Summary: Institutional And Substantive Law Of The Eu

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  • Introduction Internal Market (Week 1)

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  • Why the internal market? What is the rationale of the internal market?

    • IDEOLOGY  -> No more war (establishment of ECSC )

    • SELF INTEREST (ECONOMIC) -> BUT: give in some of sovereignty

    • Free trade protects Member State from another Member State's protectionism (which will economically benefit them)

    • Wealth of Nations (Adam Smith)
    • font-sizeLeutwiler Report -> WTO  
  • Comparative advantage   (+) on common market 

    • Riccardo (1817) -> Cloth and wine example
    • (Spaak Report 1956 -> ECSC) --> On the functioning of the common market
    • When a country produces 'everything', it is not necessarily more efficient
    • With CA: Countries focus on their specialty and are more efficient producing one product in which they thrive instead of two in which they do not. --> increase in size of production 

  • Comparative advantage (-) on common market 

    Why do ideal situations almost never occur?

    • Trade barriers
    • Information failure
    • Transaction costs
    • Buyers and seller act rationally
    • Difficult market access due to diverging local regulations   
  • From a Common Market to a Single Market(The internal market towards 'a perfect world')

    • Market integration

    • Banning protectionism

    • Ban on quantitive restrictions + MEQRS (measures)

    • Ban on discriminatory national taxes

    • Harmonization of labour law, pensions, diploma requirements

    • Ban on anti-competitive behavior
    1. Of States
    2. Of companies
  • Stages of economic integration (<)

    1. Free Trade
    2. Customs Union
    3. Common Market
    4. Economic Union (Single Market)
    5. Political Union
  • Completing the Internal Market: Single European Act (2)

    • 1986
    • New legal basis (Art. 114, (115) + 26, 27 TFEU)
    • Introduction QMV (prior: Unanimous)
    • From common market --> single market --> internal market
    • Deadline: 31st December 1992 --> But ever evolving process
  • Integration process of the Internal Market

    • Monnet Method (Neofuntionalism)
    • Spill-over effects (political, economic, cultural)
  • Positive vs. Negative integration regarding the shift--> from a Common Market to a Single Market 

    Positive (market integration): This refers to the creation of a common sovereignty through the modification of existing institutions and the creation of new ones.
    • Harmonization
    • Modification of existing policies
    • Joint execution of powers

    Negative (market integration): This implies the elimination of barriers that restrict the movement of goods, services and factors of production.
    • Eliminating obstacles
    • Removal of discriminatory behavior
    • CJEU, Gaston Schul, case 15/81

    The internal market is NOT either/or --> it is always a mix and balance (yin/yang)
  • Full Harmonization with direct effect law obligation 

    • Consumer or company, MS  cannot blame national government for issuing certain legislation based on the four freedoms
    • Because it is the EU top-down (total power) telling the member sates to act in a certain way
    • Direct effect of an EU law obligation
  • Alternatives for mutual recognition (Host country control)

    • Host country control: Free movement of services

    —> Host country determines whether foreign service has access to the market

    BUT: tempered with a rule of non-discrimination (therefore limited) + country cannot just ban any service or product for protectionist motives

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