German Law Journal Phelan Brexit copy

Introduction to the European Union's Distinctive Features

  • The European Union (EU) is often referred to as ‘new’, ‘unique’, and ‘sui generis’.

  • The EU's distinctiveness is illustrated by its lack of unilateral safeguard and escape mechanisms for policy-makers in Member States.

Escape Mechanisms in Treaty Systems

  • Many treaty systems, particularly in international relations, allow for ‘escape mechanisms’ or ‘safety valves’.

  • Such mechanisms help manage the ex post costs of strict treaty obligations, particularly in trade politics.

  • Example: Many trade treaties enable states to reintroduce trade barriers under terms such as ‘anti-dumping’ or ‘safeguards’, often without a solid economic rationale.

Justification for Escape Mechanisms

  • The 2001 article by Rosendorff and Milner provides a rationale for escape mechanisms:

    • They allow policy-makers to respond to domestic pressures without completely exiting the treaty system.

    • By permitting policy-makers to temporarily relax treaty commitments, overall stability is maintained.

    • The dilemma: Weighing the costs of providing escape mechanisms against the risk of state withdrawal from the agreement.

EU's Stance on Unilateral Safeguards

  • EU fundamentally limits the ability of Member States to unilaterally reduce treaty obligation fulfillment.

  • Notable case: Pork Products decision (December 1961, Case 7/61):

    • The European Court of Justice ruled that Member States must seek approval from European institutions before introducing safeguard measures.

    • This case exemplifies the compulsory fulfillment of EU obligations and reinforces the EU’s legal order.

Consequences for Trade and Policy-Making

  • Increased certainty for traders, investors, and individuals due to minimized unilateral safety valves.

  • However, the absence of escape mechanisms fosters alternative uncertainties:

    • Domestic lobby groups and policy-makers may contemplate leaving the treaty system altogether as an alternative response to pressures.

  • The concept of Brexit fits within this framework, highlighting tensions in the European Union’s legal order since the Pork Products decision.

Author's Credentials

  • William Phelan is affiliated with Trinity College Dublin.

  • His latest book: "In Place of Inter-State Retaliation: The European Union's Rejection of WTO-style Trade Sanctions and Trade Remedies" published by Oxford in 2015.