The Institutional Foundations of Intergovernmentalism and Supranationalism in the European Union.

We present a unified model of the politics of the European Union (EU). We focus on the effects of the EU's changing treaty base--from the founding Rome Treaty (ratified in 1958) to the Single European Act (SEA, 1987), the Maastricht Treaty on European Union (1993), and the Amsterdam Treaty (1999)--on the relations among its three supranational institutions--the Commission of the European Communities, the European Court of Justice, and the European Parliament--and between these actors and the intergovernmental Council of Ministers. We conceive of these institutions in terms of the roles they perform in the three core functions of the modem state: to legislate and formulate policy (legislative branch), to administer and implement policy (executive branch), and to interpret policy and adjudicate disputes (judicial branch).

The Council and the Parliament are predominantly legislative institutions. The Council directly represents the national governments of the member states. Council support is necessary for the passage of all EU legislation. Since 1987, the Council has increasingly made decisions under "qualified majority voting" (QMV) rather than under unanimity voting. [1] The citizens of Europe have directly elected the Parliament since 1979. The Parliament makes decisions by absolute majority at the end of all legislative procedures. [2] The Parliament had no effective influence over legislation until the ratification of the SEA in 1987. But with the ratification of the Amsterdam Treaty on 1 May 1999, the Parliament became a coequal with the Council in what is effectively a bicameral EU legislature for all policy areas covered by the reformed "codecision" procedure (Amsterdam Treaty, Art. 189b). [3] Under this new regime, new legislation requires the support of both a qualified majority in the Council and an absolute majorit y in the Parliament.

The Court is the EU's judicial branch. Its mandate is to interpret the EU's treaty base and secondary legislation passed pursuant to the treaties in the arbitration of conflicts among EU institutions and among these institutions, member states, and citizens. The Court has been remarkably effective in the past forty years, successfully "constitutionalizing" the EU's treaty base, claiming wide powers of judicial review over this would-be constitution, and exercising judicial activism in the interpretation of secondary legislation. Finally, the Commission fulfills two discrete functions in the EU: It is both a legislator with a monopoly on the drafting of bills and the bureaucracy charged with implementing legislation. [4] Most commentators consider the Commission to have been the prime mover behind the reinvigoration of European integration in the mid-1980s.

Our central contention is that the balance of power among these four institutions has changed considerably since the signing of the Rome Treaty. We analyze these changes in terms of the evolution of the EU's legislative regime and its impact on the discretion of the Commission to implement policy and of the Court to adjudicate policy disputes. The connection between legislation and discretion is straightforward. The more difficult it is for new legislation to be passed (for example, because of higher voting thresholds or more veto players), the more discretion bureaucracies and courts have to move policy outcomes closer to their own preferences. [5]

The history of European integration can be divided into three epochs. First, the Luxembourg compromise period (1958-87) was characterized by legislative gridlock in the Council. In this period the Council was an ineffective collective institution, with the system of national vetoes protecting the sovereignty of member states. In turn, the unanimity-voting requirement in the Council greatly mitigated the legislative power of the Commission (because its agenda-setting power was negligible). But the Commission was doubly hamstrung under the Luxembourg compromise because the small volume of legislation produced by the Council gave the Commission scant opportunities to exercise its (potentially extensive) bureaucratic discretion to implement policy afforded by unanimity voting. In contrast, legislative gridlock in the Council facilitated Court activism because only treaty revisions could rein in the Court. The freedom of the Court to interpret the Rome Treaty was thus the primary force propelling European integra tion during the Luxembourg compromise.

The second epoch of European integration began when the SEA was ratified. In this period the Council became a more effective legislative institution, at the cost of national sovereignty--individual governments that could no longer veto legislation of which they disapproved. The Court's discretion to interpret secondary legislation was curtailed by the move from unanimity to QMV in the Council (though its discretion in constitutional interpretation was unaffected because treaty revisions require unanimity among member states). The change in Council voting rules also gave the Commission agenda-setting power (though this power was shared with the Parliament under the "cooperation" procedure). Moreover, the proliferation of EU legislation associated with the internal market program (the "1992" agenda) gave the Commission many more opportunities to affect outcomes through policy implementation than was the case under the Luxembourg compromise. Thus the effective removal of national vetoes in the Council rendered the Commission the prime mover behind European integration in the decade following the ratification of the SEA--so long as its legislative proposals respected the preferences of the pivotal members of the Council under QMV and the Parliament (under the cooperation procedure).

The origins of Europe's third and current epoch lie in the Maastricht Treaty, and these foundations were cemented at Amsterdam. The Parliament is now a powerful legislator, coequal with the Council under the reformed codecision procedure. In contrast, the Commission's legislative agenda-setting powers are far more limited than they were in the immediate post-SEA era. But empowering the Parliament in a bicameral legislature has increased the probability of gridlock between it and the Council. Consequently, the discretionary space available to the Commission to implement policy and to the Court to adjudicate disputes has increased. In this current epoch, therefore, all four of the EU's major institutions play important roles that are reminiscent of those of legislatures (the Council and the Parliament), bureaucracies (the Commission), and legal systems (the Court) in national polities with bicameral legislatures (such as Germany).