.europa.eu/index_en.htm
http://ec.europa.eu/about/index_pt.htm
http://ec.europa.eu/about/ds_en.htm
 European Council
http://www.european-council.europa.eu/home-page?lang=en
 European Economic and Social Committee
http://www.eesc.europa.eu/?i=portal.en.home
 European Parliament
http://www.europarl.europa.eu/aboutparliament/en/00b3f21266/At-your-
service.html
 European Trade Union Institute
http://www.etui.org/
Acts, directives, initiatives
 Europe 2020 A strategy for smart, sustainable and inclusive growth
http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:2020:FIN:EN:PDF
Flagship Initiatives
 An Agenda for new skills and jobs
http://ec.europa.eu/social/main.jsp?langId=en&catId=958
 An industrial policy for the globalisation era

34
http://ec.europa.eu/enterprise/policies/industrial-competitiveness/industrial-
policy/index_en.htm
 Digital Agenda for Europe
http://ec.europa.eu/digital-agenda/
 European Platform against Poverty
http://ec.europa.eu/social/main.jsp?catId=961&langId=en
 Innovation Union
http://ec.europa.eu/research/innovation-union/index_en.cfm
 Resource Efficient Europe
http://ec.europa.eu/resource-efficient-europe/index_en.htm
 Youth on the Move
http://ec.europa.eu/youthonthemove/index_en.htm
Policy and Strategy documents
 Green Papers
http://ec.europa.eu/green-papers/index_en.htm
http://en.wikipedia.org/wiki/Green_paper
 White papers
http://europa.eu/legislation_summaries/glossary/white_paper_en.htm
http://en.wikipedia.org/wiki/White_paper
Others
 European Union Legal Acts
http://europa.eu/eu-law/decision-making/legal-acts/
 The EU Single Market
http://ec.europa.eu/internal_market/index_en.htm
 The EU Budget
http://ec.europa.eu/budget/explained/budg_system/index_en.cfm
 The EU external policy
http://europa.eu/pol/ext/index_en.htm
 The history of the European Union
http://europa.eu/about-eu/eu-history/

36
9 Glossary
1. Broad economic policy guidelines (BEPG)
2. Budget
3. Charter of Fundamental Rights
4. Co-decision procedure
5. Convergence criteria
6. EU policies:
 Common Agricultural Policy (CAP)
 Common commercial policy
 Common fisheries policy
 Common foreign and security policy (CFSP)
 Common organisation of agricultural
markets (COM)
 Common Security and Defence Policy
(CSDP)
 Common transport policy
 Monetary policy
7. Europe 2020: a strategy for European
Union growth (strategy, targets, initiatives)
8. European institutions
9. Economic, social, and territorial cohesion
10. Economic and Monetary Union (EMU)
11. European Development Fund
12. European Investment Bank (EIB)
13. European Union
14. European Union (EU) hierarchy of norms
15. European Union agencies:
 European Union agencies
 Agencies in the field of the common foreign
and security policy
 Agencies in the field of police and judicial
cooperation in criminal matters
 Executive agencies
 EURATOM Agencies and bodie
16. European Union law
17. Free movement of persons (visas, asylum,
immigration, and other policies)
18. Human rights
19. NATO (North Atlantic Treaty Organisation)
20. Natura 2000
21. OLAF (European Anti-Fraud Office)
22. Ombudsman
23. Pillars of the European Union
24. Political and Security Committee (PSC)
25. Qualified majority
26. Research and development
27. Rural development
28. Schengen (Agreement and Convention)
29. Small and medium-sized enterprises
30. Stability and Growth Pact
31. Structural Funds and Cohesion Fund
32. Subsidiarity
33. Tax harmonisation
34. Trans-European Networks (TEN)
Treaties:
 Treaty establishing the European Coal and
Steel Community (ECSC)
 Treaty establishing the European Economic
Community (EEC)
 Treaty establishing the European Atomic
Energy Community (Euratom)
 Single European Act (SEA)
 Treaty on European Union (TEU)
 Treaty of Amsterdam
 Treaty of Nice
 Treaty of Lisbon
35. Vocational training

37
DEFINITIONS OF TERMS
1. Broad economic policy guidelines (BEPG)
The broad economic policy guidelines (BEPG) are the central link in co-ordination of the
Member States' economic policies. They are adopted by the Council in the form of a non-
legally binding recommendation. However, they are subject to a multilateral
surveillance mechanism which aims to ensure that Member States comply with them.
2. Budget
All the European Union's revenue and expenditure is entered in the Community budget
on the basis of annual forecasts.
The budget is governed by several principles, including:
 unity: all the revenue and expenditure is brought together in a single document;
 annuality: budget operations relate to a given budget year;
 equilibrium: expenditure must not exceed revenue.
The European Commission is responsible for submitting an annual preliminary draft
budget to the Council and the European Parliament, which share budgetary authority.
The Council adopts and communicates its position on the draft budget to the European
Parliament before 1 October of the year preceding implementation of the budget. If the
Parliament approves the Council's position, the budget is considered to have been
adopted. If, however, the European Parliament adopts amendments to the Council's
position, the Conciliation Committee is convened in order to find an agreement. The
President of Parliament has the role of declaring final adoption of the budget.
3. Charter of Fundamental Rights
The Charter of Fundamental Rights consolidates in a single document the fundamental
rights applicable at the European Union level. It establishes ethical principles and rights
for EU citizens and residents that relate to dignity, liberty, equality, solidarity,
citizenship, and justice. While the European Convention on Human Rights (ECHR) is
limited to protecting civil and political rights, the Charter goes further to cover workers'
social rights, data protection, bioethics, and the right to good administration.

38
4. Co-decision procedure
Following the entry into force of the Treaty of Lisbon, the co-decision procedure became
the ordinary legislative procedure of the European Union. This procedure gives the
European Parliament the power to adopt instruments jointly with the Council of the
European Union. The ordinary legislative procedure also includes qualified majority
voting in the Council.
5. Convergence criteria
In order to ensure the sustainable convergence required for the achievement of
economic and monetary union (EMU), the Treaty sets four convergence criteria which
must be met by each Member State before it can take part in the third stage of EMU and
hence before it can adopt the euro. Compliance is checked on the basis of reports
produced by the Commission and the European Central Bank (ECB). The criteria are:
 the ratio of government deficit to gross domestic product must not exceed 3%
and the ratio of government debt to gross domestic product must not exceed
60%;
 there must be a sustainable degree of price stability and an average inflation rate,
observed over a period of one year before the examination, which does not
exceed by more than one and a half percentage points that of the three best
performing Member States in terms of price stability;
 there must be a long-term nominal interest rate which does not exceed by more
than two percentage points that of the three best performing Member States in
terms of price stability;
 the normal fluctuation margins provided for by the exchange-rate mechanism
must be respected without severe tensions for at least the last two years before
the examination.
The convergence criteria are meant to ensure that economic development within EMU is
balanced and does not give rise to any tensions among the Member States.
6. EU policies
Common Agricultural Policy (CAP)
The CAP is one of the most important EU policies. Policy is decided by qualified majority
voting in the Council and consultation of the European Parliament.
The CAP is an area in which competence is shared between the European Union (EU)
and the Member States. Its aims are to ensure reasonable prices for Europe's consumers
and fair incomes for farmers, in particular through the common organisation of
agricultural markets and by ensuring compliance with the principles adopted at the

39
Stresa Conference in 1958, namely single prices, financial solidarity, and Community
preference.
Common commercial policy
The common commercial policy is one of the main pillars of the European Union's
relations with the rest of the world. The common commercial policy implies uniform
conduct of trade relations with third countries, in particular by means of a common
customs tariff and common import and export regimes.
The Union supports the abolition of trade and customs barriers. To defend the European
market, it has at its disposal tools such as anti-dumping and anti-subsidy measures, the
Trade Barriers Regulation, and safeguard measures.
Common fisheries policy
The CFP has the same legal basis as the common agricultural policy (CAP) and shares the
same objectives: to increase productivity, to stabilise markets, and to ensure security of
supply and reasonable prices to the consumer. Like the CAP, the CFP is an area of
responsibility that is shared by the European Union and the Member States.
Common foreign and security policy (CFSP)
The CFSP provides for the eventual framing of a common defence policy which might
lead to a common defence in time.
The Lisbon Treaty reiterates the principles which govern the definition of this policy.
Furthermore, it increases the effectiveness of the Common Foreign and Security Policy
by entrusting the High Representative for Foreign Affairs and Security Policy with the
mission to implement the strategies and decisions taken by the European Council and
the Council in matters related to the CFSP. In carrying out their mandate, the High
Representative is supported by the European External Action Service and the Political
and Security Committee (PSC).
Common organisation of agricultural markets (COM)
The common market organisations (CMOs) cover around 90% of European Union
agricultural production. They govern the production and trade of products or groups of
products (cereals, fruit and vegetables, pork meat, eggs, wine, etc.) with the aim of
ensuring steady revenue for farmers and a continued supply for European consumers.
The CMOs are fundamental instruments in the common agricultural market in that they
eliminate obstacles to intra-Community trade in agricultural products and maintain a
common customs barrier with respect to third countries.
Common Security and Defence Policy (CSDP)

40
The European Union's European Security and Defence Policy (ESDP) includes the
gradual framing of a common defence policy which might lead to a common defence in
time. It aims to allow the Union to develop its civilian and military capacities for crisis
management and conflict prevention at international level, thus helping to maintain
peace and international security, in accordance with the United Nations Charter. The
ESDP, which does not involve the creation of a European army, is developing in a
manner that is compatible and co-ordinated with NATO.
Common transport policy
The goal of the common transport policy is to remove obstacles at the borders among
Member States so as to facilitate the free movement of persons and goods.
To that end its prime objectives are to complete the internal market for transport,
ensure sustainable development, manage funding programmes and spatial planning,
improve safety and develop international cooperation. It is also concerned with laying
down the conditions under which non-resident carriers may operate transport services
within a Member State.
Since the Amsterdam Treaty entered into force, decisions have been taken under the co-
decision procedure, following consultation of the European Economic and Social
Committee and the Committee of the Regions.
Monetary policy
It is fundamental to economic and monetary union (EMU). Decision-making procedures
vary according to the topics in hand:
 for the issue of coins by the Member States, the cooperation procedure applies,
after consultation of the European Central Bank (ECB);
 for the formulation of exchange-rate policy guidelines, the Council decides by a
qualified majority on a recommendation from the ECB or from the Commission
after consulting the ECB;
 for the implementing measures referred to in the Statute of the European System
of Central Banks (ESCB) and the limits and conditions under which the ECB is
entitled to impose fines, the Council decides by a qualified majority on a
recommendation from the ECB and after consulting the European Parliament and
the Commission;
 for technical adjustments to the Statute of the ESCB, the Council decides by a
qualified majority on a recommendation from the ECB and after consulting the
Commission and obtaining the assent of the European Parliament;
 for the exchange rate of the euro against non-Community currencies, the Council
decides unanimously on a recommendation from the ECB or the Commission,
after consulting the European Parliament.
The institutional provisions and transitional provisions have their own special decision-
making procedures which are separate from those identified here.

41
7. Europe 2020: a strategy for the European Union’s growth
The Europe 2020 was written to support employment, productivity, and social cohesion
in Europe. The European Union (EU) currently faces a moment of transformation,
resulting mainly from globalisation, climate change, and demographic ageing.
Strategy:
 smart, through the development of knowledge and innovation;
 sustainable, based on a greener, more resource efficient and more competitive
economy;
 inclusive, aimed at strengthening employment and social and territorial
cohesion.
Targets:
 increasing the employment rate of the population aged 20-64 to 75 %;
 investing 3 % of gross domestic product (GDP) in research and development;
 reducing carbon emissions by 20 % (and by 30 % if conditions permit),
increasing the share of renewable energies by 20 %, and increasing energy
efficiency by 20 %;
 reducing the school drop out rate to less than 10 % and increasing the proportion
of tertiary degrees to 40 %;
 reducing the number of people threatened by poverty by 20 million.
Initiatives:
 the Innovation Union,
 the Youth on the move,
 the Digital Agenda for Europe,
 the Resource-efficient Europe,
 the industrial policy for the globalisation era,
 the agenda for new skills and jobs,
 the European Platform against Poverty.

42
8. European institutions
The Union has an institutional framework aimed at defending its values, objectives,
interests, and the interests of its citizens and those of its Member States. This framework
also contributes to ensure the coherency, effectiveness, and continuity of Community
policies and actions.
Main EU institutions:
 European Parliament
 European Council
 Council of the European Union (“the Council”)
 European Commission
 Court of Justice of the European Union
 European Central Bank (ECB)
 Court of Auditors
 European Economic and Social Committee (EESC)
 Committee of the Regions
9. Economic, social, and territorial cohesion
Economic and social cohesion is an expression of solidarity among the Member States
and regions of the European Union. The aim is balanced development throughout the
EU, reducing structural disparities among regions and promoting equal opportunities
for all. In practical terms, this is achieved by means of a variety of financing operations,
principally through the Structural Funds and the Cohesion Fund. Every three years the
European Commission presents a report on progress made in achieving economic and
social cohesion and on how Community policies have contributed to it.
10. Economic and Monetary Union (EMU)
Economic and Monetary Union (EMU) is the result of the process of harmonising the
economic and monetary policies of the Member States of the Union with a view to the
introduction of a single currency, the euro. It was the subject of an Intergovernmental
Conference (IGC), which concluded its deliberations in Maastricht in December 1991.
EMU was achieved in three stages:
 First stage (1 July 1990 to 31 December 1993): free movement of capital among
Member States, closer co-ordination of economic policies and closer cooperation
among central banks.

43
 Second stage (1 January 1994 to 31 December 1998): convergence of the
economic and monetary policies of the Member States (to ensure stability of
prices and sound public finances) and the establishment of the European
Monetary Institute (EMI) and, in 1998, the European Central Bank (ECB).
 Third stage (from 1 January 1999): irrevocable fixing of exchange rates and
introduction of the single currency on the foreign-exchange markets and for
electronic payments. Introduction of euro notes and coins.
Three Member States did not adopt the single currency: the United Kingdom and
Denmark, both of which have an opt-out clause, and Sweden, following a referendum in
September 2003.
11. European Development Fund
The European Development Fund (EDF) is the main instrument providing Community
aid for development cooperation with the countries of Africa, the Caribbean and the
Pacific (ACP countries), and with the Overseas Countries and Territories (OCTs).
The EDF finances any projects or programmes which contribute to the economic, social,
or cultural development of the countries in question. It consists of several instruments,
including grants, risk capital, and loans to the private sector.
The EDF is funded by the Member States and has not come under the general
Community budget yet.
12. European Investment Bank (EIB)
Its task is to contribute to the economic, social, and territorial cohesion through the
balanced development of the EU territory.
The EIB's shareholders are the 28 Member States of the European Union. The bank is
supervised by the Board of Governors which comprises the 28 Finance Ministers. It has
legal personality and is financially independent. It provides long-term financing for
practical projects, the economic, technical, environmental, and financial viability of
which is guaranteed. It grants loans essentially from resources borrowed on capital
markets to which is added shareholders' equity. Between 1994 and 1999 the transport,
telecommunications, energy, water, education and training sectors were the main
beneficiaries.
Outside the European Union the EIB supports the pre-accession strategies of the
candidate countries and of the Western Balkans. It also manages the financial dimension
of the agreements concluded under the European development aid and cooperation
policies. In this connection, it is active in the Mediterranean countries and in the African,
Caribbean, and Pacific (ACP) countries.

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13. European Union
The European Union (EU) was established by the Maastricht Treaty, signed in 1992. The
project of creating a Union has a long history, and was first mooted at the European
summit of 1972.
The Union is both a political project and a form of legal organisation.
It is a political project in that its mission is to create an ever closer union among the
peoples of Europe, in which decisions are taken as openly as possible and as closely as
possible to the citizen (Article 1 of the Treaty on European Union).
14. European Union (EU) hierarchy of norms
European Union law is based on primary legislation and secondary legislation. Primary
legislation is made of the Treaties, general principles established by the Court of Justice
of the European Union (CJEU) and international agreements. Secondary legislation is
made up of all the acts which enable the Union to exercise its powers.
Hierarchy of norms within the secondary legislation:
 legislative acts (Article 289 TFEU). These are legal acts adopted by an ordinary or
special legislative procedure;
 delegated acts (Article 290 TFEU). These are non-legislative acts of general
application which supplement or amend certain non-essential elements of the
legislative act. The power to adopt this type of act may be delegated to the
Commission by the European Parliament or the Council;
 implementing acts (Article 291 TFEU). These acts are generally adopted by the
Commission, which is conferred with implementing powers; in certain cases the
Council may also be called upon to adopt implementing acts.
15. European Union agencies
The agencies of the European Union are bodies set up by the European Union (EU) to
carry out a specific technical, scientific, or administrative task.
Currently 29 bodies meet the definition of a Community agency, though referred to by
various names (centre, foundation, agency, office, monitoring centre, etc.).
As autonomous organisations, the agencies are a heterogeneous group, with a common
organisational model. They can be divided into three sub-groups according to their
areas of activity, to which the executive agencies have been added recently.
European Union agencies:
 OHIM – Office for Harmonisation in the Internal Market (Trade Marks and
Designs), with its headquarters in Alicante (Spain);
 CPVO – Community Plant Variety Office, Angers (France);

45
 ERA – European Reconstruction Agency, Thessaloniki (Greece);
 EMEA – European Medicines Agency, London (United Kingdom);
 EFSA – European Food Safety Authority, Parma (Italy);
 EMSA – European Maritime Safety Agency, Lisbon (Portugal);
 EASA – European Aviation Safety Agency, Cologne (Germany);
 ENISA – European Network and Information Security Agency, Heraklion
(Greece);
 EU-OSHA – European Agency for Safety and Health at Work, Bilbao (Spain);
 ECDC – European Centre for Disease Prevention and Control, Stockholm
(Sweden);
 CEDEFOP – European Centre for the Development of Vocational Training,
Thessaloniki (Greece);
 EEA – European Environment Agency, Copenhagen (Denmark);
 EUROFOUND – European Foundation for the Improvement of Living and Working
Conditions, Dublin (Ireland);
 EMCDDA – European Monitoring Centre for Drugs and Drug Addiction, Lisbon
(Portugal);
 EFRA - European Fundamental Rights Agency, Vienna (Austria);
 ERA – European Railway Agency, Valenciennes and Lille (France);
 ETF – European Training Foundation, Turin (Italy);
 CdT – Translation Centre for the Bodies of the European Union, Luxembourg
(Luxemburg);
 CFCA – Community Fisheries Control Agency, Vigo (Spain);
 FRONTEX – European Agency for the Management of Operational Cooperation at
the External Borders of the Member States of the European Union, Warsaw
(Poland);
 ECHA – European Chemicals Agency, Helsinki (Finland);
 European Global Navigation Satellite System (GNSS) Supervisory Authority,
Brussels (Belgium);
 EIGE - European Institute for Gender Equality, Vilnius (Lithuania).
Agencies in the field of the common foreign and security policy:
 EDA – European Defence Agency, Brussels (Belgium), headed by the High
Representative for Foreign Affairs and Security Policy;
 EUISS – European Union Institute for Security Studies, Paris (France);

46
 EUSC – European Union Satellite Centre, Madrid (Spain).
Agencies in the field of police and judicial cooperation in criminal matters:
 Eurojust – The European Union's Judicial Cooperation Unit, the Hague
(Netherlands);
 Europol – European Police Office, the Hague (Netherlands);
 CEPOL – European Police College, Bramshill (United Kingdom).
Executive agencies:
Executive agencies are organisations established under the Council Regulation (EC) n°
58/2003. They are entrusted with the management of one or more Community
programmes. These agencies are set up for a fixed period. They are located at the seat of
the European Commission.
 Education, Audiovisual and Culture Executive Agency, Brussels (Belgium);
 Executive Agency for Health and Consumers (EAHC), Luxembourg
(Luxembourg);
 Executive Agency for Competitiveness and Innovation (EACI), Brussels
(Belgium);
 European Research Council Executive Agency (ERC), Brussels (Belgium);
 Research Executive Agency (REA), Brussels (Belgium);
 Trans-European Transport Network Executive Agency (TEN-T EA), Brussels
(Belgium).
EURATOM Agencies and bodies:
 Fusion for Energy (European Joint Undertaking for ITER and the Development of
Fusion Energy), Barcelona (Spain).
16. European Union law
Strictly speaking, European Union law consists of the founding Treaties (primary
legislation) and the provisions of instruments enacted by the European institutions by
virtue of them (secondary legislation - regulations, directives, etc.).
In a broader sense, European Union law encompasses all the rules of the European
Union legal order, including general principles of law, the case law of the Court of Justice,
law flowing from the European Union external relations, and supplementary law
contained in conventions and similar agreements concluded among the Member States
to give effect to Treaty provisions.

47
17. Free movement of persons (visas, asylum, immigration,
and other policies)
Title IV of the Treaty establishing the European Community (EC Treaty) set out the
European Union's policy on "visas, asylum, immigration and other policies related to
free movement of persons". These areas of action were linked to the progressive
institution of an area of freedom, security, and justice and covered the following:
 free movement of persons;
 external border controls;
 asylum, immigration, and safeguarding of the rights of third-country nationals;
 judicial cooperation in civil matters.
18. Human rights
Respect for human rights and dignity is one of the core values of the European Union
(EU) enshrined in the Treaties. Together with the principles of freedom, democracy,
equality, and rule of law, it guides EU action inside as well as outside the EU’s borders. In
particular, action in this field focuses on combating discrimination, racism, and
xenophobia as well as on protecting vulnerable groups such as children, women, and
minorities.
19. NATO (North Atlantic Treaty Organisation)
The North Atlantic Treaty Organisation (NATO or the Atlantic Alliance) was founded by
the North Atlantic Treaty, also known as the Treaty of Washington, signed on 4 April
1949, and has its headquarters in Brussels. The EU's policy respects the NATO
obligations of the Member States concerned and is compatible with the common
security and defence policy, is determined within this framework.
20. Natura 2000
Natura 2000 is a set of areas in the Member States in which plant and animal species and
their habitats must be protected. Protection arrangements are laid down by the "Birds
Directive" (1979) and the "Habitats Directive" (1992).
21. OLAF (European Anti-Fraud Office)
The European Anti-Fraud Office has been responsible since 1 June 1999 for combating
fraud against the European Union budget.
The Office investigates the management and financing of all the Union's institutions and
bodies with absolute operational independence. This independence is guaranteed by:

48
 the Director of OLAF: appointed in agreement with the European Parliament, the
Commission and the Council, he/she is able to appeal before the Court of Justice
of the European Union to protect his/her independence. Moreover, he/she can
launch an investigation not only at the request of the institution, body, or
Member State concerned, but also on his/her own initiative;
 OLAF's Supervisory Committee: responsible for monitoring the investigative
function, it comprises five independent outside persons appointed jointly by the
European Parliament, the Commission, and the Council.
22. Ombudsman
The position of Ombudsman was established by the Treaty on European Union
(Maastricht, 1992) to ensure sound administration and administrative transparency at
EU institutional level.
He/She is empowered to receive complaints from any citizen of the Union or any natural
or legal person residing in a Member State concerning instances of maladministration in
the activities of the Union institutions, bodies, or entities (with the exception of the
Court of Justice of the European Union).
23. Pillars of the European Union
The Treaty of Maastricht (1992) introduced a new institutional structure which
remained until the entry into force of the Treaty of Lisbon. This institutional structure
was composed of three “pillars”:
1. the Community pillar which corresponded to the three Communities: the
European Community, the European Atomic Energy Community (Euratom), and
the former European Coal and Steel Community (ECSC);
2. the pillar devoted to the common foreign and security policy, which came under
Title V of the Treaty on European Union;
3. the pillar devoted to police and judicial cooperation in criminal matters, which
came under Title VI of the Treaty on European Union.
24. Political and Security Committee (PSC)
The Political and Security Committee (COPS) is the permanent body in the field of
common foreign and security policy.
It is made up of Ambassadors from the 28 Member States. Its remit is:
 to monitor the international situation in the areas covered by the common
foreign and security policy (CFSP);
 to contribute to the definition of policies;

49
 to monitor implementation of the decisions taken under the responsibility of the
High Representative of the Union for Foreign Affairs and Security Policy.
25. Qualified majority
A qualified majority (QM) is the number of votes required in the Council for a decision to
be adopted when issues are being debated on the basis of Article 16 of the Treaty on
European Union and Article 238 of the Treaty on the Functioning of the European Union.
Under the ordinary legislative procedure, the Council acts by qualified majority, in co-
decision with the European Parliament.
After 1 January 2007 and following enlargement of the Union, the qualified majority
increased to 255 votes out of a total of 345, representing a majority of the Member
States. Moreover, a Member State may request verification that the QM represents at
least 62% of the total population of the Union. If this is not the case, the decision is not
adopted.
With the entry into force of the Treaty of Lisbon a new system known as “double
majority” was introduced. It will enter into force on 1 November 2014. In accordance
with the Treaty, the new qualified majority corresponds to at least 55% of the members
of the Council, comprising at least 15 of them and representing at least 65% of the
European population. A blocking minority may be formed comprising at least four
members of the Council.
26. Research and development
Research and development policy is one of the European Union's priorities. Research,
with education and innovation, forms the "knowledge triangle" which it is hoped will
allow Europe to maintain its economic dynamism and social model.
Co-ordination of research and development initiatives within the Union is based on
various instruments:
 The framework programmes for research and technological development. These
multi-annual programmes, introduced in 1984, encompass more specific
programmes covering fields as varied as information and communication
technologies, the environment, biotechnology, energy (including nuclear power),
transport, and mobility of researchers.
 The Joint Research Centre (JRC), the research body which supports the action of
the Union, is made up of eight research establishments distributed in the
European Union which meet the specific needs of the various policies of the
European Commission. It is at the forefront of research in nuclear energy
(especially safety) and it is diversified into sectors such as materials, the
environment, industrial risks, and satellites. It is funded through the EU

50
framework programmes for research and by its own earnings from commercial
contracts.
27. Rural development
Rural development is the second pillar of the common agricultural policy (CAP). It
focuses on four fundamental areas:
 the competitiveness of agriculture, food products, and forestry;
 land management and the environment;
 quality of life and diversification in rural areas;
 the Leader Community initiative.
28. Schengen (Agreement and Convention)
By the Schengen Agreement signed on 14 June 1985, Belgium, France, Germany,
Luxembourg, and the Netherlands agreed to gradually remove controls at their common
borders and to introduce freedom of movement for all nationals of the signatory
Member States, other Member States, or third countries.
The Schengen Convention supplements the Agreement, lays down the arrangements,
and safeguards for implementing freedom of movement. It was signed by the same five
Member States on 19 June 1990 but did not enter into force until 1995.
The Agreement and the Convention as well as the related agreements and rules together
form the "Schengen acquis". Since 1999, this has formed part of the institutional and
legal framework of the European Union by virtue of a protocol to the Treaties.
The Schengen agreements have been extended over time by countries: Italy, Spain,
Portugal, Greece, Austria, Finland, Sweden, Denmark, the Czech Republic, Estonia,
Latvia, Lithuania, Hungary, Malta, Poland, Slovenia, and Slovakia. Ireland and the United
Kingdom are only partial participants in the Schengen acquis, since their border controls
have been maintained.
Bulgaria, Cyprus, and Romania also apply only parts of the Schengen acquis, as a
decision of the Council of the European Union is still required before controls at their
borders can be lifted.
Four non-Community countries also belong to the Schengen area: Iceland, Norway,
Switzerland, and Liechtenstein.
Countries that are candidates for Union membership must have accepted the whole of
the Schengen acquis at the time of accession.

51
29. Small and medium-sized enterprises
At Community level, small and medium-sized enterprises (SMEs) are defined by a set of
criteria concerning the workforce, turnover, and independence of the business. In terms
of the workforce alone, a micro-enterprise has fewer than 10 employees, a small
enterprise fewer than 50 and a medium-sized enterprise fewer than 250. The European
Union has specifically defined SMEs so that the benefits introduced for their support are
reserved for those businesses which genuinely have the characteristics of such firms.
30. Stability and Growth Pact
The Stability and Growth Pact (SGP) pertains to the third stage of economic and
monetary union, which began on 1 January 1999. It is intended to ensure that the
Member States maintain budgetary discipline after the single currency has been
introduced.
The Stability and Growth Pact establishes two main monitoring procedures:
 A multilateral surveillance procedure intends to prevent the occurrence of an
excessive deficit and to promote the coordination of economic policies. When the
economic policy of a Member State does not comply with the broad economic
guidelines set out by the Council or may result in an excessive deficit, the
Commission may address an "early warning" to the Member State concerned. The
Council, on the basis of a Commission recommendation, may then address
recommendations to the Member State;
 The "excessive deficit procedure" is laid down by article 126 TFEU. If the
Commission considers that a Member State's deficit breaches the 3% of GDP
threshold of the Treaty, it should address an opinion to the Member State
concerned. Where the existence of an excessive deficit is established, the Council
should then issue recommendations to the Member State so that it corrects the
deficit within a given period. If the Member State fails to take appropriate
measures to end an excessive deficit, the Council may then decide to impose
sanctions.
31. Structural Funds and Cohesion Fund
The Structural Funds and the Cohesion Fund are the financial instruments of European
Union (EU) regional policy which is intended to narrow the development disparities
among regions and Member States. The Funds participate fully, therefore, in pursuing
the goal of economic, social, and territorial cohesion.
There are two Structural Funds:
 the European Regional Development Fund (ERDF) is currently the largest. Since
1975 it has provided support for the creation of infrastructure and productive
job-creating investments, mainly for businesses;

52
 the European Social Fund (ESF), set up in 1958, contributes to the integration into
working life of the unemployed and disadvantaged sections of the population,
mainly by funding training measures.
In order to speed up economic, social, and territorial convergence, the European Union
set up the Cohesion Fund in 1994. It is intended for countries whose GDP per capita is
below 90% of the Community average. The purpose of the Cohesion Fund is to grant
financing to environment and transport infrastructure projects. However, aid under the
Cohesion Fund is subject to certain conditions. If the public deficit of a beneficiary
Member State exceeds 3% of national GDP (EMU convergence criteria), no new project
will be approved until the deficit has been brought under control.
These Funds are used to finance regional policy in the framework of the objectives:
 the "Convergence" objective to accelerate the convergence of the least developed
EU Member States and regions by improving growth and employment conditions.
This objective is financed by the ERDF, the ESF, and the Cohesion Fund;
 the "Regional Competitiveness and Employment" objective to anticipate economic
and social change, to promote innovation, entrepreneurship, environmental
protection, and the development of labour markets which include regions not
covered by the Convergence objective. It is financed by the ERDF and the ESF;
 the "European Territorial Cooperation" objective to strengthen cooperation at
cross-border, transnational, and interregional levels in the fields of urban, rural,
and coastal development and foster the development of economic relations and
networking among small and medium-sized enterprises (SMEs). This objective is
financed by the ERDF.
32. Subsidiarity
It ensures that decisions are taken as closely as possible to the citizen and that constant
checks are made to verify that action at Union level is justified in light of the possibilities
available at national, regional, or local level. Specifically, it is the principle whereby the
Union does not take action (except in the areas that fall within its exclusive
competence), unless it is more effective than action taken at national, regional, or local
level. It is closely bound up with the principle of proportionality, which requires that any
action by the Union should not go beyond what is necessary to achieve the objectives of
the Treaties.
33. Tax harmonisation
Tax harmonisation consists in coordinating the taxation systems of the European
countries to avoid non-concerted and competing changes in national fiscal policies,
which could have an adverse effect on the internal market.
With the "fiscal package" to combat harmful tax competition, the Council adopted:

53
 a code of conduct for business taxation (December 1997);
 an instrument to reduce distortions in the effective taxation of savings income in
the form of interest payments (Savings Taxation Directive, June 2003);
 an instrument to eliminate withholding taxes on cross-border interest and
royalty payments made between associated companies (Interest and Royalty
Payments Directive, June 2003).
34. Trans-European Networks (TEN)
The function of Trans-European Networks is to create a modern and effective
infrastructure to link the European regions and the national networks. They are
essential to proper operation of the common market, since they ensure free movement
of goods, persons, and services.
Trans-European Networks:
 Trans-European Transport Networks (TEN-T) cover road and intermodal
transport, waterways and seaports, and the European high-speed railway
network. Intelligent transport management systems also fall into this category, as
does Galileo, Europe's satellite radio navigation system.
 Trans-European Energy Networks (TEN-E) cover the electricity and natural gas
sectors. They help to create a single energy market and to contribute to the
security of supply.
 Trans-European Telecommunications Networks (eTEN) have as their aim the
deployment of telecommunication networks based services. They focus strongly
on public services and are at the very heart of the initiative "eEurope - An
Information Society for All".
35. Treaties
The creation of the first “Community”, the European Coal and Steel Community (ECSC),
was the starting point for over 50 years of the European treaty-making. Between 1951
(ECSC Treaty) and 2001 (Treaty of Nice), no fewer than 16 treaties were signed. The
principal treaties are as follows:
Treaty establishing the European Coal and Steel Community (ECSC)
Signed: 18 April 1951 in Paris
Entered into force: 23 July 1952
Expired: 23 July 2002
Purpose: to create interdependence in coal and steel, so that one country could no
longer mobilise its armed forces without others knowing. This eased distrust and
tensions after the WWII. The ECSC treaty expired in 2002.

54
Treaty establishing the European Economic Community (EEC)
Signed: 25 March 1957 in Rome
Entered into force: 1 January 1958
Purpose: to set up the European Economic Community (EEC).
Main changes: extension of the European integration to include the general economic
cooperation.
Treaty establishing the European Atomic Energy Community (Euratom)
Signed: 25 March 1957 in Rome
Entered into force: 1 January 1958
Purpose: to set the European Atomic Energy Community (Euratom).
Main changes: extension of the European integration to include the general economic
cooperation.
Single European Act (SEA)
Signed: 17 February 1986 (Luxembourg) / 28 February 1986 (The Hague)
Entered into force: 1 July 1987
Purpose: to reform the institutions in preparation for Portugal and Spain's membership
and speed up decision-making in preparation for the single market.
Main changes: extension of qualified majority voting in the Council (making it harder
for a single country to veto proposed legislation), creation of the cooperation and assent
procedures giving Parliament more influence.
Treaty on European Union (TEU)
Signed: 7 February 1992 in Maastricht
Entered into force: 1 November 1993
Purpose: to prepare for European Monetary Union and to introduce elements of a
political union (citizenship, common foreign and internal affairs policy).
Main changes: establishment of the European Union and introduction of the co-decision
procedure giving Parliament more say in decision-making. New forms of cooperation
among EU governments – for example on defence and justice and home affairs.
Treaty of Amsterdam
Signed: 2 October 1997 in Amsterdam
Entered into force: 1 May 1999
Purpose: To reform the EU institutions in preparation for the arrival of future member
countries.

55
Main changes: amendment, renumbering, and consolidation of the EU and EEC treaties.
More transparent decision-making (increased use of the co-decision).
Treaty of Nice
Signed: 26 February 2001 in Nice
Entered into force: 1 February 2003
Purpose: to reform the institutions so that the EU could function effectively after
reaching 25 member countries.
Main changes: methods for changing the composition of the Commission and redefining
the voting system in the Council.
Treaty of Lisbon
Signed: 13 December 2007
Entered into force: 1 December 2009
Purpose: to amend the Maastricht Treaty (1993) and the Treaty of Rome (1958).
Main changes: a) move from unanimity to qualified majority voting in at least 45 policy
areas in the Council of Ministers; and b) announced the Charter of Fundamental Rights -
the Union's bill of rights, legally binding.
36. Vocational training
"The Union shall implement a vocational training policy which shall support and
supplement the action of the Member States, while fully respecting the responsibility of
the Member States for the content and organisation of vocational training". (Article 166
of the Treaty on the Functioning of the European Union)
The Copenhagen Declaration (2002) and the Maastricht Communiqué (2004) reasserted
the priorities of transparency, recognition, and training quality and set out priorities at
national level.
Two important schemes were devised: Europass-Training (1998) which described skills
acquired by training abroad, and Europass (2004) which combines five documents
aimed at providing a clear and simple picture of the qualifications and skills of citizens
throughout Europe.
The Leonardo da Vinci sectoral programme, as part of the action programme for
education and life-long learning, is the funding vehicle for training activities. It seeks to
support and supplement the action taken by the Member States, by promoting
transnational partnership and mobility, innovation, and quality of training and also the
European dimension of training systems and practice.
The European agencies and bodies active in the field of training are:
 the European Centre for the Development of Vocational Training (Cedefop) with
its headquarters in Thessaloniki, established in 1975;

56
 the European Training Foundation, Turin, established in 1994;
 the Advisory Committee on Vocational Training, set up in 2004 to assist the
Commission in carrying out its policy.

Step4all guide 1 The EU history: institutions and functioning

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