In this Working Document, Stefano Micossi, Director General of Assonime, argues that once the Union is recognised for what it is – an innovative polity, where power is shared by a large number of players with many participation and influence-wielding mechanisms, – it becomes apparent that on the whole it complies with democratic legitimisation standards no less than do member states, even if multiple, and potentially conflicting legitimisation channels and principles may confuse observers.

After a long period of internal introspection and deadlock over the Constitutional Treaty, the EU can now see some light at the end of the tunnel. If successfully ratified, the new European Treaty agreed by the Head of States and Government in Lisbon may provide the appropriate institutional tools for the EU to function with 27 member states.

The new ‘Lisbon Treaty’ agreed at the European Council meeting on 18-19 October 2007, preserves most of the substance of the failed Constitution; it will serve the EU well. As usual, however, Europe has taken a step forward by creating a new disequilibrium; new Treaty revisions are likely to be proposed even before all the provisions of this present one have been implemented.

Rarely has an EU Presidency been met with such high expectations as Germany’s in the first half of 2007. With hindsight, it might be said that these expectations have largely been fulfilled. The agreement on a detailed mandate for the upcoming Intergovernmental Conference (IGC) under the Portuguese Presidency now offers a way forward for a Union that has been ‘in crisis’ since the French and Dutch no-votes. This report offers an overview of the German Presidency’s aims in the various policy areas and makes an assessment of the achievements of its six-month term.

Drawing on an extensive data set and a large number of interviews with senior officials, diplomats and other practitioners, this report investigates the 32 months leading up to and following the enlargement of the EU in May 2004, i.e. from September 2001 through December 2006. The material collected for the analysis covers each piece of legislation adopted in the Council over a period of more than 5 years.

The recent formation of a far-right party group in the European Parliament has raised a series of important questions with regard to the internal organisation and representation of interests in the EU’s only directly elected institution. In this commentary, Sara Hagemann looks into what powers the far-right politicians actually achieve by joining forces and finds that although there are great financial and organisational incentives for these extremists to meet in a trans-national party group, little formal political influence awaits them.

In light of the severe crisis afflicting the European Union and the low regard with which the Union’s institutions are held by public opinion, Stefano Micossi and Daniel Gros argue in this Policy Brief that three critical areas stand out in need of clarification and fresh initiative: the common framework for policy coordination, the budget and the democratic deficit in European institutions. The chances of success would be enhanced by tackling these issues in the right order.

This cost-benefit study carried out for the European Parliament assesses the different programmes and actions in the area of information carried out by the European Commission and financed by the Community budget over the period 2000-05. Using the criteria of relevance, effectiveness, efficiency and utility, the study shows that the overall assessment in terms of ‘value for money’ is positive. However, there is still room for improvement concerning all the actions.

Close foreign policy cooperation among a limited number of EU member states is generally looked upon with suspicion as it is associated with ‘directoires’ of large member states. The central argument of this paper is that, under certain conditions, the specialisation and division of labour among the member states can strengthen both the effectiveness and legitimacy of the foreign policy of the EU. This paper proposes the establishment of a system of small, specialised EU core groups that focus on particular foreign policy issues.

The authors of this new EPIN paper argue for a thorough reappraisal of flexibility as an instrument of integration and outline the conditions under which it would help the enlarged European Union to move forward. In particular, treaty-based ‘enhanced cooperation’ should be regarded as a useful tool that avoids many of the potentially disintegrating effects of purely intergovernmental approaches. In a Union of soon-to-be 27 members, enhanced cooperation could turn the idea of flexible integration from a measure of threat to a real opportunity for deeper integration.

Responsibility for the implementation of the Community budget is entrusted by the EC Treaty to the European Commission exclusively. However, by virtue of the principles of subsidiarity and proportionality, approximately 80% of the total expenditure (agricultural spending and spending on structural aid) is managed, in various guises, by member state administrations. The application of the above-mentioned principles to the Community budget has given rise to a complicated panoply of levels of decision-making, which has not resulted in a clear indication of who is responsible for what.

Acknowledging that the French and Dutch no-votes were a huge blow to the Constitutional Treaty and that there is no plan for putting the Constitution into force, Richard E. Baldwin, Professor of International Economics at the Graduate Institute of International Studies in Geneva, asks in this paper: What is the EU’s next step? While conceding that the full answer to this question is unknowable at this point, he asserts that any answer must surely take into account the ‘trail to failure’ – the sequence of events that led up to the Constitution.

This paper analyses the UK rebate on EU contributions and concludes that it creates adverse effects, which greatly reduce the incentive for the UK to play an active role in the development of EU policies. This may to a large extent explain the UK’s traditional semi-detached relationship with the EU. The paper concludes, however, that that there is a strong case for the continuation of a modified system of rebates for a country or countries in the UK’s position.