Maastricht Treaty

The Maastricht Treaty (officially the Treaty on European Union), signed on 7 February 1992 by the members of the European Communities in Maastricht, Netherlands,[1] created the European Union (EU); established a three-pillar structure for further European integration; and laid down the "convergence criteria" for the introduction of the euro in 2002 as a common European currency. The institutional and policy architecture established by the treaty for European economic and monetary union faced its first major challenge in the European debt crisis that unfolded from the end of 2009.

Treaty on European Union
TypeFounding treaty
Signed7 February 1992 (1992-02-07)
LocationMaastricht
Effective1 November 1993
AmendmentTreaty of Amsterdam (1999)
Treaty of Nice (2003)
Treaty of Lisbon (2009)
SignatoriesEU member states
Consolidated version of the Treaty on European Union at Wikisource

The Maastricht Treaty reformed and amended the treaties establishing the European Communities, the EU's first pillar. It renamed the European Economic Community as the European Community to reflect its expanded competences beyond economic matters. The Maastricht Treaty also created two new pillars of the EU on Common Foreign and Security Policy and Cooperation in the Fields of Justice and Home Affairs (respectively the second and third pillars), which replaced the former informal intergovernmental cooperation bodies named TREVI and European Political Cooperation on EU Foreign policy coordination.

The Maastricht Treaty (TEU) and all pre-existing treaties have subsequently been further amended by the treaties of Amsterdam (1997), Nice (2001) and Lisbon (2007). Today it is one of two treaties forming the constitutional basis of the EU, the other being the Treaty on the Functioning of the European Union.

Procedural historyEdit

SigningEdit

 
The Treaty of Maastricht, shown at an exhibition in Regensburg. The book is opened at a page containing the signatures and seals of the ministers representing the heads of state of Belgium, Denmark, Germany and Greece

The signing of the Treaty of Maastricht took place in Maastricht, Netherlands, on 7 February 1992. The Dutch government, by virtue of holding the Presidency of the Council of the European Communities during the negotiations in the second half of 1991, arranged a ceremony inside the government buildings of the Limburg province on the river Maas (Meuse). Representatives from the twelve member states of the European Communities were present, and signed the treaty as plenipotentiaries, marking the conclusion of the period of negotiations.

RatificationEdit

Only three countries held referendums (France, Denmark and Ireland – all required by their respective constitutions).[2] In Ireland, the Eleventh Amendment of the Constitution, allowing the state to ratify the Treaty, was approved in a referendum held on 18 June 1992 with the support of 69.1% of votes cast.

In Denmark, the first Danish Maastricht Treaty referendum was held on 2 June 1992 and ratification of the treaty was rejected by a margin of 50.7% to 49.3%.[3] Subsequently, alterations were made to the treaty through the addition of the Edinburgh Agreement which lists four Danish exceptions, and this treaty was ratified the following year on 18 May 1993 after a second referendum was held in Denmark, where it received the support of 56.7% of votes cast,[4] with legal effect after the formally granted royal assent on 9 June 1993.[5]

In September 1992, a referendum in France narrowly supported the ratification of the treaty, with 50.8% in favour. This narrow vote for ratification in France, known at the time as the 'petite oui', led Jacques Delors to comment that "Europe began as an elitist project in which it was believed that all that was required was to convince the decision-makers. That phase of benign despotism is over."[6]

In the United Kingdom, the Treaty came close to closing the Conservative government of John Major its parliamentary majority. Rebels within the ranks of the government party opposed the Treaty in the rounds, and opposition Labour and Liberal Democrat parties protested the an opt-out the government had negotiated from the treaty's social-policy provisions, the so-called "social chapter".[7] There began a campaign (ultimately to bear fruit in 2016) to submit British accession to European treaties to a referendum on the [[John Locke|Lockean]] grounds that being delegated from the people, "the legislature cannot transfer the power of making laws to any other hands" without the people's explicit consent.[8][9]

Entry into forceEdit

The TEU entered into force on 1 November 1993.

The Maastricht Treaty (TEU) and all pre-existing treaties has subsequently been further amended by the treaties of Amsterdam (1997), Nice (2001) and Lisbon (2007). Today it is one of two treaties forming the constitutional basis of the European Union (EU), the other being the Treaty on the Functioning of the European Union.

At the end of January 2020, as a result of the "Brexit" referendum of June 2016, the UK left the European Union and so withdrew from the Maastricht Treaty.

AmendmentsEdit

Treaties amending the TEU:

Pillar Structure of the UnionEdit

 
Stone memorial in front of the entry to the Limburg Province government building in Maastricht, Netherlands, commemorating the signing of the Maastricht Treaty

The treaty created what was commonly referred to as the pillar structure of the European Union: (1) one supranational pillar created from three European Communities (which included the European Economic Community (EEC), the European Coal and Steel Community and the European Atomic Energy Community); (2) the Common Foreign and Security Policy (CFSP) pillar; and (3) the Justice and Home Affairs (JHA) pillar.

The first pillar was where the EU's supra-national institutions—the Commission, the European Parliament and the European Court of Justice—had the most power and influence. The other two pillars were essentially more intergovernmental in nature with decisions being made by committees composed of member states' politicians and officials.[10]

All three pillars were the extensions of existing policy structures. The European Community pillar was the continuation of the European Economic Community, with the "Economic" being dropped from the name to represent the wider policy base given by the Maastricht Treaty. Coordination in foreign policy had taken place since the beginning of the 1970s under the name of European Political Cooperation (EPC), which had been first written into the treaties by the Single European Act but not as a part of the EEC. While the Justice and Home Affairs pillar extended cooperation in law enforcement, criminal justice, asylum, and immigration and judicial cooperation in civil matters, some of these areas had already been subject to intergovernmental cooperation under the Schengen Implementation Convention of 1990.

The creation of the pillar system was the result of the desire by many member states to extend the European Economic Community (EEC) to the areas of foreign policy, military, criminal justice, and judicial cooperation. This desire was set off against the misgivings of other member states, notably the United Kingdom, over adding areas which they considered to be too sensitive to be managed by the supra-national mechanisms of the EEC. The agreed compromise was that instead of renaming the EEC as the European Union, the treaty would establish a legally separate European Union comprising the renamed EEC, and the inter-governmental policy areas of foreign policy, military, criminal justice, judicial cooperation. The structure greatly limited the powers of the European Commission, the European Parliament and the European Court of Justice to influence the new intergovernmental policy areas, which were to be contained with the second and third pillars: foreign policy and military matters (the CFSP pillar) and criminal justice and cooperation in civil matters (the JHA pillar). Coordination in foreign policy had taken place since the beginning of the 1970s under the name of European Political Cooperation (EPC), which had been first written into the treaties by the Single European Act but not as a part of the EEC.

In addition, the treaty established the European Committee of the Regions (CoR). CoR is the European Union's (EU) assembly of local and regional representatives that provides sub-national authorities (i.e. regions, municipalities, cities, etc.) with a direct voice within the EU's institutional framework.

Economic and monetary unionEdit

Having "resolved to achieve the strengthening and the convergence and to establish an economic and monetary union including,... a single and stable currency", the Treaty established convergence criteria. Commonly known as the Maastricht Criteria, these set thresholds for member states to enter the third stage of European Economic and Monetary Union (EMU) and adopt the euro as their official currency.

The Maastricht criteriaEdit

The four criteria are defined in article 121 of the treaty establishing the European Union[11]. They impose control over inflation, public debt and the public deficit, exchange rate stability and the convergence of interest rates.

1. Inflation rates: No more than 1.5 percentage points higher than the average of the three best performing (lowest inflation) member states of the EU.

2. Government finance:

Annual government deficit:
The ratio of the annual government deficit to gross domestic product (GDP) must not exceed 3% at the end of the preceding fiscal year. If not, it is at least required to reach a level close to 3%. Only exceptional and temporary excesses would be granted for exceptional cases.
Government debt:
The ratio of gross government debt to GDP must not exceed 60% at the end of the preceding fiscal year. Even if the target cannot be achieved due to the specific conditions, the ratio must have sufficiently diminished and must be approaching the reference value at a satisfactory pace. As of the end of 2014, of the countries in the Eurozone, only Estonia, Latvia, Lithuania, Slovakia, Luxembourg, and Finland still met this target.[12]

3. Exchange rate: Applicant countries should have joined the exchange-rate mechanism (ERM II) under the European Monetary System (EMS) for two consecutive years and should not have devalued its currency during the period. The inflation rate should not exceed by more than 1.5% the average of the three most stable EU member states.[13][14]

4. Long-term interest rates: The nominal long-term interest rate must not be more than 2 percentage points higher than in the three member states with the lowest inflation.

The purpose of setting the criteria is to maintain price stability within the Eurozone even with the inclusion of new member states.

ControversyEdit

Germany, which had considered as an alternative an extended "Deutschmark zone" within the European Community to include other, and neighbouring, trade-surplus member states (Belgium, the Netherlands, Luxembourg and Denmark),[15] insisted convergence criteria that would prioritise price stability. The criteria, as a result, reflected what had become, following the failure of a French Socialist attempt at job-creating expansion in the early 1980s, general economic-policy orthodoxy. This has been described as a "reversed Keynesianism": macro-economic policy "not to secure a full-employment level of demand, but, through the restrictive control of monetary growth and public expenditure, to maintain price and financial market stability"; micro economic policy, not to engineer income and price controls in support of fiscal expansion, but to lower labour costs by easing market regulation.[16] The commitment to monetary union and the convergence criteria effectively denied member states the resort to currency deflation to ease balance-of-payments constraints on domestic spending, and left labour market "flexibility" as the only means of coping with asymmetric economic shocks.[17]

Confirmed by the mandate given the new European Central Bank in the amending 1997 Amsterdam Treaty, the price-stability priority of Maastricht criteria became a matter of acute controversy and debate in the new-century European debt crisis. Beginning in 2010 with Greece, several Euro-zone countries (Portugal, Ireland, Spain and Cyprus) found themselves unable to repay or refinance their government debt or to bail out over-indebted banks without assistance from third parties: their Euro-zone partners in surplus, the European Central Bank (ECB), or the International Monetary Fund (IMF).

The Maastricht model for European Monetary Union was criticised for its failure to include mechanism to manage payments imbalances between member states, co-ordinate reflation, and ease the burden of adjustment upon wage-, and benefit-, dependent households. Greek finance minister, Yanis Varoufakis credited Maastricht criteria with framing of union of deflation and unemployment.[18]

TimelineEdit

Since the end of World War II, sovereign European countries have entered into treaties and thereby co-operated and harmonised policies (or pooled sovereignty) in an increasing number of areas, in the so-called European integration project or the construction of Europe (French: la construction européenne). The following timeline outlines the legal inception of the European Union (EU) ― the principal framework for this unification. The EU inherited many of its present responsibilities from, and the membership of the European Communities (EC), which were founded in the 1950s in the spirit of the Schuman Declaration.

Legend:
  S: signing
  F: entry into force
  T: termination
  E: expiry
    de facto supersession
  Rel. w/ EC/EU framework:
   de facto inside
   outside
                    European Union (EU) [Cont.]  
  European Communities (EC) (Pillar I)
European Atomic Energy Community (EAEC or Euratom) [Cont.]      
  /   /   /   European Coal and Steel Community (ECSC)  
(Distr. of competences)
    European Economic Community (EEC)    
            Schengen Rules European Community (EC)
'TREVI' Justice and Home Affairs (JHA, pillar II)  
    North Atlantic Treaty Organisation (NATO) [Cont.] Police and Judicial Co-operation in Criminal Matters (PJCC, pillar II)
   
Anglo-French alliance
[Defence arm handed to NATO] European Political Co-operation (EPC)   Common Foreign and Security Policy
(CFSP, pillar III)
  Western Union (WU)   /   Western European Union (WEU) [Tasks defined following the WEU's 1984 reactivation handed to the EU]
     
[Social, cultural tasks handed to CoE] [Cont.]                
      Council of Europe (CoE)
Dunkirk Treaty¹
S: 4 March 1947
F: 8 September 1947
E: 8 September 1997
Brussels Treaty¹
S: 17 March 1948
F: 25 August 1948
T: 30 June 2011
London and Washington treaties¹
S: 5 May/4 April 1949
F: 3 August/24 August 1949
Paris treaties: ECSC and EDC
S: 18 April 1951/27 May 1952
F: 23 July 1952/―
E: 23 July 2002/―
Rome treaties: EEC² and EAEC
S: 25 March 1957
F: 1 January 1958
WEU-CoE agreement¹
S: 21 October 1959
F: 1 January 1960
Brussels (Merger) Treaty³
S: 8 April 1965
F: 1 July 1967
Davignon report
S: 27 October 1970
Single European Act (SEA)
S: 17/28 February 1986
F: 1 July 1987
Schengen Treaty and Convention
S: 14 June 1985/19 June 1990
F: 26 March 1995
Maastricht Treaty²,
S: 7 February 1992
F: 1 November 1993
Amsterdam Treaty
S: 2 October 1997
F: 1 May 1999
Nice Treaty
S: 26 February 2001
F: 1 February 2003
Lisbon Treaty
S: 13 December 2007
F: 1 December 2009
¹Although not EU treaties per se, these treaties affected the development of the EU defence arm, a main part of the CFSP. The Franco-British alliance established by the Dunkirk Treaty was de facto superseded by WU. The CFSP pillar was bolstered by some of the security structures that had been established within the remit of the 1955 Modified Brussels Treaty (MBT). The Brussels Treaty was terminated in 2011, consequently dissolving the WEU, as the mutual defence clause that the Lisbon Treaty provided for EU was considered to render the WEU superfluous. The EU thus de facto superseded the WEU.
²The treaties of Maastricht and Rome form the EU's legal basis, and are also referred to as the Treaty on European Union (TEU) and the Treaty on the Functioning of the European Union (TFEU), respectively. They are amended by secondary treaties.
³The European Communities obtained common institutions and a shared legal personality (i.e. ability to e.g. sign treaties in their own right).
⁴Between the EU's founding in 1993 and consolidation in 2009, the union consisted of three pillars, the first of which were the European Communities. The other two pillars consisted of additional areas of cooperation that had been added to the EU's remit.
⁵The consolidation meant that the EU inherited the European Communities' legal personality and that the pillar system was abolished, resulting in the EU framework as such covering all policy areas. Executive/legislative power in each area was instead determined by a distribution of competencies between EU institutions and member states. This distribution, as well as treaty provisions for policy areas in which unanimity is required and qualified majority voting is possible, reflects the depth of EU integration as well as the EU's partly supranational and partly intergovernmental nature.
⁶Plans to establish a European Political Community (EPC) were shelved following the French failure to ratify the Treaty establishing the European Defence Community (EDC). The EPC would have combined the ECSC and the EDC.

See alsoEdit

NotesEdit

  1. ^ "1990–1999". The history of the European Union – 1990–1999. Europa. Retrieved 1 September 2011.
  2. ^ Parsons, Craig (2006). A Certain Idea of Europe. Cornell University Press. p.202. ISBN 9780801440861
  3. ^ Havemann, Joel (4 June 1992). "EC Leaders at Sea Over Danish Rejection: Europe: Vote against Maastricht Treaty blocks the march to unity. Expansion plans may also be in jeopardy". Los Angeles Times. Retrieved 7 December 2011.
  4. ^ "In Depth: Maastricht Treaty". BBC News. 30 April 2001. Retrieved 4 May 2013.
  5. ^ "Lov om Danmarks tiltrædelse af Edinburgh-Afgørelsen og Maastricht-Traktaten (*1)" (in Danish). Retsinformation. 9 June 1993.
  6. ^ Anell, Lars (2014). Democracy in Europe – An essay on the real democratic problem in the European Union. p.23. Forum för EU-Debatt.
  7. ^ Goodwin, Stephen (23 July 1993). "The Maastricht Debate: Major 'driven to confidence factor': Commons Exchanges: Treaty issue 'cannot fester any longer'". The Independent. London. Retrieved 4 May 2013.
  8. ^ Vernon Bogdanor quotes from John Locke's The Second Treatise of Government. Bogdanor, Vernon (8 June 1993). "Why the people should have a vote on Maastricht: The House of Lords must uphold democracy and insist on a referendum". The Independent.
  9. ^ Bogdanor, Vernon (26 July 1993). "Futility of a House with no windows". The Independent.
  10. ^ "Treaties and law". European Union. Retrieved 7 December 2011.
  11. ^ EUR-Lex. "Document 12008E121". eur-lex.europa.eu. Publications Office of the European Union. Retrieved 21 September 2020.
  12. ^ "Eurostat – Tables, Graphs and Maps Interface (TGM) table". European Commission.
  13. ^ "The IMF & the European Economic and Monetary Union – Factsheet". imf.org. Retrieved 16 July 2020.
  14. ^ "The Maastricht convergence criteria". nbb.be. Retrieved 16 July 2020.
  15. ^ Abbey, Michael; Bromfield, Nicholas (1994). "A Practitioner actitioner's Guide t s Guide to the Maastricht T o the Maastricht Treaty". Michigan Journal of international Law. 15 (4): 1335.
  16. ^ McDowell, M (1994). "European Labour in a Single Market: '1992' and the Implications of Maastricht". History of European Ideas. 19 (1–3): 453–459, 455. Retrieved 13 September 2020.
  17. ^ Tsoukalis, Loukas (1997). Tsoukalis, L (19The New European Economy Revisited: the Politics and Economics of Integration. Oxford: Oxford University Press. p. 15. ISBN 9780198774778.
  18. ^ Varoufakis, Yanis (2017). The Weak Suffer What They Must: Europe's Crisis and America's Economic Future. New York: Avalon Publishing Group. ISBN 9781568585994.

Further readingEdit

External linksEdit

  Works related to Consolidated version of the Treaty on European Union at Wikisource