Subsidiarity in the EU and Brexit

LAW AND POLICY OF THE EU (ADVANCED): SUBSIDIARITY

In
July 2016 approximately 52 percent of UK nationals voted pro the referendum to
exit the European Union. The aftermath of their decision has been tragic for
British politics. Anna Blackman refers to the mainstream political parties as
ones who are facing ‘leadership crisis, and each parties’ political credibility
is becoming more dilapidated on a near-daily basis’[1].  At the same time, the fourth estate is
painting a gloomy image regarding violence in local communities fueled by
issues such as xenophobia and racism.[2]
However, the idea behind the Brexit is more complex than political ambitions or
communal hostilities, despite the fact these factors have also played a role.
It is estimated that close to 72 percent of eligible voters participated in the
referendum, which is also the highest turnout since the UK’s 1992 general
election. This turnout can be explained by ‘a feeling of political apathy
albeit with a nationalistic protectionist tone’[3].
However, it is widely believed that the setting of the referendum does not only
illustrate apathy, but distinguishes itself as communities being disempowered,
and being encroached by state and market.

The issue seems to be a question of power; which is also an issue of subsidiarity[4]. In this particular context, subsidiarity is akin to the guiding principle that revolves around regulating of power within appropriate levels. Throughout this paper, I will be focusing on the topic of ‘subsidiarity’ and will critically discuss the statement at hand: “Subsidiarity is, in reality, the centerpiece of the Brexit debate and similar debates elsewhere across the European Union. If the principle of subsidiarity were adhered to more closely, there would be fewer tensions between the EU and some Member States.” I will do this by briefly looking at how subsidiarity has deemed its way into the Brexit argument; the history, and the topic of subsidiarity in regards to court reticence prior to Lisbon and post.

Subsidiarity in Brexit

The European Union (EU) adopted the same principle into the Maastricht Treaty in 1992 to provide direction between the EU institution and member nation states. However, centralization of the EU threatened the very principle of subsidiarity hence precipitating calls for the UK referendum. However, in several aspects the Brexit has very little to do with the EU’s violation of subsidiarity and much more to do with their own[5].

Political
protagonists such as David Cameron have even conceptualized a notion of
“Big Society” that is heavily drawn upon the ideology of
subsidiarity. Cameron’s “Big Society” initiative is geared towards
devolving decision-making at the local community level while at the same time
fostering the development of volunteer associations and cooperatives[6].
However, in certain quarters such a deception is perceived as archaic as the
principle of subsidiarity should ‘involve state intervention in necessary
measures when individuals or lesser bodies are incapable of protecting the
human dignity’[7].
Therefore, subsidiarity fundamentally ensures that power lies at an appropriate
level for human dignity, as well as the balancing of powers.

Subsidiarity,
as mentioned before, “is a form of assistance to the human population via
autonomy of intermediate bodies. Such assistance is provided when individuals
or groups of people aren’t able to accomplish a particular task on their own,
and the process is always designed to accomplish the emancipation, due to the
fact that it fosters freedom and participation through assumption of
responsibility. Subsidiary entails personal dignity through acts that recognize
a person a subject that is always capable of giving something to others”[8].

Inherently,
Anna Blackman agrees that the ‘service of the human person’ is at the very core
of the concept of subsidiarity, but it is this exact principle that Cameron’s
government ignored.[9]
It is  disrespect to a system promoting
the interest of the state and market at the expense of the local community. For
instance, if we look at the different forms of nationalism which have risen
post-Brexit, their themes do not center on allegiance to the nation-state but
rather revolves on issues that are far more tribal, and this is where the
failings of subsidiarity twin principle of solidarity become apparent. Even
though subsidiarity operates by managing the vertical structure of the society,
solidarity moves horizontally. 

David
Cameron’s policies reflect on a perfect example of a grotesque miscalculation
of the critical function of subsidiarity. Because it promotes a politics of
“Big Society” that devolves the responsibility to local communities
under the disguise of empowerment accompanied with a program of austerity that
deprives communities of avenues to exercise their civic role, and any form of
governmental solidarity with communities that has failed to materialize. Such a
result cannot be assumed to be some variants of political apathy but instead a
deep-seated feeling of powerlessness to instill some political change for a big
portion of the population, hence disenchantment with political engagement. An
irony that manifests itself in the “Big Society” concept is that by
giving arguments to undo bureaucracy associated with the state, the process
occurs through a top-down bureaucratic political process.

With
the ongoing bittering players across different divide are wondering of the UK
would be better off within the EU. In true subsidiarity, the European Union
acts as a high decision organ mandated to tackle issues that previously were
difficult to deal with at the state-level such as big business and
environmental concerns.

Origins of Subsidiarity: General Principles of European Union Law

Subsidiarity
is said to be the word that saved the Maastricht Treaty.[10]
It is regarded as a general principle of the European Union law, and according
to different amendment’s related to the subsidiarity principle, the European
Union is only mandated to enact pieces of the legislative amendments in
situations where the actions of member states are insufficient[11].
The treaty was established through the Treaty of Maastricht in 1992. However at
the local level, subsidiarity has become a critical element of the European
Charter of Local self-government, an organ of the Council of Europe that was
promulgated in 1985. According to Article 4, paragraph 3, the exercise of the
public responsibilities should be decentralized. The present formulation is
available from article 5(3) of the EU treaty that was later on consolidated
into the Treaty of Lisbon, effected on 1^st December 2009.

Paul
Craig[12]
discusses the rationales for subsidiarity within the EU. He states that the
first rationale was the perceived role of subsidiarity as a ‘mechanism for
alleviating disputes concerning the division of competence between the EC and
the Member States.’[13]
Essentially, under the subsidiarity principle, regions that appear beyond the
union competence, the union is only mandated to act only if the envisaged
objectives cannot be sufficiently attained by the member countries, either at
the central or regional level, but can also due to the magnitude of the concern
be attained at the Union level. Craig went on the affirm that the second
rationale for subsidiarity was that where the limits of federal power were not
precise, subsidiarity would therefore become a way to measure it;[14]
essentially, if the objective could be ‘sufficiently’ achieved at the Member
State level, it would then be mandatory that the European council demonstrates
that it could be ‘better’ achieved at Community level.[15]
Craig also distinguished that to avoid excessive centralization, subsidiarity
was vital. It is the legal mandate of the Court of Justice of European Union to
decide whether a particular regulation cascades within the exclusive capability
of the Union. Due to the fact that the Subsidiarity principles wields both
political and legal aspects, the Court of Justice comes with a reserved attitude
towards judging whether different EU legislation is consistent with the
aforementioned concept. During such instances, the court only assesses whether
the principal was fulfilled marginally. Besides, detailed legislations are not
essential, the EU institutions can only give their explanations as to why they
believe that national legislations appear inadequate and that the Union law
comes with added value. 

Application of Subsidiarity

As
mentioned above, the principle rationale for subsidiarity is to alleviate the
‘competence’ problem; essentially in his article ‘Competence: Clarity,
Conferral, Containment and Consideration’, Craig distinguishes the theme of the
Lisbon Treaty as being equal to the theme in the Maastricht Treaty (using
Subsidiarity to alleviate fears of Federalism); essentially the division of
competencies became clearer because of the Lisbon schema.[16]

For
instance, in the Federal Republic Germany
v European Parliament and Council of European Union[17]
in relation to deposit guarantee schemes on May 13^th 1997. The
plaintiff argued that the directive failed to accentuate on its compatibility
with subsidiarity principle[18].

According
to the court: consideration should be accorded to scenarios that may arise if
the deposits from a credit institution with branches disbursed in satellite
countries are unavailable, then it is appropriate to ensure that there are
harmonized minimum level of deposit protection if deposits can be traced back
to the community level. Such a ruling illustrates that in the community
legislatures view, the aim of their action, due to the aspects of the intended
action, can best be attained at the community level. Besides, during the fifth
recital, both the parliament and the council stated actions instituted by
member countries regarding the commission’s recommendations doesn’t fully
attain the favorite results, and therefore the objective of any action is best
adequately attained by member states.

Therefore,
alongside any democratic perception, the parliament and the council gave their
opinions on why they considered that their actions conformed to subsidiarity
principle, and consequently, complied with the obligation by providing reasons
as mandated from Article 190 of the treaty. It is under this rationale that the
plea of infringement of the obligation of any state becomes unfounded and
should therefore be disregarded.

Essentially,
the Court of Justice was resistant to get involved, and they adopted a ‘light
touch’, however looking at the case of Vodafone v Secretary of State for
Business (Grand Chamber) 2010[19],
we can see the court’s discretion post-Lisbon. In this case, a regulation was
adopted on the basis of Article 114 of the TFEU which set maximum roaming
charges payable by a consumer’s home Member State network to a foreign network
used by the home operator. This case raised the issue of whether the regulation
could be annulled for the incorrect use of Article 114 TFEU. Ultimately, it was
deemed to not be of a breach as the regulation was not breaching the principle
of subsidiarity. Craig explains that the reality is “whether a particular
judicial decision was right or wrong can only be determined by looking closely
at the contested regulatory scheme and deciding whether it ‘passed’ the
subsidiarity criterion. When judged from this perspective, it is not
self-evident that any of the challenged regulations should have fallen because
of subsidiarity.”[20]

Treaties of the European Union

The
EU member countries operate within some constitutional guidelines that
establish the different EU institutions together with their remit, procedures,
and objectives. The member countries are therefore allowed to operate within
the competences granted to them via the treaties whereby the amendments also
require agreements and ramification in relation to their country specific
procedures. The EU operates under two distinct treaties, which are the Treaty
on European Union and Functioning of the European Union initially assented in
1957 in Rome to establish the economic community. These treaties have
progressively been an amendment with other treaties[21].

Amendments and Ratifications

These
treaties are usually changed using three approaches. There is the standard
revision procedure whereby different amendments are reviewed through a full
inter-governmental conference. There is also a procedure created through Treaty
of Lisbon and only ensures changes that do not enhance the powers of the
European Union. There is also the passerelle clause that doesn’t entail
amending treaties, but allows alterations of legislative amendments on
particular circumstances. 

The
procedures for amending the treaties begin when proposals from an institution
or member states are escalated to the European Council. During the ordinary
revision procedure, the president of the European council summons a European
convention comprising of representatives from commissions, national
parliamentarians, and the national government representatives to draft changes
to the European Council before proceeding with an intergovernmental conference
mandated to agree on the treaty on behalf of different government hence signed
and ratified by each member country. Despite the fact that the procedure has
been in existence prior to the Lisbon treaty, as actual European convention has
only happened twice[22].

There
is also the simplified revision procedure that does not only apply to section
three of the treaty regarding the functioning of the European Union and
therefore cannot increase the powers of the EU. Any reform being implemented on
the legal basis of the EU should be ratified in accordance with procedures from
each member state. It is the state’s legal mandate to ratify and lodge
instruments of ratification with the Government of Italy before the treaty
comes into force.

In
certain occasions, states have failed 
the particular treaty passed by the public during a referendum. A good
case is Denmark and Ireland whereby a successive referendum was held after
different concessions were granted. However, in the case of Netherlands and
France, the treaty was abandoned in favor of a treaty that would not prompt a
referendum. Even though treaties are always placed before the European
Parliament and due to the fact that the vote is not binding, it is essential
that both the Belgian and Italian parliaments said they would veto the Nice
Treaty if the European Parliament failed to approve it[23]. 

Conclusion

The
principle of subsidiarity is described in article 5 of the Treaty on the
European Union and its crucial role is to ensure that decisions regarding
operations of the union are placed carefully to the citizen as possible and
that different assessments are administered to ascertain that any action at EU
level is justified in light of possibilities from the local, regional, and
national level. Precisely, this is also the very principle that EU do not take
exclusive action with the exception being in regions that do not fall within
the brackets of its exclusive competence, unless the action appears more
efficient compared to action taken at local, regional, or national level. The rules
are closely bound up with the principle of proportionality, which entails that
any action by the EU should not proceed beyond what is essential to attain the
objectives of the treaties. According to the above case, it is evident that
there exist two protocols annexed to the treaty of Lisbon which is critical:

Protocol
1: It dictates the role of national parliament by encouraging respective
parliament from member involvement with EU activities and proposals to be
forwarded promptly so that they can examine the rules before the council takes
a decision.

Protocol
2: it involves the commission taking into account the local and regional
dimension of all draft legislative acts and to make a detailed statement on how
principle of subsidiarity is respected. Such a protocol has enabled national
parliaments to object to a proposal on the basis that it breaches the
principle, and as a result the principle which the proposal should be reviewed
and may be maintained, amended or withdrawn by the commission, or blocked by
the Council or European Parliament.

Academic Articles

Bermann, G. (2009) ‘National Parliaments
and the Principle of Subsidiarity: An Outsider’s View’. In Pernice, I. and
Tanchev, E. (eds) Ceci n’est pas une Constitution – Constitutionalisation
without a Constitution (Baden-Baden: Nomos).

Caporaso,
James A. “The European Union and forms of state: Westphalian, regulatory
or post‐modern?.” JCMS: Journal of
Common Market Studies 34, no. 1 (1996): 29-52.

Cass, D. (1992) ‘The Word that Saves
Maastricht? The Principle of Subsidiarity and the Division of Powers within the
European Community’. Common Market Law Review, Vol. 29, pp. 1107–36.

Chalmers,
Damian, Gareth Davies, and Giorgio Monti. European Union law: cases and
materials. Cambridge university press, 2010.

Craig, P. (2012) ‘Subsidiarity: A Political and Legal
Analysis’. Journal of Common Market Studies, Vol. 50, pp.72-87

Craig, P. (2004) ‘Competence: Clarity,
Conferral, Containment and Consideration’. European Law Review, Vol. 29,
pp. 323–44.

Dawson,
Mark. “EU law’transformed’? Evaluating accountability and subsidiarity in
the’streamlined’OMC for Social Inclusion and Social Protection.” (2009).

Estella
de Noriega, Antonio. The EU principle of subsidiarity and its critique.
2002.

Geyer,
Florian. Security versus justice?: police and judicial cooperation in the
European Union. Routledge, 2016.

Howarth,
David, and Lucia Quaglia. “Banking on stability: the political economy of
new capital requirements in the European Union.” Journal of European
Integration 35, no. 3 (2013): 333-346.

Lange,
Peter, George Ross, and Maurizio Vannicelli. Unions, change and crisis:
French and Italian union strategy and the political economy, 1945-1980.
Routledge, 2016.

Schimmelfennig,
Frank, and Thomas Winzen. “Instrumental and constitutional differentiation
in the European Union.” JCMS: Journal of Common Market Studies 52,
no. 2 (2014): 354-370.

Van
Kersbergen, Kees, and Bertjan Verbeek. “The politics of international
norms: Subsidiarity and the imperfect competence regime of the European
Union.” European Journal of International Relations 13, no. 2
(2007): 217-238.

Cases

Case C-233/94 Germany v Parliament [1997] ECR I-2405

Case C-58/08 R (on the application of Vodafone Ltd) v
Secretary of State for Business [2010]

[1] Anna P. Blackman, Brexit: An Exercise in the Violation of
Subsidiarity. 2016

[2] IBID

[3] IBID

[4] Estella de Noriega, Antonio. The
EU principle of subsidiarity and its critique. 2002.

[5] Dawson, Mark. “EU law
transformed’? Evaluating accountability and subsidiarity in the’streamlined’OMC
for Social Inclusion and Social Protection.” (2009).

[6] Van Kersbergen, Kees, and Bertjan
Verbeek. “The politics of international norms: Subsidiarity and the
imperfect competence regime of the European Union.” European Journal of
International Relations 13, no. 2 (2007): 217-238.

[7] N (1)

[8] Howarth, David, and Lucia Quaglia.
“Banking on stability: the political economy of new capital requirements
in the European Union.” Journal of European Integration 35, no. 3
(2013): 333-346.

[9] N (1)

[10] Cass, D. (1992)
‘The Word that Saves Maastricht? The Principle of Subsidiarity and the Division
of Powers within the European Community’. Common Market Law Review, Vol.
29, pp. 1107–36.

[11] Lange, Peter, George Ross, and
Maurizio Vannicelli. Unions, change and crisis: French and Italian union
strategy and the political economy, 1945-1980. Routledge, 2016.

[12] Craig,
P. (2012) ‘Subsidiarity: A Political and Legal Analysis’. Journal of Common
Market Studies, Vol. 50, pp.72-87

[13] IBID

[14] Bermann, G. (2009)
‘National Parliaments and the Principle of Subsidiarity: An Outsider’s View’.
In Pernice, I. and Tanchev, E. (eds) Ceci n’est pas une Constitution –
Constitutionalisation without a Constitution (Baden-Baden: Nomos).

[15] N(7)

[16] Craig, P. (2004)
‘Competence: Clarity, Conferral, Containment and Consideration’. European Law
Review, Vol. 29, pp. 323–44.

[17] Case
C-233/94 Germany v Parliament [1997] ECR I-2405

[18] Chalmers,
Damian, Gareth Davies, and Giorgio Monti. European Union law: cases and materials.
Cambridge university press, 2010.

[19] Case
C-58/08 R (on the application of Vodafone Ltd) v Secretary of State for
Business [2010]

[20] n
(7)

[21] Schimmelfennig,
Frank, and Thomas Winzen. “Instrumental and constitutional differentiation
in the European Union.” JCMS: Journal of Common Market Studies 52, no. 2
(2014): 354-370.

[22] Caporaso,
James A. “The European Union and forms of state: Westphalian, regulatory
or post‐modern?.” JCMS: Journal of Common Market Studies 34, no. 1 (1996):
29-52.

[23] Geyer,
Florian. Security versus justice?: police and judicial cooperation in the
European Union. Routledge, 2016.