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Max Planck Encyclopedia of Public International Law [MPEPIL]

European Community and Union, Association Agreements

Jürgen Bast

From: Oxford Public International Law (http://opil.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved.date: 20 May 2019

EU Treaty

Published under the auspices of the Max Planck Foundation for International Peace and the Rule of Law under the direction of Rüdiger Wolfrum.

A.  Introduction

The concept of association agreements refers to a particular group of international agreements concluded by the European Community (or now, the European Union), almost always accompanied by its Member States, on the one hand, and one or more third States, on the other. While varying considerably as regards their denominations and contents, all EC/EU association agreements aim to create privileged economic and political links with non-member countries and thus constitute an important instrument of foreign policy vis-à-vis neighbouring and other States (European Community and Union, Actor in International Relations). To employ an historical analogy, association agreements concluded by the Union correspond roughly to treaties of friendship, commerce, and navigation concluded among States.

Absent a settled legal meaning of the term ‘association’ in international law discourse, ‘association agreements’ is a concept of EU law rather than international law. It serves to distinguish a particular treaty-making power conferred on the Union in its founding treaties, in particular the Treaty establishing the European Community (‘EC Treaty’) now called Treaty on the Functioning of the European Union (TFEU), from other, less far-reaching powers such as to enter into trade or environmental agreements based on Art. 207 TFEU or Art. 192 TFEU, respectively. The power to establish associations with third States flows from Art. 217 TFEU, which reads:

The Union may conclude with one or more third countries or international organisations agreements establishing an association involving reciprocal rights and obligations, common action and special procedure.

Existing associations established under this legal basis or its predecessors include: the Association Agreement with Turkey, in effect since 1964 and by now developed into a customs union with the prospect of future membership in the EU (customs unions); the Agreement on the European Economic Area (EEA) concluded with countries belonging to the European Free Trade Association (EFTA) (except for Switzerland, which has its own package of bilateral agreements cumulatively adopted under Art. 217 TFEU), creating an enhanced free trade area which partly resembles an internal market with common policies; the development association with the African, Caribbean, and Pacific Group of States under the ACP–EC Partnership Agreement, as last prolonged by the agreement signed in Cotonou in 2000 (Lomé/Cotonou Conventions); so-called Stabilisation and Association Agreements (‘SAAs’) concluded with countries from the Western Balkans, eg with Macedonia in 2004; and the so-called Euro–Mediterranean Agreements establishing associations with Maghreb or Mashreq countries, eg with Egypt in 2004. While some of these associations are meant to prepare the European partner country for membership in the EU, others are designed to provide a durable legal position outside the EU. However, as demonstrated by the examples of Turkey (being a candidate country for more than 40 years) or Austria, Finland, and Sweden (having joined the EU only one year after the EEA Agreement entered into force), the distinction is not clear-cut; there is nothing more permanent than provisional solutions, and vice versa.

The external, treaty-based associations with independent subjects of international law under Art. 217 TFEU must not be confused with the association of the Overseas Countries and Territories (‘OCTs’) unilaterally established by the EU’s founding treaties (now Arts 198–204 TFEU) (European Community and Union, Association of Overseas Countries and Territories). The latter arrangement associates with the Union certain non-European countries and territories which have ‘special relations’ with Denmark, France, the Netherlands, or the United Kingdom. The OCTs, mostly less populated islands, constitute the remainder of much larger colonial empires ruled by some Member States when founding the EEC or joining it (Colonialism). Regardless of their non-independent status, the preferential market access and financial assistance enjoyed by the OCTs under the Overseas Association Decision, adopted by the EU Council to implement the principles set out in the preamble to the TFEU, closely resembles the treatment of their independent siblings under the ACP–EC Partnership Agreement.

B.  Historical Background and Development

The legal basis to establish an association with the Community was already present in the original version of the EEC Treaty, which entered into force on 1 January 1958. Alongside the conclusion of trade agreements as foreseen in Art. 113 EEC Treaty (now Art. 207 TFEU), the establishment of associations pursuant to Art. 238 EEC Treaty (now Art. 217 TFEU) was one of the rare examples of an express external power granted to the early Community. Its systematic position among the General and Final Provisions of the Treaty contiguous to Art. 237 EEC Treaty on admission of new Member States (now Art. 49 TEU) reveals the original perception of the Treaty drafters. Association agreements had been considered as an alternative offer to those European States which could not, or not yet, contemplate full participation in the supranational integration project undertaken by the six founding States. This reading is affirmed by the fact that already in 1954 the United Kingdom had concluded an agreement establishing an ‘intimate and enduring association’ with the European Coal and Steel Community (ECSC) (Agreement concerning the Relations between the United Kingdom of Great Britain and Northern Ireland and the European Coal and Steel Community). However, even the original version of Art. 238 EEC Treaty required association agreements to be in conformity with the entire EEC Treaty as it stands (a requirement now laid down in Art. 218 (11) TFEU). Thus, any ‘light’ version of membership or incorporation of associates into the institutional system of the Community was precluded, save for prior EEC Treaty amendment to that end. Instead, the EEC Treaty expected the parties to the association agreements to establish their own, joint institutional framework distinct from the Community’s, ‘involving…common action and special procedure’, as the Treaty drafters put it. Hence, the concept of association agreements as designed by the 1957 Treaty aimed at establishing privileged relationship with non-Member States, preferably European ones, through institutionalized cooperation on various fields covered by the EEC Treaty (Pescatore 140–43). The first association agreement concluded with Greece in 1961 precisely followed this model in establishing a pre-accession association based on a customs union (Oppermann 487–88; Ceylanoglu 220). The power to include into such agreements regulations pertaining to ‘all fields covered by the Treaty’ was recognized by the European Court of Justice (European Communities, Court of Justice [ECJ] and Court of First Instance [CFI]) in a case concerning the Association Agreement with Turkey (Case 12/86 Meryem Demirel v Stadt Schwäbisch Gmünd para. 9).

The early conception was soon to be superseded by two developments, at least to some degree. The first was the process of decolonization, briefly mentioned above. Faced with a growing number of newly independent third world States, the Community had to shape a successor regime replacing the outdated association of the former OCTs. The Community institutions thereupon apprehended Art. 238 EEC Treaty to be a sufficient legal basis also for creating multilateral development associations. The first instance was the agreement with 18 African States and Madagascar signed on 20 July 1963 in Yaoundé, later followed by the Lomé and Cotonou Conventions (Everling 478–508). The ECJ supported this approach. It held that the clause ‘reciprocal rights and obligations’ laid down in Art. 238 EEC Treaty must not be construed to require strict equality of benefits accruing to either party. According to the ECJ, a certain imbalance between the obligations assumed by the Community towards the associated States is inherent in the special nature of development associations (Case 87/75 Conceria Daniele Bresciani v Amministrazione Italiana delle Finanze paras 22–23). Subsequently, and for a considerable time to come, association agreements came to be seen as primarily an instrument of development policy (see, eg Petersmann 268).

The second factor inducing the Community to move away from the original conception is a legal development that was pushed forward by the ECJ. It has resulted in a situation where association agreements have lost much of the extraordinary legal status the treaty drafters intended them to have. The most im-portant judgment in this respect was handed down in the 1971 ERTA case, in which the ECJ paved the way for its jurisprudence of implied treaty-making powers following from the exercise of internal law-making powers (Case 22/70 Commission of the European Communities v Council of the European Communities—European Agreement on Road Transport paras 15–19). The more the specific treaty-making powers of the Community grew, the less significant became the cross-cutting power ‘to guarantee commitments … in all fields covered by the Treaty’ (Case 12/86 Meryem Demirel v Stadt Schwäbisch Gmünd para. 9). The growth happened either by way of the above-mentioned parallelism between internal and external powers or by explicit conferral of new treaty-making powers. Moreover, the ECJ endorsed the extension of institutional features typical of association agreements to other types of agreements. While all association agreements are characterized by an institutional setting involving joint decision-making bodies empowered to amend or supplement the basic agreement, this does not prevent the Union from concluding sectoral agreements instituting similar treaty bodies (see Case 104/81 Hauptzollamt Mainz v CA Kupferberg & Cie KG aA para. 19). In fact, such bodies have become a widespread feature in modern treaty-making. When determining the legal effects in EU law of decisions taken by bodies set up under international agreements (see below para. 14), the ECJ did not hesitate to apply its case law on Association Council decisions to a decision taken by a Joint Committee instituted under a bilateral trade agreement (Case C-188/91 Deutsche Shell AG v Hauptzollamt Hamburg-Harburg para. 17).

The 1990s witnessed a rebirth of the original notion of association agreements. After the breakdown of Communist rule, various European countries were seeking to closely link themselves with the Union, either as a lasting alternative to or as a preparation for EU membership (see Vöneky paras 69–97; Lazkowski 1434–37). From 1991, the EC/EU and its Member States concluded so-called Europe Agreements with 10 countries of Central, Eastern and South-Eastern Europe which later joined the Union (Malta and Cyprus already had older association agreements that could serve as legal framework for accession partnership). The EEA Agreement, for its part, can be considered the closest match to Pierre Pescatore’s early vision of creating ‘un lien permanent, général et institutionnalisé de coopération, consacrant une participation des pays tiers aux objectifs des Communautés’ (‘a permanent, general and institutionalized link of co-operation providing for the participation of third countries in the objectives of the Communities’ [translation by the editor]; Pescatore 143), or as the ECJ framed it, ‘special, privileged links with a non-member country which must, at least to a certain extent, take part in the Community system’ (Case 12/86 Meryem Demirel v Stadt Schwäbisch Gmünd para. 9; see also EFTA Court Case E-9/97 Erla María Sveinbjörnsdóttir v Government of Iceland para. 59).

The association agreements’ legal basis in the EU’s founding treaties has not remained unchanged, either. In its 1957 version, Art. 238 EEC Treaty provided that association agreements be concluded by the Council, acting unanimously after consulting the European Parliament (the Assembly, as it was then called). With the Single European Act of 1986, this provision was amended so as to reflect the reinforced institutional position of the directly elected European Parliament. From 1 July 1987, explicit assent of the Parliament had to be obtained for any new association agreements (Art. 238 (2) EEC Treaty), in parallel to its new veto power regarding the accession to the Community (then Art. 237 EEC Treaty, now Art. 49 TFEU). The Maastricht Treaty, which entered into force on 1 January 1993, consolidated the procedural aspects of Art. 238 into the general provision on Community treaty-making, ie Art. 228 EC Treaty (now Art. 218 TFEU). Since then, the assent procedure applies, inter alia, to association agreements (Art. 218 (6) (a) (i) TFEU). Hence, establishing privileged and institutionalized co-operation with third States was first among the areas of the Union’s external relations to come under full parliamentary control.

10  Further amendments were enacted by the Amsterdam and Nice Treaties of 1997 and 2001, respectively. According to the new rules, today laid down in Art. 218 (9) TFEU, the Council shall establish the positions to be adopted on behalf of the Union in a body set up by an association agreement, when that body is called upon to adopt decisions having legal effects. As far as the European Parliament is concerned, Art. 218 (10) TFEU requires it to be ‘informed’. Eventually, the Nice Treaty extended these procedural requirements for establishing the position to be adopted on behalf of the Union to any kind of agreements where joint decision-making bodies are present, be they association agreements or other (see Martenczuk 148–54).

C.  Select Legal Issues of Association Agreements under EU Law

11  Association agreements have been subject to a wealth of judgments and opinions of the ECJ. They still raise complex legal issues of European constitutional law, mainly concerning the status of international agreements within the internal EU legal order. However, on closer examination hardly any of the legal issues raised are in fact peculiar to association agreements; they concern the exercise of the EU’s external powers and the adoption and implementation of international agreements in general. It is fair to say that association agreements were the pioneers of today’s jurisprudence of EU foreign affairs. Hence, the reader is called upon to consult the relevant entries of the present encyclopaedia while keeping in mind that the international treaty which gave rise to a new legal concept or a line of case law might be an agreement based on Art. 217 TFEU or its predecessor (European Community and Union, Decision-Making and Competences on International Law Issues; European Community and Union, Party to International Agreements; European Community, Membership in International Organizations or Institutions; European Community, Mixed Agreements).

12  Among the issues directly connected to association agreements is the determination of the scope of the power conferred in Art. 217 TFEU, and the delineation to other, explicit or implicit, EU powers to conclude international agreements. A twofold delineation is required. An association agreement has to meet certain minimum standards as regards the breadth of the policies addressed and the degree to which the substantive acquis communautaire (the EU law as it stands) is extended to the associate(s). An agreement that fails to meet these standards does not come under Art. 217 TFEU and will have to be based on a combination of sectoral powers (see Lenaerts and De Smijter 17–18). The impact of such qualification is first and foremost procedural. For mandating the Commission to negotiate an association agreement, the Council has to take a unanimous decision, acting on a proposal from the Commission; for its final adoption, the Parliament’s consent is needed in addition. This deviates from the general rule of treaty-making according to which the Council decides by qualified majority after consulting the Parliament (Art. 218 (6) and (8) TFEU). As far as the maximum standard is concerned, the substantive scope of the power to establish associations is not entirely clear; the formula ‘in all fields covered by the Treaty’ once employed by the ECJ (Case 12/86 Meryem Demirel v Stadt Schwäbisch Gmünd para. 9) has not fully settled the case (on the extensive scholarly debate see Richter 90–115). In practice, this issue has been dealt with pragmatically by accepting the EC/EU Member States as additional parties to almost all association agreements, thus leaving the exact scope of the respective competences vis-à-vis third parties in abeyance. At any rate, neither Art. 217 TFEU nor any other provision of the Treaty empowers the Union to adopt international agreements that would affect the allocation of responsibilities defined in the EU’s founding treaties and, consequently, the autonomy of the EU legal system (see Opinion 1/91 Draft Agreement between the Community, on the One Hand, and the Countries of the European Free Trade Association, on the Other, relating to the Creation of the European Economic Area [1991] summary No 6 and paras 71–72).

13  Another legal issue under EU law concerns the acts adopted within the institutional framework of an association agreement, sometimes referred to as ‘secondary association law’. The establishment of institutions entrusted with the task of implementing the association has always been considered an essential feature of association agreements pursuant to Art. 217 TFEU or its predecessor (see above para. 5). As yet, however, the Community and its partners have refrained from establishing international organizations in the proper sense for that purpose. Rather, they have limited themselves to the institution of joint treaty bodies, acting on behalf of the Contracting Parties. While there is a considerable variance of institutional patterns under the different association agreements, there are some common features present in all of them. Regardless of the number of parties involved, the bodies set up under such agreements display a bilateral, parity, and consensual structure. The seats of the ‘EU bench’ are filled with representatives of the Union institutions, sometimes joined by representatives of its Member States, while the seats of the ‘associates’ bench’ are filled with representatives of the third State(s), each bench speaking with one voice. The main organ of the association representing the Contracting Parties is called Association Council, Cooperation Council, Council of Ministers, etc. It is typically vested with the power to take binding decisions in cases provided in the agreement in order to implement and develop the association. Again, the range of the decision-making powers, and its actual use, vary considerably between the individual associations. In some cases, the treaty body is empowered to amend the basic agreement and to create new obligations binding upon the parties by supplementing its provisions (the term ‘secondary association law’ which suggests a clear hierarchy of norms is therefore somewhat misleading).

14  The legal qualification of decisions taken by bodies set up under association agreements or other agreements establishing a specific institutional framework is subject to on-going scholarly debate (von Bogdandy, Arndt, and Bast 129–31; Lavranos passim). The ECJ’s approach was always straightforward in accepting the legitimacy and the binding character of such powers conferred under association agreements (Case 87/75 Conceria Daniele Bresciani v Amministrazione Italiana delle Finanze Bresciani para. 29). According to the ECJ, such decisions are ‘directly connected’ with the agreement on which they are based and thus share the latter’s position within the EU legal order (Case 30/88 Hellenic Republic v Commission of the European Communities para. 13). Consequently, also the decisions of Association Councils and similar bodies form, as from their entry into force, ‘an integral part of the Community legal system’ (ibid para. 12). In its landmark ruling in Sevince, the ECJ renewed this reasoning by stating that such decisions are capable of entailing direct effect in a national court, under the very same conditions as applicable to agreements (Case C-192/89 SZ Sevince v Staatssecretaris van Justitie para. 15). This judgment, which concerned the EEC–Turkey Association Agreement, has had an enormous impact also in terms of substance. It laid the groundwork for a jurisprudence that developed Decision No 1/80 of the Association Council of 19 September 1980 into the magna carta for Turkish migrant workers and their family members in the present Union. Under the terms of Decision 1/80 they enjoy a right of permanent residence, and protection against expulsion which is equivalent to that of Union Citizens (Aliens, Expulsion and Deportation; Migrant Workers).

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