European Economic Integration: Limits and Prospects

By Miroslav N. Jovanovic; Alexis Jacquemin | Go to book overview

7

TRADE POLICY 1

I

INTRODUCTION

The Preamble to the Treaty of Rome states that the EU desires to contribute to the progressive abolition of restrictions on international trade by means of a common commercial policy. Internal trade in the EU would be free of all customs duties and quantitative restrictions (Article 3). The EU is ready to contribute to the development of international commerce and lower barriers to trade by entering into reciprocal agreements devised to reduce tariffs below the general level (Article 18). The objective of the EU in commercial policy is ‘to contribute, in the common interest, to the harmonious development of world trade, the progressive abolition of restrictions on international trade and the lowering of customs barriers’ (Article 110). Member countries need to coordinate their trade relations with third countries (Article 111). Probably the most important provision of the Treaty regarding trade is that the common commercial policy is based on uniform principles, in particular regarding tariffs and trade arrangements with third countries (Article 113). 2 In the case of economic difficulties, the Commission may authorize the affected member state(s) to take the necessary protective measures (Article 115). 3 There are two other safeguard provisions in the Treaty. If there is a sudden crisis in the balance of payments, the member state concerned may take the necessary protective measures (Article 109). In the chapter on full elimination of quantitative restrictions on internal trade, Article 36 allows member states to prohibit or restrict trade or the transit of goods that jeopardize public morality, policy or security, or endanger the health or life of humans, animals or plants. Member states should operate in international economic organizations only on the basis of common action (Article 116). This provision is supposed to enhance the bargaining power of the EU. Small member countries particularly benefit from it. There is also an agreement to associate the non-European countries that have special (read: ex-colonial) relations with the EU (Article 131). 4 The associated countries would have the same treatment in trade as the members of the EU (Article 132). The EU may conclude association agreements with a third country, group of countries or an international organization (Articles 228 and 238). Any European state may apply for membership in the EU (Article 237). Article 100a refers to the establishment and operation of the internal market. Save for fiscal, free movement of persons and rights of employees, the earlier principle of unanimity is replaced by one of qualified majority in the decision-making process.

This chapter is structured as follows. It starts with the basic theory of customs unions. Then follows an overview of trade relations of the EU which includes

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European Economic Integration: Limits and Prospects
Table of contents

Table of contents

  • Title Page i
  • Contents vii
  • Figures viii
  • Tables ix
  • Foreword xi
  • Preface xiv
  • Acknowledgements xviii
  • Abbreviations xix
  • 1 - The Origin of the European Union 1
  • 2 - Monetary Policy 42
  • 3 - Fiscal Policy and the Budget 71
  • 4 - Common Agricultural Policy 98
  • 5 - Competition Policy 130
  • 6 - Industrial Policy in Manufacturing and Services 168
  • 7 - Trade Policy 215
  • 8 - Regional Policy 287
  • 9 - Capital Mobility 309
  • 10 - Labour Mobility 333
  • 11 - Social Policy 342
  • 12 - Environment Policy 353
  • 13 - Transport Policy 361
  • 14 - Conclusion 367
  • Bibliography 371
  • Index 382
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