Journal of European Public Policy 11:4 August 2004: 740-758 l \ ^"V

Toward a theory of EU foreign policy-

making: muiti-ievei governance,
domestic poiitics, and nationai
adaptation to Europe's common
foreign and security poiicy
Michael E. Smith

ABSTRACT The expansion of European foreign and security policy co-operation

since the 1970s imposes unique requirements on European Union (EU) member
states, and the co-ordination of these various obligations presents a major challenge
to the EU's pursuit of a common foreign and security policy (CFSP). However, the
past decade has also seen significant progress toward trie multi-level governance of
EU foreign policy, particularly when compared to the limited policy co-ordination
of the 1970s and 1980s. This article examines the relationship between institutional
development and the multi-level governance of EU foreign policy, as represented
by the CFSP. In particular, it explores: (1) the extent to which the CFSP policy
space can he described in terms of multi-level governance; (2) the processes by
which governance mechanisms inRuence the domestic foreign policy cultures of
EU member states; and (3) how the interaction of domestic politics and governance
mechanisms produces specific policy outcomes.
KEY WORDS Common foreign and security policy; domestic politics; European
foreign and security policy co-operation; multi-level governance.

INTRODUCTION
The expansion of European foreign and security policy co-operation since the
early 1970s has involved a complex fusion of several institutional forms:
intergovernmental, transgovernmental, and supranational (Smith 1998). Each
of these institutional mechanisms imposes unique requirements on European
Union (EU) member states, and the co-ordination of these various obligations
presents a major challenge to the EU's pursuit of a common foreign and
security policy (CFSP). In response to this problem, the Maastricht Treaty on
European Union (TEU) attempted to reorganize these institutional forms into
a coherent policy process. Yet while the current CFSP process is still not as
supranational as other EU policy domains, such as the single European market,
the past decade has seen significant progress toward the multi-level governance
of EU foreign policy, particularly when compared to the limited policy co-
ordination under the European political co-operation (EPC) framework of the
1970s and 1980s.
Journal of European Public Polio/
ISSN 1350-1763 print; 1466-4429 online ©2004 Taylor & Francis Ltd
http://www.tandf.co.uk/journals
DOT: 10.1080/1350176042000248124
 M.E. Smith: Toward a theory of EU foreign policy-making 741

This generic process can be described in terms of a greater consolidation of

authority at the EU level (which consists of both national and EU organiza-
tional inputs), and a greater degree of national adaptation to EU foreign policy
norms (procedural and substantive), or 'Europeanization'. Although the EU
certainly possesses some elements of a federal system, the term 'multi-level
governance' is preferred here for two reasons: the EU is clearly still a treaty-
based polity and its member states reserve ultimate authority to approve
all decisions, especially in foreign/security policy. And although multi-level
governance usually assumes a greater role for supranational European Com-
munity (EC) organizations (chiefly the Commission and the European Court
of Justice) in policy-making (Marks 1993; Marks et al. 1996), my chief goal
here is to demonstrate its applicability to the realm of foreign/security policy,
an area where supranational organizations traditionally have been marginalized.
The use of multi-level governance also helps us to avoid the pitfalls of
intergovernmental approaches to EU foreign policy, such as two-level games
(Bulmer 1991; Putnam 1988) or liberal intergovernmentalism (Moravcsik
1993). Although these conceptual tools may shed light on high-level negotia-
tions about treaty reforms, as during major Intergovernmental Conferences
(IGCs) of the EU, they are problematic in describing normal policy outcomes
for several reasons. One problem is tbeir treatment of national preference
formation as a distinct domestic political process. A growing body of research
suggests that it may be inappropriate to describe national and EU-level
decision-making, even in foreign policy, as two separate but linked processes.
EU member states do not form their national positions in isolation from each
other and then attempt to realize those goals at the EU level (Sandholtz 1996).
Intensive domestic lobbying on CESP issues is also quite rare relative to other
EU policy domains, nor do EU states typically 'ratify' common policy decisions,
either formally or informally.
A second problem is institutional: in foreign policy, EU states are required
to discuss their thinking about problems before arriving at national positions.
EPC/CFSP norms deliberately reorient member states toward a 'problem-
solving', as opposed to bargaining, style of decision-making. This involves an
appeal to common interests and the use of ostracism or peer-pressure to sanction
potential defectors. Under certain conditions, these processes may inhibit the
pursuit of rigid national policy positions in the realm of the CFSP. Moreover,
past policy decisions become new reference points for discussions about foreign
policy whether at the national or EU levels. Indeed, this problem of precedent-
setting was a major factor in explaining why it took several years for the CFSP
to function effectively. Several states were concerned about setting legal
precedents while EU organizational actors, sucb as those in its various legal
services, were drafting texts with the understanding that legal precedents were
being set (Smith 2001a).
This article examines the relationship between institutional change (at the
EU and domestic levels) and the multi-level governance of EU foreign policy,
as represented by tbe CFSP. In particular, I first explore the extent to which
742 Journal of European Public Policy

the CFSP policy space can be described in terms of multi-level governance. In

the second section, I describe the specific processes by which governance
mechanisms influence the domestic foreign policy cultures of EU member
states. Of special concern are the unique mechanisms by which CFSP
governance permanently alters the domestic political structures of EU member
states in ways that are not immediately apparent on a reading of EU treaty
obligations. The third and final section explores how the interaction of
governance mechanisms and domestic politics produces specific policy out-
comes. This relationship is crucial in determining how the EU acts (or fails to
act) in foreign policy. It also represents a move from ad hoc international co-
operation (or the co-ordination of national foreign policies, as under EPC) to
a far more collective decision-making process (or multi-level governance, as
under the CFSP), although tbis process is neither supranational nor federal.
How the EU has managed to both institutionalize and Europeanize its multi-
level governance of foreign policy, while still respecting national sovereignty, is
a key question for students of international co-operation and European
integration. Answering this question could also shed light on why most other
regional organizations have failed in this goal.

MULTI-LEVEL GOVERNANCE AND THE EUROPEAN FOREIGN

AND SECURITY POLICY PROCESS'
The analysis of multi-level governance in EU foreign policy must begin with
the broader context in which that governance is embedded. EU states today
share a high general propensity for common action owing to certain inherent
characteristics found within the region itself. These include historical experi-
ences (the legacies of the two World Wars and the Cold War), a sense of
common fate, a high degree of interdependence as commonly measured in the
literature (trade and financial flows, immigration, travel, etc.), a common
cultural/normative heritage (democracy, free markets, the rule of law, social
justice/cohesion, and human rights), and the most intensive national partici-
pation in a network of international organizations (the United Nations (UN),
tbe Organization for Security and Co-operation in Europe (OSCE), the EU,
tbe North Atlantic Treaty Organization (NATO), Council of Europe, etc.)
found in any region on the planet. Among the states of Western Europe, the
EU is now the primary frame of reference for more policy decisions than any
other international/regional organization, and it is for this reason that any
discussion of multi-level governance must focus primarily, though not exclu-
sively, on the EU. For in the realm of foreign policy, even EU decisions must
show some sensitivity to decisions taken elsewhere, particularly the UN and,
to a lesser degree, NATO. Although I cannot pursue this issue within the
confines of this article, we should be aware that interactions between the EU's
own system of governance and those of functionally related institutions like
NATO will become increasingly important as the EU develops its capabilities
as a global actor.
 M.E. Smith: Toward a theory of EU foreign policy-making 743

Yet these general propensities for co-operation do not, by themselves, lead

to common action, particularly in foreign policy. This is the 'value added' of
a multi-level governance approach to EU foreign policy: to explain hov*'
common general interests are defined, prioritized, and translated into concrete
policy actions through institutionalized behaviours at the EU and domestic
levels. Governance can be broadly defined as the authority to make, implement,
and enforce rules in a specified policy domain. Multi-level governance refers to
the sharing of this authority across an institutionalized, hierarchically structured
set of actors with varying degrees of unity/coherence, commitment to EU
norms, and power resources. In applying multi-level governance to EU foreign
policy, as compared to other EU policy domains, one must: (1) pay greater
attention to the decentralized structure of the CFSP (i.e. a diminished role for
the Commission/European Parliament/European Court of Justice relative to
socio-economic policy areas, and more access points into decision-making);
and (2) increase the potential influence of EU member states (as policy
entrepreneurs, barriers, and implementers), which involves domestic politics
in complex ways along the lines of existing approaches to multi-level governance
(i.e. continuous negotiations across several tiers of decision-making).
These EU-domestic interactions will be explored in further detail below.
For the moment, I focus on the general structure of multi-level governance in
EU foreign policy. In particular, I argue that this structure of CFSP governance
now involves four major elements. First and most generally, it involves a much
greater coherence of the policy sector and rationalization of the policy process, far
beyond what had existed under EPC. This change can be described in terms
of the definition of the CFSP itself, its linkages to the policies, organizations,
and procedures of the EU's first pillar (the EC), and its practical operation.
Although numerous problems of coherence remain (Smith 2001b), EU foreign
policy is now a formal EU policy domain with complex linkages, procedural
and substantive, to other EU policies. Second, the CFSP is legally binding on
EU member states, which includes some limited compliance mechanisms.
Third, the CFSP includes several authoritative decision-making rules, in the
form of qualified majority voting (QMV). Although the procedures are
somewhat convoluted, and they are not applicable across the entire range of
CFSP activities, their inclusion in the Maastricht Treaty clearly represents a
breach of the long-standing taboo against supranational decision-making
procedures for EU foreign policy. Even if QMV is rarely utilized, which is the
norm, the threat of QMV may help EU states to find consensus in the hopes
of avoiding a potentially embarrassing vote. Fourth and finally, the TEU
provides a greater degree of autonomy for EC organizational actors in European
foreign policy during specific phases of the policy process as described below.
If we further break down the CFSP policy-making process into a sequence
of behaviours and the key actors involved, we can see where these various
actors are most likely to influence each policy stage. Table 1 provides a general
overview of this process to help structure the rest of this article.
Taking a closer look at the EU's system of multi-level governance, the first
744 Journal of European Public Policy
Table 1 The CFSP policy process since Maastricht (major provisions only)

Po//cy stage Relevant actors

Agenda-setting: defining general European Council of Heads of State/
principles/areas for the CFSP Government (which includes a member of the
Commission)
Decision-making regarding specific Council of the EU and Commission (supported
CFSP policies by COREU, Political/Security Committee,
European Correspondents, working groups,
CFSP Secretariat, CFSP Policy Planning and
Early Warning Unit, COREPER)
Implementing common positions and EU Presidency, High Representative for the
joint actions (includes external CFSP, Commission, ad hoc Special
representation) Representatives
Funding of the CFSP Commission and EP in most cases
Performance evaluation in terms of Council of the EU, Commission, Political/
policy coherence (EC/CFSP/JHA/ Security Committee (supporting role for ECJ)
ESDP) and compliance (very limited)
Democratic legitimacy (very limited) EP and, to a lesser extent, national
parliaments

key point is that national foreign policy actors must participate in highly
institutionalized group decision-making forums at all stages of the process,
including broad agenda-setting at the European Council level. In fact, the
capacity to block this decision-making (or bypass it altogether), rather than
actively participate in it, represents the main 'national' power still enjoyed by
EU member states in the CFSP. Yet even this power is diminishing as the EU
expands its role in world politics and takes over many of the domestic activities
normally governed by member states. Of course, this process of multi-level
governance has not yet extended to the European security and defence policy
(ESDP), but it may be moving in that direction, at least in terms of tacit
norms/customs. The recent experiments with small EU military actions in
Macedonia and the Democratic Republic of Congo may hasten this process.
A second point is that the capacity for national influence into the process
varies according to the policy stage at hand. Although the European Council
may be the most direct way for national governments to set the EU agenda,
even this level is subject to certain constraints for two reasons. First, the
Maastricht Treaty has already specifled a number of broad agenda-setting aims
of the CFSP within the EU's single institutional framework.^ The Lisbon
European Council (26/27 June 1992) further approved a report by the EU
foreign ministers that identified certain 'factors determining important com-
mon interests'^ and the specific objectives to be taken into consideration when
adopting a CFSP joint action, most of which centre around democracy, human
 M,E, Smith: Toward a theory of EU foreign policy-making 745

rights, and conflict-prevention. Similarly, the Edinburgh European Council

(7/8 December 1992) set down a basic list of issues suitable for action in the
field of security.'' Any national (or Commission) proposal for the CFSP is thus
bound by these broad objectives; on these topics, EU member governments
cannot easily 'hijack' the process for their own selfish ends. Second, the
European Council, as under EPC, does not devote much attention to the day-
to-day implementation of CESP policies for several reasons: it does not meet
often or long enough to take normal policy decisions, it is usually more
concerned with Community affairs rather than CFSP affairs, and whatever
decisions it does take regarding foreign policy have usually been prepared by
other actors in other institutionalized EU forums (chiefly the Council of the
EU). As the European Council also includes a member of the Commission,
even this supposedly 'pure' intergovernmental forum is subject to the influence
of supranational actors.
Other stages of the policy process reflect a complex interplay between
national and EU-level processes. The financing of the CFSP provides it with
material resources from national or EU sources (once a decision to act has
been taken), although more of this process has been delegated to the EU level
since Maastricht.^ Performance evaluation and democratic oversight are quite
limited as parts of the multi-level governance of the CFSP and are not a major
focus of this paper. Instead, my analysis of multi-level governance will stress
CFSP decision-making and implementation processes, where the interaction
between national representatives and EU actors/processes is the most intensive.
Before examining that interaction, however, we must first determine the
extent to which domestic political processes have already been altered, or
Europeanized, by intensive participation in the EU. In other words, to what
extent are EU member states predisposed to utilize the CFSP system, beyond
the general common interests noted at the beginning of this section?

GOVERNANCE AND THE EUROPEANIZATION OF DOMESTIC

POLITICS
In addition to the emergence of governance structures as noted above, certain
aspects of the EU's foreign policy machinery cause sympathetic changes in
national foreign policy structures (Smith 2000). These aspects include the
tendency toward problem-solving as noted above, plus several key norms.
These include: (1) regular communication and consultation on foreign policy
issues through a dense transgovernmental network; (2) confidentiality, in the
sense that member states cannot use information shared between them to
embarrass or blame other states; and (3) decision-making by consensus, although
there are some provisions for taking minor policy decisions through QMV as
we saw above. As a result of these norms, participants in EU foreign policy do
not always resort to the lowest common denominator position, as inter-
governmental theories often suggest, but tend toward compromise and a
median position in the hopes of reaching a decision. In addition, these CFSP
746 Journal of European Public Policy

working methods have had feedback effects into European domestic politics
that help to reinforce the system in the absence of sustained central leadership
by EC organizations. Two of these effects are relatively indirect and do
not concern me here; these are changes of interpretation in some national
constitutions to conform to common foreign/security policy norms, and a
general growth in public support for the pursuit of the CFSP. Under normal
circumstances, these changes can foster a climate of passive approval for the
delegation of day-to-day policy-making authority to the EU s foreign policy
system.
More important to my argument here are two direct effects of national
participation in EU foreign policy at two different levels of analysis: the
individual level (elite socialization) and the organizational level (changes in
national foreign policy bureaucracies). Changes at both levels demonstrate the
key relationship between pragmatic problem-solving and rule-making in EU
foreign policy as member states try to fill in the gaps left by the treaties in
ways that cause far-reaching changes in their own national foreign policy
cultures. At the individual level of analysis, institutionalized communications
networks (chiefly CFSP working groups and the COREU system*^) and the
passage of time encourage this elite socialization. Evidence of this process has
been well documented in the literature and need not be repeated here.^ The
key point is that socialization processes help to make the CFSP less like a
series of periodic summits (as with many intergovernmental forums) and more
like a decentralized but highly institutionalized framework for policy co-
ordination. They also help to erode the monopoly that high-level government
officials appear to hold over foreign policy while reorienting all EU foreign
policy participants towards 'Europe'. In fact, elite socialization processes exhibit
aspects of three general logics of institution-building found in the literature:
socialization, functional, and appropriateness (March and Olsen 1989; North
1990). Thus, EU foreign policy elites have become far more familiar with each
others thinking regarding foreign policy (socialization logic), they have learned
to value EU foreign policy as a way to enhance their own foreign policy
capabilities (functional logic), and they have learned to believe the EU is an
acceptable arena in which to take foreign policy decisions (appropriateness
logic).
At the bureaucratic level of analysis, there is substantial evidence to show
that EU membership in general and CFSP membership in particular influence
the way individual member states organize their pursuit of foreign policy.' The
expansion and institutionalization of EU foreign policy topics since 1970 make
it increasingly difficult for EU member states to devise national policies
without some reference to EU activities. In addition, the EU's system of shared
leadership of the CFSP (particularly the EU presidency) requires EU member
states to help formulate and articulate EU foreign policy positions in numerous
settings. These requirements in turn tend to encourage more far-reaching
changes in national foreign ministries beyond privileging their overall role in
the process. To the extent that these changes last beyond individual changes
 M.E. Smith: Toward a theory of EU foreign poiicy-making 747

of government and take place in accordance with CFSP requirements, multi-

level governance is enhanced. Three changes in particular vi^ill be stressed,
although others can be mentioned when examining individual EU states.
First, the CFSP requires the establishment of new national officials to serve
it (chiefly European Correspondents in national capitals and CFSP counsellors
attached to the Committee of Permanent Representatives (COREPER)). These
institutional roles persist beyond the appointment of specific individuals and
provide a key source of continuity in national attention to CFSP affairs.
Second, the CFSP encourages the expansion of most national diplomatic
services (although there have been some cutbacks since the end of the Cold
War). Third, the CFSP leads to a clear reorientation (and in a few states, also
a reorganization of internal administrative structures) of national foreign
ministries toward 'Europe' in order to improve their handling of European
affairs, particularly as EC and CFSP activities are increasingly expected to
function in a coherent manner. While some EU states have maintained a
distinction between their economic (EC) and political (CFSP) departments,
in others there has been a much closer linkage between the two in the
hopes of maintaining consistency of external policy. Together, these three
developments have helped to reinforce the common norms and goals of EU
foreign policy (for details of these changes, see Hill 1983, 1996; Manners and
Whitman 2000; Smith 2000).
In general, these changes have: (1) enhanced the status of foreign ministries
relative to other domestic ministries involved in EU affairs; (2) opened more
channels of access to EU processes; (3) improved the linkages between
economic and political components of EU policies; (4) helped to blur
distinctions between domestic and foreign policy; and (5) reoriented national
foreign policy-makers more towards 'Europe'. These changes can also be
summarized in terms of consistency or coherence, as suggested by a reading of
several different trends in the growing literature on EU foreign policy. Table 2

Table 2 Types of coherence/consistency in the governance of EU foreign policy

Vertical (or 'Europeanization') Horizontal

Procedural/ National policy mechanisms EU foreign policy mechanisms are
institutional support/conform to common uniformiy applied across policy
EU policy mechanisms.^ areas/time.^
Substantive/policy National policies support/ Various EU policies conform to
conform to common EU broad goais or principles."
policies.^

'Hill (1983); Manners and Whitman (2000); Smith (2000).

"Neuwahl (1994); Smith (2001b).
^Hiil (1996); Manners and Whitman (2000); Smith (2004); Williams (2002).
"Coignez (1992); Krenzler and Schneider (1997); Szymanski and Smith (2004).
748 Journal of European Public Policy

organizes these changes along two dimensions: vertical/horizontal and proced-

ural/substantive.
If process matters for policy, then vertical procedural/institutional coherence
should promote vertical and horizontal/substantive policy coherence. To fully
appreciate these interactions and situate them in a broader context of multi-
level governance, we need to explore how the system functions to produce
regular policy outputs. In other words, how does the interaction of domestic
politics and governance mechanisms produce specific policy outcomes?

EU-DOMESTIC INTERACTIONS AND POLICY OUTCOMES

As the process of CFSP decision-making at the EU level has been fairly well
documented, in this section I will focus on the ways by which domestic factors
might be brought into the analysis of EU foreign policy-making. If we first
recognize that each EU member state reserves the right to take unilateral
foreign policy decisions through national decision-making processes, then we
need to examine why EU states would deviate from this tendency. However,
to answer this question, we must first make an assumption about micro-
foundations, or national preferences. Here there are two possibilities, each of
which applies to different policy issues.
One is that we assume EU states form preferences largely at the domestic
level and then merely utilize the EU system to pursue them. If this is so,
processes of multi-level governance (if states choose to pursue that route) in
foreign affairs might have an impact on the details of policy, such as funding,
but not on the general substance, which is likely to be decided by consensus.
This view applies particularly to issues where states still claim a unique right
(the so-called domaines reserves) to decide that issue largely on a unilateral
basis. As some EU states still assert this right over certain foreign policy
problems, we must accept that the multi-level governance approach to the
CFSP does not apply uniformly across all questions of foreign policy. EU
states therefore retain a capacity and willingness to take some decisions on a
purely national basis, although they may need to justify them at the EU level.
For these largely unilateral decisions one can rely on standard foreign policy
decision-making models such as rational actor, bureaucratic/organizational
politics, or domestic interest groups.
However, since the range of 'legitimate' domaines reserves has been shrinking
over the years, we must also consider that EU membership by itself increasingly
causes or persuades EU states to pursue (or at least to accept) collective rather
than national decision-making as a general rule. As I argued above, two
general trends - institution-building at the EU level (intergovernmental,
transgovernmental, and supranational) and sympathetic changes in domestic
politics - both undermine the ability and willingness of EU states to take
foreign policy decisions with complete disregard for the positions of their EU
partners and the EU's own body of rules and policies. The problem with this
view, of course, is that foreign policy-making in individual cases becomes so
 M.E. Smith: Toward a theory of EU foreign policy-making 749

complex that no single model can possibly incorporate the various factors that
may influence a specific outcome. This fact explains the attractiveness of the
rational-actor approach to national foreign policy and the liberal inter-
governmental model to EU foreign policy (for a concise review, see 0hrgaard
1997).
To solve this problem, it may be helpful to first frame the multi-level
governance of the CFSP in terms of an ideal type where each of its elements
aligns with all others to produce optimal collective action in foreign policy. By
'optimal' I mean the ordinary or routine nature of joint decision-making rather
than the effectiveness of a specific foreign policy. In other words, if the
'normal' approach to foreign policy is through national (for unilateral) or
intergovernmental (for multilateral) decision-making, then how does multi-
level governance in the EU help to overcome that tendency? We might first
propose that the potential influence of multi-level governance varies depending
on numerous factors which for the purpose of deductive theory-building can
be grouped under four headings: (1) inherent characteristics of the policy
problem/issue; (2) stages in the policy-making sequence; (3) novelty of the
policy decision; and (4) domestic factors.

Inherent characteristics of the policy problem/issue

The first of these factors involves the inherent characteristics of the foreign
policy problem. To greatly simplify, foreign policy problems can be organized
along two dimensions: the time frame involved (crises, short/medium term,
and long term) and the degree to which violence may be involved in pursuing
the policy. The time frame refers to the degree of urgency surrounding the
issue: crises must be decided within weeks at most (more ofi:en days or even
hours); short/medium-term policies must be decided over months or a few
years; and long-term problems must be decided over several years or even a
decade. The degree of violence refers to the political costs accompanying a
problem and also varies continuously, ranging from little or no possibility of
violence to actual combat military operations. The key point is that most
foreign policy problems or goals involve some degree of inherent intractability
depending on these factors, both of which may favour or undermine multi-
level governance. Time and the willingness to use violence to resist or cause
change are the main factors facing every decision-maker. More importantly,
these factors are largely independent of the initial definition of the problem to
be solved or goal to be reached. Yet they can have a profound effect on whether
the EU responds as a global actor or collapses into unilateral decisions or no
decisions at all.'

Stages in the policy-making sequence

The second factor involves key actors and stages in the policy-making sequence
itself, each of which may favour or undermine multi-level governance. As I
750 Journal of European Public Policy

noted above, multi-level governance of the CFSP involves several major policy
stages. Each of these suggests a related hypothesis about the ability of EU
member states to deviate from this inherently multilateral process (i.e. act
unilaterally):
1 Agenda-setting: Does the issue fall under existing, specific European Council
mandates, whether in geographic or functional terms? If so, the capacity for
unilateral national action on those problems may be reduced. These man-
dates include the agenda items set down in the years following the Maastricht
Treaty noted above.
2 Decision-making. What type of policy tool is under consideration (diplo-
matic, economic, or military), and what are the associated decision rules:
QMV, consensus only, or some combination of the two (i.e. economic
sanctions)? In general, multi-level governance will be most problematic in
situations where consensus is the formal rule (such as the ESIDP) and/or the
decision involves complex cross-pillar actions (such as the EC and CFSP).
3 Implementation: As the CFSP provides for several types of implementation,
the potential for multi-level governance varies accordingly. Here we can ask:
does the chosen policy tool involve delegation to EU bodies (chiefly the
Commission, which is most optimal), a pre-existing framework (such as a
joint council in the case of the EU's agreement with Mexico, which is less
optimal than delegation to the Commission alone) or strictly through
national implementation (such as funding for the administration of Mostar,
which is even less optimal than joint councils or similar arrangements)? The
greater the degree of national involvement in implementation, the more
difficult the optimal functioning of multi-level governance.
4 Funding. Similar to the question about implementation, we can ask: does
the policy tool involve only EU ftmding through its budget, mixed funding
through EU or national funds, or national funds alone? Again, the greater
the degree of national involvement in providing flinds for the policy (which
oft:en requires input by national parliaments), the more difficult the optimal
functioning of multi-level governance.
5 Coherence/compliance: Here we can ask: are there mechanisms for ensuring
horizontal coherence across other EU activities (substantive and procedural)
and ensuring compliance (vertical coherence) if national implementation is
involved? In EU foreign policies, coherence is increasingly pursued through
the use of comprehensive framework agreements, which take into considera-
tion all relevant EU policies toward an important country/region/problem
and attempt to resolve contradictions or inconsistencies (Szymanski and
Smith 2004). Compliance is more problematic, as most CFSP decisions do
not include provisions for compliance, nor do the EU treaties themselves
say much about this issue. Therefore, we can only speculate about the
potential role of compliance mechanisms in any CFSP policy decision.
6 Democratic legitimacy: It is difficult to hypothesize about this aspect of
multi-level governance as it is far more of a normative question compared
 M.E. Smith: Toward a theory of EU foreign policy-making 751

to other phases of the policy process. In addition, the nature of foreign

policy-maldng does not lend itself to optimal oversight by parliaments (or
similar arrangements). Some decisions (like treaties) may require approval
by national parliaments and/or the European Parliament, but the negotiation
and implementation of such agreements must be delegated to other actors.
However, to the extent that democratic legitimacy matters for the routine
operation of multi-level governance in foreign policy, we can ask: does the
policy tool allow legitimate involvement or oversight by elected bodies,
where 'legitimacy' varies according to the decision type (funding, approving
agreements, approving appointments, etc.)? If so, national governments may
have less reason to oppose a common policy on the grounds that it violates
democratic norms.

Novelty of the policy decision

The propensity for optimal multi-level governance also likely depends on
whether the policy decision is an entirely new one or an on-going/follow-on
decision (such as administrative agreements or follow-on implementation
decisions) where decision-making procedures have had a chance to coalesce or
even institutionalize into framework agreements or similar 'package deals'.
Similarly, whether the policy problem has resulted in the creation of one of
the more than two dozen CFSP working groups may matter a great deal. Most
pre-decision deliberation takes place within such expert working groups, and
their role in framing problems and suggesting appropriate policies is crucial to
the smooth operation of the CFSP. New problems that do not enjoy the
sustained attention of a permanent CFSP working group (whether functional
or geographic) are not likely to result in concrete policy decisions except in
rare cases.

Domestic factors
Finally, we need to find a systematic way to incorporate the role of domestic
factors (whether regular or idiosyncratic) in the pursuit of multi-level gover-
nance. This is extremely difficult considering the variation across the EU in
terms of historical experiences, power resources, key relationships, cultural
norms/values, institutional mechanisms, and government types. Although we
have seen a general harmonization of certain domestic political factors in line
with EU/CFSP participation, there is still great diversity among EU states that
certainly infiuences the pursuit of individual CFSP policies. Attempting to
organize and rank the influence of these factors (such as large vs. small states,
permanent/temporary UN Security Council members, neutral states, etc.) for
all EU states would be an extremely difficult, and possibly even counterproduc-
tive, exercise if our purpose is to develop a deductive theory of multi-level
governance in the CFSP.
Instead, it may be more useful to examine how situation-specific (rather than
752 Journai of European Pubiic Poiicy

country-specific) domestic factors are likely to interfere with the optimal

operation of multi-level governance in the CFSP. Although some domestic
events may improve the operation of the CFSP in terms of multi-level
governance, we might find it difficult to determine whether a decision was the
result of effective consensual decision-making (or other factors) or effective
leadership by a single EU state, except in isolated cases where one EU state
played a dominant role throughout the process. Thus, it may be easier, at least
in terms of finding evidence, to determine the conditions under which
domestic events undermine or interfere with the normal performance of the
CFSP. In other words, what aspects or conditions of domestic politics might
lead EU states to deviate from 'normal' multi-level governance as a policy
process described above? These conditions can be organized under two
headings: general and specific.
General characteristics of EU member states can be organized in terms of:
(1) government ideology (pro-EU/CFSP or not); (2) government unity (coali-
tion or not); and (3) type of state (centralized or federal). In general, we might
hypothesize that optimal participation in the CFSP policy process will be
undermined when a government exhibits an anti-EU/CFSP ideology, involves
a coalition (especially with multiple parties or a very minimal winning
coalition), and requires approval by federal states when taking key policy
decisions.
Specific characteristics/situations are unique to each policy decision at the
time it is made. These factors might include: (1) major unique political events
such as elections or referendums (governments facing tough elections are less
likely to take risks on questionable CFSP actions); (2) scandals/crises (which
undermine the leadership ability of a government); (3) whether the issue is
subject to a domaine reserve of an EU state; and (4) in the case of economic
sanctions (or similar) whether an EU member state has a close economic
relationship with the target state.
Since one or more of these factors is likely to be in operation for one or
more EU member states during any typical CFSP decision, we need to qualify
the argument: the factors are most likely to interfere with optimal multi-level
governance in three situations: (1) during certain phases of the policy process
as mandated by the CFSP decision itself (implementation, funding, coherence/
compliance); (2) when a country experiencing such factors is in a key position
of influence in the EU (this mainly involves holding the EU presidency, but
could also involve the appointment of special representatives for the CFSP or
participation in some forms of collective representation such as the 'troika'
mechanism); and (3) possibly when normal CFSP policy decisions are taken
during other major events, such as IGCs, which may reduce the willingness of
governments to take a risk with the CFSP. These factors are listed in Table 3.
Therefore, we might hypothesize that the multi-level governance of the
CFSP will be most optimal in situations where: the issue conforms to a
European Council mandate; the decision is reached by QMV (or no insistence
on a consensus), has a long time horizon, and does not involve violence; the
 M.E. Smith: Toward a theory of EU foreign poiicy-making 753
Table 3 Factors influencing optimai muiti-ievel governance in the CFSP

Policy stage Most optimal Least optimai

1 Agenda-setting Issue conforms to European
Council mandate
2 Decision-making QMV or not insisting on a
ruie consensus.
Policy involves a minimal chance
of violence and a long time
horizon
3 Implementation By the Commission or other
institutionalized body
4 Funding By EU budget alone
5 Coherence/ Framework agreement (or similar) No framework agreement
compliance for greater coherence.
Specific standards and
punishments for ensuring
compliance if applicable to EU
member states
6 Democratic Policy permits input by the EP as Policy allows no systematic
legitimacy appropriate (treaty approval,
funding, special appointments,
etc.)
No European Council
mandate
Insisting on consensus.
Policy involves violence and
a short time horizon
By member states (which
intensifies domestic
complications)
By member states (which
intensifies domestic
complications)
and/or no compliance
standards (which intensifies
domestic complications)
input by the EP or national
parliaments

policy involves explicit delegation to EU organizations or a pre-existing

framework; funding is provided by the EU budget; and the European Parlia-
ment provides input as required by the policy decision. In addition, governance
will be improved in cases of follow-on policies (or where there is enough time
for deliberation on more complex problems, especially where a mandate and/
or consensus are lacking) and where the issue is covered by an existing CFSP
working group. Conversely, multi-level governance will be most difficult where
there is no European Council mandate; little consensus (or insistence on a
consensus or use of a veto in the case of QMV), a good chance of violence
and a short time horizon; national implementation (through the EU presi-
dency); national funding; and no mechanisms for democratic oversight. The
problems will be further exacerbated for entirely new policies, and when a
CFSP working group does not at present cover the issue.
We should also note that optimal multi-level governance does not necessarily
mean 'supranational' in the usual sense of the term: the use of QMV for
decision-making and delegation to the Commission. Similarly, we should note
that the EU foreign policy system is increasingly able to 'compensate' in
situations when a policy stage is not conducive to multi-level governance by:
(1) delegating (tacit or explicit) leadership to an EU state or the Commission
754 Journal of European Public Policy

on an issue; (2) making new informal rules for that situation (such as mixed
agreements); or (3) not applying existing rules (such as not requiring QMV
even when the policy tool warrants it). This is why it is difficult to use a single
policy phase by itself, such as decision-making, to predict the chances of
optimal CFSP policy-making or governance. This ability to make new rules
has developed gradually over the past three decades, which explains in part the
limited number of formal EPC policy decisions compared to output under the
CFSP.
As an ideal type, multi-level governance in the CFSP certainly is difficult to
pursue. For it to function effectively (as opposed to creating deadlocks) in EU
foreign/security policy, numerous variables must come into proper alignment.
One example of this involves the EU's policy toward South Africa, which is
often cited as a successful EPC/CFSP joint action. South Africa was one of
the first major areas confronted by the CFSP during its first few months of
operation, yet EPC had devoted attention to that country since the mid-
1970s, which included the creation of an EPC working group at that time. In
a series of EPC/CFSP debates leading up to and following the collapse of the
white majority government in South Africa, a core of EU states argued for
higher cost collective foreign policy actions to undermine the apartheid system
and pave the way for a democratic transition. These actions ranged from a
'Code of Conduct for Community Companies with Interests in South Africa'
(1977) to include support targeted at non-violent anti-apartheid groups and
sanctions targeted at the white government and its military forces, both of
which were increasingly implemented by the Commission rather than indi-
vidual EU member states. Throughout these debates, the UK, Germany,
Creece, and Portugal repeatedly expressed initial opposition to such costly
measures, primarily to maintain access to South African natural resources, yet
all four states declined to exercise their right of veto and thus succumbed to
the wishes of their EU partners.
Efforts under the CFSP involved a transition from working against apartheid
(as under EPC) to helping to improve new democratic institutions and
economic development in South Africa. Toward these ends, the Commission
began producing policy option papers on this issue as early as 1992, and an
outline of the EPC—CFSP policy transition was set down during the Danish
Presidency in June 1993. After rescinding the Code of Conduct and the 1985
sanctions against South Africa (involving nuclear and military co-operation
and the exchange of military attaches) in late 1993, the EU implemented a
series of positive inducements to encourage the new government. These actions
included dispatching a large team of 450 officials to help with elections. The
activities of this group went far beyond mere elections monitoring,'" and the
Commission was fully responsible for co-ordinating these activities. In fact,
the Commission's successful involvement here showed much potential for
implementing future CFSP joint actions.
Thus, following this first joint action, the EU began a more extensive effort
to integrate the former pariah state into the global community. A Commission
 M.E. Smith: Toward a theory of EU foreign policy-making 755

delegation was established in Pretoria in December 1993, and it became the

central contact between the EU and the local government. This was a major
change compared to EPC, when relations were conducted through EU member
states with embassies in South Africa (i.e. national implementation)." In April
1994 the Council adopted a Commission proposal for stronger relations with
South Africa; the new framework involved trade and economic co-operation,
a political dialogue (where the EU placed its usual emphasis on human rights,
democracy, the rule of law, and social justice), and development co-operation.
Through these strands of activities involving the EC and the CFSP, the EU
showed more coherence and uniformity in its policy toward South Africa than
ever before despite occasional defections by individual EU states from specific
policy details. Martin Holland's detailed assessment of this policy deserves
quoting at length:
From both the European and South African perspectives, the joint action
has been an almost unqualified success... . [T]hrough the joint action a
comprehensive approach was adopted rather than segregated incrementalism.
Coordinating the various policy sectors (development, trade, election-moni-
toring, etc.) together under a single initiative (the joint action), while
difficult and possibly time-consuming, had led by the end of 1994 to a
compatible and comprehensive policy mix that was regionally sensitive as
well as of direct benefit to South Africa.
(Holland 1995: 566)
The South African experiment also ultimately 'improved the effectiveness
of European policy' and confirmed the Commission's enhanced status in this
domain, as it 'fully utilized its power of initiative and was the leading player
throughout 1993—94 in structuring the Union's contemporary policy, fulfilling
a role of at ie^t primus inter pares' (Holland 1995: 566). Thus, it could be
argued that the EU's comprehensive approach to South Africa epitomized the
optimal multi-level governance of foreign policy as I defined it above.

CONCLUSION
This article has examined the institutional development of EU foreign policy
at the European and national levels, arguing the case for a multi-level
governance approach to understanding the CFSP. Like the EU itself, the CFSP
is a unique process in international affairs and it has developed considerably
since the early days of EPC. However, as a decentralized deliberative process,
the CFSP is subject to many constraints at the EU and domestic levels, as I
have outlined in this article. The process also takes time to work effectively,
which frustrates observers inside and outside the EU. Numerous opportunities
still exist for member states to undermine the process, even if only 'accidentally'
by virtue of certain domestic events such as elections. These opportunities in
turn are contingent upon both the inherent characteristics of the policy
problem and domestic situational factors. I have attempted to incorporate
756 Journal of European Public Policy

both sets of factors into a general theory of how the EU formulates and
executes common foreign policy decisions.
These inherent tendencies will come under increasing stress in the very near
future. The largest increase in membership in the EU's history will greatly
expand the range of potential foreign policy problems, yet the EU's constitu-
tional convention is not likely to reform CFSP procedures to the degree
necessary to cope with twenty-five member states. Without more extensive
institutional reform at the EU level (such as greater use of QMV, and more
delegation to the Commission), in the future the CFSP might be pursued only
when coalitions of willing states take the lead. Otherwise weak (or no) action
might be the rule until the EU's deliberative processes have a chance to alter
the domestic political cultures of the new member states in line with EU
foreign policy priorities. In fact, the EU might even consider specific ways to
foster more domestic changes (such as eliminating the political directors from
the process and delegating many CFSP decisions to COREPER) in hopes of
a more general harmonization of foreign policy interests. However, deliberate
efforts toward this end, as through Europe's constitutional convention, might
be resisted as unacceptable violations of state sovereignty. Still, this is not
completely outside the realm of possibility, and may be the only way for EU
states to avoid the potential CFSP deadlocks that loom after enlargement.

Address for correspondence: Michael E. Smith, Assistant Professor, Depart-

ment of Political Science, Ceorgia State University, PO Box 4069, Atlanta,
GA 30302-4069, USA. Tel: 404 651 4839. Fax: 404 651 1434. email:
mesmith@gsu.edu

ACKNOWLEDGEMENTS
An earlier version of this paper was presented at the workshop entitled 'EU
Governance and External Relations', organized by the Mannheim Centre for
European Social Research, University of Mannheim, Germany, 10—11 October
2003. I am grateful to the directors of the workshop (Michele Knodt, Frank
Schimmelfennig, and Wolfgang Wagner) and to other workshop participants
for their helpful input on this article.

NOTES
1 The argument in this section is derived in part from Smith (2003: ch. 7).
2 These include: (1) safeguarding the common values, fundamental interests, and
independence of the EU; (2) strengthening the security of the EU and its members
in all ways; (3) preserving peace and strengthening international security; (4)
promoting international co-operation; and (5) developing and consolidatine demo-
cracy, the rule of law, and respect for human rights and fundamental freedoms.
3 These factors are: (1) geographical proximity or a given region or country; (2) an
important interest in the political and economic stability of a region or country;
and (3) the existence of threats to the security interests of the EU.
4 Four sets of issues suitable for joint action in the security field: the Gonference on
 M.E. Smith: Toward a theory of EU foreign policy-making 757
Security and Co-operation in Europe (CSCE) process, disarmament and arms
control in Europe, non-proliferation of weapons of mass destruction, and the
economic aspects of security (especially technology transfer). Later, the Extraordi-
nary European Council (Brussels, 1993) defined trie general objectives of European
security as preserving the territorial integrity and political independence or the
EU, its democratic character, its economic stability, and the stability of neigh-
bouring regions.
5 On CFSP (and justice and home affairs) financing problems since Maastricht, see
Monar (1997).
6 COREU is the correspondance Europeene system, an encrypted telex network used
within the CFSP.
7 See the sources in Smith (2000: 617-19). The idea of elite socialization also
informs many of the chapters on individual countries in Manners and Whitman
(2000).
8 It should also be noted that the evolution of EPC/CFSP has coincided with
changes in national military structures. Although these developments have been
increasingly linked to the emergence of EU defence co-operation, it is impossible
to disentangle them from related changes in NATO, which takes them beyond
the scope of this article.
9 Some might also consider proximity as another inherent characteristic of foreign
policy problems, yet the record of EPC/CFSP is difficult to interpret on this point.
Although the EU has produced a few more foreign policy outputs regarding its
'near abroad' (Central and Eastern European countries, Russia, the Middle East),
proximity by itself cannot help one to predict the potential for using EU
mechanisms to handle a certain issue. Some close problems have divided EU states
(such as Yugoslavia and the Mediterranean) while other distant problems have
been addressed with far-reaching common foreign policies, whether at the level of
individual countries (South Africa, Korea), regions (Central America), and the
international system (the landmines ban, renewal of the Nuclear Non-Proliferation
Treaty).
10 For a description of their activities, see Holland (1995). Holland also asserts (pp.
563—4) that in terms of 'observer days', the EU was the major player in South
Africa as compared to the UN.
11 Though the Commission did have a small, non-accredited 'European Commission
Technical Co-ordination Office' in South Africa, which hanclled the 1985-86
Special Programme and development assistance.

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Final version accepted for publication 19/4/04