Name: How Does the European Union Work?
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How Does the European Union Work?

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SummarySince the end of World War II, European countries have sought to deepen their integration in pursuit of peace and economic growth. The institutions that became the European Union have steadily expanded and strengthened their authority as member states have passed more and more decision-making power to the union.More From Our ExpertsHowever, the EU has been buffeted by a series of crises in recent years that have tested its cohesion, including the 2008 global financial crisis, an influx of migrants from Africa and the Middle East, and . In early 2020, the bloc struggled to craft a collective response to , COVID-19.More on:Today, the EU is a powerful player on the world stage, but the complexity of its many institutions can often confuse. Here’s a closer look at what the EU is and how it works.European integration began to take shape in the 1950s, but the modern union was founded in 1992 with the Maastricht Treaty. The EU was given its current structure and powers in 2007 with the Lisbon Treaty, also known as the Reform Treaty. Under these treaties, the bloc’s twenty-seven&nbsp;members agree to pool their sovereignty and delegate many decision-making powers to the EU.There are seven official EU institutions, which can be roughly grouped by their executive, legislative, judicial, and financial functions.More From Our ExpertsThe European Council, a grouping of the EU’s top political leaders, consists of the president or prime minister of every member state. Its summits set the union’s broad direction and settle urgent high-level questions. Its members elect a president, who can serve up to two two-and-a-half-year terms.&nbsp;The current president is former Belgian Prime Minister Charles Michel.The European Commission, the EU’s primary executive body, wields the most day-to-day authority. It proposes laws, manages the budget, implements decisions, issues regulations, and represents the EU around the world at summits, in negotiations, and in international organizations. The members of the commission are appointed by the European Council and approved by the European Parliament.&nbsp;The current commission is led by former German Minister of Defense Ursula von der Leyen.More on:The European Parliament is the only directly elected EU body, with representatives apportioned by each member state’s population. Unlike traditional legislatures, it can’t propose legislation, but laws can’t pass without its approval. It also negotiates and approves the EU budget and oversees the commission.&nbsp;Parliament is currently led by Italian politician David Sassoli.The Council of the European Union, also known as the Council of Ministers to avoid confusion, is a second legislative branch whose approval is also needed for legislation to pass. This council consists of the government ministers from all EU members, organized by policy area. For instance, all EU members’ foreign ministers meet together in one group, their agriculture ministers in another, and so on.The Court of Justice of the European Union (CJEU) is the EU’s highest judicial authority, interpreting EU law and settling disputes. The CJEU consists of the European Court of Justice, which clarifies EU law for national courts and rules on alleged member state violations, and the General Court, which hears a broad range of cases brought by individuals and organizations against EU institutions.The European Central Bank (ECB) manages the euro for the nineteen countries that use the currency and implements the EU’s monetary policy. It also helps regulate the EU banking system. In the midst of the European debt crisis, which rocked the continent beginning in 2009, ECB President Mario Draghi controversially committed the bank to acting as a lender of last resort to ailing eurozone economies.&nbsp;French politician Christine Lagarde, former head of the International Monetary Fund, took over from Draghi in 2019.The European Court of Auditors (ECA) audits the EU budget, checking that funds are properly spent and reporting any fraud to Parliament, the commission, and national governments.The offices of these institutions are located across the EU, with headquarters in Brussels, Frankfurt, Luxembourg City, and Strasbourg.These EU institutions form a complex web of powers and mutual oversight.At base they draw their democratic legitimacy from elections in two ways: First, the European Council, which sets the bloc’s overall political direction, is composed of democratically elected national leaders. Second, the European Parliament is composed of representatives—known as members of the European Parliament, or MEPs—who are directly elected by the citizens of each EU member state.The European Council and Parliament together determine the composition of the European Commission—the council nominates its members and Parliament must approve them. The commission has the sole authority to propose EU laws and spending, but all EU legislation requires the approval of both Parliament and the Council of Ministers.Although Parliament can’t initiate legislation, EU law can’t pass without Parliament’s approval. Parliament negotiates all laws, including the budget, with the commission and the Council of Ministers in an arrangement known as co-decision.In addition, international agreements, including trade agreements, require Parliament’s sign-off. The president of Parliament, who is elected by the body, must also sign off on laws for their passage.Parliament has a number of other powers. It approves members of the European Commission, meaning that parliamentary elections go far in determining the direction of EU policy. Parliament can also force the commission’s resignation. That has never happened, but on one occasion, in 1999, the commission over a corruption scandal before Parliament could act.As the executive body, the commission is most responsible for the day-to-day operations of the EU.The commission is tasked with drafting legislation and drawing up the EU budget. It sends these proposals to Parliament and the Council of Ministers and negotiates with them until it wins approval from both institutions.The commission is also responsible for making sure EU laws are implemented and the budget is allocated correctly, whether through oversight of the member states or through one of the EU’s .Other duties include representing the EU in international organizations, promoting the bloc’s foreign policy, and leading trade negotiations. The commission also helps enforce EU treaties by raising legal disputes with the Court of Justice.Member states gave the EU different levels of authority over different areas, :The common foreign and security policy (CFSP), as the EU’s foreign policy is known, primarily concerns diplomacy, security, and defense cooperation.High-level direction is set by the bloc’s national governments through the European Council and the Council of Ministers. But CFSP decisions must be unanimous, and member states remain free to make their own foreign policies. This has that the EU’s ability to put forward a common stance is often undermined by divisions between member states.Implementation of the CFSP, the responsibility of the European Commission, is carried out by the high representative of the union for foreign affairs and security policy, a position informally known as the EU foreign minister. This position was created by the Lisbon Treaty to strengthen and centralize EU diplomacy.The treaty also created an EU diplomatic service, the European External Action Service. It is managed by the commission, draws staff from across the EU institutions, and operates in more than 140 countries.The EU’s unity on foreign policy has been repeatedly tested in recent years. The bloc played a leading role in negotiating international agreements including the Paris climate accord and the , both finalized in 2015. In 2016 it reached a deal with Turkey to limit refugee admissions, but migration policy has deeply divided members and for Brexit, the UK’s vote to leave the union. In major conflict zones, such as Libya, Syria, and Ukraine, the bloc has struggled to define a common policy. It has maintained sanctions on Russia since the 2014 annexation of Crimea, but EU members over how closely to work with Moscow on energy and other areas.Meanwhile, French President Emmanuel Macron and German Chancellor Angela Merkel over the role and expansion of EU institutions. Divisions have also arisen over investments in critical infrastructure by and other Chinese firms, and the bloc’s response to the rapid spread of a new coronavirus has .The EU foreign ministry is distinct from the EU’s common commercial policy, which carries out trade policy via the EU trade commissioner. National governments have agreed to transfer all their decision-making power in this area, unlike other foreign policy matters, to the EU.The EU needs a unified trade policy because of its customs union, which sets a single external tariff for the entire bloc, and its single market, which treats all goods and services that enter the EU the same. Thus, the EU acts as one body in trade negotiations and at the World Trade Organization.Completing a trade agreement requires most of the EU’s institutions.Finally, if a trade deal is particularly broad, it may also require the individual approval of each EU member state. The EU-Canada Comprehensive Economic and Trade Agreement (CETA) is one such example. Signed in 2016, CETA has yet to take full effect because the Italian government has so far on it.&nbsp;The EU was also in the midst of negotiating a comprehensive trade pact with the United States, known as the Transatlantic Trade and Investment Partnership (TTIP), but the deal was shelved under U.S. President Donald J. Trump, who has called the EU a “foe” on trade.EU countries cooperate on military missions, but they are conducted on a voluntary, case-by-case basis by national militaries. There is no standing EU army independent of member states’ armies.EU security efforts take place under the common security and defense policy (CSDP), which is also operated out of the European Commission and led by the EU foreign minister. The CSDP involves both military and civilian work, ranging from police training programs to peacekeeping, anti-piracy, and rescue missions. The EU’s current major military missions are , including ones in Mali, Niger, South Sudan, and the Horn of Africa.Still, EU military operations have raised the question of how they relate to the (NATO) military alliance, whose membership partially overlaps with the EU’s. The Lisbon Treaty recognizes NATO as Europe’s primary means of collective defense and specifies that the EU will play a supporting role. In practice, many, including U.S. policymakers, have duplicates efforts and complicates European defense.The European Union’s budget was a little more than $150 billion in 2017, the last year for which the European Commission released its full accounting.The EU budget, while renegotiated by the European Commission, Parliament, and the Council of Ministers yearly, must fit previously agreed budget frameworks that set a cap on total spending, generally over a seven-year time span. The current framework covers 2014–2020.The EU budget must balance, since the bloc has no authority to spend more than it takes in. Almost all of its revenue comes from member states, which contribute varying amounts based on their economic heft. Many less developed states are net beneficiaries, receiving more in EU funding than they pay.In 2017, Poland was the greatest net beneficiary, receiving nearly $10 billion more than it paid, followed by Greece and Romania, at nearly $4 billion each.In addition to the EU’s seven official institutions, the bloc has —agencies, committees, offices, foundations, schools, and banks. They generally do research, make recommendations, carry out administrative tasks, or otherwise EU policy. There are also political and economic arrangements that include some but not all EU countries.Some major examples are:Finally, several other bodies that operate in or are based in Europe are often incorrectly assumed to be EU institutions.For media inquiries on this topic, please reach out to .RelatedHeavily armed, right-wing groups are poised to rebel against the election if President Trump loses, an extraordinary danger to U.S. democracy.Daniel Yergin, a leading authority on energy, international politics, and economics, sits down with James M. Lindsay to discuss the changing face of global power dynamics. Yergin’s most recent book,&nbsp;The New Map: Energy, Climate, and the Clash of Nations, recently hit&nbsp;bookstore shelves.Any sharp drawdown of U.S. forces in Iraq grants Iran a golden opportunity to expand its influence there and threatens to&nbsp;inflame sectarian tensions.

SummarySince the end of World War II, European countries have sought to deepen their integration in pursuit of peace and economic growth. The institutions that became the European Union have steadily expanded and strengthened their authority as member states have passed more and more decision-making power to the union.More From Our ExpertsHowever, the EU has been buffeted by a series of crises in recent years that have tested its cohesion, including the 2008 global financial crisis, an influx of migrants from Africa and the Middle East, and . In early 2020, the bloc struggled to craft a...

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