Is a fractured EU in need of mediation?

Brexit issues are notoriously divisive, and this is not intended as an attempt to fan flames: the debate has been resolved in the UK. What is under examination is the extent to which Covid 19 and other legal and financial events are highlighting some serious divisions in Europe that require resolution, even perhaps mediation. Also has the UK lost out in the health crisis from its non-membership of the club?

EU Law

Back in 1974 when European law was a relative newcomer its effect on our legal system was famously described by Lord Denning in a case concerning the rights of English cider makers to describe their product, Babycham, as ‘champagne perry’.  He said this: “the Treaty is like an incoming tide. It flows into the estuaries and up the rivers. It cannot be held back. Parliament has decreed that the Treaty is henceforward to be part of our law. It is equal in force to any statute.” Again, in the long-running Factortame litigation the House of Lords held that national courts in the UK must treat EU based rights as governing Acts of Parliament. What then are we to make of the decision of the German Constitutional Court on 5 May this year? They found that the European Central Bank (ECB) had acted beyond its powers when buying government bonds to the tune of €2 trillion.  In doing so   Germany’s highest court dismissed an earlier ruling of the Court of Justice of the European Union (CJEU) in ECB’s favour as “incomprehensible” and “meaningless”. In response, as reported in the FT, Christine Lagarde, ECB president, was defiant saying the ECB is answerable only to the CJEU and the European Parliament and the President of the Commission has threatened Germany with legal action. In addition, since the ruling in Germany both Poland and Hungary have echoed the opinion that the final arbiter on legal issues are their own Supreme Courts.

Current conduct

Then there is the threat to the bail-out proposals of the Commission intending to borrow €750 billion to rescue hard pressed member states in return for a swathe of new taxes on carbon-intensive products, a levy on large businesses and on plastic waste. The nature of the bail-out has already caused division between several member states and many more will not accept the taxation proposals. All of this in addition to a €500 billion recovery fund proposed by Germany & France. The ‘frugal four’ want to limit the grants whilst Italy & Spain want the system to provide the southern states with weighted advantages. In addition, the EU rules on banning subsidies of home industries within member states is now under extreme strain and has been largely ignored in Germany. Not much solidarity here, perhaps they need some mediation.

Add Covid

Add to all of this the impact of Covid 19, where European institutions have failed to act either in a timely or effective fashion. Generally, all member states have acted selfishly and in an uncoordinated and chaotic fashion. Perhaps this was best illustrated by the initial decision in Germany to ban the export of masks to any other EU member states. Freedom of movement, a principal identifying characteristic of the Union, has for many been rendered meaningless by border restrictions. In effect each member state has acted unilaterally because they recognised that the EU was unable to provide any assistance to them and at the same time it suited the Commission to take the view that matters of health policy were the business of member states.

Finally

None of this is intended to argue that the UK has somehow acted more robustly or with greater effect because it has left the EU, in many ways we have lagged behind some other member states.  It does seem however that not only is the EU currently in a parlous condition but at the moment in relation to the health crisis non-membership is simply an irrelevance.