The EU
The European Union (EU) is a trading bloc of 27 countries in Europe.
Trading bloc = a group of countries that agree to trade freely with each other.
The countries in the EU are called member states.
There is free trade between all member states. This is called the single market.
Importance of EU membership for Ireland.
The Single European Market provides Irish businesses with the opportunity to increase their profits as they are allowed to sell their products and services freely to a market of over 480 million people.
The EU has given Ireland grants to improve its infrastructure, eg. Airports, ports, motorways. This helps Irish businesses import and export products quickly and cheaply.
Ireland’s membership of the Single European Market attracts Transnational Companies/ Multi national corporations here, such as Dell and Intel. These companies provide thousands of jobs in Ireland/ They also buy materials from Irish businesses.
The EU CAP (common agricultural policy) and the CFP (common fisheries policy) have given grants to Irish farms, agriculture and fishing to help modernize these industries.
EU Institutions
There are 5 organisations / institutions that you need to know about.
European Commission European Parliament Council of the EU
European court of Auditors Court of Justice
You must know what each of these institutions does:
European Commission:
The European Commission is the institution that runs the EU.
It consists of commissioners. Each commissioner is in charge of a different area eg. Transport, Education, health.
The main functions of the European Commission are:
To propose new European laws.
The European commission finds new laws that are needed and then drafts up a new law. Eg. Mimimum wage was a idea from the European Commission and directly affects Ireland like all European Commission laws.
To enforce EU laws.
The European Commission looks over the EU to make sure all member states obey the laws. If a country is not enforcing a European law then that country can be brought to the Court of Justice.
To draft the EU budget.
The Commission is responsible for drafting the EU budget. This means they make the initial decision on how much each country should get from the EU. This also directly affects us as we need the money to develop poor areas and infastructure etc.
European Parliament:
The European Parliament is the institution that is directly elected by the citizens of the EU to represent our interests in discussions with other EU institutions.
There are over 700 Members of the European Parliament (MEP’s) representing people in all the member states.
The main functions of the European Parliament are:
To debate and approve new European laws.
The European Parliament looks over laws the European Commission draws up. The MEP’s discuss and debate the proposed law and suggest changes to make it better.
To supervise the EU.
MEP’s look over what the Council of the European Union is doing. The parliament interviews all the candidates for the European Commission. It then votes on whether to accept the new Commission or not. Parliament also has the power to sack the entire Commission if they are unhappy with it.
To approve the EU budget.
The European Parliament shares the power with the Council of the EU to approve or reject the entire EU budget. So it can influence how the EU spends its money.
Council of the European Union:
The Council of the European Union is the most important decision making body in the EU. The Council of the European Union represents the member states and its meetings are attended by one minister from each member states government.
The main functions of the Council of the EU are:
To pass European laws.
The Council (with the European Parliament) that has the final say on what becomes EU law. This is called co-decision.
To sign off on international agreements between the Eu and other countries or origanisations.
Every year, the council officially signs off agreements that cover areas such as trade with non-EU countries or organisations , Fisheries, science and transport.
To approve the EU budget.
The Council in co-decision with the European parliament has the power to approve or reject the entire EU budget, this influences how the budget is spent.
To allow member states to work together in areas of security, defence and foreign policy.
Eg. To deal with international crises, the Council of the EU created a Rapid Reaction Force, that consisted of soldiers from each EU army who work together to carry out rescue and peacekeeping missions.
European Court of Auditors:
The European Court of Auditors ensures that the EU budget is managed properly.
Its job consists of checking EU funds, that come from EU taxpayers. The Court of auditors ensures that the tax’s are properly collected and that they are spent legally, economically and for the Intended purpose. The Court of Auditors aim Is to ensure that the taxpayers get maximum value for their money.
The Court of Auditors can audit any country or organisation that received EU funding to ensure the money was not wasted. The Court of Auditors conducts paperwork and on the spot checks.
The Court writes a report on its findings and brings to the attention of the member states and commission if there are any problems.
Court of Justice:
The Court of Justice makes sure that EU laws are applied the same way in all EU countries. The Court is made up of one judge from each EU country.
The functions of the Court of Justice are:
To give advice:
The court of Justice gives advice to member states, to help them understand EU law and how to apply the law in their country.
Ensure counties obey EU law’s:
The Court of Justice makes sure that each country and institution in the EU obeys EU laws and does exactly what EU law requires. It has the power to settle disputes between EU countries, EU institutions, citizens and businesses.
Strike down any EU law that is illegal.
If member states or institutions believe that a particular EU law is illegal, they can ask the Court to abolish it.
The EU operates through common policies to ensure laws and policies are enforced throughout all member states. The most important common policies are the :
Agriculture Policy,
Fisheries Policy,
Competition Policy,
Social Policy
and the various Structural Policies, all of which have a great bearing on the future prosperity of the Irish economy.
On the next page each EU policy is explained in detail:
Common Agricultural policy (CAP):
· The CAP (common Agricultural policy has improved the standard of living of farmers.
· The CAP improved the quality of food and the methods of producing it.
· To help farmers improve the CAP gives EU farmers grants. This enables the farmer to grow better crops and rear better quality animals. This means the farmer can sell more.
Common Fisheries policy (CFP):
· The aim of this policy has been to reduce fishing capacity due to the overfishing of certain fish stocks along with an overcapacity in the industry. (makes sure there is enough fish for everyone for years)
· To prevent over-fishing. The CFP does this by:
1. Every country is given a quota, the maximum amount of each type of fish it can catch each year.
2. The CFP sets limits for the size of holes in nets, to stop small fish being caught.
· To provide a decent standard of living for fishermen.
1. Prices for fish at the start of each year are fixed.
2. To improve quality of fish caught, the CFP gives grants to EU fishermen to buy better boats and technology.
EU Social Charter:
The EU Social Charter is the EU’s social policy. It aims to improve working and living conditions for EU citizens.
It give all EU workers the following rights.
· EU citizens have freedom of movement.
This means they can work in any EU country they want and be treated the same as nationals of that country.
· EU workers have the right to a fair wage.
This wage must give them and their families a decent standard of living, all EU countries must set a minimum wage.
· EU workers can work only a maximum of 48 hours per week. They also must be entitled to public holidays with pay, and four weeks paid holiday annually.
EU Competition Policy.
The EU Competition Policy is a set of rules intended to ensure free and fair competition between businesses in the EU.
Its aim is to ensure that EU customers get quality products at a fair price.
It contains a number of rules.
· Businesses cannot form cartels. A cartel is a secret agreement between big competitors in which they agree to restrict competition. They cannot work together to rip off the consumer, by charging a high price.
Eg. It would be illegal for all the B&B owners to get together before summer and agree to charge €2000 per person per night.
· Business who are dominating the market (Huge companies) are not allowed abuse their power by increasing prices or trying to stop new competitors from entering the market.
· State-Owned enterprises cannot hold a monopoly position. They cannot be the only business offering a product.
Eg. RTÉ has competition with TV3.. Bus Éireann and AirCoach.
· All large mergers/takeovers have to be approved by the European Commission. Permission is denied if the Commission believes that the merger would seriously damage competiton.
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