Principles of law harmonisation and approximation

Eugene Stuart

Scope
Differences between HARMONISATION and APPROXIMATION ? Different types of harmonisation. New approaches to harmonisation Forbidden Harmonisation Stuart theory of harmonisation and approximation Some of the issues in harmonisation and approximation

HARMONISATION VS. APPROXIMATION

harmonization originally only in Article 99 EEC, in relation to indirect taxes. approximation was used in Article 100 (now Art. 94 EC) dealing with the elimination of barriers to the functioning of the internal market arising from Member State laws, regulations or decisions. harmonization was introduced by the Single Act, specifically in paragraphs (4) and (5) of Article 100a EEC (now Art. 95(4) and (5) EC).

Harmonisation vs. Approximation (2)

In Article 95(1) EC harmonization refers to EU law measures for the approximation of the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment and functioning of the internal market. In Article 94 EC, where the term itself is not explicitly used, harmonization refers to EU directives for the approximation of such laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the common market.

Harmonisation vs. Approximation (3)

Approximation and Harmonization of laws are used in the EC Treaty as synonyms. Approximation and Harmonization in fact also encompass unification of national laws. Harmonization is mainly used in connection with directives which, unlike regulations, are not intended to unify national laws. Convergence is often also used in a general way Pre-accession context - it has been repeatedly clarified that approximation includes the concept of effective enforcement.

METHODS OF HARMONISATION
Harmonization of national laws through Community legislation laid down in directives the most common means In early years, uniformity was the prevailing approach. Opened the possibility for Direct Effect of Directives Differentiation and flexibility since enlargements White Paper of 1985 on the completion of the internal market. New approach results in a number of different harmonisation methods

Methods of Harmonisation (2)

total harmonisation, allowing no derogation in the preempted area except for safeguard measures or to the extent permitted in the directive; optional harmonisation, allowing producers to apply national norms or Community norms, some directives allowing the Member States to exercise the option (opting-out); partial harmonisation, regulating some aspects of the subject matter only (e.g. rules which only applied for certain cross-border transactions); minimum harmonisation, allowing Member States to provide for more stringent rules; alternative harmonisation, allowing Member States to choose between alternative methods of harmonization; and mutual recognition of controls, rather than of substantive rules.

CONSUMER LAW
Mixed Approach Framework Legislation + Targeted Directives Emphasis on involvement of key actors in the process

FINANCIAL SERVICES
The Lamfalussy process
Level 1 framework legislation is adopted by the Community institutions in conformity with the codecision procedure; Level 2 the Commission adopts directives or regulations laying down technical details to implement Level 1 legislation, after consulting the European Securities Committee (ECS) and taking the advice of the European Regulators Committee (CESR) (which must prepare its advice in consultation with market participants, end-users and consumers) and under the control of the European Parliament as to whether the proposed measures do not go beyond the level of mere implementation; Level 3, the European Regulators Committee works on joint interpretation recommendations, consistent guidelines to facilitate day-to-day implementation of Community rules in the respective Member States, and on common (but not binding) standards in areas not covered by Community legislation; Level 4, the Commission checks compliance of Member States laws with Community legislation, and if necessary takes legal action before the ECJ.

Reflections on Lamfalussy
Easier to adopt Level 1 framework laws Speeds up detailed rule making in Level 2 Improved best practice role for national regulators Provides for extensive consultation with all stakeholders

FORBIDDEN HARMONISATION
Education and Training Culture Public Health A sovereignty issue EU may only take supporting, coordinating or complementary action. may not entail harmonisation of Member States laws and regulations. Currently, prohibitions of this kind are found in Articles 149(4), 150(4), 151(4), 152(4) EC

OPEN METHOD OF COORDINATION

Employment, Social and Economic policies In areas where policy takes over from law, harmonisation of laws, as an instrument, is replaced by coordination of policies Implies that Member State governments should agree to define certain policy purposes or problems as matters of common concern, whereas the actual choice of effective policies should remain a national responsibility. Harmonisation of Member State laws and regulations is explicitly excluded (Art. 129).

ISSUES IN HARMONISATION/ APPROXIMATION EU integration and pre-accession processes.

STUART THEORY: Useful to regard harmonisation as the process of getting the national law right vs. EU legislation. This is usually the first step and this can be complex and take some time. On this basis, approximation can be viewed as the second and final (or continuing) phase where:
(a) related policies (including interpretation and how the law is applied) and (b) effective and verifiable enforcement can be added.

PRINCIPLES
1. Partial Approximation is not allowed 2. Careful and accurate interpretation of the instrument to be approximated 3. Getting behind exceptions and derogations 4. Careful examination of the existing law and situation 5. Inclusion of necessary national modifications

Principles (2)
6. Impact Assessment 7. Consultation 8. Benchmarking 9. Avoiding CUT & PAST harmonisation 10. Adequate consideration of institutional capacity issues 11. Enforcement and Strategic Planning 12. Anticipate transparency and EU review