Chapter 1 Guidance on answering assessment questions

The origins of the European Union and EU law
1. Explain the reasons for the formation of the EEC in 1957.

The reasons for the formation of the EEC (now the EU) were both economic and political. The economies of Europe had been devastated by the Second World War and the best hope of recovery seemed to lie in a pooling of resources and the creation of a trading bloc to compete with the USA and the then USSR. The union of the coal and steel industries of six countries (the ECSC) had proved to be a success and its members felt that cooperation over a wider sphere would bring them greater prosperity. It was also felt that a European union would lessen the likelihood of another European war and enable its members to withstand military pressure from the Soviet bloc. The Preamble to the EEC Treaty stressed the intention to lay the foundations of an ever closer union of peoples and to strengthen peace and liberty.

The original impetus of the organization was towards the creation of a common or single market in goods, services, labour, and capital, but the EU now involves full economic and monetary union, with a single currency and a single monetary policy most Member States, and its activities now include measures for police and judicial co-operation and a common foreign policy.

2. What is the single market?

The single market consists of an area in which there are no internal duties or quotas on the cross border movement of goods, a common external tariff for imports from third countries, and free movement not only of goods but also of persons, services and capital. 

3.Why was the Single European Act (1986) necessary and how did it provide for the achievement of its objectives?

By the 1980s the original deadline for the creation of the single market (1969) had long sincepassed without fulfilment and few measures of importance to it had been taken for over a decade.

The Single European Act (SEA) set out to achieve a rejuvenation of the EEC (now the EU), paying particular attention to the objective of a single market. A new and more detailed definition of the single market was provided, together with a new law-making power to be applied to provisions to achieve the single market. New areas of competence for what was then the EEC and is now the EU were established, and foreign policy cooperation was also mentioned for the first time although it was not incorporated into the EEC Treaty.

The SEA succeeded in reviving interest in the European project. In particular the completion of the single market made it possible for the Member States to contemplate further economic integration.

The SEA therefore provided the basis for the EEC to agree the more ambitious TEU (1992).

4. What significant developments were introduced by the TEU (1992)?

The TEU (1992) was perhaps the most significant Treaty since the EEC was founded in 1957.  It provided for economic and monetary union, a step far beyond the original aim of a common market and including a single currency.  This required the EEC – renamed the EC by the TEU (1992) - to adopt an economic policy conducted in accordance with free competition and based on common objectives, the coordination of national policies and the internal market; and a single monetary policy based on fixed exchange rates leading to a single currency. The TEU (1992) also provided for greater economic and social cohesion.  

The TEU (1992) made provision for an EU foreign policy, although it is true to say that this had first appeared in a more modest form in the SEA, and has not been particularly successful to date.  It also provided for EC competence in another policy area which was traditionally left to national governments; justice and home affairs.

It also introduced a radical new structure to what had been the EEC.  The EEC, renamed the EC, remained, but the common foreign and security policy and justice and home affairs were not integrated into its legislative and judicial structures, but formed part of a new body, the EU, with a new standalone Treaty.  As a result, national governments were able to limit or exclude the powers exercised in these areas by, in particular, the European Parliament and the Court of Justice.

5. What major changes were made by the Treaty of Lisbon (2007)?

The Treaty of Lisbon (2007) merged the EC and the EU into a single body which was from then on called the EU, renamed the EC Treaty (now the Treaty on the Functioning of the European Union (TFEU)) and renumbered both it and the TEU (1992) (now the TEU).  It continued the institutional reforms which had been seen in previous amending Treaties and gave legal force to the Charter of Fundamental Rights.