Year XLVIII, 2006, Number 3, Page 205
“Differentiated Integration”: An Alternative Path to Classical Integration?
The European Union (EU) started out as an association of six countries with limited economic cooperation. Over the intervening decades, the EU has developed into a guiding political entity that is unifying the entire continent. Fifteen years after the political upheaval of central Europe, this voluntary joining together of sovereign nations, which is aimed at increasing their economic and political potential, can be seen to be the most compelling European idea since the Enlightenment. Nevertheless, the public’s general ambivalence towards the future of Europe’s constitution and institutional architecture is becoming increasingly evident — and indeed was so long before the failed referendums in France and the Netherlands. As a result, Europe’s future must now be considered less a topic for rhetorical debate than a matter demanding concrete political planning and visible success. Economic and monetary union, structural reforms and the current integration of central and eastern European states into the Union all require a solid foundation.
Against this backdrop, key aspects of the Bertelsmann Foundation’s International Relations Programme include: analysis of the European political situation and development of strategies for addressing integration policy issues. Our “Enlarged Europe” project, which brings together international and interdisciplinary analyses and proposals and recommendations for political practice, while at the same time communicating project findings to policy makers and the public, aims not to be academic so much as to propose a workable Europe.
The sustainability of the European Union’s integration process rests upon its potential to reform and innovate at the same time. The Bertelsmann Foundation’s proposals for systemic change of the EU are intended to combine exploitation of a European political opportunity with a realistic approach: i.e., the opportunity to define the objectives of a federalist and democratic European Union with the realistic formulation of concrete proposals for its development within a precisely defined timeframe. Thus, the core objectives governing the EU should include: improving transparency, strengthening democratic legitimacy, structuring the institutional system to serve more than twenty-five member states, and guaranteeing a stable balance between the Union and its members by clearly defining the delineation and division of powers and competences between the various actors on the national and on the EU stage.
The Concept of “Differentiated Integration”.
In the context of EU enlargement, Europe’s growing heterogeneity is influencing the willingness and the capacity of member states to integrate further. Enlargement and deepening of the EU seem to be difficult to accomplish together, and require the urgent introduction of higher levels of differentiation and flexibility. “Differentiated integration” or flexibility is an expression used to define any set of arrangements, within (or even outside) the EU’s institutional order, that represents a departure from the principle that all member states must move towards the same objectives at the same pace. Flexibility may apply to the European project’s participants, objectives, pace, or any combination of these. “Core Europe”, “variable geometry Europe”, “multi-speed Europe”, “European vanguard”, “opt-out”, and “Europe à la carte” are flexibility concepts, as is “enhanced (or closer) cooperation”. Calls for greater flexibility have been prompted by the frustration felt by certain member states within a system that obliges the convoy to move at the speed of the slowest ship.
“Differentiated integration” became a key topic of debate with the 1996/97 Intergovernmental Conference. Its origins, in fact, go back much farther, to the founding of the EC itself. The debate on differentiation has, however, been much clouded by the huge number of terms used to describe forms of European integration other than the ideal type, in which all participating countries, in principle, operate in accordance with the same rules and policies and in virtually identical ways. Differentiation is the most straightforward, but also the most politically neutral (and actually quite sterile), term used to denote variations in the application of European policies, or variations in the level and intensity of participation in European policy regimes. Many other terms have been coined, most of which seek to prescribe or proscribe a particular preference with regard to integration, or to convey a particular metaphor for the process of integration.
The case for greater flexibility has been strengthened by the imminence of further enlargement and the accession of member states unable, however willing, to match the pace set by the leaders. On the other hand, there are concerns about the overall coherence and consistency of the Union, the equal sharing of financial burdens, the homogeneity of Community law, fair competition, and the principle of non-discrimination between citizens of the Union. Differentiated integration exists when closer cooperation is established between consenting member states in selected policy fields, preferably within the EU (but also outside it, through recourse to the classical instrument of intergovernmental cooperation if there is no alternative method available, as was the case at the start of the Schengen regime, and with the Bologna process aiming at establishing a European Higher Education Area). Indeed, when a new project goes beyond the legal competences of the European Community, the EU member states are not required to embark upon it all at the same time. However, different groups of states can cooperate more closely and advance together, as long as they keep their group basically open to other member states willing and able to cooperate with them in the given policy area. In certain areas, such as monetary policy (economic and monetary union), internal policy (Schengen, the Prüm Treaty, the G6 informal grouping of interior ministers) and social policy (the Social Charter), stalemates have been avoided through recourse to differentiated integration. Thus, flexibility is a pragmatic choice, made in order to avoid stalemate situations, and it has not yet given rise to new splits within the EU. Indeed, as a working tool, differentiated integration has contributed to increased efficiency and constructive problem solving in the interests of all the member states.
Therefore, EU members that want deeper integration in certain policy areas, such as interior and justice policy, foreign policy and defence, economic policy, research policy, and so on, should be allowed to ally with groups of states sharing similar interests. Forms of differentiated integration are, in principle, applicable across the whole political spectrum, but they can also include closer cooperation initiatives, or be restricted to specific issues. Unfortunately, since the addition of the Treaty of Amsterdam to the Treaty of Rome, the institutional provisions for flexibility have been so strictly worded that it is virtually impossible for ‘closer cooperation’ initiatives to take place. In particular, it is hard to see how a few member states could voluntarily cooperate more closely in an area already covered by the Treaties without affecting “Community policies, actions or programmes”. Also the flexibility article says nothing about how any costs arising from “enhanced cooperation” will be met, nor does it specify a role for the European Court of Justice. Generally speaking, most initiatives in the framework of differentiated integration (and the present Austrian Presidency has counted over seventy dossiers currently before the Council) are mainly intergovernmentally organised and rather lacking in transparency, showing an inherent tendency to exclude the European Parliament from the decision making, thereby deepening the democratic deficit. At the same time, the flexibility article does not really affect any voluntary arrangements, present or future, amongst member states (and sometimes also non-member states) wanting to collaborate on specific projects, such as the European Space Agency or the Bologna process, that lie outside the framework of the Union. The Schengen Agreement is, to date, the only example of a “flexible” collaboration concept which started outside the Treaties and has gradually been incorporated into the acquis communautaire.
The Importance of “Differentiated Integration” in the Debate on the Future of Europe.
There are five key reasons why flexibility has become a last resort, to be vigorously promoted in this time of uncertainty and debate over the future of Europe:
1. Growing differences among EU member states. It is a common sense observation that there have always been substantial differences between EU member states and, in fact, among regions or social groups within the single member states. This was true even in the original and close-knit Europe of the Six. From the outset, therefore, and under certain circumstances, the Treaties accepted the existence of objective differences between member states, and accordingly allowed a certain degree of differentiation in the national application of Community rules. Hence, special protocols were attached to the Treaties and special clauses were added to some legislative acts, or different ways of implementing directives were accepted (usually the granting of more time). This, then, is the origin of the term differentiation and the explanation for its periodic recognition by the European Court of Justice. Problems over this strategic concept arise only when differentiated application of a policy by one member state has negative repercussions on other member states.
2. The EC/EU is just one of many frameworks of European cooperation. From its beginnings, the EC was only one of many European frameworks for policy cooperation. It coexisted with a variety of other (formal and informal) forums that had different memberships (Benelux, WEU, groupings in the fields of science and technology). It was this situation that gave rise, in the late 1970s, to the term “variable geometry”, used to describe the “idea of a method of differentiated integration which acknowledges that there are irreconcilable differences within the integration structure and therefore allows for a permanent separation between a group of Member States and a number of less developed integration units”. Again, this was not a problem as long as the groups’ spheres of action did not coincide, any occasional contradictions being tolerated, temporarily, by all the parties concerned. However, as the policy scope of the EU expanded and the membership of the club was progressively enlarged, these contradictions, or conflicts, became an increasing problem. This prompted supporters of a strong EU to argue that the Union should become the primary and predominant forum for policy cooperation, absorbing other European forums, such as the WEU or the Council of Europe. But it also caused some subgroups to insist on retaining, in relation to certain objectives, a distinct identity, examples being the Nordic Council and the narrower Schengen and eurozone groups.
3. Divergence as a Concept that Specifically Accepts Differences. If divergence is a form of difference it can refer, in EU terminology, to different levels of economic performance or to different socioeconomic patterns. Within the context of the common and later the single market, the question for policymakers was whether and how to compensate for the economic divergences between regions, or countries, in particular through budgetary transfers (since the mid-80s with the help of cohesion policies). A similar debate was started, and remains strong, with regard to economic and monetary union. The whole philosophy of accepting divergence is based upon the notion that all the member countries should try to attain convergence of performance and of policy outcomes — a notion that has always contradicted the assumption that not all member states would actually manage to converge, either because of their particular economic situation or because of their distinct public policies.
4. EU Member States Caught Between Parity and Leadership. The founding rules of the EC gave each member state a form of parity within the decision-making process, to counterbalance Germany’s historic weight as a major European power. Nonetheless, issues of power, leadership and relative influence have always fired political debate in Europe, the crux of the problem being how, beyond the weighted voting formula adopted within the Council of Ministers, might power differences be taken into account in the way the EC/EU establishes its agenda and reaches decisions. In other words, should the special relationship between France and Germany be regarded as a “driving force” for the integration of the wider group, or, to use a less diplomatic expression that reflects the view of the eurosceptics, the “axis” of integration. For many years, while the EU member states recognised the influence wielded, informally, by Paris and Bonn/Berlin, they were clearly resistant to any suggestion that this “tandem” might be formalised — turned into sort of governing directorate. As the size of the EC/EU has increased, the question has re-emerged, raising various hypotheses: a “multi-tier” construction, in which some of the most integration-minded member states are organised in a first league, while others are left to follow; the concept of “concentric circles” according to which Europe is organised in a “circle of shared law” (the Union’s member states), an “adjacent circle” (countries outside the EU waiting to join it), and “more select circles” of greater cooperation (the currency circle, the defence circle, etc.). The debate was stepped up when enlargement was agreed upon and raised the possibility of a widened EU, numbering 27 member states or more. Fears of either a dilution of integration (wider but weaker) or a breakdown of the EU institutions under the weight of numbers have strengthened the case for the formation, within the Union, of a group (“noyau dur” or “Kerneuropa”) of more important countries that can act as a driving force.
5. Integration or Europeanisation of the Member States. How pervasive and how invasive should integration be for the member states? The problems with national implementation are obvious. The difficult question is how the concept of differentiation, or flexibility, can be rendered operational, given the reasons for its presence in the debate and the mixture of arguments in favour of its development. The constitutional reforms envisaged by the successive European Treaties, from Maastricht to Nice and beyond, extended the EU’s scope and authority to an extent that left some governments unwilling to accept all of the consequences, and that provoked vociferous public dissent, which was particularly strong in some member states, for example the United Kingdom. Therefore, a number of “opt-out” and “opt-in” clauses, as well as a series of special protocols and declarations, were added to the TEU, which also embodies the principle of subsidiarity as a counterweight to the centralisation of power within the EU institutions. So Britain and Denmark can practise singularity. These modifications also implied a break with the long established practice of one set of policies applicable to all member states. Therefore, in the mid-90s the UK government was convinced of the benefits of “flexibility” as an operating principle for the EU. But its critics warned that flexibility would lead to the creation of a “Europe à la carte”, at the expense of collective discipline and of solidarity.
One approach to the problem of the practical implementation of flexibility could be to ask the question: from what common basis should it start? Is there a minimum set of core policies to which all EU members must subscribe and on which there can be no room for manoeuvre? If there is, does it correspond to the acquis communautaire, or to something less than that? The EU’s formal documents tend to insist on the maintenance of the acquis communautaire, even though the sustainability of this position is not clear. Is there scope for variation in relation to the core policy of the single market, so as to allow for local ‘differences of taste’ (e.g., beer sold only in bottles and not in cans, as in Denmark)? Or to allow differences in the way products are processed (differentiated social and environmental processes), as long as the product in question conforms to minimum essential requirements in order to be able to circulate freely? Another problem is whether EMU should be part of the set of core policies, even though it may be beyond the reach of some current and potential members.
A second approach could be to focus on the question of the so-called hard-core countries. The term “hard core” implies that some member states are more important or committed, and more integration-minded than others. It is proposed that these countries should therefore carry more weight and should be allowed to advance faster than others, or to be pioneers in particular spheres of cooperation. It is usually suggested that this European hard core will include France, Germany, and the Benelux area, initially united in an economic and monetary union. Although this would give these states more political power with regard to the pursuit of a common defence as a priority objective, it would be logical to seek the participation of the UK as a necessary and not just a desirable component. But this is contrary to British European policy and the specific weight of British military capability.
A third approach to this question is to consider whether a vanguard or pioneer group should, in practice, advance, leaving the others irretrievably behind. The members of the Bertelsmann Foundation are tempted to argue that the slower or the more reluctant member states should always find the door to their participation open; the pioneer group need not be exclusive. This is the view behind the suggestion that any such group, comprising less than the whole EU membership, should be bound by the Treaties and open to late joiners. Yet as the EMU rules already reveal, there is scope for excluding late joiners, precisely on the grounds that they are too different or divergent (as the UK found when its diplomatic representatives suddenly found themselves barred from EMU meetings in the Council).
Thus, we can see that the differentiation concept is associated with a broad spectrum of ideas, ranging from sensible political solutions for the management of local differences, to solutions relating to the more general question of power and relative influence within the EU. The policy and political choices of some of the member states have long been made; this applies, in particular, to the five countries that seem to be ideal candidates to constitute the core (even though this assertion can be seriously questioned following the failed referenda in France and the Netherlands). But for the other member states the choices are much more difficult. “Differentiated integration” appears quite promising in certain areas (i.e., in relation to security and defence, common rules for the taxation of businesses, and research and development), because it could result in a sufficiently clear, and workable, institutional design for the EU. Certainly, the differentiated integration concept, failing to offer a clear political vision, has some shortcomings. Therefore, one might hope to see the EU developing into a polity characterised by federalism, yet without becoming a federation (=state). If the EU adapts specific federal tools in selected policy areas and works according to federal principles, it might, while not being a traditional federal state, turn into a “federal polity,” comprising features of dual and of cooperative federalism. This federal polity could then have an institutional federal pact as its legal document (Constitution). As long as European integration has an open finalité and remains borderless, it is an ongoing process with scope for many variations to come.
 Brandan Donnelly and Jo Shaw, Flexibility and the Future of the European Union, London, Federal Trust Report, 2005, pp. 7-9.
 See Katrin Langner, Verstärkte Zusammenarbeit in der Europäischen Union. Stärkung der Integration oder hin zu einem Europa von mehreren Geschwindigkeiten?, Frankfurt/Main, Peter Lang, 2004.
 See Desmond Dinan (editor), Encyclopaedia of the European Union, Houndmills, Macmillan, 2000, pp. 137-140.
 Even the European Commission has included the term “differentiated integration (flexibility)” into its official Glossary (Institutions, Policies and Enlargement of the European Union, Luxembourg, 2000, p. 26) and uses it to define “…a process of integration in which the Member States opt to move forward at different speeds and/or towards different objectives, in contrast to the notion of a monolithic bloc of States pursuing identical objectives at a single speed”.
 See Peter A. Zervakis, “Der Bologna-Prozess – Politische Vision oder pragmatische Antwort?”, in Politische Studien, 2004, 55, 393, pp. 105-116.
 Olga Ilona Niemi, Perspektiven der Ratspräsidentschaft in einer erweiterten Europäischen Union, Frankfurt/Main, Peter Lang, 2005, p. 21.
 The Enlarged Europe Project in the Bertelsmann Foundation has initiated the mapping of diverging national interests in different policy areas. The first results are expected shortly: see www.bertelsmann-stiftung.de.
 Glossary (footnote 4), p. 69.
 Peter A. Zervakis - Dominik Hierlemann “Wie geht es weiter, Europa? ”, in Europäische Rundschau , 2005, 3/3, pp. 69-71.
 Peter A. Zervakis - Sébastien von Gossler, “40 Jahre Elysée-Vertrag: Hat das deutsch-französische Tandem noch eine Zukunft?”, in Aus Politik und Zetgeschichte, 2003, 3-4, pp. 12-13.
 Josef Janning, “Leadership coalitions and change: the role of states in the European Union”, in International Affairs, 2005, 81/4, pp. 821-833.
 Glossary (footnote 4), p. 29.
 See the most recent pamphlet by the Belgian prime minister Guy Verhofstadt, The United States of Europe. Manifesto for a new Europe, London, The Federal Trust, 2006.
 The Glossary (p. 33) refers to “the idea of a non-uniform methodof integration which allows Member States to select policies as if from a menu and involve themselves fully in those policies; there would still be a minimum number of common objectives”.
 Heinz Theisen, Die Grenzen Europas. Die Europäische Union zwischen Erweiterung und Überdehnung, Opladen, Barbara Budrich, 2006, p. 215.
 See Martin Nettesheim, “Die konsoziative Föderation von EU und Mitgliedstaaten”, in Burkhard Heß (editor), Wandel der Rechtsordnung, Tübingen, Mohr Siebeck, 2003, pp. 31-34.
 See Peter Leslie, “Finalité, Federalism, Flexibility”, in Peter A. Zervakis - Peter J. Cullen (editors), The Post-Nice Process: Towards a European Constitution?, Baden-Baden, Nomos, 2002, pp. 215-236.