The Intergovernmental Conference and the Treaty of Nice

The themes dominating the European Union in 2000 were: the forthcoming enlargement of the Union, and the institutional reforms required by this process. The Intergovernmental Conference that was convened for this purpose opened on 14 February 2000 under the Portuguese presidency. Its work was completed at the European Council in Nice on 7-11 December under the French presidency. The resulting Treaty of Nice was to be formally signed during 2001.

The principal issues were: the size and membership of the European Commission, the weighing of votes in the Council, a possible extension of qualified majority voting in the Council, "as well as other necessary amendments to the Treaties arising as regards the European institutions in connection with enlargement and in implementing the Treaty of Amsterdam". The IGC differed from previous conferences on institutional reform in that it concentrated on the operational viability of the existing institutions without endowing the Union with new competences. Decisions were taken with a view to an enlarged European Union of 27 members.

The European Commission

The smaller Member States, including Austria, succeeded in having the principle of one commissioner per member country reaffirmed. The five larger states agreed to give up their second commissioners in exchange for an increased voting weight in the Council. This arrangement will have to be reviewed once the accession treaty of the 27th Member State has been signed. At this point in time, the Council will have to take a unanimous decision on limiting the size of the Commission on the basis of a fair and equal rotation procedure. The new provisions will be applicable once a new Commission takes up its functions following the accession of the 27th member. The President of the Commission has been invested with additional powers, including the right to ask an individual commissioner to resign following the approval of the college. The overall agreement ensures that the balance between the larger and smaller Member States will be maintained in the future, and guarantees that all members will continue to be represented in the Union's central institutions on a basis of equality.

Distribution of Votes in the Council

Being the key to the balance of power between the larger and smaller Member States, the weighing of votes was the most controversial issue at the conference. The new system for the enlarged Union allocates 29 votes to each of the four largest Member States (France, Germany, Italy and the United Kingdom) while the smallest future Member State, Malta, received 3 votes. Austria, Bulgaria and Sweden will have 10 votes each. Once the EU reaches 27 members, qualified majority decisions can be taken by a minimum of 258 votes representing a majority of members. One member of the Council may request verification that the Member States constituting the qualified majority represent at least 62% of the total population of the Union. The new system will come into force on 1 January 2005 with every enlargement requiring adaptations. The agreement on the reweighing of votes was coupled with a declaration according to which, from 2002, one meeting of the European Council in each presidency will be held in Brussels, and that once membership reaches 18 states, all meetings will be held in Brussels.

Extension of Majority Voting

The Conference agreed that decisions of a constitutional nature, decisions requiring ratification by national parliaments, exceptions to the Internal Market and decisions on own resources should still be taken on the basis of unanimity. The European Council in Nice decided to introduce qualified majority voting in 30 areas. These include the freedom of movement of persons, transnational cooperation in civil law, some aspects of social policy, certain international negotiations on services and intellectual property, appointments to senior jobs in EU institutions, and the rules of procedure in the European Court of Justice. Insofar as such measures are of a legislative nature, the European Parliament is granted the right of co-decision. For another 15 areas, the European Council envisaged qualified majority voting at a later date. Austria was basically in favour of extending qualified majority voting, but insisted on maintaining unanimity in certain sensitive areas like water resources, land use, regional planning, the choice of energy carriers, and strategic transport policy. Unanimity will be required for the meantime on asylum and immigration policies.

Enhanced Cooperation

The Treaty of Amsterdam allowed for closer cooperation between groups of Member States in individual sectors, provided these remain within the limits set by the Treaties. The Treaty of Nice abolishes the right of veto previously granted in this area but specifies that this cooperation has to respect the coherence of the Union, that it must be open to all Member States, that the rights and responsibilities of non-participating members must be respected and that core areas of the Internal Market are excluded. For the first time, enhanced cooperation is permitted within the area of the Common Foreign and Security Policy, although with the exclusion of military and defence policy issues.

Other Institutional Reforms

After enlargement, the European Parliament will have a maximum of 732 members. This implies that most existing Member States will have their allocations of seats reduced. Austria's seats will be reduced from 21 to 17. Parliament's legislative role has been strengthened, and it now has the right of recourse to the European Court of Justice. Both the Committee of the Regions and the Economic and Social Committee will be enlarged to 344 members, Austria's representation of 12 members in each remaining unaltered. Judicial panels for specific areas may be attached to the Court of First Instance by unanimous decision of the Council. Plenary sessions of the court will mostly be replaced by meetings of a smaller body, a so-called "Grand Chamber" of eleven judges.

Democratic Standards

Article 7 of the Treaty of Amsterdam specified that a country's membership in the European Union can be suspended in the event of serious and continued violation of the basic principles of democracy. The crisis over the sanctions imposed by 14 Member States against Austria revealed, however, that this provision does not offer any legal basis for action in cases not involving serious and continued violations. On the basis of an Austrian initiative further developed by the European Commission, the existing procedure was supplemented by an early warning phase for cases where there is a clear risk of a serious breach of democratic standards and human rights. During this early warning phase, recommendations can be addressed to the state in question. This procedure can be invoked by a majority of four fifths of the members of the Council after approval by the European Parliament. Decisions can be made only after the state concerned has been heard, and have to be both justified and proportional. At Austrian request, this procedure was made subject to the control of the European Court of Justice.

The Follow-Up Process

During 2001, a comprehensive debate is to be conducted with all interested parties with a view to deciding how the institutional reform process is to be continued. It is foreseen that the next Intergovernmental Conference will be held in 2004. The process should address, inter alia, the following questions: a more precise delimitation the of competences between the European Union and the Member States, in the lightreflecting of the principle of subsidiarity, the status of the Charter of Fundamental Rights proclaimed in Nice, a simplification of the Treaties, and the role of national Parliaments in the European architecture.