International Business: European Union Informative Essay

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The Evolution of the European Union

After the Second World War, Robert Schumann proposed a plan to unite Europe; however, he realized that it could not be done at once. He proposed that it could be built through its achievements. The union began by the establishment of three European Communities; Coal and Steel Community, Atomic Energy Community and the Economic Community (Harrop 24).

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The treaty which established the Economic Community is a Rome treaty which was a framework treaty that led to the attainment a Customs Union. The treaty also set out objectives that led to the development of guidelines for policies in economic activities. The treaties that established European communities created institutions that were in charge of activities of each community (Nugent 216).

In mid-eighties, the building blocks for the European Community changed with the establishment of a single European Act. An internal market was established in 1992, and during this year, the Maastricht Treaty led to the formalization of the European Union; this defines a community that has common policies in different areas (Harrop 43).

In 1999, a Monetary Union was established together with a common citizenship, foreign as well as security policies. The union started operating on three pillars: Common Foreign and security, the European Community, cooperation in police and judicial criminal matters.

Political structure in the European Union

“The European Union consists of European countries that are democratic; they are committed to working for peace and prosperity” (Tatham, 2009). This union has five institutions, with each institution playing its specific role. These institutions include the European Parliament, Court of auditors, Court of justice, European Commission and the European Union council.

Apart from these five institutions, there are other important bodies such as the European Investment Bank, European Ombudsman, European Central Bank, Committee of the regions and the European Social and Economic Committee.

The European Union has a rule of law, which is fundamental to the union where all its procedures and decisions are based on the union treaties and are agreed upon by all the member countries (Hix and Hoyland, 209). The Union is unique on its own in that it is not a federal government and it is also not just a union of a countries; its political system was established on a chain of treaties and has been evolving over the past years.

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The treaties represent both the national interests and collective interests. The treaties have primary legislation, and it is from the primary legislation that secondary legislation is derived; it is through the secondary legislation that the union impacts the lives of its citizens (Nugent 186). The legislation consists of directives, regulations and recommendations and these laws are according to the policies of the European Union.

The decisions about the laws are made by the European Parliament, the European Commission and the European Union Council. The position of the Council is presided over by each member country after very six month, and each council meeting is attended by each member country’s minister, and the decision on which minister to attend the meeting is made basing on the topic on the gender.

The European Parliament is a body that is elected to represent the Member states citizens, this body also participates in the process of legislation with the election of its members scheduled to take place after five years.

The Council and the European Parliament share legislative power and have an equal responsibility during the adoption of the European Union budget; they debate of the budget proposed by the European Commission, and they can pass the budget or reject it (Hix and Hoyland 323).

Through the budgetary powers, the parliament is able to influence policy making in the European Union. The body exercises democratic control; it has the mandate of dismissing the Commission through the adoption of censure motion; the parliament also ensures that the policies of the union are managed and implemented correctly.

The European commission is an institution which does its activities with political independence, and makes shore that the interests of the union are protected. It also ensures that the regulations and directives of the union are adopted by the Parliament and the Council, and if not the offending party is taken to the Court of Justice by the Commission (Hix and Hoyland 212).

The commission also proposes new EU legislation; therefore, it is mandated to take action to help the Council and Parliament to agree. On the other hand, the commission is under the Parliament; therefore, it is answerable to the Parliament.

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The Single European Act

The Single European Act is an act that was signed in The Hague and Luxembourg, and started functioning in 1987. The act represents the European Communities first treaties’ modification.

Among other modifications, this modification gave the European Council a formal recognition with the creation of a court and an introduction of new procedures for legislation (Nugent 48). The parliament was given veto powers on the accession of new members and agreement conclusion with associated member states.

The force behind the adoption of this act was in Article 8A; this article sets the single objective of the market. In 1985, the programme of the Single market objective proposal implied that the approval of many directives sought to eliminate obstacle that had been recognized.

The act also had a significant policy on industrial relations and employment; the Social Action Programme of the commission in 1989 brought to light the concern of working time.

This issue could have concentrated on the effects of working time on completion in the local market; it could have allowed for the approval by majority voting, however, the issue could have raised a question of whether to exclude the proposal from the majority voting regime considering paragraph 2 in Article 100A (Nugent 167).

During this event, there was an argument by the commission on whether the regulatory practices on diversity regarding working time flexibility threatened health and well-being of workers; this argument was meant to push for a way out to Article 118A. The challenge by the United Kingdom to the choice of the Commission regarding working time directives was adopted by the council, but it did not succeed.

The Establishment of the Euro

Euro is a currency used by the members of the European Union; it is also used in Kosovo, Andorra and Montenegro. This currency is as a result of monetary reform during the Roman Empire in Europe. The creation of this currency perfected the single market in Europe; it is through the euro that Europe achieved political integration.

The idea of the euro was in Europe for decade; this is according to the Rome’s treaty in 1957, however, the currency formally started circulating in 2002 (Eliassen 78). In 1979, there was an introduction of the European Monetary System together with locked exchange rates within the participating countries; this set basics for the single currency creation.

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After seven years, the euro was created after the participating member countries created exchange rates between their currencies; this created a monetary union (Hill et al 57). The transition took 3 years with the use of euro as electric money, and later, the euro notes and coins took over; up to now, the member states use Euro as a single currency and they have a common central bank as well as a common interest rate.

Enlargement of the European Union

Currently, the European Union has an ambitious plan of enlarging its integration; the enlargement is aimed at reuniting the Europe as a continent. The union believes that the move will consolidate democracy and peace in Europe and make the European people to share the benefits which have been accrued through the progress of the European Union together with the welfare generated by the integration (Bradley et al 205).

More countries have applied to be members of the European integration. The members and the union are still negotiating about the circumstances of their integration with the union (Weiler 39). Each country is unique, therefore, members are negotiating with the unions at their own pace and this depends on the situation in each country.

The European Union gives rules for members who want to become members; for a country to be a member of European Union, it should have a stable democracy, which would ensure that there is a rule of law, protection from minority groups and human right protection (Nugent 146). The country’s market economy must be functioning well and its public administration should be in a position to apply as well as manage EU laws.

Works Cited

Bradley, John et al. Integration, growth and cohesion in an enlarged European Union. Chicago: Springer, 2005. Print.

Eliassen, Kjell. Foreign and security policy in the European Union. New York: SAGE, 1998. Print.

Harrop, Jeffrey. The political economy of integration in the European Union. Camberley: Edward Elgar Publishing, 2000. Print.

Hill, Charles et al. Global Business Today. Whitby: McGraw-Hill Ryerson, Limited, 2006. Print.

Hix, Simon & Hoyland, Bjorn. The Political System of the European Union. Sydney: Palgrave Macmillan, 2011. Print.

Nugent, Neill. The government and politics of the European Union. Durham: Duke University Press, 2006. Print.

Tatham, Allan. Enlargement of the European Union. Cambridge: Kluwer Law International, 2009. Print.

Weiler, Joseph et al. Integration in an expanding European Union: reassessing the fundamentals. Hoboken: Wiley-Blackwell, 2003. Print.

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IvyPanda. 2022. "International Business: European Union." May 25, 2022. https://ivypanda.com/essays/international-business-european-union/.

1. IvyPanda. "International Business: European Union." May 25, 2022. https://ivypanda.com/essays/international-business-european-union/.


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IvyPanda. "International Business: European Union." May 25, 2022. https://ivypanda.com/essays/international-business-european-union/.

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