Is The EU A Federal State?

by | Jul 19, 2019

Is The EU A Federal State?

by | Jul 19, 2019

In 1776 the Kingdom of Great Britain saw the Thirteen Colonies in America announce their Independence. At stake was the question of sovereignty. In 2016 the United Kingdom declared its independence from the EU. At stake is the question of sovereignty. Ironies of history…

When Brexit came up, a lot of people around the world were clearly surprised. Why would the United Kingdom want to leave the European Union? The slogan “take back control” got on the scene to supporting the leaving. But what control? It might sound strange for many (the world still does not know when Brexit will take place), but this debate is nothing new for those who have been watching the EU closely during the past decades.

Since 1993, when the European Community was renamed the European Union, or likely even earlier, the expansion of the community’s scope entails tensions between (1) those who want to see it enlarge its range and (2) those who seek to limit the swelling supranational powers. Who is winning this tug of war?

Answering this question helps us to understand not only Brexit but also why the EU should be considered nowadays much more than an international body (a union of sovereign countries), but a true quasi-federal state.

Trade blocs v. Federal states

A trade bloc is a type of international agreement that aims to reduce or eliminate barriers to trade among the participating states. Depending on the level of integration, the blocs can be classified as preferential trading areas, free-trade areas, customs unions, common markets, and economic and monetary unions.

Mercosur is an example of trade bloc (its full members are Argentina, Brazil, Paraguay, Uruguay, and, shamefully, Venezuela), whose purpose is to promote intra-zone trade and a common trade policy, likewise fluid movement of goods and people. The Mercosur’s institutional structure (as we ordinarily can see in trade blocs) is formed by councils and commissions – there is not, strictly speaking, a supranational government.

A federal state, in its turn, is a diverse kind of political entity. In thesis, it is unlike anything we have just seen.

Federal states bring to life a form of government (federalism) characterized by the division of powers into two levels of government: there is a central power (federal) and regional powers (state, provincial, cantonal). The central power (representing the federation as a whole) keeps the sovereignty while regional powers maintain only autonomy – sub-units can have their own government and create their own laws, as long as they observe the federative pact (according to the Federal Constitution).

Further essential characteristics of the federal states are: (1) a national court of justice is charged with (or claim) the power of invalidating regional laws, acts and government actions considered incompatible with the terms of the Federal Constitution; (2) normally adopt the separation of powers, under which the government is divided into branches: a legislature, an executive, and a judiciary; (3) secession (withdrawal of the federation) is forbidden – the cause of the American Civil War (from 1861 to 1865), between the North (Union) and the South (Confederacy), was the southern states’ right of seceding from the United States and keep on with slavery.

Considering this, how dare we affirm EU is more of a federal entity than a trade bloc? Keep reading and you will see!

From unpretentious origins to bold goals

Long narratives are normally boring, I know. But, in this case, the full comprehension of the EU’s development requires a brief historical approach.

In 1951 Belgium, France, Italy, Luxembourg, the Netherlands, and West Germany created the European Coal and Steel Community (ECSC). Five years later, the same countries structured the European Atomic Energy Community (Euratom) and the European Economic Community (EEC).

These three bodies (ECSC, Euratom and EEC) were unified in 1967 to form the European Community (EC). Between 1973 and 1986, United Kingdom, Greece, Ireland, Denmark, Portugal, and Spain joined the club, followed by many others. In 2013 Croatia became the 28th European Union member.

Supposedly to achieve the integrational projected aims, a new institutional structure was fashioned to include an executive (a Commission residing in Brussels), a legislature (a Parliament sat in Strasbourg), and a judiciary branch (a Court of Justice, which took place in Luxembourg). As we can see, the community has developed into a supranational entity arranged such as a State.

This is remarkable! What originally was just a means to coordinate essential industries and integrate economy (creating a common market) turned into something completely different, encompassing (gradually) deep political integration, a single economic market, a shared currency (Euro), suppression of internal borders, a European citizenship, and common policies in several areas (some quite controversial, such as immigration).

And that is not the end (it was just the beginning). Over the years, EU organs would dramatically expand their roles, supported by most of national politicians, who likely believed this process was favorable to their countries or that it was too costly (economically and politically) resist it. The point is: as only few critical voices sought to set clear boundaries to the community institutions, the supranational powers moved forward.

Continental law: an old novelty

A unified law is a European’s old dream.

Back in time, around the 12th century, when arising capitalism system brought revitalized towns, new centers and commercial routes, and intensified immigration, many already claimed for a unified law, which could rule relations between trading partners from different communities.

But then England took an entirely diverse path, adopting its own common law system, and the national law enacted during the French Revolution lead to a radical transformation in legal theory, turning it upside down. Europe moved away from any uniformity. Who would have thought this audacious idea of a continental Law still could become reality? The conception of the EU has made it possible.

More than legal acts, in 2004, representatives of the 25 member states signed a fishy treaty intending to create a Constitution for the whole European Union. However, the rejection of the document by French and Dutch voters (in popular referendums) brought the ratification process to an end.

It happens that, through the Treaty of Lisbon, signed in 2007, many of the provisions originally rejected were furtively reintroduced. The core of the changes was kept. Now EU has a new superior law, able to drive and bend national laws. Currently there are several European statutes in force to which supremacy is conferred. Projections indicate that maybe half of national legislation across Europe is influenced by European law.

Expanding the jurisdiction and taking control

By the 11th century Europeans lived under a feudal regime. Vassals were tied to lords, not to monarchs. This was a problem for kings, who wanted to gain direct control over vassals. They sorted it out expanding the royal jurisdiction, what meant to claim the power to adjudicate the biggest number of conflicts as possible or, at least, the most important ones. The same recipe was used with good results by Norman kings in England (12th century) and… guess what: by the European Union (20th century).

The European Court of Justice was charged with interpreting European law and guiding how legislation created by European Parliament should be applied, what include (a) ensuring the supranational law obedience and (b) ruling on questions when member states disagree about its application, meaning, and extension.

Wielding these prerogatives, in two key decisions, the Court held (1) that member state´s courts can apply European law directly, regardless any procedure of reception or reenactment (Van Gend en Loos v. Nederlandse Administratie Belastingen) and (2) that European law has primacy over national law (Flaminio Costa v. ENEL). Wow!

After these decisions, it was clear that European law must be seen as a sort of supreme constitutional law (taking precedence over any norms of national law, including the Constitutions of member states). Moreover, the European Court of Justice vindicated the exercise of a kind of judicial review to guarantee this primacy, declaring inapplicable national laws when they are considered incompatible with continental law.

A quasi-federal state

The classical meaning of sovereignty, provided by Jean Bodin, is the highest, absolute, indivisible and perpetual power to create laws that subject the citizens. Law is the command of sovereignty. All other rights and prerogatives are included in the power of making and repealing laws.

Considering this, if European law has the power to override national laws, in fact national states are no longer sovereign.

And it is hardly surprising. Never has the Dani Rodrik’s trilemma appeared more accurate: it is impossible to attain economic integration, national sovereignty and democracy at the same time. They are mutually incompatible: we can combine any two of them, but never have all three simultaneously – integration requires the removal of variations between countries. But as people from different countries want different things, a single institution means ignoring the preferences of electors from some countries. One option is to go for an “international federalism”, with the dissolution of nation-states.

This is the way the European Union (in practice) has taken.

In historian Tamar Herzog words, “as a result of these developments, many now argue that de facto, even if not de jure, the European Union lost its original character as an international body and became a quasi-federal state with a quasi-federal constitution (European law) to which all member states are now subject”.

So, why all that noise around the UK leaving the EU? Since the community will not retreat in the powers it has taken on, the only remaining door for Britain was secession – invoking article 50 of the Treaty on the European Union. And perhaps this possibility of withdrawal from the community is the last lived difference between the EU and a classical federal state.


Jean Vilbert holds a Bachelors and a Masters of Law. He is currently a Judge and Professor in São Paulo, Brazil. You can reach him at jeanvilbert@gmail.com.

About Jean Vilbert

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