EUROPEAN UNION

(EU), French Union Europenne, German Europische Union, Italian Unione Europea, an organization of most of the nations of western Europe that works toward and oversees the economic and political integration of these states. The European Union consists of the European Community (q.v.; formerly European Economic Community) and a framework for unified action by member countries in security and foreign policy and for cooperation in police and justice matters. The European Economic Community (EEC) had been founded in 195758 to oversee the economic integration of the nations of western Europe. In 1967 the EEC joined together with the European Coal and Steel Community and the European Atomic Energy Community to form the European Communities, or EC (the plural was dropped from the name in the 1980s). The success of the liberalized trade policies sponsored by the EEC (or EC) in the 1960s, '70s, and '80s made its members more receptive to the greater integration of the EC. Subsequent efforts toward greater economic and political union of the EC's members eventually yielded the Treaty on European Union (Maastricht Treaty), concluded in December 1991. The treaty's enactment (Nov. 1, 1993) created the European Union out of the European Community; in addition, the European Economic Community was renamed the European Community, and the EC's Council of Ministers was renamed the Council of Ministers of the European Union. The original members of the EEC were Belgium, France, West Germany, Italy, Luxembourg, and The Netherlands. Denmark, Ireland, and the United Kingdom joined in 1973, Greece in 1981, and Portugal and Spain in 1986; the former East Germany was admitted as part of reunified Germany in 1990. Greenland, a dependent state of Denmark that had entered the EC when under full Danish rule, withdrew in 1985. The Maastricht Treaty paved the way for other European countries to join the EU. Austria, Finland, and Swedenall members of the European Free Trade Association (EFTA)became members of the EU in 1995. The Commission of the European Communities (also commonly called the European Commission) is headed by 20 members, or commissioners (including a president and several vice presidents), with at least one commissioner from each nation in the Union. The European Commission is charged with the formal and practical implementation of the various treaties of the Union and the various rules issued by the Council of Ministers. The Commission also helps prepare acts submitted to the European Parliament and the Council of Ministers. It is thus both initiator and implementer of the Union's legislation. The Commission has a broad array of executive powers and functions as the civil service of the EU. It enforces the laws of the Union, acts to ensure the integrity of western Europe's integrated market, and administers the EU's agricultural policies and regional development programs. With a staff of more than 15,000 people, the Commission is the largest body within the EU. The Council of Ministers, whose membership is made up of one representative from each of the member national governments, has the real power of decision in the Union. It determines how the intents of the treaties are to be carried out and how the separate economic policies of the member nations are to be coordinated toward that end. The European Council, which is composed of the heads of state or government of the member nations, has met regularly since 1974ordinarily three times a yearfor the purpose of policy making on the highest level. The European Parliament (q.v.) is the legislative branch of the EU, and the European Court of Justice (q.v.) is the judicial branch of the EU. The Court of Auditors, created in 1977 and consisting of one member from each of the member nations, is responsible for the external audit of the expenditures and revenue of the Union. The European Investment Bank, created in 1958, is an independent public institution acting as the European Union's bank for long-term finance. It makes or guarantees loans for investment projects, mainly in industry, power resources, and infrastructure. The Economic and Social Committee, a consultative body established in 1958, has three groups of representativesfrom employers' organizations, trade unions, and special interests (e.g., professions, consumers, agriculturists, small businesses). It is intended to advise the Commission and the Council of Ministers on the effect of the EU's policies and practices on the general economy. One of the main goals of the EC was the integration of its members' economies into a single frontierless market that would have a common currency and a common central bank. The measures the EC took in this regard were obtained by the unanimous consensus of its members. The EC oversaw the establishment of the European Monetary System (EMS) in 1978 to regulate currency exchange rates and aid monetary stability among its members. The EMS, which took effect in 1979, linked the currencies of the EC member countries (excepting those of the United Kingdom, Spain, and Portugal, who declined to participate) so as to avoid large day-to-day fluctuations in currency rates while permitting periodic realignments. In the interest of encouraging the mobility of labour, restrictions on the movement of labour among the EC countries also were effectively removed. In 1987 the EC member states adopted the Single European Act, by which they declared their eventual intention to create a unified, free-trade market in western Europe. Measures implementing this declaration began in 1990 with the lifting of exchange controls and the elimination of barriers to Europe-wide banking, insurance, securities, and other financial services. The economic agreements of the Maastricht Treaty further advanced this process by establishing the European Monetary Institute (effective Jan. 1, 1994) at Frankfurt am Main, Ger., and by creating a vast free-trade zonethe European Economic Area (EEA)between the members of the EC and EFTA. The EEA also was implemented on Jan. 1, 1994, with the participation of all EC and EFTA members except Switzerland and Liechtenstein.