Identifier
Created
Classification
Origin
07BRUSSELS2473
2007-08-02 14:56:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
USEU Brussels
Cable title:  

EU REFORM TREATY: MAKING THE SAUSAGE

Tags:  ECIN EUN PBTS PGOV PHUM PREL 
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PP RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHBS #2473/01 2141456
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FM USEU BRUSSELS
TO RUEHC/SECSTATE WASHDC PRIORITY
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC PRIORITY
RUCNDT/USMISSION USUN NEW YORK PRIORITY
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UNCLAS SECTION 01 OF 06 BRUSSELS 002473 

SIPDIS

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECIN EUN PBTS PGOV PHUM PREL
SUBJECT: EU REFORM TREATY: MAKING THE SAUSAGE

REF: BRUSSELS 02001

UNCLAS SECTION 01 OF 06 BRUSSELS 002473

SIPDIS

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECIN EUN PBTS PGOV PHUM PREL
SUBJECT: EU REFORM TREATY: MAKING THE SAUSAGE

REF: BRUSSELS 02001


1. (SBU) Summary. On July 23, EU Foreign Ministers opened an
Intergovernmental Conference (IGC) to draw up the EU's
"Reform Treaty." The Portuguese Presidency wants to draft
the treaty quickly on the basis of the mandate adopted by the
leaders at the June 21-23 European Council. In fact, the
Presidency aims to conclude the IGC before the end of 2007,
in order to have Member States ratify the new treaty before
the June 2009 European Parliament elections. The IGC mandate
maintains many provisions of the abandoned 2004 draft
Constitutional Treaty but with amendments designed to ensure
smooth ratification. The level of detail in the political
framework agreed at the June European Council should make the
IGC more of a technical than a political exercise. However,
there could still be some snags in IGC discussions and
certainly in the subsequent national ratification processes.
This cable describes the IGC process and reviews where the
European Council agreement came out on issues relevant to
U.S. interests and the conduct of U.S. diplomacy toward the
EU (reftel). END SUMMARY.

WHAT TO EXPECT FROM THE IGC
--------------


2. (SBU) The task of the Intergovernmental Conference is to
translate the political agreement reached by EU leaders at
the June 21-23 European Council into legal form. The end
product will be a "Reform Treaty" amending the existing EU
treaties. Don't expect much drama from this exercise:
because the June Council locked in virtually all of the key
political decisions, much of the IGC will be the realm of
lawyers and translators. (Indeed the lawyers are already
reviewing a first draft over the EU's August recess.) If all
goes according to plan, the text will then be scrubbed by EU
Foreign Ministers at their informal (Gymnich) meeting
September 8-9, and a final version presented to the heads of
state for discussion at their Council meeting October 18-19.
Formal signing will then take place at the December Council
meeting. In short, the plan is for a fast, tight, and
low-key IGC process.

What Could Go Wrong?

--------------


3. (SBU) The biggest worry for the Portuguese is that the
Poles will try to re-open the discussion on the voting
system. The IGC mandate includes a mechanism allowing Member
States falling slightly short of constituting a blocking
minority to request the Council continue negotiations on the
proposal they dislike and address their concern "within a
reasonable delay" (a formula EU officials say should not
exceed four months). Soon after the June Council agreement,
the Poles indicated that they had been misled into believing
they would be allowed a two-year delay of Council decisions
under this mechanism. However, the Poles have received no
sympathy for this argument from other Member States or the
Commission, and at the most recent GAERC, the Polish foreign
minister was more conciliatory. With other Member States
fearing a spill-over effect if this issue is re-visited,
there will be big pressure on the Poles to drop their case.

The Real Drama: Ratification
--------------


4. (SBU) The miracle of the German presidency-led treaty
development process was to transform the bulk of the
abandoned Constitutional treaty into a legalistic series of
treaty amendments that Member States could either sell to
their publics as technical improvements or simply sneak right
past them with no public discussion at all. Will it work?
Certainly for most of the Member States - even France is
expected to act with little public fuss. At this early
stage, the nail-biters look like the Netherlands, the UK, and
Ireland - the latter being only Member State required to hold
a referendum. In any case, Member State governments will
have little margin to delay, as the EU's goal is to have full
ratification in place by 2009, when a new European Parliament
will be elected and a new Commission chosen.

And What Does It All Mean?
--------------


5. (SBU) The balance of this message will outline in detail
how the Reform Treaty will change the EU. The details are
important, because the EU's power and influence have
typically expanded the most as a result of relatively obscure
changes, little noted at the time. For those of you with

BRUSSELS 00002473 002 OF 006


time only for the CliffsNotes version, however, here is what
you should ponder:

- The consolidation of Council and Commission foreign
relations authorities will greatly increase the influence and
reach of the new High Rep.

Our Council secretariat contacts are already salivating at
the prospect of their boss controlling the policy apparatus
in the Council secretariat, chairing the foreign policy
councils (both the GAERC and the PSC),serving as Commission
Vice President, managing the Commission's external assistance
budget, and heading the "diplomatic corps." Together these
tools will give the High Rep a powerful capacity to not only
set the foreign policy agenda, but interpret and implement
Council decisions in a manner of his own choosing. Yet, he
will still have to win unanimous 27 support for formal
Council decisions on CFSP issues. How this relationship
plays out in practice will likely depend on personalities,
but it seems certain that the new High Rep position will grab
even more influence away from Member State foreign ministers.

- New powers mean that Justice and Home Affairs (JHA) will
remain a major avenue for further EU integration over the
next decade.

There is little more to do in terms of integratig Member
State markets and services - instead, the next frontier is
JHA. The Reform Treaty will set the stage, though the
process will inevitably be slow and acrimonious. While
Member States will retain primary jurisdiction over
enforcement of criminal laws, the European Union will play an
increasingly important role in setting overall guidelines and
policies for police and judicial cooperation. Unlike under
current procedures, the Reform Treaty will allow for
"enhanced" cooperation to occur, even if Member States do not
agree unanimously on such mechanisms. The new process will
remain somewhat cumbersome, though.

- The new voting rules - much ado about little?

Although one of the most talked-about changes of the reform
treaty is the new Council voting system, Perm Rep contacts
here don't think this will change much in practice. In their
view, the Council will continue to strive for consensus (or
at least large majorities) in most of its decision-making.

The Mechanics
--------------


6. (U) The Reform Treaty will not replace the existing EU
treaties, which remain in force. However, it will do three
important things:

- amend existing treaties
- carry forward many of the innovations of the defunct
Constitutional treaty
- add some new innovations of its own, concerning the
competencies of the EU and the Member States, the nature of
CFSP, the enhanced role of national parliaments, the
treatment of the EU Charter of Fundamental Rights, and a
mechanism in the area of police and judicial cooperation
enabling some Member States to go forward on a given act,
while allowing others not to participate.

THE MANDATE FOR THE REFORM TREATY: A THUMBNAIL SKETCH
-------------- --------------


7. (SBU) Following is a more thorough score sheet of where
the EU came out on decisions at the June European Council and
what may still raise its head in the coming months during the
IGC.


8. (SBU) Issue: Voting

Outcome: EU leaders agreed to a "double majority" voting
system (55% of member states plus 65% of the EU's total
population). This applies mainly to economic legislation. A
number of concessions were required to obtain Warsaw's
support for this agreement, as the current voting system
gives Poland a larger voting share than the new one.
Accordingly, leaders agreed that the entry into force of the
"double majority" will be delayed until November 1, 2014.
Secondly, until March 31, 2017, any Member State may request
that a given decision be taken on the basis of the current
system (which favors Poland). Furthermore, the IGC mandate
includes a mechanism allowing Member States falling short of
constituting a blocking minority to request the Council

BRUSSELS 00002473 003 OF 006


continue negotiations on a proposal they dislike and address
their concern "within a reasonable delay" (a formula EU
officials say should not exceed four months). Polish PM
Kaczynski claimed shortly after the June 23 agreement on the
IGC mandate that Poland got a
verbal agreement at the European Council allowing a two
year-delay of Council decisions under this mechanism, which
he wants put in writing during the IGC. FM Fotyga at the IGC
reportedly did not reiterate Kaczynski's demand but alluded
to the importance of respecting "the will of Member States
(in the minority)," a notion that could lead to endless
negotiations, as noted by several observers in the corridors
of the IGC. The Portuguese Presidency and other Member
States will do their best to prevent the Poles from reopening
this discussion.


9. (SBU) Issue: EU Charter of Fundamental Rights

Outcome: The Reform Treaty will cross-reference the EU
Charter of Fundamental Rights rather than including the
Charter as part of the Treaty itself (as was envisaged under
the abandoned Constitutional Treaty). The Charter is a
catalogue of individual rights and freedoms. The idea of the
cross-reference is to give the Charter, which was until now
solely a political declaration, a binding character without
having it part of the treaty itself. However, the UK secured
an opt-out from the Charter, and the IGC mandate specifies
that two other countries -- reportedly Ireland and Poland --
reserved the right to opt out as well, taking the wind out of
the sails of those advocates of a universal set of "European
rights."


10. (SBU) Issue: Justice and Home Affairs Decision-Making

Outcome: The Reform Treaty will eliminate the EU's current
"three pillar" legislative structure and extend the scope of
voting to more than 40 new areas. Arguably, the most
important of these areas is Justice and Home Affairs (JHA),
including issues of cross-border crime and police
cooperation. (Note: Despite the expansion of voting into key
policy areas, decisions about Common Foreign and Security
Policy (CFSP),defense, taxation, and social security issues
will still require consensus.)

The Reform Treaty will allow Member States to develop EU-wide
legislation applicable to JHA issues without the need for
unanimity. Under the new treaty, Member States would prepare
draft directives for enhanced cooperation and attempt to
reach EU-wide consensus within the Council. Failing such
consensus, if at least one third of the Member States agree
to the draft directive for enhanced cooperation, they may
refer the proposal to a European Council meeting (heads of
state) for discussion. If the European Council reaches
unanimous agreement within four months, it will refer the
proposal back to the Council for adoption.

If consensus is not reached within the European Council, and
at least one third of the Member States still want to proceed
with the draft proposal, they may inform the Parliament,
Commission, and Council of their decision to proceed with the
proposal for enhanced cooperation. Member States that
disagree with the proposal can then "opt-out" of the ultimate
decision. The "opt-out" provision was engineered primarily
for the UK and Ireland, which have different legal systems
than those of most Member States.

Issue: EU "Foreign Minister"


11. (SBU) Outcome: The Reform Treaty will establish the new
position of "High Representative of the Union for Foreign
Affairs and Security Policy." The term "Foreign Minister"
was dropped due to objections from the UK and some other
Member States. The position incorporates the following
elements:
- Merges the current functions of the EU High Rep for CFSP
(now Solana) and the Commissioner for External Relations (now
Ferrero-Waldner);
- Manages the Commission's external relations budget as well
as off-budget resources;
- Chairs the monthly meetings of Member States' Foreign
Ministers (External Relations sessions of the GAERC);
- Oversees the newly-created EU diplomatic corps, officially
named the "European External Action Service" (EEAS) and
composed of officials from the Council Secretariat, the
Commission, and seconded officials from the diplomatic
services of individual Member States. The EEAS will now
provide political reporting to the Council.


BRUSSELS 00002473 004 OF 006



12. (SBU) Issue: Permanent President of the European Council

Outcome: In a change from the current six-month rotation of
Member State presidencies, the Reform Treaty will establish a
new position of permanent President of the European Council,
elected by EU leaders for a two-and-a-half year term,
renewable once. This is designed to make EU policy more
consistent and give the EU more visibility on the world
stage. The new President will not entirely replace the
rotating six-month Presidency of the Council, which will be
retained for some Council formations such as meetings of JHA
and environment ministers.


13. (SBU) Issue: Reducing the Number of Commissioners

Outcome: The size of the Commission will shrink, but not
until 2014. There will no longer be one Commissioner per
Member State. Instead, the number of Commissioners will
correspond to two thirds the number of Member States. Those
Commissioners will be selected on the basis of a rotation
system that remains to be worked out among Member States, but
will take into account demographics and geography.


14. (SBU) Issue: European Parliament

Outcome: MEPs will enjoy more power in more policy areas,
where they will have joint decision-making authority
(extension of "co-decision") with the Council. This will be
a major selling point for those packaging the reforms as a
way to make the EU more democratic. The Treaty caps the
number of Members of the European Parliament (MEPs) at 750 -
down from its current 785. The number of MEPs per country
will be based on population with a maximum of 96 and a
minimum of six.


15. (SBU) Issue: Giving National Parliaments a Voice in EU
Decisions

Outcome: Although contacts claim the change is mainly
symbolic, the Reform Treaty gives national parliaments a more
formal role in legislation. In practice, the Commission
already consults national parliaments on legislation. With
the new treaty, under a mechanism of "subsidiarity," a simple
majority of national parliaments will be able to challenge a
draft piece of EU legislation if they view the Commission as
exceeding its powers. The Commission will have to reexamine
the draft, which it may decide to amend, withdraw, or
maintain (in the case of the latter it will provide
justification to the Council and European Parliament.)


16. (SBU) Issue: The Future of the Common Foreign and
Security Policy (CFSP)

Outcome: The UK invested much of its energy in the June
European Council negotiations to ensure that the Reform
Treaty does not erode national sovereignty over foreign and
defense policy. As a result of their tough stance, the
treaty will state that CFSP is "subject to specific
procedures" and shall be "defined and implemented by the
European Council and the Council acting unanimously." This
emphasis on Council unanimity is viewed by some Member States
as a means to limit the power of the new High Rep by
maintaining institutional divisions on CFSP issues.


17. (SBU) Issue: Single Legal Personality

Outcome: The treaty gives the EU a single legal personality,
but legal services contacts stress the single legal
personality does not change the balance of any competencies
between institutions or with Member States. The Reform
Treaty will underline that a single EU legal identity poses
no threat to the UNSC seats of the UK and France. Currently,
Member States still sign international economic agreements as
the "European Community" and foreign policy or justice
agreements as the "European Union." Under the new treaty,
Member States will be allowed to sign future international
treaties as simply "the EU" - making the European Union the
legal successor of both the European Community and the
present-day European Union.

(SBU) Issue: Symbols of the Constitutional Treaty (European
flag, anthem, the word "Constitution")

Outcome: Member States abandoned the constitutional concept
of the 2004 IGC, which would have repealed all existing
treaties and replaced them with a single text called
"Constitution." Consequently, the term "Constitution" will
not be used anywhere in the Reform Treaty. Nor will the

BRUSSELS 00002473 005 OF 006


treaty mention EU symbols such as the flag, the anthem, or
the motto. Though mainly cosmetic (the flag, anthem and
motto will continue to be used in practice),this was an
important concession to Member States whose publics are
concerned with the EU swallowing up national sovereignty.


18. (SBU) Issue: Humanitarian affairs and development policy

Outcome: The Reform Treaty introduces a legal basis for
humanitarian affairs as an objective in itself. The
provision will underline that humanitarian assistance is a
specific policy goal of the EU and emphasize the application
of the principles of international humanitarian law, in
particular impartiality and non-discrimination. The Reform
Treaty will also state clearly that the eradication of
poverty is the primary objective of the EU's development
cooperation policy. Policy towards middle income countries
will be more complex and will likely include a mix of trade,
economic, financial, technical, and cultural forms of
cooperation.


19. (U) Issue: Environment and Energy

Outcome: The new treaty will state that one of the Union's
objectives is to work for the sustainable development of
Europe, based on a high level of protection and improvement
of the quality of the environment. Although the idea of
sustainable development is not absent from the current
treaties, the Reform Treaty will reinforce and more clearly
define this objective. Sustainable development is affirmed
as one of the fundamental objectives of the Union in its
relations with the rest of the world. The provisions on
energy reflect decisions already taken by EU leaders in March
2007, giving them a formal treaty basis. They include a
reference to the spirit of solidarity between Member States
as well as a point on the promotion of the interconnection of
energy networks.


20. (SBU) Issue: Competition

Outcome: As a result of French pressure, "free and
undistorted" competition will not be listed in the new treaty
among the objectives of the EU. However, the IGC mandate
states that the single market ensures that competition is not
distorted and that the EU will take action under existing
treaty provisions to that effect. This will be confirmed in
a treaty protocol (Note: a protocol has the same legal value
and binding character as the treaty itself). In practice,
the current EU rules will therefore continue to apply.


21. (U) Issue: Leaving the Club

Outcome: The Reform Treaty allows for a Member State to
leave the EU. A country that wants to withdraw will
negotiate new arrangements for working with the rest of the
Union, but EU law would no longer apply to it.

IT'S A UNION, NOT A COMMUNITY
--------------


22. (U) The Reform Treaty will contain two clauses amending
respectively the Treaty on the European Union (TEU -
"Maastricht Treaty") and the Treaty establishing the European
Community (TEC). The TEU will keep its name, but the TEC
will be called the "Treaty on the Functioning of the Union,"
a reflection of the fact that the Union will acquire a single
legal personality. The word "Community" will be replaced by
the word "Union" throughout the text of the treaty. It will
be stated that the two (amended) treaties constitute the
treaties on which the Union is founded and that the Union
replaces and succeeds the Community.

IT AIN'T OVER 'TIL IT'S OVER
--------------


23. (SBU) Comment: The great ambition of the failed
"Constitutional" treaty was not in any of its individual
parts, but rathers its concept. It was billed as a
Constitution for a reason - it was to represent a new, more
political, more united Europe: a true union. Bereft of that
concept, the Reform Treaty has become merely a set of
unconnected, incremental expansions of EU authority - but one
in which the whole is clearly less than the sum of the parts.
Indeed, although the Reform Treaty's provisions are
meaningful, the real objective is to wipe out the political
strain of the failure to pass the Constitutional treaty.
Thus, the imperative for a carefully orchestrated process
with - uniquely in the EU's history - all of the key

BRUSSELS 00002473 006 OF 006


decisions locked down by the leaders before the IGC even
began. It was not for nothing that Portuguese Foreign
Minister Amado opened the IGC with the words "we shall not
deviate one millimeter from that mandate" - the over-riding
goal is a signed treaty, and a tightly controlled script is
the surest means to that goal. The downside of this
strategy, however, is that it invites public apathy. Indeed,
this is not only the most unambitious treaty in EU history,
but also the one that has generated the least excitement.
This could be a particular problem for those countries who
choose to ratify via a formal referendum. While Ireland is
the only Member State legally bound to hold a referendum (the
result of which is far from assured),other countries are
facing renewed and increasing demands for a popular vote on
the new treaty. It may be difficult to mobilize a positive
voter turnout for a treaty without a clear, powerful concept.
Instead, to sell the Reform Treaty to the European public,
EU leaders will try to demonstrate how the reforms are aimed
at enhancing the efficiency and democratic legitimacy of the
enlarged EU as well as the coherence of its external actions.
Whether this works remains to be seen. End Comment.
MURRAY
.