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Vice-President of the European Commission, EU Justice Commissioner
The EU and the UK: Continuing to fulfil Winston Churchill's vision?
European Week Conference Series 2012 of the King's College London
London, 1 March 2012
Dear Ladies and Gentlemen,
I would like to thank the "European Society" student foundation at King's College for the kind invitation to address this year's European Week conference series. I know of the fine reputation of the King's College Centre of European Law in both research and teaching built up over many years; now overseen by Sir Francis Jacobs who of course served for many years as a distinguished Advocate General at the Court of Justice.
What a pleasure it is to address you in your fine new home in the East Wing of Somerset House, inaugurated only yesterday by Her Majesty the Queen. I understand that King's College has had its eye on this piece of London real estate for the last 180 years. It is good to see the virtue of patience being so richly rewarded.
Patience has also been required over the years in building up the family which we now call the European Union. When Winston Churchill made his famous speech at Zurich University in 1946 calling for a United States of Europe, his text revealed a sense of urgency, but also read as a message of hope for a divided and broken continent. In that speech, Winston Churchill mentioned his vision that the peoples of Europe might enjoy the four freedoms. He was not anticipating the four freedoms so beloved by specialists in European law. He was referring to the basic rights identified by President Roosevelt in 1941; the freedom of speech and expression; freedom of worship; freedom from want and freedom from fear. The United States of Europe "or whatever name or form it might take" was the means to achieve these ends in Churchill's view of 1946.
It is a measure of how far we have come – and that includes taking account of the extra level of patience required in Central and Eastern Europe – that we now take the achievement of these goals so much for granted.
Thankfully, the challenges we face today are of a different order than in post-war Europe. But that is no reason for complacency; especially in the midst of the worst financial crisis since the 1930s. In this time of crisis, there needs to be a new vision for Europe; we need to avoid – in the words of Winston Churchill – "a Babel of jarring voices" and "the sullen silence of despair".
The answer lies in re-establishing confidence. Confidence has been shaken at many different levels by the economic crisis. There has been a loss of faith, quite understandably, in markets to provide good outcomes; there has been a loss of faith in all kinds of institutions at national level. And there has also been a loss of faith in the capacity of the European Union to effectively address the current crisis.
A loss of faith is almost invariably a dangerous moment. We Europeans must face reality. If the current trends of economic growth continue, a country like Brazil might overtake Europe's strongest economies in the United Kingdom, France and Germany. Figures foresee that by 2050 we risk having no EU country as a member of the G8 anymore. If these forecasts are confirmed, our wealth in Europe, our security and our different social models are bound to be put to the test. That is why the European Union needs to relocate its common purpose. The pace of global competition is fast. In Europe we should never forget that we depend on each other not only for maintaining peace but also for our prosperity.
Europe needs a comprehensive strategy to overcome a crisis which has deeply rooted structural causes. Thanks to many Commission proposals and EU summits, since autumn 2008 Europe now has that strategy. It is a combination of elements which are inter-linked and which therefore must be tackled together. We need smart fiscal consolidation so that debt in our Member States can become sustainable, but which maintains investments in future-oriented areas, like education, research, innovation and a well-functioning justice system. We need, of course, to boost growth and employment. We must support but also reform the financial sector. We need strong financial firewalls against contagion. We need a more integrated, a more coherent economic governance in the EU and in particular in the Euro area. And of course, last but not least, we need a lasting solution for Greece.
All of this is essential to rebuild confidence. In this endeavour, I would stress in the first place, that more than ever the Union needs to unlock the potential of its Single Market. This will be Europe's greatest asset in the years ahead: a market of 500 million people, a testing ground for successful products, and a standard-setter for quality.
We should not forget that the European Union has the biggest economy in the world, amounting to 20% of world trade. Sometimes, I hear commentators implying that the future means finding new markets in Asia, as if exporting within Europe would now be a waste of time. Of course, the clear answer is that this is not a binary choice between one and the other. The obvious answer is to export to both. Successful companies do just that, often using our own Single Market as a spring-board for global expansion.
The Single Market means a huge competitive advantage in today's globalised world. For the UK for example, the Single Market means 440 million extra consumers. Each year, the Single Market adds billions of pounds to the UK economy. Seven out of the UK's top ten trading partners are European.
The United Kingdom has historically been one of the Single Market's greatest champions. And I see no indication why this should change in the current crisis; only that the logic should grow stronger, the Single Market being an economic gold-mine, a gold-mine we need to adapt to new developments. As a new digital economy emerges, so does the need to break down new barriers. In other words, we need to keep up with the changing nature of the Single Market; there is a move to trade increasingly in services and digital content products; purchasing online with our credit cards. In other words: our Single Market must also become a digital Single Market.
Here, if I may, I come back to the issue of confidence. The internet economy will continue to grow exponentially under one pre-condition: that people's trust in the internet prevails. And that will be no mean achievement: 79 percent of British internet users buy goods and services online (EU-27: 60 percent). Yet a quarter of British online shoppers feel they have no control at all over the data they disclose when shopping on the internet.
We have to give an answer to those doubts. We have to make the Single Market fit for the digital age. This will increase our competitiveness and bring Europe back to economic recovery. This is why the new Digital Agenda is such an important part of Europe's long-term growth strategy.
In fact, there are estimates that a proper Single Market for services and online trade once completed will add about €4,200 to each EU household on average. That means €800 billion extra for the EU's economy.
These aren't my figures. They are the ones used by Deputy Prime Minister Nick Clegg in a speech he made to the European Parliament last November. He also made a call for growth to be prioritised in all that we do. Well, I could not agree more.
As EU Justice Commissioner, I have since the beginning of my mandate developed a "Justice for Growth" policy, adding a strong growth dimension to all reforms in the justice field. If we can abolish unnecessary formalities when it comes to veterinary inspections, then we should do the same when it comes to having a judgment recognised and enforced in another Member State by the intermediate "exequatur" procedure. This can save time and money for businesses. That is why I proposed to abolish this procedure. Let's face it: the single market in the United States has been working very well since 1787 without the exequatur procedure.
I already mentioned the chilling effect that online shoppers experience with regard to the use of their personal data. It is only when consumers can 'trust' that their data are well protected, that they will continue to entrust businesses and authorities with it, buy online, and accept new product developments and services. That is why in January this year, the European Commission brought forward a comprehensive data protection reform package.
In the totally connected world of exploding data flows, we need to set a high standard for data protection. But we have seen that the existing EU Data Protection Directive has brought with it 27 different, and often contradictory, regimes. By proposing a Regulation, I intend to bring an end to a fragmented application of the rules. I've also taken the decision to set up a one stop shop for businesses in Europe: the national Data Protection Authority where the business has its main establishment. The new rules should also cut red tape for businesses by doing away with the current costly general notification requirements for processing data. We estimate net savings for businesses amounting to about € 2.3 billion per year – around £1.9 billion – in administrative burden.
If I may be permitted to rely on another statistic, found in Deputy Prime Minister Clegg's speech of last November: only 12% of all our online trade in Europe is cross-border, completely undermining the great value of the internet. This is often attributable to the uncertainty associated with compliance with foreign rules; we calculate, for example, that for each new market it would cost a trader on average €10,000 in legal fees to receive the appropriate advice on that market's system of contract law.
This is why, last October, I also brought forward a proposal for a Common European Sales Law – a new optional mechanism for completing the Single Market. Businesses can opt for this harmonised set of sales law rules when they are seeking to expand into new markets, and when it suits their purpose. When they do so, they will not have to worry about diverging consumer protection rules, because the instrument harmonises these rules, on the basis of a high level of consumer protection. At the same time, and taking full account of the businesses that trade locally without any cross-border dimension, the proposal leaves them free to rely on existing national contract law, which remains untouched for these purposes. In other words, the optional measure has an in-built red tape avoidance mechanism.
So, for confidence to be restored, the European Union can and must do more to exploit its Single Market, which remains our key growth lever. This requires not only that the Commission makes growth-enhancing proposals, but also that the Parliament and the Council put these proposals into law.
The second inter-locking component for restoring confidence in the European project is rather different. It has nothing to do with economic statistics and bare commercial logic. It is about building a more direct relationship between the European Union and it citizens. It is about constantly demonstrating to Europe's citizens that the Union adds value to their lives.
Take the case of the British nationals who have written to the European Commission and the European Parliament to complain about the fact that they no longer have the right to vote in national elections. In effect, some now have a second-class status – a limbo where they have no right to vote in any national elections. Is this in line with the Opinion of Advocate-General Jacobs where he noted that a citizen exercising a right of free movement should be entitled to say "Civis europeus sum"? I have asked the Member States to address this matter given that national election law is first of all a national responsibility.
I get thousands of letters per year from citizens across Europe explaining their problems and hopes.
We have to engage with citizens, and understand their real problems as they go about their daily business. People fall in love, get married, get divorced, have custody disputes over children and are not sure what happens to the property they brought into the partnership. People die. What happens in all these cases when there is a cross-border dimension? If we are to be relevant to citizens, the European Union has to simplify these complex and stressful situations. That is what I have been working on over the past years. On the basis of the EU Treaties, we now have an emerging body of law in this field.
In the coming weeks, I very much expect to see the adoption of an EU Regulation on wills and successions that will add to this. The new rules are aimed at simplifying the settlement of international successions by providing a single criterion for determining both the jurisdiction and the applicable law: the deceased's habitual place of residence. This is aimed at the more than 12 million Europeans living in another EU country – often with property and bank accounts in different jurisdictions.
Citizens living in the UK already belong to the avant-garde of free movement: UK residents travel abroad a lot. I guess that you, dear students – who are particularly mobile – are among these people: In 2010, UK residents made more than 34 million trips to the EU. This number is impressive. But the fact that it has become such a matter of routine should not lead us to take it for granted!
Nor should we forget the many advantages that the large numbers of EU nationals that have come to the United Kingdom have brought with them. There are countless positive anecdotes about Polish plumbers. There may even be an emerging appetite for Polish food and beer!
While you are abroad, have you noticed which rights and opportunities you enjoy thanks to concrete EU actions? These benefits range from reduced roaming fees, consular protection by any EU embassy, and also, you can move around without any passport checks in the Schengen Zone that now comprises 26 countries (even if the United Kingdom is not one of them). And of course, as students, you might have made use of an Erasmus grant or you will still do so as part of your studies. Over the last ten years, almost 80,000 UK students have studied with Erasmus at another EU university. In Europe, per year, 600,000 EU students study abroad, with 160,000 of these coming to the UK. I also saw a report that there are 100,000 French nationals registered here in London to vote in the forthcoming French elections (out of 300,000 French people living in London).
In other words, free movement across borders is a fact of life. And that brings other responsibilities for the European Union. There are over 8 million criminal proceedings in the EU every year. A proportion of these are free movement cases. This explains the introduction of the European Arrest Warrant. But for that system to work properly there has to be mutual trust. Citizens need to be able to trust that a warrant issued by law enforcement authorities in another Member State is as valid as a national warrant. However, such mutual trust cannot be imposed by decree. We will only have mutual trust in Europe if citizens are sure that the neighbours have a criminal justice system with independent judges, sound rights for the defence and a guarantee of fair trials.
That is why I have taken action to achieve a full set of fair trial rights throughout the European judicial area. Some of these measures have already been adopted by Parliament and Council, for example the Directive on the right to interpretation and translation in criminal proceedings. The Directive on the right of access to a lawyer is on the way to be adopted. We are currently looking into other measures that could follow, notably the protection of vulnerable suspects such as children. I am pursuing a similar course of action on victims' rights.
So, while the focus today is of course on the stabilisation of Europe, of our public finances and of our single currency, let us not forget that we are doing all this to promote the wellbeing of our citizens. In order to recognize this fact widely, we will make 2013 the European Year of Citizens.
Let me now come back to the "four freedoms" in Winston Churchill's Zurich speech. They highlight another dimension which we should not lose from sight: the importance of fundamental rights during the post-war construction of Europe. As was mentioned by Attorney General Dominic Grieve in his speech last October, the prohibition of torture, right to liberty and right to a fair trial all reflect the development of British common and statute law from Magna Carta, habeas corpus, to the Bill of Rights. The United Kingdom played an active part in negotiating the European Convention on Human Rights Convention and was the first country to ratify it in 1951.
This tradition has been taken up in the European Union's legal order first in the form of general principles of Union law and now, with the Lisbon Treaty, in the provisions of the Charter of Fundamental Rights - the Union's very own Bill of Rights. It has confirmed the central importance of the respect of fundamental rights by the institutions and bodies of the Union and by the Member States when they are implementing Union law.
In order to complete the fundamental rights architecture in Europe the accession by the European Union to the European Convention of Human Rights. This is required by the Lisbon Treaty, and negotiations are being actively pursued. That is why I welcome the commitment to this accession expressed recently by Foreign Secretary William Hague.
I also note the commitment of the United Kingdom in its present role as Chairman of the Committee of Ministers – the governing body of the Council of Europe. The debate on the functioning of the European Court of Human Rights is an important one; the process of improving the efficiency of its procedures is laudable. But we should take care that the Court's ability to fulfil Winston Churchill's vision– helping to entrench the protection of fundamental rights in all 47 member countries – is not hampered. I sincerely hope that the United Kingdom will pursue this important process in line with this country's long and solid human rights tradition.
Ladies and Gentlemen,
As the European Union moves forward in the coming months, it will be under the spotlight as never before – across all Member States. New responsibilities can no longer be avoided, in particular, the effective monitoring and supervision of the Euro area by the European Commission. That is why it was so important that, notwithstanding the inter-governmental nature of the new Fiscal Compact, the logic of the traditional Community method has been confirmed. This is the method that has proved itself over the years in ensuring that in core areas of competence, such as the Single Market, rules are fairly and effectively enforced. Because it is based on the equality of all Member States. On independent institutions. And on the rule of law.
It is also clear that mechanisms for enhancing political legitimacy will need attention. The Lisbon Treaty has already pointed towards a greater involvement of national parliaments and of the European Parliament. I think we have to go a step further as I recently outlined in an article published by the Wall Street Journal Europe and 10 major European papers.
Just as in 1989-90, major political events and challenges today are opening opportunities for historical changes. Europe has the chance to develop into a strong political union. By 2020, our continent – benefitting from a strong currency and the world's largest internal market – can assume a power position on the international stage.
For this, we need to be more united than ever and to take our citizens with us. We need to have the courage and patience for institutional reform. Rome was not built in a day, and neither will a European political union be. But we have a historic chance to make it happen.