How the EU Became a Global Regulatory Power

How the EU Became a Global Regulatory Power

SINCE THE nineteen nineties, the EU has embarked on an ambitious project to build a European regulatory state. Through regulation, EU institutions have integrated the common market by adopting common standards to protect the health and safety of consumers and the environment, to foster competition, and to safeguard the integrity of personal data. An important motive behind these regulations has been to build a single market that allows for a harmonized regulatory environment and thereby frictionless trade across the member states. Over the years, this internal goal of pursuing European integration through regulation has gained an increasingly external dimension-driven by the Brussels Effect-establishing the EU as the global regulatory hegemon. For a long time, the Brussels Effect was an ancillary and largely unintended by-product of a regulatory agenda that was driven by internal motivations. Only more recently, a conscious external agenda has emerged alongside this internal one.

This chapter discusses the EU's evolution into a global regulatory power. First, it briefly introduces key EU institutions and their role in the regulatory process. It then explains how regulation has been developed to advance European integration, giving these institutions a powerful motivation to pursue an ambitious regulatory agenda, while catering to the European Commission's bureaucratic interests in the process. Finally, it considers the internal and external motives that have guided the EU's regulatory rule-making.

The Key Institutions Generating EU Regulations

The EU institutions involved in the legislative and regulatory process are comprised of three primary players: the Council of the European Union (Council), the European Parliament (EP), and the European Commission (Commission),

representing the interests of the individual EU member states, the European citizens, and the EU as an institution, respectively. In addition, European courts play a crucial role in the interpretation and enforcement of EU treaties, regulations, and directives.

The Council brings together the executive branches of the member states and is composed of the government ministers of each member state. It forms the legislative arm of the EU and meets in different configurations, depending on the policy area being discussed. For example, when the Council considers an environmental regulation, each member state sends its environmental minister. Similarly, when the Council legislates on agricultural policy, the minister responsible for agriculture represents each member state. These representatives are authorized to vote on behalf of their member state, binding their respective countries to the decisions the Council makes collectively. The Council makes decisions in accordance with a simple majority, qualified majority, or unanimous vote, depending on the subject matter.

The EP represents the EU citizenry and exercises legislative authority in conjunction with the Council in this capacity. The EP consists of seven hundred fifty-one members who are directly elected by European citizens. Each member state is afforded representatives in the EP roughly proportionate to its population. For example, while Germany, as the most populous nation in the EU, is allotted ninety-six members of the European Parliament, Malta, Estonia, Cyprus, and Luxembourg each have six members of the European Parliament. The members of the European Parliament organize themselves into political groups and typically vote with their political group as opposed to along national lines. For example, Spanish center-right parties align themselves with members of the European Parliament representing center-right parties in all other member states (European People's Party) while the Spanish socialists align themselves with socialists from all other member states (Progressive Alliance of Socialists and Democrats).

The Commission functions as the EU's executive arm and enjoys substantial independent decision-making authority. The Commission consists of the political "College of Commissioners," with one commissioner hailing from each member state. Each Commissioner is assigned responsibility over a certain policy department known as a Directorate-General. Each Directorate-General focuses on a specific policy area, such as health and food safety or competition policy. Even though commissioners come from all twenty-eight member states, the commissioners advance the common EU interest as opposed to that of their own member state. In addition to the politically selected commissioners, the Commission has a large bureaucratic staff of approximately thirty thousand career civil servants.

The Commission has significant agenda-setting power through its right to propose legislation. It remains influential throughout the legislative process, acting in close cooperation with the Council and the EP, and is also in charge of the implementation and enforcement of EU legislation. As the "guardian of the treaties," the Commission oversees the enforcement of EU law. If an individual member state fails to implement certain regulations, the Commission has the authority to challenge the noncomplying member state before the European Court of Justice. It also negotiates treaties on behalf of the EU after receiving a mandate from the Council. In many policy areas, the Commission is a semi-autonomous actor, with extensive powers to engage in the legislative process and independent regulatory activity. The Council has delegated to the Commission significant regulatory powers in several policy areas, including competition law, allowing the Commission to pursue its regulatory agenda largely unconstrained by other EU institutions.

Finally, European courts play a significant role in interpreting and enforcing EU laws and regulations. The European courts consist of the European Court of Justice and the General Court, both of which are composed of judges nominated by each of the member states. The main task of the European courts is to ensure the uniform application of EU law across member states. This uniformity is facilitated by the European Court of Justice's authority to give preliminary rulings that guide national courts in EU member states in their interpretation and application of EU law. Many key elements of EU law, such as the concept of the primacy of EU law or "direct effect," did not originate in EU treaties but were later pronounced by the European Court of Justice in its rulings. In addition, the European courts are the key to ensuring that member states and EU institutions abide by EU law, and that the rights of individuals under EU treaties are upheld.