European Union — Consolidated versions of the Treaty on European Union and of the Treaty establishing the European Community (2002)
Date: 2002-12-24
Institutions: European Commission
Subjects: Court of Justice of the European Union, ECSC Treaty, European treaties, Protocol (EU), Treaty of Nice, Treaty on European Union, enlargement of the Union

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EUROPEAN UNION

CONSOLIDATED VERSIONS

OF THE TREATY ON EUROPEAN UNION

AND OF THE TREATY
ESTABLISHING THE EUROPEAN COMMUNITY

(2002)

(2002/C 325/01)

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INTRODUCTORY NOTE

This publication contains the consolidated versions of the Treaty on European Union and of the Treaty estab-
lishing the European Community,
incorporating the amendments made by the Treaty of Nice, signed on
26 February 2001.

It also reproduces the four Protocols adopted at Nice, namely the Protocol on the enlargement of the European
Union, the Protocol on the Statute of the Court of Justice, the Protocol on the financial consequences of the
expiry of the ECSC Treaty and on the Research Fund for Coal and Steel, as well as the Protocol on Article 67 of
the Treaty establishing the European Community.

This publication does not contain the text of the other Protocols in force, nor that of the Treaty establishing the
European Atomic Energy Community, nor that of other acts of primary law.

It should be noted that amendments made by the Treaty of Nice will be effective only on the date of its entry into
force, as provided for in Article 12(2) of that Treaty.

This text has been produced for documentary purposes and does not involve the responsibility of the institutions.

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CONSOLIDATED VERSION OF THE TREATY ON EUROPEAN UNION ...........................................................

Page

5

CONTENTS

I. Text of the Treaty

II. List of Protocols (text not reproduced)

CONSOLIDATED VERSION OF THE TREATY ESTABLISHING THE EUROPEAN COMMUNITY ................

33

I. Text of the Treaty

II. List of Protocols (text not reproduced)

PROTOCOLS ADOPTED AT NICE ................................................................................................ ................................

161

— Protocol on the enlargement of the European Union .....................................................................................

— Protocol on the Statute of the Court of Justice ................................................................................................

— Protocol on the financial consequences of the expiry of the ECSC Treaty and on the Research Fund
................................................................................................ .....................................................

for Coal and Steel

163

167

182

— Protocol on Article 67 of the Treaty establishing the European Community ..........................................

184

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CONSOLIDATED VERSION
OF THE TREATY
ON EUROPEAN UNION

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I. TEXT OF THE TREATY

CONTENTS

Preamble ................................................................................................ .......................................................................

TITLE I — Common provisions ................................................................................................ ........................

TITLE II — Provisions amending the Treaty establishing the European Economic Community with
a view to establishing the European Community ...................................................................

TITLE III — Provisions amending the Treaty establishing the European Coal and Steel Community

TITLE IV — Provisions amending the Treaty establishing the European Atomic Energy Community

TITLE V — Provisions on a common foreign and security policy ...........................................................

TITLE VI — Provisions on police and judicial cooperation in criminal matters......................................

TITLE VII — Provisions on enhanced cooperation ..........................................................................................

TITLE VIII — Final provisions ................................................................................................ ................................

Page

9

10

13

13

13

13

21

28

30

II.

PROTOCOLS (text not reproduced, with the exception of the four Protocols adopted by the Nice Intergovern-
mental Conference (see the end of this publication)) (*)

Protocol annexed to the Treaty on European Union

— Protocol (1) on Article 17 of the Treaty on European Union (1997)

Protocols annexed to the Treaty on European Union and to the Treaty establishing the European Community

— Protocol (2) integrating the Schengen acquis into the framework of the European Union (1997)

— Protocol (3) on the application of certain aspects of Article 14 of the Treaty establishing the European

Community to the United Kingdom and to Ireland (1997)

— Protocol (4) on the position of the United Kingdom and Ireland (1997)

— Protocol (5) on the position of Denmark (1997)

Protocols annexed to the Treaty on European Union, to the Treaty establishing the European Community and
to the Treaty establishing the European Atomic Energy Community

— Protocol (6) on the Statute of the Court of Justice (2001) (text reproduced hereafter)

— Protocol (7) annexed to the Treaty on European Union and to the Treaties establishing the European

Communities (1992)

— Protocol (8) on the location of the seats of the institutions and of certain bodies and departments of the

European Communities and of Europol (1997)

— Protocol (9) on the role of national parliaments in the European Union (1997)

— Protocol (10) on the enlargement of the European Union (2001) (text reproduced hereafter)

(*) For the text of the Protocols adopted at Intergovernmental Conferences prior to Nice, the reader is requested to refer to pages 355
et seq. of the Selected Instruments taken from the Treaties, book I, volume I, 1999 edition, published by the Office for Official
Publications of the European Communities, ISBN 92-824-1661-5.

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HIS MAJESTY THE KING OF THE BELGIANS, HER MAJESTY THE QUEEN OF DENMARK, THE
PRESIDENT OF THE FEDERAL REPUBLIC OF GERMANY, THE PRESIDENT OF THE HELLENIC
REPUBLIC, HIS MAJESTY THE KING OF SPAIN, THE PRESIDENT OF THE FRENCH REPUBLIC, THE
PRESIDENT OF IRELAND, THE PRESIDENT OF THE ITALIAN REPUBLIC, HIS ROYAL HIGHNESS THE
GRAND DUKE OF LUXEMBOURG, HER MAJESTY THE QUEEN OF THE NETHERLANDS, THE
PRESIDENT OF THE PORTUGUESE REPUBLIC, HER MAJESTY THE QUEEN OF THE UNITED
KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND,

RESOLVED to mark a new stage in the process of European integration undertaken with the estab-
lishment of the European Communities,

RECALLING the historic importance of the ending of the division of the European continent and the
need to create firm bases for the construction of the future Europe,

CONFIRMING their attachment to the principles of liberty, democracy and respect for human rights and
fundamental freedoms and of the rule of law,

CONFIRMING their attachment to fundamental social rights as defined in the European Social Charter
signed at Turin on 18 October 1961 and in the 1989 Community Charter of the Fundamental Social
Rights of Workers,

DESIRING to deepen the solidarity between their peoples while respecting their history, their culture and
their traditions,

DESIRING to enhance further the democratic and efficient functioning of the institutions so as to enable
them better to carry out, within a single institutional framework, the tasks entrusted to them,

RESOLVED to achieve the strengthening and the convergence of their economies and to establish an
economic and monetary union including, in accordance with the provisions of this Treaty, a single and
stable currency,

DETERMINED to promote economic and social progress for their peoples, taking into account the
principle of sustainable development and within the context of the accomplishment of the internal
market and of reinforced cohesion and environmental protection, and to implement policies ensuring
that advances in economic integration are accompanied by parallel progress in other fields,

RESOLVED to establish a citizenship common to nationals of their countries,

RESOLVED to implement a common foreign and security policy including the progressive framing of a
common defence policy, which might lead to a common defence in accordance with the provisions of
Article 17, thereby reinforcing the European identity and its independence in order to promote peace,
security and progress in Europe and in the world,

RESOLVED to facilitate the free movement of persons, while ensuring the safety and security of their
peoples, by establishing an area of freedom, security and justice, in accordance with the provisions of
this Treaty,

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RESOLVED to continue the process of creating an ever closer union among the peoples of Europe, in
which decisions are taken as closely as possible to the citizen in accordance with the principle of
subsidiarity,

IN VIEW of further steps to be taken in order to advance European integration,

HAVE DECIDED to establish a European Union and to this end have designated as their Plenipo-
tentiaries:

(List of plenipotentiaries not reproduced)

WHO, having exchanged their full powers, found in good and due form, have agreed as follows.

TITLE I

COMMON PROVISIONS

Article 1

By this Treaty, the HIGH CONTRACTING PARTIES establish among themselves a EUROPEAN UNION,
hereinafter called ‘the Union’.

This Treaty marks a new stage in the process of creating an ever closer union among the peoples of
Europe, in which decisions are taken as openly as possible and as closely as possible to the citizen.

The Union shall be founded on the European Communities, supplemented by the policies and forms of
cooperation established by this Treaty.
in a manner demonstrating
consistency and solidarity, relations between the Member States and between their peoples.

Its task shall be to organise,

The Union shall set itself the following objectives:

Article 2

— to promote economic and social progress and a high level of employment and to achieve balanced
internal
and sustainable development,
frontiers, through the strengthening of economic and social cohesion and through the estab-
lishment of economic and monetary union, ultimately including a single currency in accordance
with the provisions of this Treaty,

in particular through the creation of an area without

— to assert its identity on the international scene,

in particular through the implementation of a
common foreign and security policy including the progressive framing of a common defence
policy, which might lead to a common defence, in accordance with the provisions of Article 17,

— to strengthen the protection of the rights and interests of the nationals of its Member States

through the introduction of a citizenship of the Union,

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— to maintain and develop the Union as an area of freedom, security and justice, in which the free
movement of persons is assured in conjunction with appropriate measures with respect to external
border controls, asylum, immigration and the prevention and combating of crime,

— to maintain in full the acquis communautaire and build on it with a view to considering to what
extent the policies and forms of cooperation introduced by this Treaty may need to be revised with
the aim of ensuring the effectiveness of the mechanisms and the institutions of the Community.

The objectives of the Union shall be achieved as provided in this Treaty and in accordance with the
conditions and the timetable set out therein while respecting the principle of subsidiarity as defined in
Article 5 of the Treaty establishing the European Community.

The Union shall be served by a single institutional framework which shall ensure the consistency and the
continuity of the activities carried out in order to attain its objectives while respecting and building
upon the acquis communautaire.

Article 3

The Union shall in particular ensure the consistency of its external activities as a whole in the context of
its external relations, security, economic and development policies. The Council and the Commission
shall be responsible for ensuring such consistency and shall cooperate to this end. They shall ensure the
implementation of these policies, each in accordance with its respective powers.

The European Council shall provide the Union with the necessary impetus for its development and shall
define the general political guidelines thereof.

Article 4

The European Council shall bring together the Heads of State or Government of the Member States and
the President of the Commission. They shall be assisted by the Ministers for Foreign Affairs of the
Member States and by a Member of the Commission. The European Council shall meet at least twice a
year, under the chairmanship of the Head of State or Government of the Member State which holds the
Presidency of the Council.

The European Council shall submit to the European Parliament a report after each of its meetings and a
yearly written report on the progress achieved by the Union.

Article 5

The European Parliament, the Council, the Commission, the Court of Justice and the Court of Auditors
shall exercise their powers under the conditions and for the purposes provided for, on the one hand, by
the provisions of the Treaties establishing the European Communities and of the subsequent Treaties and
Acts modifying and supplementing them and, on the other hand, by the other provisions of this Treaty.

The Union is founded on the principles of liberty, democracy, respect for human rights and

1.
fundamental freedoms, and the rule of law, principles which are common to the Member States.

Article 6

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2.
The Union shall respect fundamental rights, as guaranteed by the European Convention for the
Protection of Human Rights and Fundamental Freedoms signed in Rome on 4 November 1950 and as
they result from the constitutional traditions common to the Member States, as general principles of
Community law.

3.

The Union shall respect the national identities of its Member States.

The Union shall provide itself with the means necessary to attain its objectives and carry through

4.
its policies.

Article 7 (*)

1.
On a reasoned proposal by one third of the Member States, by the European Parliament or by the
Commission, the Council, acting by a majority of four fifths of its members after obtaining the assent of
the European Parliament, may determine that there is a clear risk of a serious breach by a Member State
of principles mentioned in Article 6(1), and address appropriate recommendations to that State. Before
making such a determination, the Council shall hear the Member State in question and, acting in
accordance with the same procedure, may call on independent persons to submit within a reasonable
time limit a report on the situation in the Member State in question.

The Council shall regularly verify that the grounds on which such a determination was made continue
to apply.

2.
The Council, meeting in the composition of the Heads of State or Government and acting by
unanimity on a proposal by one third of the Member States or by the Commission and after obtaining
the assent of the European Parliament, may determine the existence of a serious and persistent breach by
a Member State of principles mentioned in Article 6(1), after inviting the government of the Member
State in question to submit its observations.

3.
Where a determination under paragraph 2 has been made, the Council, acting by a qualified
majority, may decide to suspend certain of the rights deriving from the application of this Treaty to the
Member State in question, including the voting rights of the representative of the government of that
Member State in the Council. In doing so, the Council shall take into account the possible consequences
of such a suspension on the rights and obligations of natural and legal persons.

The obligations of the Member State in question under this Treaty shall in any case continue to be
binding on that State.

The Council, acting by a qualified majority, may decide subsequently to vary or revoke measures
4.
taken under paragraph 3 in response to changes in the situation which led to their being imposed.

For the purposes of this Article, the Council shall act without taking into account the vote of the
5.
representative of the government of the Member State in question. Abstentions by members present in
person or represented shall not prevent the adoption of decisions referred to in paragraph 2. A qualified
majority shall be defined as the same proportion of the weighted votes of the members of the Council
concerned as laid down in Article 205(2) of the Treaty establishing the European Community.

(*) Article amended by the Treaty of Nice.

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This paragraph shall also apply in the event of voting rights being suspended pursuant to paragraph 3.

For the purposes of paragraphs 1 and 2, the European Parliament shall act by a two-thirds

6.
majority of the votes cast, representing a majority of its Members.

TITLE II

PROVISIONS AMENDING THE TREATY ESTABLISHING THE EUROPEAN
ECONOMIC COMMUNITY WITH A VIEW TO ESTABLISHING
THE EUROPEAN COMMUNITY

Article 8

(not reproduced)

TITLE III

PROVISIONS AMENDING THE TREATY ESTABLISHING THE EUROPEAN COAL
AND STEEL COMMUNITY

Article 9

(not reproduced)

TITLE IV

PROVISIONS AMENDING THE TREATY ESTABLISHING THE EUROPEAN
ATOMIC ENERGY COMMUNITY

Article 10

(not reproduced)

TITLE V

PROVISIONS ON A COMMON FOREIGN AND SECURITY POLICY

The Union shall define and implement a common foreign and security policy covering all areas of

1.
foreign and security policy, the objectives of which shall be:

Article 11

— to safeguard the common values, fundamental interests, independence and integrity of the Union in

conformity with the principles of the United Nations Charter,

— to strengthen the security of the Union in all ways,

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— to preserve peace and strengthen international security, in accordance with the principles of the
United Nations Charter, as well as the principles of the Helsinki Final Act and the objectives of the
Paris Charter, including those on external borders,

— to promote international cooperation,

— to develop and consolidate democracy and the rule of law, and respect for human rights and

fundamental freedoms.

The Member States shall support the Union's external and security policy actively and unre-

2.
servedly in a spirit of loyalty and mutual solidarity.

The Member States shall work together to enhance and develop their mutual political solidarity. They
shall refrain from any action which is contrary to the interests of the Union or likely to impair its
effectiveness as a cohesive force in international relations.

The Council shall ensure that these principles are complied with.

The Union shall pursue the objectives set out in Article 11 by:

Article 12

— defining the principles of and general guidelines for the common foreign and security policy,

— deciding on common strategies,

— adopting joint actions,

— adopting common positions,

— strengthening systematic cooperation between Member States in the conduct of policy.

Article 13

The European Council shall define the principles of and general guidelines for the common

1.
foreign and security policy, including for matters with defence implications.

The European Council shall decide on common strategies to be implemented by the Union in

2.
areas where the Member States have important interests in common.

Common strategies shall set out their objectives, duration and the means to be made available by the
Union and the Member States.

3.
The Council shall take the decisions necessary for defining and implementing the common
foreign and security policy on the basis of the general guidelines defined by the European Council.

The Council shall recommend common strategies to the European Council and shall implement them, in
particular by adopting joint actions and common positions.

The Council shall ensure the unity, consistency and effectiveness of action by the Union.

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Article 14

1.
The Council shall adopt joint actions. Joint actions shall address specific situations where oper-
ational action by the Union is deemed to be required. They shall lay down their objectives, scope, the
if necessary their duration, and the conditions for their
means to be made available to the Union,
implementation.

2.
If there is a change in circumstances having a substantial effect on a question subject to joint
action, the Council shall review the principles and objectives of that action and take the necessary
decisions. As long as the Council has not acted, the joint action shall stand.

Joint actions shall commit the Member States in the positions they adopt and in the conduct of

3.
their activity.

The Council may request the Commission to submit to it any appropriate proposals relating to

4.
the common foreign and security policy to ensure the implementation of a joint action.

Whenever there is any plan to adopt a national position or take national action pursuant to a
5.
joint action, information shall be provided in time to allow, if necessary, for prior consultations within
the Council. The obligation to provide prior information shall not apply to measures which are merely a
national transposition of Council decisions.

6.
In cases of imperative need arising from changes in the situation and failing a Council decision,
Member States may take the necessary measures as a matter of urgency having regard to the general
objectives of the joint action. The Member State concerned shall inform the Council immediately of any
such measures.

7.
Should there be any major difficulties in implementing a joint action, a Member State shall refer
them to the Council which shall discuss them and seek appropriate solutions. Such solutions shall not
run counter to the objectives of the joint action or impair its effectiveness.

The Council shall adopt common positions. Common positions shall define the approach of the Union
to a particular matter of a geographical or thematic nature. Member States shall ensure that their
national policies conform to the common positions.

Article 15

Member States shall inform and consult one another within the Council on any matter of foreign and
security policy of general interest in order to ensure that the Union's influence is exerted as effectively as
possible by means of concerted and convergent action.

Article 16

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Article 17 (*)

1.
The common foreign and security policy shall include all questions relating to the security of the
Union, including the progressive framing of a common defence policy, which might lead to a common
defence, should the European Council so decide. It shall in that case recommend to the Member States
the adoption of such a decision in accordance with their respective constitutional requirements.

The policy of the Union in accordance with this Article shall not prejudice the specific character of the
security and defence policy of certain Member States and shall respect the obligations of certain Member
States, which see their common defence realised in the North Atlantic Treaty Organisation (NATO),
under the North Atlantic Treaty and be compatible with the common security and defence policy
established within that framework.

The progressive framing of a common defence policy will be supported, as Member States consider
appropriate, by cooperation between them in the field of armaments.

Questions referred to in this Article shall include humanitarian and rescue tasks, peacekeeping

2.
tasks and tasks of combat forces in crisis management, including peacemaking.

Decisions having defence implications dealt with under this Article shall be taken without

3.
prejudice to the policies and obligations referred to in paragraph 1, second subparagraph.

4.
The provisions of this Article shall not prevent the development of closer cooperation between
two or more Member States on a bilateral level, in the framework of the Western European Union
(WEU) and NATO, provided such cooperation does not run counter to or impede that provided for in
this title.

With a view to furthering the objectives of this Article, the provisions of this Article will be

5.
reviewed in accordance with Article 48.

The Presidency shall represent the Union in matters coming within the common foreign and

1.
security policy.

Article 18

2.
The Presidency shall be responsible for the implementation of decisions taken under this title; in
that capacity it shall in principle express the position of the Union in international organisations and
international conferences.

The Presidency shall be assisted by the Secretary-General of the Council who shall exercise the

3.
function of High Representative for the common foreign and security policy.

4.
The Commission shall be fully associated in the tasks referred to in paragraphs 1 and 2. The
Presidency shall be assisted in those tasks if need be by the next Member State to hold the Presidency.

(*) Article amended by the Treaty of Nice.

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The Council may, whenever it deems it necessary, appoint a special representative with a

5.
mandate in relation to particular policy issues.

Member States shall coordinate their action in international organisations and at international

1.
conferences. They shall uphold the common positions in such forums.

Article 19

In international organisations and at
participate, those which do take part shall uphold the common positions.

international conferences where not all

the Member States

2.
Without prejudice to paragraph 1 and Article 14(3), Member States represented in international
organisations or international conferences where not all the Member States participate shall keep the
latter informed of any matter of common interest.

Member States which are also members of the United Nations Security Council will concert and keep
the other Member States fully informed. Member States which are permanent members of the Security
Council will, in the execution of their functions, ensure the defence of the positions and the interests of
the Union, without prejudice to their responsibilities under the provisions of the United Nations Charter.

Article 20

The diplomatic and consular missions of the Member States and the Commission delegations in third
countries and international conferences, and their representations to international organisations, shall
cooperate in ensuring that the common positions and joint actions adopted by the Council are complied
with and implemented.

They shall step up cooperation by exchanging information, carrying out
joint assessments and
contributing to the implementation of the provisions referred to in Article 20 of the Treaty establishing
the European Community.

Article 21

The Presidency shall consult the European Parliament on the main aspects and the basic choices of the
common foreign and security policy and shall ensure that the views of the European Parliament are duly
taken into consideration. The European Parliament shall be kept regularly informed by the Presidency
and the Commission of the development of the Union's foreign and security policy.

The European Parliament may ask questions of the Council or make recommendations to it. It shall hold
an annual debate on progress in implementing the common foreign and security policy.

Any Member State or the Commission may refer to the Council any question relating to the

1.
common foreign and security policy and may submit proposals to the Council.

Article 22

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2.
In cases requiring a rapid decision, the Presidency, of its own motion, or at the request of the
Commission or a Member State, shall convene an extraordinary Council meeting within 48 hours or, in
an emergency, within a shorter period.

Article 23 (*)

Decisions under this title shall be taken by the Council acting unanimously. Abstentions by

1.
members present in person or represented shall not prevent the adoption of such decisions.

When abstaining in a vote, any member of the Council may qualify its abstention by making a formal
declaration under the present subparagraph. In that case, it shall not be obliged to apply the decision,
but shall accept that the decision commits the Union. In a spirit of mutual solidarity, the Member State
concerned shall refrain from any action likely to conflict with or impede Union action based on that
decision and the other Member States shall respect its position. If the members of the Council qualifying
their abstention in this way represent more than one third of the votes weighted in accordance with
Article 205(2) of the Treaty establishing the European Community, the decision shall not be adopted.

2.

By derogation from the provisions of paragraph 1, the Council shall act by qualified majority:

— when adopting joint actions, common positions or taking any other decision on the basis of a

common strategy,

— when adopting any decision implementing a joint action or a common position,

— when appointing a special representative in accordance with Article 18(5).

If a member of the Council declares that, for important and stated reasons of national policy, it intends
to oppose the adoption of a decision to be taken by qualified majority, a vote shall not be taken. The
Council may, acting by a qualified majority, request that the matter be referred to the European Council
for decision by unanimity.

The votes of the members of the Council shall be weighted in accordance with Article 205(2) of the
Treaty establishing the European Community. For their adoption, decisions shall require at least 62 votes
in favour, cast by at least 10 members (**).

This paragraph shall not apply to decisions having military or defence implications.

3.

For procedural questions, the Council shall act by a majority of its members.

Article 24 (*)

1.
When it is necessary to conclude an agreement with one or more States or international organi-
sations in implementation of this title, the Council may authorise the Presidency, assisted by the
Commission as appropriate, to open negotiations to that effect. Such agreements shall be concluded
by the Council on a recommendation from the Presidency.

(*) Article amended by the Treaty of Nice.
(**) This subparagraph will be amended on 1 January 2005 in accordance with the Protocol on the enlargement of the

European Union (see Annex).

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The Council shall act unanimously when the agreement covers an issue for which unanimity is

2.
required for the adoption of internal decisions.

When the agreement is envisaged in order to implement a joint action or common position, the

3.
Council shall act by a qualified majority in accordance with Article 23(2).

The provisions of this Article shall also apply to matters falling under Title VI. When the
4.
agreement covers an issue for which a qualified majority is required for the adoption of internal
decisions or measures, the Council shall act by a qualified majority in accordance with Article 34(3).

5.
No agreement shall be binding on a Member State whose representative in the Council states that
it has to comply with the requirements of its own constitutional procedure; the other members of the
Council may agree that the agreement shall nevertheless apply provisionally.

Agreements concluded under the conditions set out by this Article shall be binding on the

6.
institutions of the Union.

Article 25 (*)

Without prejudice to Article 207 of the Treaty establishing the European Community, a Political and
Security Committee shall monitor the international situation in the areas covered by the common
foreign and security policy and contribute to the definition of policies by delivering opinions to the
Council at the request of the Council or on its own initiative. It shall also monitor the implementation
of agreed policies, without prejudice to the responsibility of the Presidency and the Commission.

Within the scope of this title, this Committee shall exercise, under the responsibility of the Council,
political control and strategic direction of crisis management operations.

The Council may authorise the Committee, for the purpose and for the duration of a crisis management
operation, as determined by the Council, to take the relevant decisions concerning the political control
and strategic direction of the operation, without prejudice to Article 47.

Article 26

The Secretary-General of the Council, High Representative for the common foreign and security policy,
shall assist the Council in matters coming within the scope of the common foreign and security policy,
in particular through contributing to the formulation, preparation and implementation of policy
decisions, and, when appropriate and acting on behalf of the Council at the request of the Presidency,
through conducting political dialogue with third parties.

The Commission shall be fully associated with the work carried out in the common foreign and security
policy field.

Article 27

(*) Article amended by the Treaty of Nice.

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Article 27a (*)

1.
Enhanced cooperation in any of the areas referred to in this title shall be aimed at safeguarding
the values and serving the interests of the Union as a whole by asserting its identity as a coherent force
on the international scene. It shall respect:

— the principles, objectives, general guidelines and consistency of the common foreign and security

policy and the decisions taken within the framework of that policy,

— the powers of the European Community, and

— consistency between all the Union's policies and its external activities.

Articles 11 to 27 and Articles 27b to 28 shall apply to the enhanced cooperation provided for in

2.
this article, save as otherwise provided in Article 27c and Articles 43 to 45.

Enhanced cooperation pursuant to this title shall relate to implementation of a joint action or a
common position. It shall not relate to matters having military or defence implications.

Article 27b (*)

Article 27c (*)

Member States which intend to establish enhanced cooperation between themselves under Article 27b
shall address a request to the Council to that effect.

The request shall be forwarded to the Commission and, for information, to the European Parliament.
The Commission shall give its opinion particularly on whether the enhanced cooperation proposed is
consistent with Union policies. Authorisation shall be granted by the Council, acting in accordance with
the second and third subparagraphs of Article 23(2) and in compliance with Articles 43 to 45.

Article 27d (*)

Without prejudice to the powers of the Presidency and of the Commission, the Secretary-General of the
Council, High Representative for the common foreign and security policy, shall in particular ensure that
the European Parliament and all members of the Council are kept fully informed of the implementation
of enhanced cooperation in the field of the common foreign and security policy.

Article 27e (*)

Any Member State which wishes to participate in enhanced cooperation established in accordance with
Article 27c shall notify its intention to the Council and inform the Commission. The Commission shall
give an opinion to the Council within three months of the date of receipt of that notification. Within
four months of the date of receipt of that notification, the Council shall take a decision on the request
and on such specific arrangements as it may deem necessary. The decision shall be deemed to be taken
unless the Council, acting by a qualified majority within the same period, decides to hold it in abeyance;
in that case, the Council shall state the reasons for its decision and set a deadline for re-examining it.

(*) Article inserted by the Treaty of Nice.

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For the purposes of this Article, the Council shall act by a qualified majority. The qualified majority shall
be defined as the same proportion of the weighted votes and the same proportion of the number of the
members of the Council concerned as those laid down in the third subparagraph of Article 23(2).

Article 28

1.
Articles 189, 190, 196 to 199, 203, 204, 206 to 209, 213 to 219, 255 and 290 of the Treaty
establishing the European Community shall apply to the provisions relating to the areas referred to in
this title.

Administrative expenditure which the provisions relating to the areas referred to in this title

2.
entail for the institutions shall be charged to the budget of the European Communities.

3.
Operating expenditure to which the implementation of those provisions gives rise shall also be
for such expenditure arising from
charged to the budget of
operations having military or defence implications and cases where the Council acting unanimously
decides otherwise.

the European Communities, except

In cases where expenditure is not charged to the budget of the European Communities, it shall be
charged to the Member States in accordance with the gross national product scale, unless the Council
acting unanimously decides otherwise. As for expenditure arising from operations having military or
defence implications, Member States whose representatives in the Council have made a formal
declaration under Article 23(1), second subparagraph, shall not be obliged to contribute to the
financing thereof.

The budgetary procedure laid down in the Treaty establishing the European Community shall

4.
apply to the expenditure charged to the budget of the European Communities.

TITLE VI

PROVISIONS ON POLICE AND JUDICIAL COOPERATION IN CRIMINAL
MATTERS

Article 29 (*)

Without prejudice to the powers of the European Community, the Union's objective shall be to provide
citizens with a high level of safety within an area of freedom, security and justice by developing
common action among the Member States in the fields of police and judicial cooperation in criminal
matters and by preventing and combating racism and xenophobia.

That objective shall be achieved by preventing and combating crime, organised or otherwise,
particular terrorism, trafficking in persons and offences against children,
illicit arms trafficking, corruption and fraud, through:

in
illicit drug trafficking and

— closer cooperation between police forces, customs authorities and other competent authorities in
the Member States, both directly and through the European Police Office (Europol), in accordance
with the provisions of Articles 30 and 32,

(*) Article amended by the Treaty of Nice.

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— closer cooperation between judicial and other competent authorities of the Member States including
cooperation through the European Judicial Cooperation Unit (‘Eurojust’), in accordance with the
provisions of Articles 31 and 32,

— approximation, where necessary, of rules on criminal matters in the Member States, in accordance

with the provisions of Article 31(e).

1.

Common action in the field of police cooperation shall include:

Article 30

(a)

(b)

including the police, customs and
operational cooperation between the competent authorities,
other specialised law enforcement services of the Member States in relation to the prevention,
detection and investigation of criminal offences;

the collection, storage, processing, analysis and exchange of relevant
including
information held by law enforcement services on reports on suspicious financial transactions, in
particular through Europol, subject to appropriate provisions on the protection of personal data;

information,

(c)

cooperation and joint initiatives in training, the exchange of liaison officers, secondments, the use
of equipment, and forensic research;

(d)

the common evaluation of particular investigative techniques in relation to the detection of serious
forms of organised crime.

The Council shall promote cooperation through Europol and shall in particular, within a period

2.
of five years after the date of entry into force of the Treaty of Amsterdam:

(a)

enable Europol to facilitate and support the preparation, and to encourage the coordination and
carrying out, of specific investigative actions by the competent authorities of the Member States,
including operational actions of joint teams comprising representatives of Europol in a support
capacity;

(b)

adopt measures allowing Europol to ask the competent authorities of the Member States to conduct
and coordinate their investigations in specific cases and to develop specific expertise which may be
put at the disposal of Member States to assist them in investigating cases of organised crime;

(c)

promote liaison arrangements between prosecuting/investigating officials specialising in the fight
against organised crime in close cooperation with Europol;

(d)

establish a research, documentation and statistical network on cross-border crime.

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1.

Common action on judicial cooperation in criminal matters shall include:

Article 31 (*)

(a)

facilitating and accelerating cooperation between competent ministries and judicial or equivalent
authorities of the Member States, including, where appropriate, cooperation through Eurojust, in
relation to proceedings and the enforcement of decisions;

(b)

facilitating extradition between Member States;

(c)

ensuring compatibility in rules applicable in the Member States, as may be necessary to improve
such cooperation;

(d) preventing conflicts of jurisdiction between Member States;

(e)

progressively adopting measures establishing minimum rules relating to the constituent elements of
criminal acts and to penalties in the fields of organised crime, terrorism and illicit drug trafficking.

2.

The Council shall encourage cooperation through Eurojust by:

(a)

enabling Eurojust to facilitate proper coordination between Member States' national prosecuting
authorities;

(b) promoting support by Eurojust for criminal investigations in cases of serious cross-border crime,
particularly in the case of organised crime, taking account, in particular, of analyses carried out by
Europol;

(c)

facilitating close cooperation between Eurojust and the European Judicial Network, particularly, in
order to facilitate the execution of letters rogatory and the implementation of extradition requests.

The Council shall
lay down the conditions and limitations under which the competent authorities
referred to in Articles 30 and 31 may operate in the territory of another Member State in liaison
and in agreement with the authorities of that State.

Article 32

This title shall not affect the exercise of the responsibilities incumbent upon Member States with regard
to the maintenance of law and order and the safeguarding of internal security.

Article 33

(*) Article amended by the Treaty of Nice.

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1.
In the areas referred to in this title, Member States shall inform and consult one another within
the Council with a view to coordinating their action. To that end, they shall establish collaboration
between the relevant departments of their administrations.

Article 34

2.
The Council shall take measures and promote cooperation, using the appropriate form and
procedures as set out in this title, contributing to the pursuit of the objectives of the Union. To that
end, acting unanimously on the initiative of any Member State or of the Commission, the Council may:

(a)

adopt common positions defining the approach of the Union to a particular matter;

(b)

(c)

(d)

adopt framework decisions for the purpose of approximation of the laws and regulations of the
Member States. Framework decisions shall be binding upon the Member States as to the result to be
achieved but shall leave to the national authorities the choice of form and methods. They shall not
entail direct effect;

adopt decisions for any other purpose consistent with the objectives of this title, excluding any
approximation of the laws and regulations of the Member States. These decisions shall be binding
and shall not entail direct effect; the Council, acting by a qualified majority, shall adopt measures
necessary to implement those decisions at the level of the Union;

establish conventions which it shall recommend to the Member States for adoption in accordance
with their respective constitutional requirements. Member States shall begin the procedures
applicable within a time limit to be set by the Council.

Unless they provide otherwise, conventions shall, once adopted by at least half of the Member
States, enter into force for those Member States. Measures implementing conventions shall be
adopted within the Council by a majority of two thirds of the Contracting Parties.

3. (*)
Where the Council is required to act by a qualified majority, the votes of its members shall be
weighted as laid down in Article 205(2) of the Treaty establishing the European Community, and for
their adoption acts of the Council shall require at least 62 votes in favour, cast by at least 10 members.

4.

For procedural questions, the Council shall act by a majority of its members.

Article 35

Justice of

The Court of

to the
1.
conditions laid down in this article, to give preliminary rulings on the validity and interpretation of
framework decisions and decisions, on the interpretation of conventions established under this title and
on the validity and interpretation of the measures implementing them.

the European Communities shall have jurisdiction, subject

(*) This paragraph will be amended on 1 January 2005, in accordance with the Protocol on the enlargement of the

European Union (see Annex).

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2.
By a declaration made at the time of signature of the Treaty of Amsterdam or at any time
thereafter, any Member State shall be able to accept the jurisdiction of the Court of Justice to give
preliminary rulings as specified in paragraph 1.

3.

A Member State making a declaration pursuant to paragraph 2 shall specify that either:

(a)

(b)

any court or tribunal of that State against whose decisions there is no judicial remedy under
national law may request the Court of Justice to give a preliminary ruling on a question raised
in a case pending before it and concerning the validity or interpretation of an act referred to in
paragraph 1 if that court or tribunal considers that a decision on the question is necessary to
enable it to give judgment; or

any court or tribunal of that State may request the Court of Justice to give a preliminary ruling on
a question raised in a case pending before it and concerning the validity or interpretation of an act
referred to in paragraph 1 if that court or tribunal considers that a decision on the question is
necessary to enable it to give judgment.

4.
Any Member State, whether or not it has made a declaration pursuant to paragraph 2, shall be
entitled to submit statements of case or written observations to the Court in cases which arise under
paragraph 1.

5.
The Court of Justice shall have no jurisdiction to review the validity or proportionality of
operations carried out by the police or other law enforcement services of a Member State or the
exercise of the responsibilities incumbent upon Member States with regard to the maintenance of
law and order and the safeguarding of internal security.

6.
The Court of Justice shall have jurisdiction to review the legality of framework decisions and
decisions in actions brought by a Member State or the Commission on grounds of lack of competence,
infringement of an essential procedural requirement, infringement of this Treaty or of any rule of law
relating to its application, or misuse of powers. The proceedings provided for in this paragraph shall be
instituted within two months of the publication of the measure.

7.
The Court of Justice shall have jurisdiction to rule on any dispute between Member States
regarding the interpretation or the application of acts adopted under Article 34(2) whenever such
dispute cannot be settled by the Council within six months of its being referred to the Council by
one of its members. The Court shall also have jurisdiction to rule on any dispute between Member States
and the Commission regarding the interpretation or the application of conventions established under
Article 34(2)(d).

A Coordinating Committee shall be set up consisting of senior officials. In addition to its coor-

1.
dinating role, it shall be the task of the Committee to:

Article 36

— give opinions for the attention of the Council, either at the Council's request or on its own

initiative,

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— contribute, without prejudice to Article 207 of the Treaty establishing the European Community, to

the preparation of the Council's discussions in the areas referred to in Article 29.

2.

The Commission shall be fully associated with the work in the areas referred to in this title.

Within international organisations and at international conferences in which they take part, Member
States shall defend the common positions adopted under the provisions of this title.

Article 37

Articles 18 and 19 shall apply as appropriate to matters falling under this title.

Agreements referred to in Article 24 may cover matters falling under this title.

Article 38

Article 39

1.
The Council shall consult the European Parliament before adopting any measure referred to in
Article 34(2)(b), (c) and (d). The European Parliament shall deliver its opinion within a time limit which
the Council may lay down, which shall not be less than three months. In the absence of an opinion
within that time limit, the Council may act.

The Presidency and the Commission shall

2.
discussions in the areas covered by this title.

regularly inform the European Parliament of

The European Parliament may ask questions of the Council or make recommendations to it. Each

3.
year, it shall hold a debate on the progress made in the areas referred to in this title.

1.
Enhanced cooperation in any of the areas referred to in this title shall have the aim of enabling
the Union to develop more rapidly into an area of freedom, security and justice, while respecting the
powers of the European Community and the objectives laid down in this title.

Article 40 (*)

Articles 29 to 39 and Articles 40a to 41 shall apply to the enhanced cooperation provided for by

2.
this article, save as otherwise provided in Article 40a and in Articles 43 to 45.

3.
The provisions of the Treaty establishing the European Community concerning the powers of the
Court of Justice and the exercise of those powers shall apply to this article and to Articles 40a and 40b.

(*) Article amended by the Treaty of Nice.

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Article 40a (*)

1.
Member States which intend to establish enhanced cooperation between themselves under Article
40 shall address a request to the Commission, which may submit a proposal to the Council to that
effect. In the event of the Commission not submitting a proposal, it shall inform the Member States
concerned of the reasons for not doing so. Those Member States may then submit an initiative to the
Council designed to obtain authorisation for the enhanced cooperation concerned.

2.
The authorisation referred to in paragraph 1 shall be granted, in compliance with Articles 43 to
45, by the Council, acting by a qualified majority, on a proposal from the Commission or on the
initiative of at least eight Member States, and after consulting the European Parliament. The votes of the
members of the Council shall be weighted in accordance with Article 205(2) of the Treaty establishing
the European Community.

A member of the Council may request that the matter be referred to the European Council. After that
matter has been raised before the European Council, the Council may act in accordance with the first
subparagraph of this paragraph.

Article 40b (*)

Any Member State which wishes to participate in enhanced cooperation established in accordance with
Article 40a shall notify its intention to the Council and to the Commission, which shall give an opinion
to the Council within three months of the date of receipt of that notification, possibly accompanied by a
recommendation for such specific arrangements as it may deem necessary for that Member State to
become a party to the cooperation in question. The Council shall take a decision on the request within
four months of the date of receipt of that notification. The decision shall be deemed to be taken unless
the Council, acting by a qualified majority within the same period, decides to hold it in abeyance; in that
case, the Council shall state the reasons for its decision and set a deadline for re-examining it.

For the purposes of this Article, the Council shall act under the conditions set out in Article 44(1).

Article 41

1.
Articles 189, 190, 195, 196 to 199, 203, 204, 205(3), 206 to 209, 213 to 219, 255 and 290 of
the Treaty establishing the European Community shall apply to the provisions relating to the areas
referred to in this title.

Administrative expenditure which the provisions relating to the areas referred to in this title

2.
entail for the institutions shall be charged to the budget of the European Communities.

3.
Operating expenditure to which the implementation of those provisions gives rise shall also be
charged to the budget of the European Communities, except where the Council acting unanimously
decides otherwise.
the European
it shall be charged to the Member States in accordance with the gross national
Communities,
product scale, unless the Council acting unanimously decides otherwise.

In cases where expenditure is not charged to the budget of

The budgetary procedure laid down in the Treaty establishing the European Community shall

4.
apply to the expenditure charged to the budget of the European Communities.

(*) Article inserted by the Treaty of Nice.

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Article 42

The Council, acting unanimously on the initiative of the Commission or a Member State, and after
consulting the European Parliament, may decide that action in areas referred to in Article 29 shall fall
under Title IV of the Treaty establishing the European Community, and at the same time determine the
relevant voting conditions relating to it. It shall recommend the Member States to adopt that decision in
accordance with their respective constitutional requirements.

TITLE VII

PROVISIONS ON ENHANCED COOPERATION

Article 43 (*)

Member States which intend to establish enhanced cooperation between themselves may make use of
the institutions, procedures and mechanisms laid down by this Treaty and by the Treaty establishing the
European Community provided that the proposed cooperation:

(a)

is aimed at furthering the objectives of the Union and of the Community, at protecting and serving
their interests and at reinforcing their process of integration;

(b)

respects the said Treaties and the single institutional framework of the Union;

(c)

(d)

(e)

respects the acquis communautaire and the measures adopted under the other provisions of the said
Treaties;

remains within the limits of the powers of the Union or of the Community and does not concern
the areas which fall within the exclusive competence of the Community;

does not undermine the internal market as defined in Article 14(2) of the Treaty establishing the
European Community, or the economic and social cohesion established in accordance with Title
XVII of that Treaty;

(f)

does not constitute a barrier to or discrimination in trade between the Member States and does not
distort competition between them;

(g)

involves a minimum of eight Member States;

(h)

(i)

respects the competences, rights and obligations of those Member States which do not participate
therein;

does not affect the provisions of the Protocol integrating the Schengen acquis into the framework of
the European Union;

(j)

is open to all the Member States, in accordance with Article 43b.

(*) Article amended by the Treaty of Nice.

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Enhanced cooperation may be undertaken only as a last resort, when it has been established within the
Council that the objectives of such cooperation cannot be attained within a reasonable period by
applying the relevant provisions of the Treaties.

Article 43a (*)

Article 43b (*)

When enhanced cooperation is being established, it shall be open to all Member States. It shall also be
open to them at any time, in accordance with Articles 27e and 40b of this Treaty and with Article 11a
of the Treaty establishing the European Community, subject to compliance with the basic decision and
with the decisions taken within that framework. The Commission and the Member States participating
in enhanced cooperation shall ensure that as many Member States as possible are encouraged to take
part.

Article 44 (**)

1.
For the purposes of the adoption of the acts and decisions necessary for the implementation of
enhanced cooperation referred to in Article 43, the relevant institutional provisions of this Treaty and of
the Treaty establishing the European Community shall apply. However, while all members of the
Council shall be able to take part in the deliberations, only those representing Member States partici-
pating in enhanced cooperation shall take part in the adoption of decisions. The qualified majority shall
be defined as the same proportion of the weighted votes and the same proportion of the number of the
Council members concerned as laid down in Article 205(2) of the Treaty establishing the European
Community, and in the second and third subparagraphs of Article 23(2) of this Treaty as regards
enhanced cooperation established on the basis of Article 27c. Unanimity shall be constituted by only
those Council members concerned.

Such acts and decisions shall not form part of the Union acquis.

2.
Member States shall apply, as far as they are concerned, the acts and decisions adopted for the
implementation of the enhanced cooperation in which they participate. Such acts and decisions shall be
binding only on those Member States which participate in such cooperation and, as appropriate, shall be
directly applicable only in those States. Member States which do not participate in such cooperation
shall not impede the implementation thereof by the participating Member States.

Expenditure resulting from implementation of enhanced cooperation, other than administrative costs
entailed for the institutions, shall be borne by the participating Member States, unless all members of the
Council, acting unanimously after consulting the European Parliament, decide otherwise.

Article 44a (***)

(*) Article inserted by the Treaty of Nice.
(**) Article amended by the Treaty of Nice.
(***) Article inserted by the Treaty of Nice (former Article 44(2)).

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The Council and the Commission shall ensure the consistency of activities undertaken on the basis of
this title and the consistency of such activities with the policies of the Union and the Community, and
shall cooperate to that end.

Article 45 (*)

TITLE VIII

FINAL PROVISIONS

Article 46 (*)

The provisions of the Treaty establishing the European Community, the Treaty establishing the European
Coal and Steel Community and the Treaty establishing the European Atomic Energy Community
concerning the powers of the Court of Justice of the European Communities and the exercise of
those powers shall apply only to the following provisions of this Treaty:

(a)

provisions amending the Treaty establishing the European Economic Community with a view to
establishing the European Community,
the Treaty establishing the European Coal and Steel
Community and the Treaty establishing the European Atomic Energy Community;

(b) provisions of Title VI, under the conditions provided for by Article 35;

(c)

provisions of Title VII, under the conditions provided for by Articles 11 and 11a of the Treaty
establishing the European Community and Article 40 of this Treaty;

(d) Article 6(2) with regard to action of the institutions, in so far as the Court has jurisdiction under

the Treaties establishing the European Communities and under this Treaty;

(e)

the purely procedural stipulations in Article 7, with the Court acting at the request of the Member
State concerned within one month from the date of the determination by the Council provided for
in that Article;

(f) Articles 46 to 53.

Article 47

Subject to the provisions amending the Treaty establishing the European Economic Community with a
view to establishing the European Community, the Treaty establishing the European Coal and Steel
Community and the Treaty establishing the European Atomic Energy Community, and to these final
provisions, nothing in this Treaty shall affect the Treaties establishing the European Communities or the
subsequent Treaties and Acts modifying or supplementing them.

(*) Article amended by the Treaty of Nice.

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The government of any Member State or the Commission may submit to the Council proposals for the
amendment of the Treaties on which the Union is founded.

Article 48

If the Council, after consulting the European Parliament and, where appropriate, the Commission,
delivers an opinion in favour of calling a conference of representatives of the governments of the
Member States, the conference shall be convened by the President of the Council for the purpose of
determining by common accord the amendments to be made to those Treaties. The European Central
Bank shall also be consulted in the case of institutional changes in the monetary area.

The amendments shall enter into force after being ratified by all the Member States in accordance with
their respective constitutional requirements.

Article 49

Any European State which respects the principles set out in Article 6(1) may apply to become a member
of the Union. It shall address its application to the Council, which shall act unanimously after consulting
the Commission and after receiving the assent of the European Parliament, which shall act by an
absolute majority of its component members.

The conditions of admission and the adjustments to the Treaties on which the Union is founded, which
such admission entails, shall be the subject of an agreement between the Member States and the
applicant State. This agreement shall be submitted for ratification by all the contracting States in
accordance with their respective constitutional requirements.

Articles 2 to 7 and 10 to 19 of the Treaty establishing a Single Council and a Single Commission

1.
of the European Communities, signed in Brussels on 8 April 1965, are hereby repealed.

Article 50

Article 2, Article 3(2) and Title III of the Single European Act signed in Luxembourg on

2.
17 February 1986 and in The Hague on 28 February 1986 are hereby repealed.

This Treaty is concluded for an unlimited period.

Article 51

1.
This Treaty shall be ratified by the High Contracting Parties in accordance with their respective
constitutional requirements. The instruments of ratification shall be deposited with the Government of
the Italian Republic.

Article 52

2.
This Treaty shall enter into force on 1 January 1993, provided that all the Instruments of
ratification have been deposited, or, failing that, on the first day of the month following the deposit
of the Instrument of ratification by the last signatory State to take this step.

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Article 53

This Treaty, drawn up in a single original in the Danish, Dutch, English, French, German, Greek, Irish,
Italian, Portuguese and Spanish languages, the texts in each of these languages being equally authentic,
shall be deposited in the archives of the Government of the Italian Republic, which will transmit a
certified copy to each of the governments of the other signatory States.

Pursuant to the Accession Treaty of 1994, the Finnish and Swedish versions of this Treaty shall also be
authentic.

IN WITNESS WHEREOF the undersigned Plenipotentiaries have signed this Treaty.

Done at Maastricht on the seventh day of February in the year one thousand nine hundred and
ninety-two.

(List of signatories not reproduced)

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CONSOLIDATED VERSION
OF THE TREATY
ESTABLISHING THE EUROPEAN COMMUNITY

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I — TEXT OF THE TREATY

CONTENTS

Preamble ................................................................................................ ...................................................................

Part one — Principles ................................................................................................ ...........................................

Part two — Citizenship of the Union ................................................................................................ ..............

Part three — Community policies ................................................................................................ .....................

TITLE I — Free movement of goods ................................................................................................ ......

Chapter 1 — The Customs Union ................................................................................................ ..

Chapter 2 — Prohibition of quantitative restrictions between Member States ...................

TITLE II — Agriculture ................................................................................................ ...............................

TITLE III — Free movement of persons, services and capital

..........................................................

Chapter 1 — Workers ................................................................................................ .......................

Chapter 2 — Right of establishment .............................................................................................

Chapter 3 — Services ................................................................................................ ........................

Chapter 4 — Capital and payments ...............................................................................................

TITLE IV — Visas, asylum,

immigration and other policies related to free movement of
persons ................................................................................................ ..................................

TITLE V — Transport ................................................................................................ ..................................

TITLE VI — Common rules on competition, taxation and approximation of laws ...................

Chapter 1 — Rules on competition ...............................................................................................

Section 1 — Rules applying to undertakings .....................................................................

Section 2 — Aids granted by States .....................................................................................

Chapter 2 — Tax provisions ................................................................................................ ............

Chapter 3 — Approximation of laws ............................................................................................

TITLE VII — Economic and monetary policy .......................................................................................

Chapter 1 — Economic policy ................................................................................................ ........

Chapter 2 — Monetary policy ................................................................................................ .........

Chapter 3 — Institutional provisions .............................................................................................

Chapter 4 — Transitional provisions .............................................................................................

TITLE VIII — Employment

................................................................................................ ........................

TITLE IX — Common commercial policy .............................................................................................

TITLE X — Customs cooperation ................................................................................................ ............

Page

39

40

44

46

46

46

47

48

51

51

52

54

56

57

61

64

64

64

67

68

69

71

71

75

78

81

88

90

92

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TITLE XI — Social policy, education, vocational training and youth ............................................

Chapter 1 — Social provisions ................................................................................................ ........

Chapter 2 — The European Social Fund ......................................................................................

Chapter 3 — Education, vocational training and youth ...........................................................

TITLE XII — Culture ................................................................................................ .....................................

TITLE XIII — Public health ................................................................................................ ........................

TITLE XIV — Consumer protection ................................................................................................ ........

TITLE XV — Trans-European networks ................................................................................................ ..

TITLE XVI — Industry ................................................................................................ ................................

TITLE XVII — Economic and social cohesion ......................................................................................

TITLE XVIII — Research and technological development ..................................................................

TITLE XIX — Environment ................................................................................................ ........................

TITLE XX — Development cooperation ................................................................................................ .

TITLE XXI (*) — Economic, financial and technical cooperation with third countries ..............

Part four — Association of the overseas countries and territories

Part five — Institutions of the Community ................................................................................................ ....

TITLE I — Provisions governing the institutions .................................................................................

Chapter 1 — The institutions ................................................................................................ ..........

Section 1 — The European Parliament ................................................................................

Section 2 — The Council

................................................................................................ ........

Section 3 — The Commission ...............................................................................................

Section 4 — The Court of Justice .........................................................................................

Section 5 — The Court of Auditors .....................................................................................

Chapter 2 — Provisions common to several institutions .........................................................

Chapter 3 — The Economic and Social Committee ..................................................................

Chapter 4 — The Committee of the Regions .............................................................................

Chapter 5 — The European Investment Bank .............................................................................

TITLE II — Financial provisions ................................................................................................ ...............

Part six — General and final provisions ................................................................................................ ..........

Final provisions ................................................................................................ .......................................................
________________
(*) Title inserted by the Treaty of Nice.

92

92

97

98

99

100

101

101

103

103

105

107

109

111

111

113

113

113

113

117

119

122

129

132

136

138

139

140

146

154

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Annex I — List referred to in Article 32 of the Treaty .............................................................................

157

Annex II — Overseas countries and territories to which the provisions of part four of the Treaty
apply ................................................................................................ ..................................................

159

II — PROTOCOLS (text not reproduced with the exception of the four Protocols adopted by the Nice Inter-

governmental Conference (see the end of this publication)) (*)

Protocols annexed to the Treaty on European Union and to the Treaty establishing the European
Community:

— Protocol (2) integrating the Schengen acquis into the framework of the European Union (1997)

— Protocol (3) on the application of certain aspects of Article 14 of the Treaty establishing the European

Community to the United Kingdom and to Ireland (1997)

— Protocol (4) on the position of the United Kingdom and Ireland (1997)

— Protocol (5) on the position of Denmark (1997)

Protocols annexed to the Treaty on European Union, to the Treaty establishing the European Community
and to the Treaty establishing the European Atomic Energy Community:

— Protocol (6) on the Statute of the Court of Justice (2001) (text reproduced hereafter)

— Protocol (7) annexed to the Treaty on European Union and to the Treaties establishing the European

Communities (1992)

— Protocol (8) on the location of the seats of the institutions and of certain bodies and departments of

the European Communities and of Europol (1997)

— Protocol (9) on the role of national parliaments in the European Union (1997)

— Protocol (10) on the enlargement of the European Union (2001) (text reproduced hereafter)

Protocols annexed to the Treaty establishing the European Community:

— Protocol (11) on the Statute of the European Investment Bank (1957)

— Protocol (12) on Italy (1957)

— Protocol

(13) on goods originating in and coming from certain countries and enjoying special

treatment when imported into a Member State (1957)

— Protocol (14) concerning imports into the European Community of petroleum products refined in the

Netherlands Antilles (1962)

— Protocol (15) on special arrangements for Greenland (1985)

— Protocol (16) on the acquisition of property in Denmark (1992)

— Protocol (17) concerning Article 141 of the Treaty establishing the European Community (1992)

(*) For the text of the Protocols adopted at Intergovernmental Conferences prior to Nice, the reader is requested to refer to pages 355
et seq. of the Selected Instruments taken from the Treaties, book I, volume I, 1999 edition, published by the Office for Official
Publications of the European Communities, ISBN 92-824-1661-5.
For the text of Protocols 12, 13, 14 and 15, the reader is requested to refer to pages 213 et seq. of the Selected Instruments taken
from the Treaties, book I, volume II, 1995 edition, published by the Office for Official Publications of the European Communities,
ISBN 92-824-1180-x.

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— Protocol (18) on the Statute of the European System of Central Banks and of the European Central

Bank (1992)

— Protocol (19) on the Statute of the European Monetary Institute (1992)

— Protocol (20) on the excessive deficit procedure (1992)

— Protocol (21) on the convergence criteria referred to in Article 121 of the Treaty establishing the

European Community (1992)

— Protocol (22) on Denmark (1992)

— Protocol (23) on Portugal (1992)

— Protocol (24) on the transition to the third stage of economic and monetary union (1992)

— Protocol (25) on certain provisions relating to the United Kingdom of Great Britain and Northern

Ireland (1992)

— Protocol (26) on certain provisions relating to Denmark (1992)

— Protocol (27) on France (1992)

— Protocol (28) on economic and social cohesion (1992)

— Protocol (29) on asylum for nationals of Member States of the European Union (1997)

— Protocol (30) on the application of the principles of subsidiarity and proportionality (1997)

— Protocol (31) on external relations of the Member States with regard to the crossing of external

borders (1997)

— Protocol (32) on the system of public broadcasting in the Member States (1997)

— Protocol (33) on protection and welfare of animals (1997)

— Protocol (34) on the financial consequences of the expiry of the ECSC Treaty and on the Research

Fund for Coal and Steel (2001) (text reproduced hereafter)

— Protocol

(35) on Article 67 of

the Treaty establishing the European Community (2001)

(text

reproduced hereafter)

Protocol annexed to the Treaties establishing the European Community and the European Atomic Energy
Community:

— Protocol (36) on the privileges and immunities of the European Communities (1965)

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HIS MAJESTY THE KING OF THE BELGIANS, THE PRESIDENT OF THE FEDERAL REPUBLIC OF
GERMANY, THE PRESIDENT OF THE FRENCH REPUBLIC, THE PRESIDENT OF THE ITALIAN
REPUBLIC, HER ROYAL HIGHNESS THE GRAND DUCHESS OF LUXEMBOURG, HER MAJESTY THE
QUEEN OF THE NETHERLANDS (1),

DETERMINED to lay the foundations of an ever closer union among the peoples of Europe,

RESOLVED to ensure the economic and social progress of their countries by common action to
eliminate the barriers which divide Europe,

AFFIRMING as the essential objective of their efforts the constant improvements of the living and
working conditions of their peoples,

RECOGNISING that the removal of existing obstacles calls for concerted action in order to guarantee
steady expansion, balanced trade and fair competition,

ANXIOUS to strengthen the unity of their economies and to ensure their harmonious development by
reducing the differences existing between the various regions and the backwardness of the less favoured
regions,

DESIRING to contribute, by means of a common commercial policy, to the progressive abolition of
restrictions on international trade,

INTENDING to confirm the solidarity which binds Europe and the overseas countries and desiring to
ensure the development of their prosperity, in accordance with the principles of the Charter of the
United Nations,

RESOLVED by thus pooling their resources to preserve and strengthen peace and liberty, and calling
upon the other peoples of Europe who share their ideal to join in their efforts,

DETERMINED to promote the development of the highest possible level of knowledge for their peoples
through a wide access to education and through its continuous updating,

HAVE DECIDED to create a EUROPEAN COMMUNITY and to this end have designated as their
Plenipotentiaries:

(List of plenipotentiaries not reproduced)

WHO, having exchanged their full powers, found in good and due form, have agreed as follows.

(1) The Kingdom of Denmark, the Hellenic Republic, the Kingdom of Spain, Ireland, the Republic of Austria, the
Portuguese Republic, the Republic of Finland, the Kingdom of Sweden and the United Kingdom of Great Britain
and Northern Ireland have since become members of the European Community.

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PART ONE

PRINCIPLES

Article 1

By this Treaty,
COMMUNITY.

the HIGH CONTRACTING PARTIES establish among themselves a EUROPEAN

Article 2

The Community shall have as its task, by establishing a common market and an economic and monetary
union and by implementing common policies or activities referred to in Articles 3 and 4, to promote
throughout the Community a harmonious, balanced and sustainable development of economic activities,
a high level of employment and of social protection, equality between men and women, sustainable and
non-inflationary growth, a high degree of competitiveness and convergence of economic performance, a
high level of protection and improvement of the quality of the environment, the raising of the standard
of living and quality of life, and economic and social cohesion and solidarity among Member States.

Article 3

For the purposes set out in Article 2, the activities of the Community shall include, as provided in

1.
this Treaty and in accordance with the timetable set out therein:

(a)

the prohibition, as between Member States, of customs duties and quantitative restrictions on the
import and export of goods, and of all other measures having equivalent effect;

(b)

a common commercial policy;

(c)

an internal market characterised by the abolition, as between Member States, of obstacles to the
free movement of goods, persons, services and capital;

(d) measures concerning the entry and movement of persons as provided for in Title IV;

(e)

a common policy in the sphere of agriculture and fisheries;

(f)

a common policy in the sphere of transport;

(g)

a system ensuring that competition in the internal market is not distorted;

(h)

(i)

the approximation of the laws of Member States to the extent required for the functioning of the
common market;

the promotion of coordination between employment policies of the Member States with a view to
enhancing their effectiveness by developing a coordinated strategy for employment;

(j)

a policy in the social sphere comprising a European Social Fund;

(k)

the strengthening of economic and social cohesion;

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(l)

a policy in the sphere of the environment;

(m)

the strengthening of the competitiveness of Community industry;

(n)

the promotion of research and technological development;

(o)

encouragement for the establishment and development of trans-European networks;

(p)

a contribution to the attainment of a high level of health protection;

(q)

(r)

(s)

a contribution to education and training of quality and to the flowering of the cultures of the
Member States;

a policy in the sphere of development cooperation;

the association of the overseas countries and territories in order to increase trade and promote
jointly economic and social development;

(t)

a contribution to the strengthening of consumer protection;

(u) measures in the spheres of energy, civil protection and tourism.

In all the activities referred to in this Article, the Community shall aim to eliminate inequalities,

2.
and to promote equality, between men and women.

Article 4

For the purposes set out in Article 2, the activities of the Member States and the Community
1.
shall
include, as provided in this Treaty and in accordance with the timetable set out therein, the
adoption of an economic policy which is based on the close coordination of Member States'
economic policies, on the internal market and on the definition of common objectives, and
conducted in accordance with the principle of an open market economy with free competition.

Concurrently with the foregoing, and as provided in this Treaty and in accordance with the
2.
include the irrevocable fixing of
timetable and the procedures set out therein, these activities shall
exchange rates leading to the introduction of a single currency,
the ecu, and the definition and
conduct of a single monetary policy and exchange-rate policy the primary objective of both of which
shall be to maintain price stability and, without prejudice to this objective, to support the general
economic policies in the Community, in accordance with the principle of an open market economy
with free competition.

These activities of the Member States and the Community shall entail compliance with the
3.
following guiding principles: stable prices, sound public finances and monetary conditions and a
sustainable balance of payments.

The Community shall act within the limits of the powers conferred upon it by this Treaty and of the
objectives assigned to it therein.

Article 5

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In areas which do not fall within its exclusive competence, the Community shall take action,
in
accordance with the principle of subsidiarity, only if and in so far as the objectives of the proposed
action cannot be sufficiently achieved by the Member States and can therefore, by reason of the scale or
effects of the proposed action, be better achieved by the Community.

Any action by the Community shall not go beyond what is necessary to achieve the objectives of this
Treaty.

Environmental protection requirements must be integrated into the definition and implementation of the
in particular with a view to promoting
Community policies and activities referred to in Article 3,
sustainable development.

Article 6

1.

The tasks entrusted to the Community shall be carried out by the following institutions:

Article 7

— a EUROPEAN PARLIAMENT,

— a COUNCIL,

— a COMMISSION,

— a COURT OF JUSTICE,

— a COURT OF AUDITORS.

Each institution shall act within the limits of the powers conferred upon it by this Treaty.

The Council and the Commission shall be assisted by an Economic and Social Committee and a

2.
Committee of the Regions acting in an advisory capacity.

Article 8

A European system of central banks (hereinafter referred to as ‘ESCB’) and a European Central Bank
(hereinafter referred to as ‘ECB’) shall be established in accordance with the procedures laid down in this
Treaty; they shall act within the limits of the powers conferred upon them by this Treaty and by the
Statute of the ESCB and of the ECB (hereinafter referred to as ‘Statute of the ESCB’) annexed thereto.

Article 9

A European Investment Bank is hereby established, which shall act within the limits of the powers
conferred upon it by this Treaty and the Statute annexed thereto.

Article 10

Member States shall take all appropriate measures, whether general or particular, to ensure fulfilment of
the obligations arising out of this Treaty or resulting from action taken by the institutions of the
Community. They shall facilitate the achievement of the Community's tasks.

They shall abstain from any measure which could jeopardise the attainment of the objectives of this
Treaty.

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Article 11 (*)

1.
Member States which intend to establish enhanced cooperation between themselves in one of the
areas referred to in this Treaty shall address a request to the Commission, which may submit a proposal
to the Council to that effect. In the event of the Commission not submitting a proposal, it shall inform
the Member States concerned of the reasons for not doing so.

Authorisation to establish enhanced cooperation as referred to in paragraph 1 shall be granted, in
2.
compliance with Articles 43 to 45 of the Treaty on European Union, by the Council, acting by a
qualified majority on a proposal from the Commission and after consulting the European Parliament.
When enhanced cooperation relates to an area covered by the procedure referred to in Article 251 of
this Treaty, the assent of the European Parliament shall be required.

A member of the Council may request that the matter be referred to the European Council. After that
matter has been raised before the European Council, the Council may act in accordance with the first
subparagraph of this paragraph.

3.
The acts and decisions necessary for the implementation of enhanced cooperation activities shall
be subject to all the relevant provisions of this Treaty, save as otherwise provided in this Article and in
Articles 43 to 45 of the Treaty on European Union.

Article 11a (**)

Any Member State which wishes to participate in enhanced cooperation established in accordance with
Article 11 shall notify its intention to the Council and to the Commission, which shall give an opinion
to the Council within three months of the date of receipt of that notification. Within four months of the
date of receipt of that notification, the Commission shall take a decision on it, and on such specific
arrangements as it may deem necessary.

Article 12

Within the scope of application of this Treaty, and without prejudice to any special provisions contained
therein, any discrimination on grounds of nationality shall be prohibited.

The Council, acting in accordance with the procedure referred to in Article 251, may adopt rules
designed to prohibit such discrimination.

Article 13 (*)

Without prejudice to the other provisions of this Treaty and within the limits of the powers
1.
conferred by it upon the Community, the Council, acting unanimously on a proposal
from the
Commission and after consulting the European Parliament, may take appropriate action to combat
discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orien-
tation.

2.
By way of derogation from paragraph 1, when the Council adopts Community incentive
measures, excluding any harmonisation of the laws and regulations of the Member States, to support
action taken by the Member States in order to contribute to the achievement of the objectives referred
to in paragraph 1, it shall act in accordance with the procedure referred to in Article 251.

(*) Article amended by the Treaty of Nice.
(**) Article inserted by the Treaty of Nice (former Article 11(3)).

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Article 14

1.
The Community shall adopt measures with the aim of progressively establishing the internal
market over a period expiring on 31 December 1992, in accordance with the provisions of this Article
and of Articles 15, 26, 47(2), 49, 80, 93 and 95 and without prejudice to the other provisions of this
Treaty.

The internal market shall comprise an area without internal frontiers in which the free movement

2.
of goods, persons, services and capital is ensured in accordance with the provisions of this Treaty.

The Council, acting by a qualified majority on a proposal from the Commission, shall determine

3.
the guidelines and conditions necessary to ensure balanced progress in all the sectors concerned.

Article 15

When drawing up its proposals with a view to achieving the objectives set out in Article 14, the
Commission shall take into account the extent of the effort that certain economies showing differences
in development will have to sustain during the period of establishment of the internal market and it may
propose appropriate provisions.

If these provisions take the form of derogations, they must be of a temporary nature and must cause the
least possible disturbance to the functioning of the common market.

Article 16

Without prejudice to Articles 73, 86 and 87, and given the place occupied by services of general
economic interest in the shared values of the Union as well as their role in promoting social and
territorial cohesion, the Community and the Member States, each within their respective powers and
within the scope of application of this Treaty, shall take care that such services operate on the basis of
principles and conditions which enable them to fulfil their missions.

PART TWO

CITIZENSHIP OF THE UNION

Article 17

1.
Citizenship of the Union is hereby established. Every person holding the nationality of a Member
State shall be a citizen of the Union. Citizenship of the Union shall complement and not replace national
citizenship.

Citizens of the Union shall enjoy the rights conferred by this Treaty and shall be subject to the

2.
duties imposed thereby.

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Article 18 (*)

1.
Every citizen of the Union shall have the right to move and reside freely within the territory of
the Member States, subject to the limitations and conditions laid down in this Treaty and by the
measures adopted to give it effect.

2.
If action by the Community should prove necessary to attain this objective and this Treaty has
not provided the necessary powers, the Council may adopt provisions with a view to facilitating the
exercise of the rights referred to in paragraph 1. The Council shall act in accordance with the procedure
referred to in Article 251.

Paragraph 2 shall not apply to provisions on passports, identity cards, residence permits or any

3.
other such document or to provisions on social security or social protection.

Article 19

1.
Every citizen of the Union residing in a Member State of which he is not a national shall have the
right to vote and to stand as a candidate at municipal elections in the Member State in which he resides,
under the same conditions as nationals of that State. This right shall be exercised subject to detailed
arrangements adopted by the Council, acting unanimously on a proposal from the Commission and
after consulting the European Parliament; these arrangements may provide for derogations where
warranted by problems specific to a Member State.

2.
Without prejudice to Article 190(4) and to the provisions adopted for its implementation, every
citizen of the Union residing in a Member State of which he is not a national shall have the right to vote
and to stand as a candidate in elections to the European Parliament in the Member State in which he
resides, under the same conditions as nationals of that State. This right shall be exercised subject to
detailed arrangements adopted by the Council, acting unanimously on a proposal from the Commission
and after consulting the European Parliament; these arrangements may provide for derogations where
warranted by problems specific to a Member State.

Article 20

Every citizen of the Union shall, in the territory of a third country in which the Member State of which
he is a national is not represented, be entitled to protection by the diplomatic or consular authorities of
any Member State, on the same conditions as the nationals of that State. Member States shall establish
the necessary rules among themselves and start the international negotiations required to secure this
protection.

Article 21

Every citizen of the Union shall have the right to petition the European Parliament in accordance with
Article 194.

Every citizen of the Union may apply to the Ombudsman established in accordance with Article 195.

Every citizen of the Union may write to any of the institutions or bodies referred to in this Article or in
Article 7 in one of the languages mentioned in Article 314 and have an answer in the same language.

(*) Article amended by the Treaty of Nice.

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Article 22

The Commission shall report to the European Parliament, to the Council and to the Economic and
Social Committee every three years on the application of the provisions of this part. This report shall
take account of the development of the Union.

On this basis, and without prejudice to the other provisions of this Treaty, the Council, acting unani-
mously on a proposal from the Commission and after consulting the European Parliament, may adopt
provisions to strengthen or to add to the rights laid down in this part, which it shall recommend to the
Member States for adoption in accordance with their respective constitutional requirements.

PART THREE

COMMUNITY POLICIES

TITLE I

FREE MOVEMENT OF GOODS

Article 23

The Community shall be based upon a customs union which shall cover all trade in goods and
1.
which shall involve the prohibition between Member States of customs duties on imports and exports
and of all charges having equivalent effect, and the adoption of a common customs tariff in their
relations with third countries.

2.
The provisions of Article 25 and of Chapter 2 of this title shall apply to products originating in
Member States and to products coming from third countries which are in free circulation in Member
States.

Article 24

Products coming from a third country shall be considered to be in free circulation in a Member State if
the import formalities have been complied with and any customs duties or charges having equivalent
effect which are payable have been levied in that Member State, and if they have not benefited from a
total or partial drawback of such duties or charges.

CHAPTER 1

THE CUSTOMS UNION

Article 25

Customs duties on imports and exports and charges having equivalent effect shall be prohibited between
Member States. This prohibition shall also apply to customs duties of a fiscal nature.

Common Customs Tariff duties shall be fixed by the Council acting by a qualified majority on a
proposal from the Commission.

Article 26

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In carrying out the tasks entrusted to it under this chapter the Commission shall be guided by:

Article 27

(a)

the need to promote trade between Member States and third countries;

(b)

developments in conditions of competition within the Community in so far as they lead to an
improvement in the competitive capacity of undertakings;

(c)

the requirements of the Community as regards the supply of raw materials and semi-finished
goods;
take care to avoid distorting conditions of
competition between Member States in respect of finished goods;

in this connection the Commission shall

(d)

the need to avoid serious disturbances in the economies of Member States and to ensure rational
development of production and an expansion of consumption within the Community.

CHAPTER 2

PROHIBITION OF QUANTITATIVE RESTRICTIONS BETWEEN MEMBER STATES

Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited
between Member States.

Article 28

Quantitative restrictions on exports, and all measures having equivalent effect, shall be prohibited
between Member States.

Article 29

Article 30

The provisions of Articles 28 and 29 shall not preclude prohibitions or restrictions on imports, exports
the
or goods in transit justified on grounds of public morality, public policy or public security;
protection of health and life of humans, animals or plants;
treasures
possessing artistic, historic or archaeological value; or the protection of industrial and commercial
property. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimi-
nation or a disguised restriction on trade between Member States.

the protection of national

1.
Member States shall adjust any State monopolies of a commercial character so as to ensure that
no discrimination regarding the conditions under which goods are procured and marketed exists
between nationals of Member States.

Article 31

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The provisions of this Article shall apply to any body through which a Member State, in law or in fact,
either directly or indirectly supervises, determines or appreciably influences imports or exports between
Member States. These provisions shall likewise apply to monopolies delegated by the State to others.

2.
Member States shall refrain from introducing any new measure which is contrary to the prin-
ciples laid down in paragraph 1 or which restricts the scope of the articles dealing with the prohibition
of customs duties and quantitative restrictions between Member States.

3.
If a State monopoly of a commercial character has rules which are designed to make it easier to
dispose of agricultural products or obtain for them the best return, steps should be taken in applying the
rules contained in this article to ensure equivalent safeguards for the employment and standard of living
of the producers concerned.

TITLE II

AGRICULTURE

Article 32

1.
The common market shall extend to agriculture and trade in agricultural products. ‘Agricultural
products’ means the products of the soil, of stockfarming and of fisheries and products of first-stage
processing directly related to these products.

Save as otherwise provided in Articles 33 to 38, the rules laid down for the establishment of the

2.
common market shall apply to agricultural products.

3.

The products subject to the provisions of Articles 33 to 38 are listed in Annex I to this Treaty.

The operation and development of the common market for agricultural products must be accom-

4.
panied by the establishment of a common agricultural policy.

1.

(a)

The objectives of the common agricultural policy shall be:

Article 33

to increase agricultural productivity by promoting technical progress and by ensuring the rational
development of agricultural production and the optimum utilisation of the factors of production, in
particular labour;

(b)

thus to ensure a fair standard of living for the agricultural community, in particular by increasing
the individual earnings of persons engaged in agriculture;

(c)

to stabilise markets;

(d)

to assure the availability of supplies;

(e)

to ensure that supplies reach consumers at reasonable prices.

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In working out the common agricultural policy and the special methods for its application,

2.
account shall be taken of:

(a)

the particular nature of agricultural activity, which results from the social structure of agriculture
and from structural and natural disparities between the various agricultural regions;

(b)

the need to effect the appropriate adjustments by degrees;

(c)

the fact that in the Member States agriculture constitutes a sector closely linked with the economy
as a whole.

In order to attain the objectives set out in Article 33, a common organisation of agricultural

1.
markets shall be established.

Article 34

This organisation shall take one of the following forms, depending on the product concerned:

(a)

common rules on competition;

(b)

compulsory coordination of the various national market organisations;

(c)

a European market organisation.

2.
The common organisation established in accordance with paragraph 1 may include all measures
required to attain the objectives set out in Article 33, in particular regulation of prices, aids for the
production and marketing of the various products, storage and carryover arrangements and common
machinery for stabilising imports or exports.

The common organisation shall be limited to pursuit of the objectives set out in Article 33 and shall
exclude any discrimination between producers or consumers within the Community.

Any common price policy shall be based on common criteria and uniform methods of calculation.

In order to enable the common organisation referred to in paragraph 1 to attain its objectives,

3.
one or more agricultural guidance and guarantee funds may be set up.

Article 35

To enable the objectives set out in Article 33 to be attained, provision may be made within the
framework of the common agricultural policy for measures such as:

(a)

an effective coordination of efforts in the spheres of vocational training, of research and of the
dissemination of agricultural knowledge; this may include joint financing of projects or institutions;

(b)

joint measures to promote consumption of certain products.

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Article 36

The provisions of the chapter relating to rules on competition shall apply to production of and trade in
agricultural products only to the extent determined by the Council within the framework of Article
37(2) and (3) and in accordance with the procedure laid down therein, account being taken of the
objectives set out in Article 33.

The Council may, in particular, authorise the granting of aid:

(a)

for the protection of enterprises handicapped by structural or natural conditions;

(b) within the framework of economic development programmes.

Article 37

1.
In order to evolve the broad lines of a common agricultural policy, the Commission shall,
immediately this Treaty enters into force, convene a conference of the Member States with a view to
making a comparison of their agricultural policies,
in particular by producing a statement of their
resources and needs.

Having taken into account the work of the Conference provided for in paragraph 1, after
2.
consulting the Economic and Social Committee and within two years of the entry into force of this
Treaty, the Commission shall submit proposals for working out and implementing the common agri-
cultural policy, including the replacement of the national organisations by one of the forms of common
organisation provided for in Article 34(1), and for implementing the measures specified in this title.

These proposals shall take account of the interdependence of the agricultural matters mentioned in this
title.

The Council shall, on a proposal from the Commission and after consulting the European Parliament,
acting by a qualified majority, make regulations, issue directives, or take decisions, without prejudice to
any recommendations it may also make.

The Council may, acting by a qualified majority and in accordance with paragraph 2, replace the

3.
national market organisations by the common organisation provided for in Article 34(1) if:

(a)

the common organisation offers Member States which are opposed to this measure and which have
an organisation of
their own for the production in question equivalent safeguards for the
employment and standard of living of the producers concerned, account being taken of the
adjustments that will be possible and the specialisation that will be needed with the passage of
time;

(b)

such an organisation ensures conditions for trade within the Community similar to those existing
in a national market.

4.
If a common organisation for certain raw materials is established before a common organisation
exists for the corresponding processed products, such raw materials as are used for processed products
intended for export to third countries may be imported from outside the Community.

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Article 38

Where in a Member State a product is subject to a national market organisation or to internal rules
having equivalent effect which affect the competitive position of similar production in another Member
State, a countervailing charge shall be applied by Member States to imports of this product coming from
the Member State where such organisation or rules exist, unless that State applies a countervailing
charge on export.

The Commission shall fix the amount of these charges at the level required to redress the balance; it may
also authorise other measures, the conditions and details of which it shall determine.

FREE MOVEMENT OF PERSONS, SERVICES AND CAPITAL

TITLE III

CHAPTER 1

WORKERS

Article 39

1.

Freedom of movement for workers shall be secured within the Community.

2.
Such freedom of movement shall entail the abolition of any discrimination based on nationality
between workers of the Member States as regards employment, remuneration and other conditions of
work and employment.

It shall entail the right, subject to limitations justified on grounds of public policy, public security

3.
or public health:

(a)

to accept offers of employment actually made;

(b)

to move freely within the territory of Member States for this purpose;

(c)

(d)

to stay in a Member State for the purpose of employment in accordance with the provisions
governing the employment of nationals of that State laid down by law, regulation or administrative
action;

to remain in the territory of a Member State after having been employed in that State, subject to
conditions which shall be embodied in implementing regulations to be drawn up by the
Commission.

4.

The provisions of this article shall not apply to employment in the public service.

Article 40

The Council shall, acting in accordance with the procedure referred to in Article 251 and after
consulting the Economic and Social Committee, issue directives or make regulations setting out the
measures required to bring about freedom of movement for workers, as defined in Article 39,
in
particular:

(a)

by ensuring close cooperation between national employment services;

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(b) by abolishing those administrative procedures and practices and those qualifying periods in respect
of eligibility for available employment, whether resulting from national
legislation or from
agreements previously concluded between Member States, the maintenance of which would form
an obstacle to liberalisation of the movement of workers;

(c)

(d)

by abolishing all such qualifying periods and other restrictions provided for either under national
legislation or under agreements previously concluded between Member States as imposed on
workers of other Member States conditions regarding the free choice of employment other than
those imposed on workers of the State concerned;

by setting up appropriate machinery to bring offers of employment into touch with applications
for employment and to facilitate the achievement of a balance between supply and demand in the
employment market in such a way as to avoid serious threats to the standard of living and level of
employment in the various regions and industries.

Member States shall, within the framework of a joint programme, encourage the exchange of young
workers.

Article 41

Article 42

The Council shall, acting in accordance with the procedure referred to in Article 251, adopt such
measures in the field of social security as are necessary to provide freedom of movement
for
workers; to this end, it shall make arrangements to secure for migrant workers and their dependants:

(a)

aggregation, for the purpose of acquiring and retaining the right to benefit and of calculating the
amount of benefit, of all periods taken into account under the laws of the several countries;

(b) payment of benefits to persons resident in the territories of Member States.

The Council shall act unanimously throughout the procedure referred to in Article 251.

CHAPTER 2

RIGHT OF ESTABLISHMENT

Article 43

Within the framework of the provisions set out below, restrictions on the freedom of establishment of
nationals of a Member State in the territory of another Member State shall be prohibited. Such
prohibition shall also apply to restrictions on the setting-up of agencies, branches or subsidiaries by
nationals of any Member State established in the territory of any Member State.

include the right to take up and pursue activities as self-employed
Freedom of establishment shall
in particular companies or firms within the
persons and to set up and manage undertakings,
meaning of
the second paragraph of Article 48, under the conditions laid down for its own
nationals by the law of the country where such establishment is effected, subject to the provisions of
the chapter relating to capital.

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Article 44

1.
In order to attain freedom of establishment as regards a particular activity, the Council, acting in
accordance with the procedure referred to in Article 251 and after consulting the Economic and Social
Committee, shall act by means of directives.

The Council and the Commission shall carry out the duties devolving upon them under the

2.
preceding provisions, in particular:

(a)

(b)

(c)

(d)

(e)

(f)

(g)

by according, as a general rule, priority treatment to activities where freedom of establishment
makes a particularly valuable contribution to the development of production and trade;

by ensuring close cooperation between the competent authorities in the Member States in order to
ascertain the particular situation within the Community of the various activities concerned;

by abolishing those administrative procedures and practices, whether resulting from national legis-
lation or from agreements previously concluded between Member States, the maintenance of which
would form an obstacle to freedom of establishment;

by ensuring that workers of one Member State employed in the territory of another Member State
may remain in that territory for the purpose of taking up activities therein as self-employed
persons, where they satisfy the conditions which they would be required to satisfy if they were
entering that State at the time when they intended to take up such activities;

by enabling a national of one Member State to acquire and use land and buildings situated in the
territory of another Member State, in so far as this does not conflict with the principles laid down
in Article 33(2);

by effecting the progressive abolition of restrictions on freedom of establishment in every branch of
activity under consideration, both as regards the conditions for setting up agencies, branches or
subsidiaries in the territory of a Member State and as regards the subsidiaries in the territory of a
Member State and as regards the conditions governing the entry of personnel belonging to the
main establishment into managerial or supervisory posts in such agencies, branches or subsidiaries;

by coordinating to the necessary extent the safeguards which, for the protection of the interests of
members and other, are required by Member States of companies or firms within the meaning of
the second paragraph of Article 48 with a view to making such safeguards equivalent throughout
the Community;

(h) by satisfying themselves that the conditions of establishment are not distorted by aids granted by

Member States.

Article 45

The provisions of this chapter shall not apply, so far as any given Member State is concerned, to
activities which in that State are connected, even occasionally, with the exercise of official authority.

The Council may, acting by a qualified majority on a proposal from the Commission, rule that the
provisions of this chapter shall not apply to certain activities.

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Article 46

1.
The provisions of this chapter and measures taken in pursuance thereof shall not prejudice the
applicability of provisions laid down by law, regulation or administrative action providing for special
treatment for foreign nationals on grounds of public policy, public security or public health.

The Council shall, acting in accordance with the procedure referred to in Article 251,

2.
directives for the coordination of the abovementioned provisions.

issue

Article 47

In order to make it easier for persons to take up and pursue activities as self-employed persons,
1.
the Council shall, acting in accordance with the procedure referred to in Article 251, issue directives for
the mutual recognition of diplomas, certificates and other evidence of formal qualifications.

2.
For the same purpose, the Council shall, acting in accordance with the procedure referred to in
Article 251, issue directives for the coordination of the provisions laid down by law, regulation or
administrative action in Member States concerning the taking-up and pursuit of activities as self-
employed persons. The Council, acting unanimously throughout the procedure referred to in Article
251, shall decide on directives the implementation of which involves in at least one Member State
amendment of the existing principles laid down by law governing the professions with respect to
training and conditions of access for natural persons. In other cases the Council shall act by qualified
majority.

3.
In the case of the medical and allied and pharmaceutical professions, the progressive abolition of
restrictions shall be dependent upon coordination of the conditions for their exercise in the various
Member States.

Article 48

Companies or firms formed in accordance with the law of a Member State and having their registered
office, central administration or principal place of business within the Community shall,
for the
purposes of
this Chapter, be treated in the same way as natural persons who are nationals of
Member States.

‘Companies or firms’ means companies or firms constituted under civil or commercial law, including
cooperative societies, and other legal persons governed by public or private law, save for those which
are non-profit-making.

CHAPTER 3

SERVICES

Article 49

Within the framework of the provisions set out below, restrictions on freedom to provide services
within the Community shall be prohibited in respect of nationals of Member States who are established
in a State of the Community other than that of the person for whom the services are intended.

The Council may, acting by a qualified majority on a proposal from the Commission, extend the
provisions of the Chapter to nationals of a third country who provide services and who are established
within the Community.

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Services shall be considered to be ‘services’ within the meaning of this Treaty where they are normally
provided for remuneration, in so far as they are not governed by the provisions relating to freedom of
movement for goods, capital and persons.

Article 50

‘Services’ shall in particular include:

(a)

activities of an industrial character;

(b)

activities of a commercial character;

(c)

activities of craftsmen;

(d)

activities of the professions.

Without prejudice to the provisions of the chapter relating to the right of establishment, the person
providing a service may, in order to do so, temporarily pursue his activity in the State where the service
is provided, under the same conditions as are imposed by that State on its own nationals.

Article 51

Freedom to provide services in the field of transport shall be governed by the provisions of the

1.
title relating to transport.

The liberalisation of banking and insurance services connected with movements of capital shall be

2.
effected in step with the liberalisation of movement of capital.

Article 52

1.
In order to achieve the liberalisation of a specific service, the Council shall, on a proposal from
the Commission and after consulting the Economic and Social Committee and the European Parliament,
issue directives acting by a qualified majority.

2.
As regards the directives referred to in paragraph 1, priority shall as a general rule be given to
those services which directly affect production costs or the liberalisation of which helps to promote
trade in goods.

Article 53

The Member States declare their readiness to undertake the liberalisation of services beyond the extent
required by the directives issued pursuant to Article 52(1), if their general economic situation and the
situation of the economic sector concerned so permit.

To this end, the Commission shall make recommendations to the Member States concerned.

As long as restrictions on freedom to provide services have not been abolished, each Member State shall
apply such restrictions without distinction on grounds of nationality or residence to all persons
providing services within the meaning of the first paragraph of Article 49.

Article 54

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The provisions of Articles 45 to 48 shall apply to the matters covered by this chapter.

Article 55

CHAPTER 4

CAPITAL AND PAYMENTS

Article 56

Within the framework of the provisions set out in this chapter, all restrictions on the movement
1.
of capital between Member States and between Member States and third countries shall be prohibited.

Within the framework of the provisions set out in this chapter, all restrictions on payments

2.
between Member States and between Member States and third countries shall be prohibited.

Article 57

1.
The provisions of Article 56 shall be without prejudice to the application to third countries of
any restrictions which exist on 31 December 1993 under national or Community law adopted in respect
of the movement of capital to or from third countries involving direct investment — including in real
estate — establishment, the provision of financial services or the admission of securities to capital
markets.

2.
Whilst endeavouring to achieve the objective of free movement of capital between Member States
and third countries to the greatest extent possible and without prejudice to the other chapters of this
Treaty, the Council may, acting by a qualified majority on a proposal from the Commission, adopt
measures on the movement of capital to or from third countries involving direct investment —
including investment
financial services or the
admission of securities to capital markets. Unanimity shall be required for measures under this
paragraph which constitute a step back in Community law as regards the liberalisation of
the
movement of capital to or from third countries.

in real estate — establishment,

the provision of

1.

(a)

(b)

The provisions of Article 56 shall be without prejudice to the right of Member States:

Article 58

to apply the relevant provisions of their tax law which distinguish between taxpayers who are not
in the same situation with regard to their place of residence or with regard to the place where their
capital is invested;

to take all requisite measures to prevent infringements of national law and regulations, in particular
in the field of taxation and the prudential supervision of financial institutions, or to lay down
procedures for the declaration of capital movements for purposes of administrative or statistical
information, or to take measures which are justified on grounds of public policy or public security.

The provisions of this chapter shall be without prejudice to the applicability of restrictions on the

2.
right of establishment which are compatible with this Treaty.

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3.
The measures and procedures referred to in paragraphs 1 and 2 shall not constitute a means of
arbitrary discrimination or a disguised restriction on the free movement of capital and payments as
defined in Article 56.

Article 59

Where, in exceptional circumstances, movements of capital to or from third countries cause, or threaten
to cause, serious difficulties for the operation of economic and monetary union, the Council, acting by a
qualified majority on a proposal from the Commission and after consulting the ECB, may take safeguard
measures with regard to third countries for a period not exceeding six months if such measures are
strictly necessary.

1.
If, in the cases envisaged in Article 301, action by the Community is deemed necessary, the
Council may, in accordance with the procedure provided for in Article 301, take the necessary urgent
measures on the movement of capital and on payments as regards the third countries concerned.

Article 60

2.
Without prejudice to Article 297 and as long as the Council has not taken measures pursuant to
paragraph 1, a Member State may, for serious political reasons and on grounds of urgency, take
unilateral measures against a third country with regard to capital movements and payments. The
Commission and the other Member States shall be informed of such measures by the date of their
entry into force at the latest.

The Council may, acting by a qualified majority on a proposal from the Commission, decide that the
Member State concerned shall amend or abolish such measures. The President of the Council shall
inform the European Parliament of any such decision taken by the Council.

TITLE IV

VISAS, ASYLUM, IMMIGRATION AND OTHER POLICIES RELATED TO FREE
MOVEMENT OF PERSONS

In order to establish progressively an area of freedom, security and justice, the Council shall adopt:

Article 61

(a) within a period of five years after the entry into force of the Treaty of Amsterdam, measures aimed
at ensuring the free movement of persons in accordance with Article 14, in conjunction with
directly related flanking measures with respect to external border controls, asylum and immi-
in accordance with the provisions of Article 62(2) and (3) and Article 63(1)(a) and
gration,
(2)(a), and measures to prevent and combat crime in accordance with the provisions of Article
31(e) of the Treaty on European Union;

(b) other measures in the fields of asylum, immigration and safeguarding the rights of nationals of

third countries, in accordance with the provisions of Article 63;

(c) measures in the field of judicial cooperation in civil matters as provided for in Article 65;

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(d)

appropriate measures to encourage and strengthen administrative cooperation, as provided for in
Article 66;

(e) measures in the field of police and judicial cooperation in criminal matters aimed at a high level of
security by preventing and combating crime within the Union in accordance with the provisions of
the Treaty on European Union.

Article 62

The Council, acting in accordance with the procedure referred to in Article 67, shall, within a period of
five years after the entry into force of the Treaty of Amsterdam, adopt:

1. measures with a view to ensuring, in compliance with Article 14, the absence of any controls on
persons, be they citizens of the Union or nationals of third countries, when crossing internal
borders;

2. measures on the crossing of the external borders of the Member States which shall establish:

(a)

standards and procedures to be followed by Member States in carrying out checks on persons
at such borders;

(b)

rules on visas for intended stays of no more than three months, including:

(i)

the list of third countries whose nationals must be in possession of visas when crossing
the external borders and those whose nationals are exempt from that requirement;

(ii)

the procedures and conditions for issuing visas by Member States;

(iii)

a uniform format for visas;

(iv)

rules on a uniform visa;

3. measures setting out the conditions under which nationals of third countries shall have the freedom
to travel within the territory of the Member States during a period of no more than three months.

Article 63

The Council, acting in accordance with the procedure referred to in Article 67, shall, within a period of
five years after the entry into force of the Treaty of Amsterdam, adopt:

1. measures on asylum, in accordance with the Geneva Convention of 28 July 1951 and the Protocol
of 31 January 1967 relating to the status of refugees and other relevant treaties, within the
following areas:

(a)

criteria and mechanisms for determining which Member State is responsible for considering an
application for asylum submitted by a national of a third country in one of the Member States,

(b) minimum standards on the reception of asylum seekers in Member States,

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(c) minimum standards with respect to the qualification of nationals of third countries as refugees,

(d) minimum standards on procedures in Member States for granting or withdrawing refugee

status;

2. measures on refugees and displaced persons within the following areas:

(a) minimum standards for giving temporary protection to displaced persons from third countries
who cannot return to their country of origin and for persons who otherwise need international
protection,

(b) promoting a balance of effort between Member States in receiving and bearing the conse-

quences of receiving refugees and displaced persons;

3. measures on immigration policy within the following areas:

(a)

conditions of entry and residence, and standards on procedures for the issue by Member States
of long-term visas and residence permits, including those for the purpose of family reunion,

(b)

illegal immigration and illegal residence, including repatriation of illegal residents;

4. measures defining the rights and conditions under which nationals of third countries who are legally

resident in a Member State may reside in other Member States.

Measures adopted by the Council pursuant to points 3 and 4 shall not prevent any Member State from
maintaining or introducing in the areas concerned national provisions which are compatible with this
Treaty and with international agreements.

Measures to be adopted pursuant to points 2(b), 3(a) and 4 shall not be subject to the five-year period
referred to above.

This title shall not affect the exercise of the responsibilities incumbent upon Member States with

1.
regard to the maintenance of law and order and the safeguarding of internal security.

Article 64

2.
In the event of one or more Member States being confronted with an emergency situation
characterised by a sudden inflow of nationals of third countries and without prejudice to paragraph
1, the Council may, acting by qualified majority on a proposal from the Commission, adopt provisional
measures of a duration not exceeding six months for the benefit of the Member States concerned.

Measures in the field of judicial cooperation in civil matters having cross-border implications, to be
taken in accordance with Article 67 and in so far as necessary for the proper functioning of the internal
market, shall include:

Article 65

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(a)

improving and simplifying:

— the system for cross-border service of judicial and extrajudicial documents,

— cooperation in the taking of evidence,

— the recognition and enforcement of decisions in civil and commercial cases,

including

decisions in extrajudicial cases;

(b) promoting the compatibility of the rules applicable in the Member States concerning the conflict of

laws and of jurisdiction;

(c)

eliminating obstacles to the good functioning of civil proceedings, if necessary by promoting the
compatibility of the rules on civil procedure applicable in the Member States.

The Council, acting in accordance with the procedure referred to in Article 67, shall take measures to
ensure cooperation between the relevant departments of the administrations of the Member States in the
areas covered by this title, as well as between those departments and the Commission.

Article 66

During a transitional period of

1.
five years following the entry into force of the Treaty of
Amsterdam, the Council shall act unanimously on a proposal from the Commission or on the initiative
of a Member State and after consulting the European Parliament.

Article 67 (*)

2.

After this period of five years:

— the Council shall act on proposals from the Commission; the Commission shall examine any

request made by a Member State that it submit a proposal to the Council,

— the Council, acting unanimously after consulting the European Parliament, shall take a decision
with a view to providing for all or parts of the areas covered by this title to be governed by the
procedure referred to in Article 251 and adapting the provisions relating to the powers of the
Court of Justice.

3.
By derogation from paragraphs 1 and 2, measures referred to in Article 62(2)(b) (i) and (iii) shall,
from the entry into force of the Treaty of Amsterdam, be adopted by the Council acting by a qualified
majority on a proposal from the Commission and after consulting the European Parliament.

4.
By derogation from paragraph 2, measures referred to in Article 62(2)(b) (ii) and (iv) shall, after a
period of five years following the entry into force of the Treaty of Amsterdam, be adopted by the
Council acting in accordance with the procedure referred to in Article 251.

(*) Article amended by the Treaty of Nice.

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By derogation from paragraph 1, the Council shall adopt, in accordance with the procedure

5.
referred to in Article 251:

— the measures provided for in Article 63(1) and (2)(a) provided that the Council has previously
in accordance with paragraph 1 of this article, Community legislation defining the

adopted,
common rules and basic principles governing these issues,

— the measures provided for in Article 65 with the exception of aspects relating to family law.

Article 68

1.
Article 234 shall apply to this title under the following circumstances and conditions: where a
question on the interpretation of this title or on the validity or interpretation of acts of the institutions
of the Community based on this title is raised in a case pending before a court or a tribunal of a
Member State against whose decisions there is no judicial remedy under national law, that court or
tribunal shall, if it considers that a decision on the question is necessary to enable it to give judgment,
request the Court of Justice to give a ruling thereon.

2.
In any event, the Court of Justice shall not have jurisdiction to rule on any measure or decision
taken pursuant to Article 62(1) relating to the maintenance of law and order and the safeguarding of
internal security.

3.
The Council, the Commission or a Member State may request the Court of Justice to give a ruling
on a question of interpretation of this title or of acts of the institutions of the Community based on this
title. The ruling given by the Court of Justice in response to such a request shall not apply to judgments
of courts or tribunals of the Member States which have become res judicata.

Article 69

The application of this title shall be subject to the provisions of the Protocol on the position of the
United Kingdom and Ireland and to the Protocol on the position of Denmark and without prejudice to
the Protocol on the application of certain aspects of Article 14 of the Treaty establishing the European
Community to the United Kingdom and to Ireland.

TITLE V

TRANSPORT

Article 70

The objectives of this Treaty shall, in matters governed by this title, be pursued by Member States within
the framework of a common transport policy.

Article 71

1.
For the purpose of implementing Article 70, and taking into account the distinctive features of
transport, the Council shall, acting in accordance with the procedure referred to in Article 251 and after
consulting the Economic and Social Committee and the Committee of the Regions, lay down:

(a)

common rules applicable to international transport to or from the territory of a Member State or
passing across the territory of one or more Member States;

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(b)

the conditions under which non-resident carriers may operate transport services within a Member
State;

(c) measures to improve transport safety;

(d)

any other appropriate provisions.

2.
By way of derogation from the procedure provided for in paragraph 1, where the application of
provisions concerning the principles of the regulatory system for transport would be liable to have a
serious effect on the standard of living and on employment in certain areas and on the operation of
transport facilities, they shall be laid down by the Council acting unanimously on a proposal from the
Commission, after consulting the European Parliament and the Economic and Social Committee. In so
doing, the Council shall take into account the need for adaptation to the economic development which
will result from establishing the common market.

Article 72

Until the provisions referred to in Article 71(1) have been laid down, no Member State may, without the
unanimous approval of the Council, make the various provisions governing the subject on 1 January
1958 or, for acceding States, the date of their accession less favourable in their direct or indirect effect
on carriers of other Member States as compared with carriers who are nationals of that State.

Aids shall be compatible with this Treaty if they meet the needs of coordination of transport or if they
represent reimbursement for the discharge of certain obligations inherent in the concept of a public
service.

Article 73

Any measures taken within the framework of this Treaty in respect of transport rates and conditions
shall take account of the economic circumstances of carriers.

Article 74

Article 75

In the case of transport within the Community, discrimination which takes the form of carriers
1.
charging different rates and imposing different conditions for the carriage of the same goods over the
same transport links on grounds of the country of origin or of destination of the goods in question shall
be abolished.

Paragraph 1 shall not prevent the Council from adopting other measures pursuant to Article

2.
71(1).

3.
The Council shall, acting by a qualified majority on a proposal from the Commission and after
consulting the Economic and Social Committee, lay down rules for implementing the provisions of
paragraph 1.

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The Council may in particular lay down the provisions needed to enable the institutions of the
Community to secure compliance with the rule laid down in paragraph 1 and to ensure that users
benefit from it to the full.

4.
The Commission shall, acting on its own initiative or on application by a Member State, inves-
tigate any cases of discrimination falling within paragraph 1 and, after consulting any Member State
concerned, shall take the necessary decisions within the framework of the rules laid down in accordance
with the provisions of paragraph 3.

Article 76

1.
The imposition by a Member State, in respect of transport operations carried out within the
Community, of rates and conditions involving any element of support or protection in the interest of
one or more particular undertakings or industries shall be prohibited, unless authorised by the
Commission.

2.
The Commission shall, acting on its own initiative or on application by a Member State, examine
the rates and conditions referred to in paragraph 1, taking account in particular of the requirements of
an appropriate regional economic policy, the needs of underdeveloped areas and the problems of areas
seriously affected by political circumstances on the one hand, and of the effects of such rates and
conditions on competition between the different modes of transport on the other.

After consulting each Member State concerned, the Commission shall take the necessary decisions.

3.

The prohibition provided for in paragraph 1 shall not apply to tariffs fixed to meet competition.

Charges or dues in respect of the crossing of frontiers which are charged by a carrier in addition to the
transport rates shall not exceed a reasonable level after taking the costs actually incurred thereby into
account.

Article 77

Member States shall endeavour to reduce these costs progressively.

The Commission may make recommendations to Member States for the application of this article.

Article 78

The provisions of this title shall not form an obstacle to the application of measures taken in the Federal
Republic of Germany to the extent that such measures are required in order to compensate for the
economic disadvantages caused by the division of Germany to the economy of certain areas of the
Federal Republic affected by that division.

Article 79

An Advisory Committee consisting of experts designated by the governments of Member States shall be
attached to the Commission. The Commission, whenever it considers it desirable, shall consult the
Committee on transport matters without prejudice to the powers of
the Economic and Social
Committee.

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1.

The provisions of this title shall apply to transport by rail, road and inland waterway.

Article 80

The Council may, acting by a qualified majority, decide whether, to what extent and by what

2.
procedure appropriate provisions may be laid down for sea and air transport.

The procedural provisions of Article 71 shall apply.

TITLE VI

COMMON RULES ON COMPETITION, TAXATION AND APPROXIMATION OF
LAWS

CHAPTER 1

RULES ON COMPETITION

SECTION 1

RULES APPLYING TO UNDERTAKINGS

Article 81

1.
The following shall be prohibited as incompatible with the common market: all agreements
between undertakings, decisions by associations of undertakings and concerted practices which may
affect trade between Member States and which have as their object or effect the prevention, restriction
or distortion of competition within the common market, and in particular those which:

(a)

directly or indirectly fix purchase or selling prices or any other trading conditions;

(b)

limit or control production, markets, technical development, or investment;

(c)

share markets or sources of supply;

(d)

apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing
them at a competitive disadvantage;

(e) make the conclusion of contracts subject to acceptance by the other parties of supplementary
obligations which, by their nature or according to commercial usage, have no connection with the
subject of such contracts.

2.

3.

Any agreements or decisions prohibited pursuant to this article shall be automatically void.

The provisions of paragraph 1 may, however, be declared inapplicable in the case of:

— any agreement or category of agreements between undertakings,

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— any decision or category of decisions by associations of undertakings,

— any concerted practice or category of concerted practices,

which contributes to improving the production or distribution of goods or to promoting technical or
economic progress, while allowing consumers a fair share of the resulting benefit, and which does not:

(a)

impose on the undertakings concerned restrictions which are not indispensable to the attainment of
these objectives;

(b)

afford such undertakings the possibility of eliminating competition in respect of a substantial part
of the products in question.

Any abuse by one or more undertakings of a dominant position within the common market or in a
substantial part of it shall be prohibited as incompatible with the common market in so far as it may
affect trade between Member States.

Article 82

Such abuse may, in particular, consist in:

(a)

directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions;

(b)

limiting production, markets or technical development to the prejudice of consumers;

(c)

applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing
them at a competitive disadvantage;

(d) making the conclusion of contracts subject to acceptance by the other parties of supplementary
obligations which, by their nature or according to commercial usage, have no connection with the
subject of such contracts.

1.
The appropriate regulations or directives to give effect to the principles set out in Articles 81 and
82 shall be laid down by the Council, acting by a qualified majority on a proposal from the Commission
and after consulting the European Parliament.

Article 83

2.

The regulations or directives referred to in paragraph 1 shall be designed in particular:

(a)

to ensure compliance with the prohibitions laid down in Article 81(1) and in Article 82 by making
provision for fines and periodic penalty payments;

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(b)

(c)

(d)

(e)

to lay down detailed rules for the application of Article 81(3), taking into account the need to
ensure effective supervision on the one hand, and to simplify administration to the greatest possible
extent on the other;

to define,
Articles 81 and 82;

if need be,

in the various branches of the economy, the scope of the provisions of

to define the respective functions of the Commission and of the Court of Justice in applying the
provisions laid down in this paragraph;

to determine the relationship between national laws and the provisions contained in this section or
adopted pursuant to this article.

Article 84

Until the entry into force of the provisions adopted in pursuance of Article 83, the authorities in
Member States shall rule on the admissibility of agreements, decisions and concerted practices and
on abuse of a dominant position in the common market
their
country and with the provisions of Article 81, in particular paragraph 3, and of Article 82.

in accordance with the law of

Article 85

1.
Without prejudice to Article 84, the Commission shall ensure the application of the principles
laid down in Articles 81 and 82. On application by a Member State or on its own initiative, and in
cooperation with the competent authorities in the Member States, which shall give it their assistance, the
Commission shall investigate cases of suspected infringement of these principles. If it finds that there has
been an infringement, it shall propose appropriate measures to bring it to an end.

2.
If the infringement is not brought to an end, the Commission shall record such infringement of
the principles in a reasoned decision. The Commission may publish its decision and authorise Member
States to take the measures, the conditions and details of which it shall determine, needed to remedy the
situation.

Article 86

1.
In the case of public undertakings and undertakings to which Member States grant special or
exclusive rights, Member States shall neither enact nor maintain in force any measure contrary to the
rules contained in this Treaty, in particular to those rules provided for in Article 12 and Articles 81 to
89.

Undertakings entrusted with the operation of services of general economic interest or having the
2.
character of a revenue-producing monopoly shall be subject to the rules contained in this Treaty, in
particular to the rules on competition, in so far as the application of such rules does not obstruct the
performance, in law or in fact, of the particular tasks assigned to them. The development of trade must
not be affected to such an extent as would be contrary to the interests of the Community.

The Commission shall ensure the application of the provisions of this Article and shall, where

3.
necessary, address appropriate directives or decisions to Member States.

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SECTION 2

AIDS GRANTED BY STATES

Article 87

1.
Save as otherwise provided in this Treaty, any aid granted by a Member State or through State
resources in any form whatsoever which distorts or threatens to distort competition by favouring certain
undertakings or the production of certain goods shall, in so far as it affects trade between Member
States, be incompatible with the common market.

2.

(a)

The following shall be compatible with the common market:

aid having a social character, granted to individual consumers, provided that such aid is granted
without discrimination related to the origin of the products concerned;

(b)

aid to make good the damage caused by natural disasters or exceptional occurrences;

(c)

3.

(a)

(b)

(c)

(d)

(e)

aid granted to the economy of certain areas of the Federal Republic of Germany affected by the
division of Germany, in so far as such aid is required in order to compensate for the economic
disadvantages caused by that division.

The following may be considered to be compatible with the common market:

aid to promote the economic development of areas where the standard of living is abnormally low
or where there is serious underemployment;

aid to promote the execution of an important project of common European interest or to remedy a
serious disturbance in the economy of a Member State;

aid to facilitate the development of certain economic activities or of certain economic areas, where
such aid does not adversely affect trading conditions to an extent contrary to the common interest;

aid to promote culture and heritage conservation where such aid does not affect trading conditions
and competition in the Community to an extent that is contrary to the common interest;

such other categories of aid as may be specified by decision of the Council acting by a qualified
majority on a proposal from the Commission.

Article 88

The Commission shall,

1.
systems of aid existing in those States.
required by the progressive development or by the functioning of the common market.

in cooperation with Member States, keep under constant review all
It shall propose to the latter any appropriate measures

2.
If, after giving notice to the parties concerned to submit their comments, the Commission finds
that aid granted by a State or through State resources is not compatible with the common market
having regard to Article 87, or that such aid is being misused, it shall decide that the State concerned
shall abolish or alter such aid within a period of time to be determined by the Commission.

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If the State concerned does not comply with this decision within the prescribed time, the Commission or
any other interested State may, in derogation from the provisions of Articles 226 and 227, refer the
matter to the Court of Justice direct.

On application by a Member State, the Council may, acting unanimously, decide that aid which that
State is granting or intends to grant shall be considered to be compatible with the common market, in
derogation from the provisions of Article 87 or from the regulations provided for in Article 89, if such
a decision is justified by exceptional circumstances. If, as regards the aid in question, the Commission
has already initiated the procedure provided for in the first subparagraph of this paragraph, the fact that
the State concerned has made its application to the Council shall have the effect of suspending that
procedure until the Council has made its attitude known.

If, however, the Council has not made its attitude known within three months of the said application
being made, the Commission shall give its decision on the case.

The Commission shall be informed, in sufficient time to enable it to submit its comments, of any
3.
plans to grant or alter aid. If it considers that any such plan is not compatible with the common market
having regard to Article 87, it shall without delay initiate the procedure provided for in paragraph 2.
The Member State concerned shall not put its proposed measures into effect until this procedure has
resulted in a final decision.

Article 89

The Council, acting by a qualified majority on a proposal from the Commission and after consulting the
European Parliament, may make any appropriate regulations for the application of Articles 87 and 88
and may in particular determine the conditions in which Article 88(3) shall apply and the categories of
aid exempted from this procedure.

CHAPTER 2

TAX PROVISIONS

Article 90

No Member State shall
impose, directly or indirectly, on the products of other Member States any
internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic
products.

Furthermore, no Member State shall
taxation of such a nature as to afford indirect protection to other products.

impose on the products of other Member States any internal

Where products are exported to the territory of any Member State, any repayment of internal taxation
shall not exceed the internal taxation imposed on them whether directly or indirectly.

Article 91

Article 92

In the case of charges other than turnover taxes, excise duties and other forms of indirect taxation,
remissions and repayments in respect of exports to other Member States may not be granted and
countervailing charges in respect of imports from Member States may not be imposed unless the
measures contemplated have been previously approved for a limited period by the Council acting by
a qualified majority on a proposal from the Commission.

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Article 93

The Council shall, acting unanimously on a proposal from the Commission and after consulting the
European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation
of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent
that such harmonisation is necessary to ensure the establishment and the functioning of the internal
market within the time limit laid down in Article 14.

CHAPTER 3

APPROXIMATION OF LAWS

Article 94

The Council shall, acting unanimously on a proposal from the Commission and after consulting the
European Parliament and the Economic and Social Committee, issue directives for the approximation of
such laws, regulations or administrative provisions of the Member States as directly affect the estab-
lishment or functioning of the common market.

Article 95

1.
By way of derogation from Article 94 and save where otherwise provided in this Treaty, the
following provisions shall apply for the achievement of the objectives set out in Article 14. The Council
shall, acting in accordance with the procedure referred to in Article 251 and after consulting the
Economic and Social Committee, adopt the measures for the approximation of the provisions laid
down by law, regulation or administrative action in Member States which have as their object the
establishment and functioning of the internal market.

Paragraph 1 shall not apply to fiscal provisions, to those relating to the free movement of persons

2.
nor to those relating to the rights and interests of employed persons.

3.
The Commission, in its proposals envisaged in paragraph 1 concerning health, safety, environ-
mental protection and consumer protection, will take as a base a high level of protection, taking account
in particular of any new development based on scientific facts. Within their respective powers, the
European Parliament and the Council will also seek to achieve this objective.

If, after the adoption by the Council or by the Commission of a harmonisation measure, a
4.
Member State deems it necessary to maintain national provisions on grounds of major needs referred
to in Article 30, or relating to the protection of the environment or the working environment, it shall
notify the Commission of these provisions as well as the grounds for maintaining them.

5.
Moreover, without prejudice to paragraph 4, if, after the adoption by the Council or by the
Commission of a harmonisation measure, a Member State deems it necessary to introduce national
provisions based on new scientific evidence relating to the protection of the environment or the
working environment on grounds of a problem specific to that Member State arising after the
adoption of the harmonisation measure,
it shall notify the Commission of the envisaged provisions
as well as the grounds for introducing them.

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6.
The Commission shall, within six months of the notifications as referred to in paragraphs 4 and
5, approve or reject the national provisions involved after having verified whether or not they are a
means of arbitrary discrimination or a disguised restriction on trade between Member States and
whether or not they shall constitute an obstacle to the functioning of the internal market.

In the absence of a decision by the Commission within this period the national provisions referred to in
paragraphs 4 and 5 shall be deemed to have been approved.

When justified by the complexity of the matter and in the absence of danger for human health, the
Commission may notify the Member State concerned that the period referred to in this paragraph may
be extended for a further period of up to six months.

When, pursuant to paragraph 6, a Member State is authorised to maintain or introduce national
immediately examine

7.
provisions derogating from a harmonisation measure,
whether to propose an adaptation to that measure.

the Commission shall

8.
When a Member State raises a specific problem on public health in a field which has been the
subject of prior harmonisation measures, it shall bring it to the attention of the Commission which shall
immediately examine whether to propose appropriate measures to the Council.

9.
By way of derogation from the procedure laid down in Articles 226 and 227, the Commission
and any Member State may bring the matter directly before the Court of Justice if it considers that
another Member State is making improper use of the powers provided for in this Article.

10.
The harmonisation measures referred to above shall, in appropriate cases, include a safeguard
clause authorising the Member States to take, for one or more of the non-economic reasons referred to
in Article 30, provisional measures subject to a Community control procedure.

Article 96

Where the Commission finds that a difference between the provisions laid down by law, regulation or
administrative action in Member States is distorting the conditions of competition in the common
market and that the resultant distortion needs to be eliminated,
it shall consult the Member States
concerned.

If such consultation does not result in an agreement eliminating the distortion in question, the Council
shall, on a proposal from the Commission, acting by a qualified majority, issue the necessary directives.
The Commission and the Council may take any other appropriate measures provided for in this Treaty.

Article 97

Where there is a reason to fear that the adoption or amendment of a provision laid down by law,
1.
regulation or administrative action may cause distortion within the meaning of Article 96, a Member
State desiring to proceed therewith shall consult the Commission. After consulting the Member States,
the Commission shall recommend to the States concerned such measures as may be appropriate to
avoid the distortion in question.

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2.
If a State desiring to introduce or amend its own provisions does not comply with the recom-
mendation addressed to it by the Commission, other Member States shall not be required, pursuant to
Article 96, to amend their own provisions in order to eliminate such distortion. If the Member State
which has ignored the recommendation of the Commission causes distortion detrimental only to itself,
the provisions of Article 96 shall not apply.

TITLE VII

ECONOMIC AND MONETARY POLICY

CHAPTER 1

ECONOMIC POLICY

Article 98

Member States shall conduct their economic policies with a view to contributing to the achievement of
the objectives of the Community, as defined in Article 2, and in the context of the broad guidelines
referred to in Article 99(2). The Member States and the Community shall act in accordance with the
principle of an open market economy with free competition,
favouring an efficient allocation of
resources, and in compliance with the principles set out in Article 4.

Member States shall regard their economic policies as a matter of common concern and shall

1.
coordinate them within the Council, in accordance with the provisions of Article 98.

Article 99

2.
The Council shall, acting by a qualified majority on a recommendation from the Commission,
formulate a draft for the broad guidelines of the economic policies of the Member States and of the
Community, and shall report its findings to the European Council.

The European Council shall, acting on the basis of the report from the Council, discuss a conclusion on
the broad guidelines of the economic policies of the Member States and of the Community.

On the basis of this conclusion, the Council shall, acting by a qualified majority, adopt a recommen-
dation setting out these broad guidelines. The Council shall
inform the European Parliament of its
recommendation.

3.
In order to ensure closer coordination of economic policies and sustained convergence of the
economic performances of the Member States, the Council shall, on the basis of reports submitted by
the Commission, monitor economic developments in each of the Member States and in the Community
as well as the consistency of economic policies with the broad guidelines referred to in paragraph 2, and
regularly carry out an overall assessment.

For the purpose of this multilateral surveillance, Member States shall forward information to the
Commission about important measures taken by them in the field of their economic policy and such
other information as they deem necessary.

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4.
Where it is established, under the procedure referred to in paragraph 3, that the economic
policies of a Member State are not consistent with the broad guidelines referred to in paragraph 2
or that they risk jeopardising the proper functioning of economic and monetary union, the Council
may, acting by a qualified majority on a recommendation from the Commission, make the necessary
recommendations to the Member State concerned. The Council may, acting by a qualified majority on a
proposal from the Commission, decide to make its recommendations public.

The President of the Council and the Commission shall report to the European Parliament on the results
of multilateral surveillance. The President of the Council may be invited to appear before the competent
committee of the European Parliament if the Council has made its recommendations public.

5.
The Council, acting in accordance with the procedure referred to in Article 252, may adopt
detailed rules for the multilateral surveillance procedure referred to in paragraphs 3 and 4 of this Article.

Without prejudice to any other procedures provided for in this Treaty, the Council, acting by a
1.
qualified majority on a proposal from the Commission, may decide upon the measures appropriate to
the economic situation, in particular if severe difficulties arise in the supply of certain products.

Article 100 (*)

2.
Where a Member State is in difficulties or is seriously threatened with severe difficulties caused by
natural disasters or exceptional occurrences beyond its control, the Council, acting by a qualified
from the Commission, may grant, under certain conditions, Community
majority on a proposal
inform the
financial assistance to the Member State concerned. The President of the Council shall
European Parliament of the decision taken.

Article 101

1.
Overdraft facilities or any other type of credit facility with the ECB or with the central banks of
the Member States (hereinafter referred to as ‘national central banks’) in favour of Community insti-
tutions or bodies, central governments, regional, local or other public authorities, other bodies governed
by public law, or public undertakings of Member States shall be prohibited, as shall the purchase directly
from them by the ECB or national central banks of debt instruments.

2.
Paragraph 1 shall not apply to publicly owned credit institutions which, in the context of the
supply of reserves by central banks, shall be given the same treatment by national central banks and the
ECB as private credit institutions.

Article 102

Any measure, not based on prudential considerations, establishing privileged access by
1.
Community institutions or bodies, central governments, regional,
local or other public authorities,
other bodies governed by public law, or public undertakings of Member States to financial institutions,
shall be prohibited.

(*) Article amended by the Treaty of Nice.

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2.
The Council, acting in accordance with the procedure referred to in Article 252, shall, before
1 January 1994, specify definitions for the application of the prohibition referred to in paragraph 1.

Article 103

1.
The Community shall not be liable for or assume the commitments of central governments,
regional, local or other public authorities, other bodies governed by public law, or public undertakings
of any Member State, without prejudice to mutual financial guarantees for the joint execution of a
specific project. A Member State shall not be liable for or assume the commitments of central
governments, regional,
local or other public authorities, other bodies governed by public law, or
public undertakings of another Member State, without prejudice to mutual financial guarantees for
the joint execution of a specific project.

If necessary, the Council, acting in accordance with the procedure referred to in Article 252, may
2.
specify definitions for the application of the prohibition referred to in Article 101 and in this Article.

1.

Member States shall avoid excessive government deficits.

Article 104

2.
The Commission shall monitor the development of the budgetary situation and of the stock of
government debt in the Member States with a view to identifying gross errors. In particular it shall
examine compliance with budgetary discipline on the basis of the following two criteria:

(a) whether the ratio of the planned or actual government deficit to gross domestic product exceeds a

reference value, unless:

— either the ratio has declined substantially and continuously and reached a level that comes

close to the reference value,

— or, alternatively, the excess over the reference value is only exceptional and temporary and the

ratio remains close to the reference value;

(b) whether the ratio of government debt to gross domestic product exceeds a reference value, unless
the ratio is sufficiently diminishing and approaching the reference value at a satisfactory pace.

The reference values are specified in the Protocol on the excessive deficit procedure annexed to this
Treaty.

If a Member State does not fulfil the requirements under one or both of these criteria, the
3.
Commission shall prepare a report. The report of
the Commission shall also take into account
whether the government deficit exceeds government investment expenditure and take into account all
other relevant factors, including the medium-term economic and budgetary position of the Member
State.

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The Commission may also prepare a report if, notwithstanding the fulfilment of the requirements under
the criteria, it is of the opinion that there is a risk of an excessive deficit in a Member State.

The Committee provided for in Article 114 shall formulate an opinion on the report of the

4.
Commission.

If the Commission considers that an excessive deficit in a Member State exists or may occur, the

5.
Commission shall address an opinion to the Council.

6.
The Council shall, acting by a qualified majority on a recommendation from the Commission,
and having considered any observations which the Member State concerned may wish to make, decide
after an overall assessment whether an excessive deficit exists.

7.
Where the existence of an excessive deficit is decided according to paragraph 6, the Council shall
make recommendations to the Member State concerned with a view to bringing that situation to an end
within a given period. Subject to the provisions of paragraph 8, these recommendations shall not be
made public.

Where it establishes that there has been no effective action in response to its recommendations

8.
within the period laid down, the Council may make its recommendations public.

9.
If a Member State persists in failing to put into practice the recommendations of the Council, the
Council may decide to give notice to the Member State to take, within a specified time limit, measures
for the deficit reduction which is judged necessary by the Council in order to remedy the situation.

In such a case, the Council may request the Member State concerned to submit reports in accordance
with a specific timetable in order to examine the adjustment efforts of that Member State.

10.
the framework of paragraphs 1 to 9 of this Article.

The rights to bring actions provided for in Articles 226 and 227 may not be exercised within

11.
As long as a Member State fails to comply with a decision taken in accordance with paragraph
9, the Council may decide to apply or, as the case may be, intensify one or more of the following
measures:

— to require the Member State concerned to publish additional information, to be specified by the

Council, before issuing bonds and securities,

— to invite the European Investment Bank to reconsider its lending policy towards the Member State

concerned,

— to require the Member State concerned to make a non-interest-bearing deposit of an appropriate
size with the Community until the excessive deficit has, in the view of the Council, been corrected,

— to impose fines of an appropriate size.

The President of the Council shall inform the European Parliament of the decisions taken.

The Council shall abrogate some or all of its decisions referred to in paragraphs 6 to 9 and 11
12.
to the extent that the excessive deficit in the Member State concerned has, in the view of the Council,
been corrected. If the Council has previously made public recommendations, it shall, as soon as the
decision under paragraph 8 has been abrogated, make a public statement that an excessive deficit in the
Member State concerned no longer exists.

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13.
When taking the decisions referred to in paragraphs 7 to 9, 11 and 12, the Council shall act on
a recommendation from the Commission by a majority of two thirds of the votes of its members
weighted in accordance with Article 205(2), excluding the votes of the representative of the Member
State concerned.

14.
set out in the Protocol on the excessive deficit procedure annexed to this Treaty.

Further provisions relating to the implementation of the procedure described in this article are

The Council shall, acting unanimously on a proposal from the Commission and after consulting the
European Parliament and the ECB, adopt the appropriate provisions which shall then replace the said
Protocol.

Subject to the other provisions of this paragraph, the Council shall, before 1 January 1994, acting by a
qualified majority on a proposal from the Commission and after consulting the European Parliament, lay
down detailed rules and definitions for the application of the provisions of the said Protocol.

CHAPTER 2

MONETARY POLICY

Article 105

1.
The primary objective of the ESCB shall be to maintain price stability. Without prejudice to the
objective of price stability, the ESCB shall support the general economic policies in the Community with
a view to contributing to the achievement of the objectives of the Community as laid down in Article 2.
The ESCB shall act in accordance with the principle of an open market economy with free competition,
favouring an efficient allocation of resources, and in compliance with the principles set out in Article 4.

2.

The basic tasks to be carried out through the ESCB shall be:

— to define and implement the monetary policy of the Community,

— to conduct foreign-exchange operations consistent with the provisions of Article 111,

— to hold and manage the official foreign reserves of the Member States,

— to promote the smooth operation of payment systems.

The third indent of paragraph 2 shall be without prejudice to the holding and management by

3.
the governments of Member States of foreign-exchange working balances.

4.

The ECB shall be consulted:

— on any proposed Community act in its fields of competence,

— by national authorities regarding any draft legislative provision in its fields of competence, but
within the limits and under the conditions set out by the Council in accordance with the procedure
laid down in Article 107(6).

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The ECB may submit opinions to the appropriate Community institutions or bodies or to national
authorities on matters in its fields of competence.

5.
The ESCB shall contribute to the smooth conduct of policies pursued by the competent auth-
orities relating to the prudential supervision of credit institutions and the stability of the financial
system.

6.
The Council may, acting unanimously on a proposal from the Commission and after consulting
the ECB and after receiving the assent of the European Parliament, confer upon the ECB specific tasks
concerning policies relating to the prudential supervision of credit institutions and other financial
institutions with the exception of insurance undertakings.

Article 106

1.
The ECB shall have the exclusive right to authorise the issue of banknotes within the Community.
The ECB and the national central banks may issue such notes. The banknotes issued by the ECB and the
national central banks shall be the only such notes to have the status of legal tender within the
Community.

Member States may issue coins subject to approval by the ECB of the volume of the issue. The
2.
Council may, acting in accordance with the procedure referred to in Article 252 and after consulting the
ECB, adopt measures to harmonise the denominations and technical specifications of all coins intended
for circulation to the extent necessary to permit their smooth circulation within the Community.

The ESCB shall be composed of the ECB and of the national central banks.

Article 107

The ECB shall have legal personality.

1.

2.

The ESCB shall be governed by the decision-making bodies of the ECB which shall be the

3.
Governing Council and the Executive Board.

4.

The Statute of the ESCB is laid down in a Protocol annexed to this Treaty.

5.
Articles 5.1, 5.2, 5.3, 17, 18, 19.1, 22, 23, 24, 26, 32.2, 32.3, 32.4, 32.6, 33.1(a) and 36 of the
Statute of the ESCB may be amended by the Council, acting either by a qualified majority on a
recommendation from the ECB and after consulting the Commission or unanimously on a proposal
from the Commission and after consulting the ECB. In either case, the assent of the European Parliament
shall be required.

6.
The Council, acting by a qualified majority either on a proposal from the Commission and after
consulting the European Parliament and the ECB or on a recommendation from the ECB and after
consulting the European Parliament and the Commission, shall adopt the provisions referred to in
Articles 4, 5.4, 19.2, 20, 28.1, 29.2, 30.4 and 34.3 of the Statute of the ESCB.

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Article 108

When exercising the powers and carrying out the tasks and duties conferred upon them by this Treaty
and the Statute of the ESCB, neither the ECB, nor a national central bank, nor any member of their
decision-making bodies shall seek or take instructions from Community institutions or bodies, from any
government of a Member State or from any other body. The Community institutions and bodies and the
governments of the Member States undertake to respect this principle and not to seek to influence the
members of the decision-making bodies of the ECB or of the national central banks in the performance
of their tasks.

Each Member State shall ensure, at the latest at the date of the establishment of the ESCB, that its
national legislation including the statutes of its national central bank is compatible with this Treaty and
the Statute of the ESCB.

Article 109

In order to carry out the tasks entrusted to the ESCB, the ECB shall, in accordance with the

1.
provisions of this Treaty and under the conditions laid down in the Statute of the ESCB:

Article 110

— make regulations to the extent necessary to implement the tasks defined in Article 3.1, first indent,
Articles 19.1, 22 and 25.2 of the Statute of the ESCB and in cases which shall be laid down in the
acts of the Council referred to in Article 107(6),

— take decisions necessary for carrying out the tasks entrusted to the ESCB under this Treaty and the

Statute of the ESCB,

— make recommendations and deliver opinions.

A regulation shall have general application.

2.
applicable in all Member States.

It shall be binding in its entirety and directly

Recommendations and opinions shall have no binding force.

A decision shall be binding in its entirety upon those to whom it is addressed.

Articles 253, 254 and 256 shall apply to regulations and decisions adopted by the ECB.

The ECB may decide to publish its decisions, recommendations and opinions.

3.
Within the limits and under the conditions adopted by the Council under the procedure laid
down in Article 107(6), the ECB shall be entitled to impose fines or periodic penalty payments on
undertakings for failure to comply with obligations under its regulations and decisions.

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Article 111 (*)

1.
By way of derogation from Article 300, the Council may, acting unanimously on a recommen-
dation from the ECB or from the Commission, and after consulting the ECB in an endeavour to reach a
consensus consistent with the objective of price stability, after consulting the European Parliament, in
accordance with the procedure in paragraph 3 for determining the arrangements, conclude formal
agreements on an exchange-rate system for the ecu in relation to non-Community currencies. The
Council may, acting by a qualified majority on a recommendation from the ECB or from the
Commission, and after consulting the ECB in an endeavour to reach a consensus consistent with the
objective of price stability, adopt, adjust or abandon the central rates of the ecu within the exchange-rate
system. The President of the Council shall inform the European Parliament of the adoption, adjustment
or abandonment of the ecu central rates.

2.
In the absence of an exchange-rate system in relation to one or more non-Community currencies
as referred to in paragraph 1, the Council, acting by a qualified majority either on a recommendation
from the Commission and after consulting the ECB or on a recommendation from the ECB, may
formulate general orientations for exchange-rate policy in relation to these currencies. These general
orientations shall be without prejudice to the primary objective of the ESCB to maintain price stability.

3.
By way of derogation from Article 300, where agreements concerning monetary or foreign-
exchange regime matters need to be negotiated by the Community with one or more States or inter-
national organisations, the Council, acting by a qualified majority on a recommendation from the
Commission and after consulting the ECB, shall decide the arrangements for the negotiation and for
the conclusion of such agreements. These arrangements shall ensure that the Community expresses a
single position. The Commission shall be fully associated with the negotiations.

Agreements concluded in accordance with this paragraph shall be binding on the institutions of the
Community, on the ECB and on Member States.

4.
Subject to paragraph 1, the Council, acting by a qualified majority on a proposal from the
Commission and after consulting the ECB, shall decide on the position of the Community at inter-
national level as regards issues of particular relevance to economic and monetary union and on its
representation, in compliance with the allocation of powers laid down in Articles 99 and 105.

5.
Without prejudice to Community competence and Community agreements as regards economic
and monetary union, Member States may negotiate in international bodies and conclude international
agreements.

CHAPTER 3

INSTITUTIONAL PROVISIONS

Article 112

The Governing Council of the ECB shall comprise the members of the Executive Board of the

1.
ECB and the Governors of the national central banks.

(*) Article amended by the Treaty of Nice.

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2. (a) The Executive Board shall comprise the President, the Vice-President and four other members.

(b) The President, the Vice-President and the other members of the Executive Board shall be
recognised standing and professional experience in
appointed from among persons of
monetary or banking matters by common accord of the governments of the Member States
at the level of Heads of State or Government, on a recommendation from the Council, after it
has consulted the European Parliament and the Governing Council of the ECB.

Their term of office shall be eight years and shall not be renewable.

Only nationals of Member States may be members of the Executive Board.

Article 113

The President of the Council and a member of the Commission may participate, without having

1.
the right to vote, in meetings of the Governing Council of the ECB.

The President of the Council may submit a motion for deliberation to the Governing Council of the ECB.

The President of the ECB shall be invited to participate in Council meetings when the Council is

2.
discussing matters relating to the objectives and tasks of the ESCB.

3.
The ECB shall address an annual report on the activities of the ESCB and on the monetary policy
of both the previous and current year to the European Parliament, the Council and the Commission, and
also to the European Council. The President of the ECB shall present this report to the Council and to
the European Parliament, which may hold a general debate on that basis.

The President of the ECB and the other members of the Executive Board may, at the request of the
European Parliament or on their own initiative, be heard by the competent committees of the European
Parliament.

In order to promote coordination of the policies of Member States to the full extent needed for
1.
the functioning of the internal market, a Monetary Committee with advisory status is hereby set up.

Article 114

It shall have the following tasks:

— to keep under review the monetary and financial situation of the Member States and of the
Community and the general payments system of the Member States and to report regularly
thereon to the Council and to the Commission,

— to deliver opinions at the request of the Council or of the Commission, or on its own initiative for

submission to those institutions,

— without prejudice to Article 207, to contribute to the preparation of the work of the Council
referred to in Articles 59, 60, 99(2), (3), (4) and (5), 100, 102, 103, 104, 116(2), 117(6), 119, 120,
121(2) and 122(1),

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— to examine, at least once a year, the situation regarding the movement of capital and the freedom
of payments, as they result from the application of this Treaty and of measures adopted by the
Council; the examination shall cover all measures relating to capital movements and payments; the
Committee shall report to the Commission and to the Council on the outcome of this examination.

The Member States and the Commission shall each appoint two members of the Monetary Committee.

At the start of the third stage, an Economic and Financial Committee shall be set up. The

2.
Monetary Committee provided for in paragraph 1 shall be dissolved.

The Economic and Financial Committee shall have the following tasks:

— to deliver opinions at the request of the Council or of the Commission, or on its own initiative for

submission to those institutions,

— to keep under review the economic and financial situation of the Member States and of the
Community and to report regularly thereon to the Council and to the Commission, in particular
on financial relations with third countries and international institutions,

— without prejudice to Article 207, to contribute to the preparation of the work of the Council
referred to in Articles 59, 60, 99(2), (3), (4) and (5), 100, 102, 103, 104, 105(6), 106(2), 107(5)
and (6), 111, 119, 120(2) and (3), 122(2), 123(4) and (5), and to carry out other advisory and
preparatory tasks assigned to it by the Council,

— to examine, at least once a year, the situation regarding the movement of capital and the freedom
of payments, as they result from the application of this Treaty and of measures adopted by the
Council; the examination shall cover all measures relating to capital movements and payments; the
Committee shall report to the Commission and to the Council on the outcome of this examination.

The Member States, the Commission and the ECB shall each appoint no more than two members of the
Committee.

The Council shall, acting by a qualified majority on a proposal from the Commission and after
3.
lay down detailed provisions
consulting the ECB and the Committee referred to in this Article,
concerning the composition of the Economic and Financial Committee. The President of the Council
shall inform the European Parliament of such a decision.

4.
In addition to the tasks set out in paragraph 2, if and as long as there are Member States with a
derogation as referred to in Articles 122 and 123, the Committee shall keep under review the monetary
and financial situation and the general payments system of those Member States and report regularly
thereon to the Council and to the Commission.

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Article 115

For matters within the scope of Articles 99(4), 104 with the exception of paragraph 14, 111, 121, 122
and 123(4) and (5), the Council or a Member State may request the Commission to make a recom-
mendation or a proposal, as appropriate. The Commission shall examine this request and submit its
conclusions to the Council without delay.

CHAPTER 4

TRANSITIONAL PROVISIONS

Article 116

1.

2.

The second stage for achieving economic and monetary union shall begin on 1 January 1994.

Before that date:

(a)

each Member State shall:

— adopt, where necessary, appropriate measures to comply with the prohibitions laid down in

Article 56 and in Articles 101 and 102(1),

— adopt, if necessary, with a view to permitting the assessment provided for in subparagraph (b),
multiannual programmes intended to ensure the lasting convergence necessary for the
achievement of economic and monetary union, in particular with regard to price stability
and sound public finances;

(b)

the Council shall, on the basis of a report from the Commission, assess the progress made with
regard to economic and monetary convergence,
in particular with regard to price stability and
sound public finances, and the progress made with the implementation of Community law
concerning the internal market.

The provisions of Articles 101, 102(1), 103(1) and 104 with the exception of paragraphs 1, 9,

3.
11 and 14 shall apply from the beginning of the second stage.

The provisions of Articles 100(2), 104(1), (9) and (11), 105, 106, 108, 111, 112, 113 and 114(2) and
(4) shall apply from the beginning of the third stage.

4.

In the second stage, Member States shall endeavour to avoid excessive government deficits.

During the second stage, each Member State shall, as appropriate, start the process leading to the

5.
independence of its central bank, in accordance with Article 109.

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Article 117

1.
At the start of the second stage, a European Monetary Institute (hereinafter referred to as ‘EMI’)
shall be established and take up its duties; it shall have legal personality and be directed and managed by
a Council, consisting of a President and the Governors of the national central banks, one of whom shall
be Vice-President.

The President shall be appointed by common accord of the governments of the Member States at the
level of Heads of State or Government, on a recommendation from the Council of the EMI, and after
consulting the European Parliament and the Council. The President shall be selected from among
persons of recognised standing and professional experience in monetary or banking matters. Only
nationals of Member States may be President of the EMI. The Council of the EMI shall appoint the
Vice-President.

The Statute of the EMI is laid down in a Protocol annexed to this Treaty.

2.

The EMI shall:

— strengthen cooperation between the national central banks,

— strengthen the coordination of the monetary policies of the Member States, with the aim of

ensuring price stability,

— monitor the functioning of the European Monetary System,

— hold consultations concerning issues falling within the competence of the national central banks

and affecting the stability of financial institutions and markets,

— take over the tasks of the European Monetary Cooperation Fund, which shall be dissolved; the

modalities of dissolution are laid down in the Statute of the EMI,

— facilitate the use of the ecu and oversee its development, including the smooth functioning of the

ecu clearing system.

3.

For the preparation of the third stage, the EMI shall:

— prepare the instruments and the procedures necessary for carrying out a single monetary policy in

the third stage,

— promote the harmonisation, where necessary, of the rules and practices governing the collection,

compilation and distribution of statistics in the areas within its field of competence,

— prepare the rules for operations to be undertaken by the national central banks within the

framework of the ESCB,

— promote the efficiency of cross-border payments,

— supervise the technical preparation of ecu banknotes.

At the latest by 31 December 1996, the EMI shall specify the regulatory, organisational and logistical
framework necessary for the ESCB to perform its tasks in the third stage. This framework shall be
submitted for decision to the ECB at the date of its establishment.

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4.

The EMI, acting by a majority of two thirds of the members of its Council, may:

— formulate opinions or recommendations on the overall orientation of monetary policy and

exchange-rate policy as well as on related measures introduced in each Member State,

— submit opinions or recommendations to governments and to the Council on policies which might
affect the internal or external monetary situation in the Community and, in particular, the func-
tioning of the European Monetary System,

— make recommendations to the monetary authorities of the Member States concerning the conduct

of their monetary policy.

5.

The EMI, acting unanimously, may decide to publish its opinions and its recommendations.

The EMI shall be consulted by the Council regarding any proposed Community act within its field

6.
of competence.

Within the limits and under the conditions set out by the Council, acting by a qualified majority on a
proposal from the Commission and after consulting the European Parliament and the EMI, the EMI shall
be consulted by the authorities of the Member States on any draft legislative provision within its field of
competence.

7.
The Council may, acting unanimously on a proposal from the Commission and after consulting
the European Parliament and the EMI, confer upon the EMI other tasks for the preparation of the third
stage.

Where this Treaty provides for a consultative role for the ECB, references to the ECB shall be read

8.
as referring to the EMI before the establishment of the ECB.

During the second stage, the term ‘ECB’ used in Articles 230, 232, 233, 234, 237 and 288 shall

9.
be read as referring to the EMI.

The currency composition of the ecu basket shall not be changed.

Article 118

From the start of the third stage, the value of the ecu shall be irrevocably fixed in accordance with
Article 123(4).

Article 119

1.
Where a Member State is in difficulties or is seriously threatened with difficulties as regards its
balance of payments either as a result of an overall disequilibrium in its balance of payments, or as a
result of the type of currency at its disposal, and where such difficulties are liable in particular to
jeopardise the functioning of the common market or the progressive implementation of the common
commercial policy, the Commission shall immediately investigate the position of the State in question
and the action which, making use of all the means at its disposal, that State has taken or may take in
accordance with the provisions of this Treaty. The Commission shall state what measures it recommends
the State concerned to take.

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If the action taken by a Member State and the measures suggested by the Commission do not prove
sufficient to overcome the difficulties which have arisen or which threaten, the Commission shall, after
consulting the Committee referred to in Article 114, recommend to the Council the granting of mutual
assistance and appropriate methods therefor.

The Commission shall keep the Council regularly informed of the situation and of how it is developing.

2.
The Council, acting by a qualified majority, shall grant such mutual assistance; it shall adopt
directives or decisions laying down the conditions and details of such assistance, which may take such
forms as:

(a)

a concerted approach to or within any other international organisations to which Member States
may have recourse;

(b) measures needed to avoid deflection of trade where the State which is in difficulties maintains or

reintroduces quantitative restrictions against third countries;

(c)

the granting of limited credits by other Member States, subject to their agreement.

3.
If the mutual assistance recommended by the Commission is not granted by the Council or if the
mutual assistance granted and the measures taken are insufficient, the Commission shall authorise the
State which is in difficulties to take protective measures, the conditions and details of which the
Commission shall determine.

Such authorisation may be revoked and such conditions and details may be changed by the Council
acting by a qualified majority.

4.

Subject to Article 122(6), this article shall cease to apply from the beginning of the third stage.

Article 120

1.
Where a sudden crisis in the balance of payments occurs and a decision within the meaning of
Article 119(2) is not immediately taken, the Member State concerned may, as a precaution, take the
necessary protective measures. Such measures must cause the least possible disturbance in the func-
tioning of the common market and must not be wider in scope than is strictly necessary to remedy the
sudden difficulties which have arisen.

2.
The Commission and the other Member States shall be informed of such protective measures not
later than when they enter into force. The Commission may recommend to the Council the granting of
mutual assistance under Article 119.

3.
After the Commission has delivered an opinion and the Committee referred to in Article 114 has
been consulted, the Council may, acting by a qualified majority, decide that the State concerned shall
amend, suspend or abolish the protective measures referred to above.

4.

Subject to Article 122(6), this article shall cease to apply from the beginning of the third stage.

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Article 121

1.
The Commission and the EMI shall report to the Council on the progress made in the fulfilment
by the Member States of their obligations regarding the achievement of economic and monetary union.
These reports shall include an examination of the compatibility between each Member State's national
legislation, including the statutes of its national central bank, and Articles 108 and 109 of this Treaty
and the Statute of the ESCB. The reports shall also examine the achievement of a high degree of
sustainable convergence by reference to the fulfilment by each Member State of the following criteria:

— the achievement of a high degree of price stability; this will be apparent from a rate of inflation
which is close to that of, at most, the three best performing Member States in terms of price
stability,

— the sustainability of the government financial position; this will be apparent from having achieved a
government budgetary position without a deficit that is excessive as determined in accordance with
Article 104(6),

— the observance of the normal fluctuation margins provided for by the exchange-rate mechanism of
the European Monetary System, for at least two years, without devaluing against the currency of
any other Member State,

— the durability of convergence achieved by the Member State and of

its participation in the
exchange-rate mechanism of the European Monetary System being reflected in the long-term
interest-rate levels.

The four criteria mentioned in this paragraph and the relevant periods over which they are to be
respected are developed further in a Protocol annexed to this Treaty. The reports of the Commission
and the EMI shall also take account of the development of the ecu, the results of the integration of
markets, the situation and development of the balances of payments on current account and an
examination of the development of unit labour costs and other price indices.

On the basis of these reports, the Council, acting by a qualified majority on a recommendation

2.
from the Commission, shall assess:

— for each Member State, whether it fulfils the necessary conditions for the adoption of a single

currency;

— whether a majority of the Member States fulfils the necessary conditions for the adoption of a

single currency,

and recommend its findings to the Council, meeting in the composition of
the Heads of State or
Government. The European Parliament shall be consulted and forward its opinion to the Council, meeting
in the composition of the Heads of State or Government.

3.
Taking due account of the reports referred to in paragraph 1 and the opinion of the European
Parliament referred to in paragraph 2, the Council, meeting in the composition of the Heads of State or
Government, shall, acting by a qualified majority, not later than 31 December 1996:

— decide, on the basis of the recommendations of the Council referred to in paragraph 2, whether a
majority of the Member States fulfils the necessary conditions for the adoption of a single currency,

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— decide whether it is appropriate for the Community to enter the third stage,

and if so:

— set the date for the beginning of the third stage.

4.
If, by the end of 1997, the date for the beginning of the third stage has not been set, the third
stage shall start on 1 January 1999. Before 1 July 1998, the Council, meeting in the composition of the
Heads of State or Government, after a repetition of the procedure provided for in paragraphs 1 and 2,
with the exception of the second indent of paragraph 2, taking into account the reports referred to in
paragraph 1 and the opinion of the European Parliament, shall, acting by a qualified majority and on the
basis of the recommendations of the Council referred to in paragraph 2, confirm which Member States
fulfil the necessary conditions for the adoption of a single currency.

Article 122

If the decision has been taken to set the date in accordance with Article 121(3), the Council shall,
1.
on the basis of its recommendations referred to in Article 121(2), acting by a qualified majority on a
recommendation from the Commission, decide whether any, and if so which, Member States shall have
a derogation as defined in paragraph 3 of this Article. Such Member States shall in this Treaty be
referred to as ‘Member States with a derogation’.

If the Council has confirmed which Member States fulfil the necessary conditions for the adoption of a
single currency,
in accordance with Article 121(4), those Member States which do not fulfil the
conditions shall have a derogation as defined in paragraph 3 of this Article. Such Member States
shall in this Treaty be referred to as ‘Member States with a derogation’.

2.
At least once every two years, or at the request of a Member State with a derogation, the
Commission and the ECB shall report to the Council in accordance with the procedure laid down in
Article 121(1). After consulting the European Parliament and after discussion in the Council, meeting in
the composition of the Heads of State or Government, the Council shall, acting by a qualified majority
on a proposal from the Commission, decide which Member States with a derogation fulfil the necessary
conditions on the basis of the criteria set out in Article 121(1), and abrogate the derogations of the
Member States concerned.

A derogation referred to in paragraph 1 shall entail that the following articles do not apply to the
3.
Member State concerned: Articles 104(9) and (11), 105(1),
(3) and (5), 106, 110, 111, and
112(2)(b). The exclusion of such a Member State and its national central bank from rights and obli-
gations within the ESCB is laid down in Chapter IX of the Statute of the ESCB.

(2),

In Articles 105(1), (2) and (3), 106, 110, 111 and 112(2)(b), ‘Member States’ shall be read as

4.
‘Member States without a derogation’.

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5.
The voting rights of Member States with a derogation shall be suspended for the Council
decisions referred to in the articles of this Treaty mentioned in paragraph 3. In that case, by way of
derogation from Articles 205 and 250(1), a qualified majority shall be defined as two thirds of the votes
of the representatives of the Member States without a derogation weighted in accordance with Article
205(2), and unanimity of those Member States shall be required for an act requiring unanimity.

6.

Articles 119 and 120 shall continue to apply to a Member State with a derogation.

Immediately after the decision on the date for the beginning of the third stage has been taken in

1.
accordance with Article 121(3), or, as the case may be, immediately after 1 July 1998:

Article 123 (*)

— the Council shall adopt the provisions referred to in Article 107(6),

— the governments of the Member States without a derogation shall appoint, in accordance with the
procedure set out in Article 50 of the Statute of the ESCB, the President, the Vice-President and the
other members of the Executive Board of the ECB. If there are Member States with a derogation,
the number of members of the Executive Board may be smaller than provided for in Article 11.1 of
the Statute of the ESCB, but in no circumstances shall it be less than four.

As soon as the Executive Board is appointed, the ESCB and the ECB shall be established and shall
prepare for their full operation as described in this Treaty and the Statute of the ESCB. The full exercise
of their powers shall start from the first day of the third stage.

2.
As soon as the ECB is established, it shall, if necessary, take over tasks of the EMI. The EMI shall
go into liquidation upon the establishment of the ECB; the modalities of liquidation are laid down in the
Statute of the EMI.

3.
If and as long as there are Member States with a derogation, and without prejudice to Article
107(3) of this Treaty, the General Council of the ECB referred to in Article 45 of the Statute of the ESCB
shall be constituted as a third decision-making body of the ECB.

At the starting date of the third stage, the Council shall, acting with the unanimity of the Member
4.
States without a derogation, on a proposal from the Commission and after consulting the ECB, adopt
the conversion rates at which their currencies shall be irrevocably fixed and at which irrevocably fixed
rate the ecu shall be substituted for these currencies, and the ecu will become a currency in its own
right. This measure shall by itself not modify the external value of the ecu. The Council, acting by a
qualified majority of the said Member States, on a proposal from the Commission and after consulting
the ECB, shall take the other measures necessary for the rapid introduction of the ecu as the single
currency of those Member States. The second sentence of Article 122(5) shall apply.

(*) Article amended by the Treaty of Nice.

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5.
If it is decided, according to the procedure set out in Article 122(2), to abrogate a derogation, the
Council shall, acting with the unanimity of the Member States without a derogation and the Member
State concerned, on a proposal from the Commission and after consulting the ECB, adopt the rate at
which the ecu shall be substituted for the currency of the Member State concerned, and take the other
measures necessary for the introduction of
the ecu as the single currency in the Member State
concerned.

Article 124

1.
Until the beginning of the third stage, each Member State shall treat its exchange-rate policy as a
matter of common interest. In so doing, Member States shall take account of the experience acquired in
cooperation within the framework of the European Monetary System (EMS) and in developing the ecu,
and shall respect existing powers in this field.

From the beginning of the third stage and for as long as a Member State has a derogation,

2.
paragraph 1 shall apply by analogy to the exchange-rate policy of that Member State.

TITLE VIII

EMPLOYMENT

Article 125

Member States and the Community shall,
in accordance with this title, work towards developing a
coordinated strategy for employment and particularly for promoting a skilled, trained and adaptable
workforce and labour markets responsive to economic change with a view to achieving the objectives
defined in Article 2 of the Treaty on European Union and in Article 2 of this Treaty.

1.
Member States, through their employment policies, shall contribute to the achievement of the
objectives referred to in Article 125 in a way consistent with the broad guidelines of the economic
policies of the Member States and of the Community adopted pursuant to Article 99(2).

Article 126

2.
Member States, having regard to national practices related to the responsibilities of management
and labour, shall regard promoting employment as a matter of common concern and shall coordinate
their action in this respect within the Council, in accordance with the provisions of Article 128.

1.
The Community shall contribute to a high level of employment by encouraging cooperation
between Member States and by supporting and, if necessary, complementing their action. In doing so,
the competences of the Member States shall be respected.

Article 127

The objective of a high level of employment shall be taken into consideration in the formulation

2.
and implementation of Community policies and activities.

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1.
The European Council shall each year consider the employment situation in the Community and
adopt conclusions thereon, on the basis of a joint annual report by the Council and the Commission.

Article 128

On the basis of the conclusions of the European Council, the Council, acting by a qualified
2.
majority on a proposal
from the Commission and after consulting the European Parliament, the
Economic and Social Committee, the Committee of the Regions and the Employment Committee
referred to in Article 130, shall each year draw up guidelines which the Member States shall take
into account in their employment policies. These guidelines shall be consistent with the broad guidelines
adopted pursuant to Article 99(2).

Each Member State shall provide the Council and the Commission with an annual report on the
its employment policy in the light of the guidelines for

3.
principal measures taken to implement
employment as referred to in paragraph 2.

4.
The Council, on the basis of the reports referred to in paragraph 3 and having received the views
of the Employment Committee, shall each year carry out an examination of the implementation of the
employment policies of the Member States in the light of the guidelines for employment. The Council,
acting by a qualified majority on a recommendation from the Commission, may,
if it considers it
appropriate in the light of that examination, make recommendations to Member States.

5.
On the basis of the results of that examination, the Council and the Commission shall make a
joint annual report to the European Council on the employment situation in the Community and on the
implementation of the guidelines for employment.

Article 129

The Council, acting in accordance with the procedure referred to in Article 251 and after consulting the
Economic and Social Committee and the Committee of the Regions, may adopt incentive measures
designed to encourage cooperation between Member States and to support their action in the field of
employment through initiatives aimed at developing exchanges of information and best practices,
providing comparative analysis and advice as well as promoting innovative approaches and evaluating
experiences, in particular by recourse to pilot projects.

Those measures shall not include harmonisation of the laws and regulations of the Member States.

The Council, after consulting the European Parliament, shall establish an Employment Committee with
advisory status to promote coordination between Member States on employment and labour market
policies. The tasks of the Committee shall be:

Article 130

— to monitor the employment situation and employment policies in the Member States and the

Community,

— without prejudice to Article 207, to formulate opinions at the request of either the Council or the
the Council

Commission or on its own initiative, and to contribute to the preparation of
proceedings referred to in Article 128.

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In fulfilling its mandate, the Committee shall consult management and labour.

Each Member State and the Commission shall appoint two members of the Committee.

TITLE IX

COMMON COMMERCIAL POLICY

Article 131

By establishing a customs union between themselves Member States aim to contribute, in the common
interest, to the harmonious development of world trade, the progressive abolition of restrictions on
international trade and the lowering of customs barriers.

The common commercial policy shall take into account the favourable effect which the abolition of
customs duties between Member States may have on the increase in the competitive strength of under-
takings in those States.

Article 132

1.
Without prejudice to obligations undertaken by them within the framework of other international
organisations, Member States shall progressively harmonise the systems whereby they grant aid for
exports to third countries, to the extent necessary to ensure that competition between undertakings
of the Community is not distorted.

On a proposal from the Commission, the Council shall, acting by a qualified majority,
directives needed for this purpose.

issue any

The preceding provisions shall not apply to such a drawback of customs duties or charges having
2.
equivalent effect nor to such a repayment of indirect taxation including turnover taxes, excise duties and
other indirect taxes as is allowed when goods are exported from a Member State to a third country, in
so far as such a drawback or repayment does not exceed the amount imposed, directly or indirectly, on
the products exported.

Article 133 (*)

1.
The common commercial policy shall be based on uniform principles, particularly in regard to
changes in tariff rates, the conclusion of tariff and trade agreements, the achievement of uniformity in
measures of liberalisation, export policy and measures to protect trade such as those to be taken in the
event of dumping or subsidies.

The Commission shall submit proposals to the Council

2.
commercial policy.

for

implementing the common

3.
Where agreements with one or more States or international organisations need to be negotiated,
the Commission shall make recommendations to the Council, which shall authorise the Commission to
open the necessary negotiations. The Council and the Commission shall be responsible for ensuring that
the agreements negotiated are compatible with internal Community policies and rules.

(*) Article amended by the Treaty of Nice.

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The Commission shall conduct these negotiations in consultation with a special committee appointed by
the Council to assist the Commission in this task and within the framework of such directives as the
Council may issue to it. The Commission shall report regularly to the special committee on the progress
of negotiations.

The relevant provisions of Article 300 shall apply.

In exercising the powers conferred upon it by this Article, the Council shall act by a qualified

4.
majority.

5.
Paragraphs 1 to 4 shall also apply to the negotiation and conclusion of agreements in the fields
of trade in services and the commercial aspects of intellectual property, in so far as those agreements are
not covered by the said paragraphs and without prejudice to paragraph 6.

By way of derogation from paragraph 4, the Council shall act unanimously when negotiating and
the fields referred to in the first subparagraph, where that
concluding an agreement
agreement includes provisions for which unanimity is required for the adoption of internal rules or
where it relates to a field in which the Community has not yet exercised the powers conferred upon it
by this Treaty by adopting internal rules.

in one of

The Council shall act unanimously with respect to the negotiation and conclusion of a horizontal
agreement insofar as it also concerns the preceding subparagraph or the second subparagraph of
paragraph 6.

This paragraph shall not affect the right of the Member States to maintain and conclude agreements
with third countries or international organisations in so far as such agreements comply with Community
law and other relevant international agreements.

An agreement may not be concluded by the Council if it includes provisions which would go
in particular by leading to harmonisation of the laws or

6.
beyond the Community's internal powers,
regulations of the Member States in an area for which this Treaty rules out such harmonisation.

In this regard, by way of derogation from the first subparagraph of paragraph 5, agreements relating to
trade in cultural and audiovisual services, educational services, and social and human health services,
shall fall within the shared competence of the Community and its Member States. Consequently, in
addition to a Community decision taken in accordance with the relevant provisions of Article 300, the
negotiation of such agreements shall require the common accord of the Member States. Agreements
thus negotiated shall be concluded jointly by the Community and the Member States.

The negotiation and conclusion of international agreements in the field of transport shall continue to be
governed by the provisions of Title V and Article 300.

Without prejudice to the first subparagraph of paragraph 6, the Council, acting unanimously on a
7.
proposal
from the Commission and after consulting the European Parliament, may extend the
application of paragraphs 1 to 4 to international negotiations and agreements on intellectual
property in so far as they are not covered by paragraph 5.

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Article 134

In order to ensure that the execution of measures of commercial policy taken in accordance with this
Treaty by any Member State is not obstructed by deflection of trade, or where differences between such
measures lead to economic difficulties in one or more Member States, the Commission shall recommend
the methods for the requisite cooperation between Member States. Failing this, the Commission may
authorise Member States to take the necessary protective measures, the conditions and details of which it
shall determine.

In case of urgency, Member States shall request authorisation to take the necessary measures themselves
from the Commission, which shall take a decision as soon as possible; the Member States concerned
shall then notify the measures to the other Member States. The Commission may decide at any time that
the Member States concerned shall amend or abolish the measures in question.

In the selection of such measures, priority shall be given to those which cause the least disturbance of
the functioning of the common market.

TITLE X

CUSTOMS COOPERATION

Article 135

Within the scope of application of this Treaty, the Council, acting in accordance with the procedure
referred to in Article 251, shall take measures in order to strengthen customs cooperation between
Member States and between the latter and the Commission. These measures shall not concern the
application of national criminal law or the national administration of justice.

SOCIAL POLICY, EDUCATION, VOCATIONAL TRAINING AND YOUTH

TITLE XI

CHAPTER 1

SOCIAL PROVISIONS

Article 136

The Community and the Member States, having in mind fundamental social rights such as those set out
in the European Social Charter signed at Turin on 18 October 1961 and in the 1989 Community
Charter of the Fundamental Social Rights of Workers, shall have as their objectives the promotion of
employment, improved living and working conditions, so as to make possible their harmonisation while
the improvement is being maintained, proper social protection, dialogue between management and
labour,
the development of human resources with a view to lasting high employment and the
combating of exclusion.

To this end the Community and the Member States shall implement measures which take account of the
diverse forms of national practices, in particular in the field of contractual relations, and the need to
maintain the competitiveness of the Community economy.

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They believe that such a development will ensue not only from the functioning of the common market,
which will favour the harmonisation of social systems, but also from the procedures provided for in this
Treaty and from the approximation of provisions laid down by law, regulation or administrative action.

Article 137 (*)

With a view to achieving the objectives of Article 136, the Community shall support and

1.
complement the activities of the Member States in the following fields:

(a)

improvement in particular of the working environment to protect workers' health and safety;

(b) working conditions;

(c)

social security and social protection of workers;

(d) protection of workers where their employment contract is terminated;

(e)

the information and consultation of workers;

(f)

representation and collective defence of the interests of workers and employers, including co-deter-
mination, subject to paragraph 5;

(g)

conditions of employment for third-country nationals legally residing in Community territory;

(h)

the integration of persons excluded from the labour market, without prejudice to Article 150;

(i)

equality between men and women with regard to labour market opportunities and treatment at
work;

(j)

the combating of social exclusion;

(k)

the modernisation of social protection systems without prejudice to point (c).

2.

To this end, the Council:

(a) may adopt measures designed to encourage cooperation between Member States through initiatives
aimed at improving knowledge, developing exchanges of information and best practices, promoting
innovative approaches and evaluating experiences, excluding any harmonisation of the laws and
regulations of the Member States;

(b) may adopt, in the fields referred to in paragraph 1(a) to (i), by means of directives, minimum
requirements for gradual
implementation, having regard to the conditions and technical rules
obtaining in each of the Member States. Such directives shall avoid imposing administrative,
financial and legal constraints in a way which would hold back the creation and development
of small and medium-sized undertakings.

(*) Article amended by the Treaty of Nice.

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The Council shall act in accordance with the procedure referred to in Article 251 after consulting the
Economic and Social Committee and the Committee of the Regions, except in the fields referred to in
paragraph 1(c), (d), (f) and (g) of this article, where the Council shall act unanimously on a proposal
from the Commission, after consulting the European Parliament and the said Committees. The Council,
acting unanimously on a proposal from the Commission, after consulting the European Parliament, may
decide to render the procedure referred to in Article 251 applicable to paragraph 1(d), (f) and (g) of this
article.

A Member State may entrust management and labour, at their joint request, with the implemen-

3.
tation of directives adopted pursuant to paragraph 2.

In this case, it shall ensure that, no later than the date on which a directive must be transposed in
accordance with Article 249, management and labour have introduced the necessary measures by
agreement, the Member State concerned being required to take any necessary measure enabling it at
any time to be in a position to guarantee the results imposed by that directive.

4.

The provisions adopted pursuant to this article:

— shall not affect the right of Member States to define the fundamental principles of their social

security systems and must not significantly affect the financial equilibrium thereof,

— shall not prevent any Member State from maintaining or introducing more stringent protective

measures compatible with this Treaty.

The provisions of this article shall not apply to pay, the right of association, the right to strike or

5.
the right to impose lock-outs.

1.
The Commission shall have the task of promoting the consultation of management and labour at
Community level and shall take any relevant measure to facilitate their dialogue by ensuring balanced
support for the parties.

Article 138

To this end, before submitting proposals in the social policy field, the Commission shall consult

2.
management and labour on the possible direction of Community action.

3.
If, after such consultation, the Commission considers Community action advisable, it shall consult
management and labour on the content of the envisaged proposal. Management and labour shall
forward to the Commission an opinion or, where appropriate, a recommendation.

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4.
On the occasion of such consultation, management and labour may inform the Commission of
their wish to initiate the process provided for in Article 139. The duration of the procedure shall not
exceed nine months, unless the management and labour concerned and the Commission decide jointly
to extend it.

Article 139 (*)

Should management and labour so desire, the dialogue between them at Community level may

1.
lead to contractual relations, including agreements.

Agreements concluded at Community level shall be implemented either in accordance with the
2.
procedures and practices specific to management and labour and the Member States or,
in matters
covered by Article 137, at the joint request of the signatory parties, by a Council decision on a proposal
from the Commission.

The Council shall act by qualified majority, except where the agreement in question contains one or
more provisions relating to one of the areas for which unanimity is required pursuant to Article 137(2).
In that case, it shall act unanimously.

Article 140

With a view to achieving the objectives of Article 136 and without prejudice to the other provisions of
this Treaty, the Commission shall encourage cooperation between the Member States and facilitate the
coordination of their action in all social policy fields under this chapter, particularly in matters relating
to:

— employment,

— labour law and working conditions,

— basic and advanced vocational training,

— social security,

— prevention of occupational accidents and diseases,

— occupational hygiene,

— the right of association and collective bargaining between employers and workers.

To this end, the Commission shall act in close contact with Member States by making studies, delivering
opinions and arranging consultations both on problems arising at national level and on those of concern
to international organisations.

Before delivering the opinions provided for in this article, the Commission shall consult the Economic
and Social Committee.

(*) Article amended by the Treaty of Nice.

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Article 141

Each Member State shall ensure that the principle of equal pay for male and female workers for

1.
equal work or work of equal value is applied.

2.
For the purpose of this article, ‘pay’ means the ordinary basic or minimum wage or salary and
any other consideration, whether in cash or in kind, which the worker receives directly or indirectly, in
respect of his employment, from his employer.

Equal pay without discrimination based on sex means:

(a)

that pay for the same work at piece rates shall be calculated on the basis of the same unit of
measurement;

(b)

that pay for work at time rates shall be the same for the same job.

3.
The Council, acting in accordance with the procedure referred to in Article 251, and after
consulting the Economic and Social Committee, shall adopt measures to ensure the application of
the principle of equal opportunities and equal treatment of men and women in matters of employment
and occupation, including the principle of equal pay for equal work or work of equal value.

With a view to ensuring full equality in practice between men and women in working life, the
4.
principle of equal treatment shall not prevent any Member State from maintaining or adopting measures
providing for specific advantages in order to make it easier for the underrepresented sex to pursue a
vocational activity or to prevent or compensate for disadvantages in professional careers.

Member States shall endeavour to maintain the existing equivalence between paid holiday schemes.

Article 142

Article 143

The Commission shall draw up a report each year on progress in achieving the objectives of Article 136,
including the demographic situation in the Community. It shall forward the report to the European
Parliament, the Council and the Economic and Social Committee.

The European Parliament may invite the Commission to draw up reports on particular problems
concerning the social situation.

Article 144 (*)

The Council, after consulting the European Parliament, shall establish a Social Protection Committee
with advisory status to promote cooperation on social protection policies between Member States and
with the Commission. The tasks of the Committee shall be:

— to monitor the social situation and the development of social protection policies in the Member

States and the Community,

(*) Article amended by the Treaty of Nice.

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— to promote exchanges of information, experience and good practice between Member States and

with the Commission,

— without prejudice to Article 207, to prepare reports, formulate opinions or undertake other work
within its fields of competence, at the request of either the Council or the Commission or on its
own initiative.

In fulfilling its mandate, the Committee shall establish appropriate contacts with management and
labour.

Each Member State and the Commission shall appoint two members of the Committee.

The Commission shall include a separate chapter on social developments within the Community in its
annual report to the European Parliament.

Article 145

The European Parliament may invite the Commission to draw up reports on any particular problems
concerning social conditions.

CHAPTER 2

THE EUROPEAN SOCIAL FUND

Article 146

In order to improve employment opportunities for workers in the internal market and to contribute
thereby to raising the standard of living, a European Social Fund is hereby established in accordance
with the provisions set out below; it shall aim to render the employment of workers easier and to
increase their geographical and occupational mobility within the Community, and to facilitate their
adaptation to industrial changes and to changes in production systems, in particular through vocational
training and retraining.

The Fund shall be administered by the Commission.

Article 147

The Commission shall be assisted in this task by a Committee presided over by a Member of the
Commission and composed of representatives of governments, trade unions and employers' organi-
sations.

The Council, acting in accordance with the procedure referred to in Article 251 and after consulting the
Economic and Social Committee and the Committee of the Regions, shall adopt implementing decisions
relating to the European Social Fund.

Article 148

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CHAPTER 3

EDUCATION, VOCATIONAL TRAINING AND YOUTH

Article 149

1.
The Community shall contribute to the development of quality education by encouraging coop-
eration between Member States and, if necessary, by supporting and supplementing their action, while
fully respecting the responsibility of the Member States for the content of teaching and the organisation
of education systems and their cultural and linguistic diversity.

2.

Community action shall be aimed at:

— developing the European dimension in education, particularly through the teaching and dissemi-

nation of the languages of the Member States,

— encouraging mobility of students and teachers, by encouraging inter alia, the academic recognition

of diplomas and periods of study,

— promoting cooperation between educational establishments,

— developing exchanges of information and experience on issues common to the education systems

of the Member States,

— encouraging the development of youth exchanges and of exchanges of socioeducational instructors,

— encouraging the development of distance education.

3.
The Community and the Member States shall foster cooperation with third countries and the
competent international organisations in the field of education, in particular the Council of Europe.

4.

In order to contribute to the achievement of the objectives referred to in this Article, the Council:

— acting in accordance with the procedure referred to in Article 251, after consulting the Economic
and Social Committee and the Committee of the Regions, shall adopt incentive measures, excluding
any harmonisation of the laws and regulations of the Member States,

— acting by a qualified majority on a proposal from the Commission, shall adopt recommendations.

Article 150

The Community shall

1.
support and
supplement the action of the Member States, while fully respecting the responsibility of the Member
States for the content and organisation of vocational training.

training policy which shall

implement a vocational

2.

Community action shall aim to:

— facilitate adaptation to industrial changes, in particular through vocational training and retraining,

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— improve initial and continuing vocational training in order to facilitate vocational integration and

reintegration into the labour market,

— facilitate access to vocational training and encourage mobility of instructors and trainees and

particularly young people,

— stimulate cooperation on training between educational or training establishments and firms,

— develop exchanges of information and experience on issues common to the training systems of the

Member States.

The Community and the Member States shall foster cooperation with third countries and the

3.
competent international organisations in the sphere of vocational training.

The Council, acting in accordance with the procedure referred to in Article 251 and after
4.
consulting the Economic and Social Committee and the Committee of
the Regions, shall adopt
measures to contribute to the achievement of the objectives referred to in this article, excluding any
harmonisation of the laws and regulations of the Member States.

TITLE XII

CULTURE

Article 151

1.
The Community shall contribute to the flowering of the cultures of the Member States, while
respecting their national and regional diversity and at the same time bringing the common cultural
heritage to the fore.

Action by the Community shall be aimed at encouraging cooperation between Member States

2.
and, if necessary, supporting and supplementing their action in the following areas:

— improvement of the knowledge and dissemination of the culture and history of the European

peoples,

— conservation and safeguarding of cultural heritage of European significance,

— non-commercial cultural exchanges,

— artistic and literary creation, including in the audiovisual sector.

The Community and the Member States shall foster cooperation with third countries and the

3.
competent international organisations in the sphere of culture, in particular the Council of Europe.

The Community shall take cultural aspects into account in its action under other provisions of

4.
this Treaty, in particular in order to respect and to promote the diversity of its cultures.

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5.

In order to contribute to the achievement of the objectives referred to in this Article, the Council:

— acting in accordance with the procedure referred to in Article 251 and after consulting the
Committee of the Regions, shall adopt incentive measures, excluding any harmonisation of the
laws and regulations of the Member States. The Council shall act unanimously throughout the
procedure referred to in Article 251,

— acting unanimously on a proposal from the Commission, shall adopt recommendations.

TITLE XIII

PUBLIC HEALTH

Article 152

A high level of human health protection shall be ensured in the definition and implementation of

1.
all Community policies and activities.

Community action, which shall complement national policies, shall be directed towards improving
public health, preventing human illness and diseases, and obviating sources of danger to human
health. Such action shall cover the fight against the major health scourges, by promoting research
into their causes, their transmission and their prevention, as well as health information and education.

The Community shall complement the Member States' action in reducing drugs-related health damage,
including information and prevention.

The Community shall encourage cooperation between the Member States in the areas referred to

2.
in this Article and, if necessary, lend support to their action.

Member States shall, in liaison with the Commission, coordinate among themselves their policies and
programmes in the areas referred to in paragraph 1. The Commission may, in close contact with the
Member States, take any useful initiative to promote such coordination.

The Community and the Member States shall foster cooperation with third countries and the

3.
competent international organisations in the sphere of public health.

4.
The Council, acting in accordance with the procedure referred to in Article 251 and after
consulting the Economic and Social Committee and the Committee of the Regions, shall contribute
to the achievement of the objectives referred to in this article through adopting:

(a) measures setting high standards of quality and safety of organs and substances of human origin,
blood and blood derivatives; these measures shall not prevent any Member State from maintaining
or introducing more stringent protective measures;

(b) by way of derogation from Article 37, measures in the veterinary and phytosanitary fields which

have as their direct objective the protection of public health;

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(c)

incentive measures designed to protect and improve human health, excluding any harmonisation of
the laws and regulations of the Member States.

The Council, acting by a qualified majority on a proposal from the Commission, may also adopt
recommendations for the purposes set out in this article.

Community action in the field of public health shall fully respect the responsibilities of the
5.
Member States for the organisation and delivery of health services and medical care. In particular,
measures referred to in paragraph 4(a) shall not affect national provisions on the donation or
medical use of organs and blood.

TITLE XIV

CONSUMER PROTECTION

Article 153

In order to promote the interests of consumers and to ensure a high level of consumer
1.
protection, the Community shall contribute to protecting the health, safety and economic interests of
consumers, as well as to promoting their right to information, education and to organise themselves in
order to safeguard their interests.

Consumer protection requirements shall be taken into account in defining and implementing

2.
other Community policies and activities.

The Community shall contribute to the attainment of the objectives referred to in paragraph 1

3.
through:

(a) measures adopted pursuant to Article 95 in the context of the completion of the internal market;

(b) measures which support, supplement and monitor the policy pursued by the Member States.

4.
The Council, acting in accordance with the procedure referred to in Article 251 and after
consulting the Economic and Social Committee, shall adopt the measures referred to in paragraph 3(b).

5.
Measures adopted pursuant to paragraph 4 shall not prevent any Member State from maintaining
or introducing more stringent protective measures. Such measures must be compatible with this Treaty.
The Commission shall be notified of them.

TITLE XV

TRANS-EUROPEAN NETWORKS

Article 154

To help achieve the objectives referred to in Articles 14 and 158 and to enable citizens of the
1.
Union, economic operators and regional and local communities to derive full benefit from the setting-up
of an area without internal frontiers, the Community shall contribute to the establishment and devel-
opment of trans-European networks in the areas of transport, telecommunications and energy infra-
structures.

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2.
Within the framework of a system of open and competitive markets, action by the Community
shall aim at promoting the interconnection and interoperability of national networks as well as access to
such networks. It shall take account in particular of the need to link island, landlocked and peripheral
regions with the central regions of the Community.

1.

In order to achieve the objectives referred to in Article 154, the Community:

Article 155

— shall establish a series of guidelines covering the objectives, priorities and broad lines of measures
identify projects of

envisaged in the sphere of trans-European networks; these guidelines shall
common interest,

— shall

implement any measures that may prove necessary to ensure the interoperability of the

networks, in particular in the field of technical standardisation,

— may support projects of common interest supported by Member States, which are identified in the
framework of the guidelines referred to in the first indent, particularly through feasibility studies,
loan guarantees or interest-rate subsidies;
through the
Cohesion Fund set up pursuant to Article 161, to the financing of specific projects in Member
States in the area of transport infrastructure.

the Community may also contribute,

The Community's activities shall take into account the potential economic viability of the projects.

Member States shall, in liaison with the Commission, coordinate among themselves the policies
2.
pursued at national level which may have a significant impact on the achievement of the objectives
referred to in Article 154. The Commission may, in close cooperation with the Member State, take any
useful initiative to promote such coordination.

The Community may decide to cooperate with third countries to promote projects of mutual

3.
interest and to ensure the interoperability of networks.

The guidelines and other measures referred to in Article 155(1) shall be adopted by the Council, acting
in accordance with the procedure referred to in Article 251 and after consulting the Economic and
Social Committee and the Committee of the Regions.

Article 156

Guidelines and projects of common interest which relate to the territory of a Member State shall require
the approval of the Member State concerned.

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TITLE XVI

INDUSTRY

Article 157 (*)

The Community and the Member States shall ensure that the conditions necessary for the

1.
competitiveness of the Community's industry exist.

For that purpose, in accordance with a system of open and competitive markets, their action shall be
aimed at:

— speeding up the adjustment of industry to structural changes,

— encouraging an environment favourable to initiative and to the development of undertakings

throughout the Community, particularly small and medium-sized undertakings,

— encouraging an environment favourable to cooperation between undertakings,

— fostering better exploitation of the industrial potential of policies of innovation, research and

technological development.

2.
The Member States shall consult each other in liaison with the Commission and, where necessary,
shall coordinate their action. The Commission may take any useful initiative to promote such coor-
dination.

3.
The Community shall contribute to the achievement of the objectives set out in paragraph 1
through the policies and activities it pursues under other provisions of this Treaty. The Council, acting
in accordance with the procedure referred to in Article 251 and after consulting the Economic and
Social Committee, may decide on specific measures in support of action taken in the Member States to
achieve the objectives set out in paragraph 1.

This title shall not provide a basis for the introduction by the Community of any measure which could
lead to a distortion of competition or contains tax provisions or provisions relating to the rights and
interests of employed persons.

TITLE XVII

ECONOMIC AND SOCIAL COHESION

Article 158

In order to promote its overall harmonious development, the Community shall develop and pursue its
actions leading to the strengthening of its economic and social cohesion.

In particular, the Community shall aim at reducing disparities between the levels of development of the
various regions and the backwardness of the least favoured regions or islands, including rural areas.

(*) Article amended by the Treaty of Nice.

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Article 159 (*)

Member States shall conduct their economic policies and shall coordinate them in such a way as, in
addition, to attain the objectives set out in Article 158. The formulation and implementation of the
Community's policies and actions and the implementation of the internal market shall take into account
the objectives set out in Article 158 and shall contribute to their achievement. The Community shall
also support the achievement of these objectives by the action it takes through the Structural Funds
(European Agricultural Guidance and Guarantee Fund, Guidance Section; European Social Fund;
European Regional Development Fund),
the European Investment Bank and the other existing
Financial Instruments.

The Commission shall submit a report to the European Parliament, the Council, the Economic and
Social Committee and the Committee of the Regions every three years on the progress made towards
achieving economic and social cohesion and on the manner in which the various means provided for in
this Article have contributed to it. This report shall,
if necessary, be accompanied by appropriate
proposals.

If specific actions prove necessary outside the Funds and without prejudice to the measures decided
upon within the framework of the other Community policies, such actions may be adopted by the
Council acting in accordance with the procedure referred to in Article 251 and after consulting the
Economic and Social Committee and the Committee of the Regions.

The European Regional Development Fund is intended to help to redress the main regional imbalances
in the Community through participation in the development and structural adjustment of regions whose
development is lagging behind and in the conversion of declining industrial regions.

Article 160

Article 161 (*)

Without prejudice to Article 162, the Council, acting unanimously on a proposal from the Commission
and after obtaining the assent of the European Parliament and consulting the Economic and Social
Committee and the Committee of the Regions, shall define the tasks, priority objectives and the
organisation of the Structural Funds, which may involve grouping the Funds. The Council, acting by
the same procedure, shall also define the general rules applicable to them and the provisions necessary
to ensure their effectiveness and the coordination of the Funds with one another and with the other
existing Financial Instruments.

A Cohesion Fund set up by the Council in accordance with the same procedure shall provide a financial
contribution to projects in the fields of environment and trans-European networks in the area of
transport infrastructure.

From 1 January 2007, the Council shall act by a qualified majority on a proposal from the Commission
after obtaining the assent of the European Parliament and after consulting the Economic and Social
Committee and the Committee of the Regions if, by that date, the multiannual financial perspective
applicable from 1 January 2007 and the Interinstitutional Agreement relating thereto have been
adopted. If such is not the case, the procedure laid down by this paragraph shall apply from the
date of their adoption.

(*) Article amended by the Treaty of Nice.

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Implementing decisions relating to the European Regional Development Fund shall be taken by the
Council, acting in accordance with the procedure referred to in Article 251 and after consulting the
Economic and Social Committee and the Committee of the Regions.

Article 162

With regard to the European Agricultural Guidance and Guarantee Fund, Guidance Section, and the
European Social Fund, Articles 37 and 148 respectively shall continue to apply.

TITLE XVIII

RESEARCH AND TECHNOLOGICAL DEVELOPMENT

Article 163

The Community shall have the objective of strengthening the scientific and technological bases of
level, while

1.
Community industry and encouraging it to become more competitive at international
promoting all the research activities deemed necessary by virtue of other chapters of this Treaty.

For this purpose the Community shall, throughout the Community, encourage undertakings,
2.
including small and medium-sized undertakings, research centres and universities in their research
and technological development activities of high quality;
it shall support their efforts to cooperate
with one another, aiming, notably, at enabling undertakings to exploit the internal market potential
to the full, in particular through the opening-up of national public contracts, the definition of common
standards and the removal of legal and fiscal obstacles to that cooperation.

All Community activities under this Treaty in the area of research and technological development,
3.
including demonstration projects, shall be decided on and implemented in accordance with the
provisions of this title.

In pursuing these objectives, the Community shall carry out the following activities, complementing the
activities carried out in the Member States:

Article 164

(a)

implementation of
promoting cooperation with and between undertakings, research centres and universities;

technological development and demonstration programmes, by

research,

(b) promotion of cooperation in the field of Community research, technological development and

demonstration with third countries and international organisations;

(c)

dissemination and optimisation of the results of activities in Community research, technological
development and demonstration;

(d)

stimulation of the training and mobility of researchers in the Community.

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Article 165

1.
The Community and the Member States shall coordinate their research and technological devel-
opment activities so as to ensure that national policies and Community policy are mutually consistent.

In close cooperation with the Member State, the Commission may take any useful initiative to

2.
promote the coordination referred to in paragraph 1.

A multiannual framework programme, setting out all the activities of the Community, shall be
1.
adopted by the Council, acting in accordance with the procedure referred to in Article 251 after
consulting the Economic and Social Committee.

Article 166

The framework programme shall:

— establish the scientific and technological objectives to be achieved by the activities provided for in

Article 164 and fix the relevant priorities,

— indicate the broad lines of such activities,

— fix the maximum overall amount and the detailed rules for Community financial participation in
the framework programme and the respective shares in each of the activities provided for.

2.

The framework programme shall be adapted or supplemented as the situation changes.

3.
The framework programme shall be implemented through specific programmes developed within
each activity. Each specific programme shall define the detailed rules for implementing it, fix its duration
and provide for the means deemed necessary. The sum of the amounts deemed necessary, fixed in the
specific programmes, may not exceed the overall maximum amount
the framework
programme and each activity.

fixed for

4.
The Council, acting by a qualified majority on a proposal from the Commission and after
consulting the European Parliament and the Economic and Social Committee, shall adopt the specific
programmes.

For the implementation of the multiannual framework programme the Council shall:

Article 167

— determine the rules for the participation of undertakings, research centres and universities,

— lay down the rules governing the dissemination of research results.

In implementing the multiannual framework programme, supplementary programmes may be decided
on involving the participation of certain Member States only, which shall finance them subject to
possible Community participation.

Article 168

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The Council shall adopt the rules applicable to supplementary programmes, particularly as regards the
dissemination of knowledge and access by other Member States.

Article 169

In implementing the multiannual framework programme, the Community may make provision,
agreement with the Member States concerned,
programmes undertaken by several Member States,
for the execution of those programmes.

in
for participation in research and development
including participation in the structures created

Article 170

In implementing the multiannual framework programme the Community may make provision for
cooperation in Community research,
technological development and demonstration with third
countries or international organisations.

The detailed arrangements for such cooperation may be the subject of agreements between the
Community and the third parties concerned, which shall be negotiated and concluded in accordance
with Article 300.

The Community may set up joint undertakings or any other structure necessary for the efficient
execution of Community research, technological development and demonstration programmes.

Article 171

Article 172

The Council, acting by qualified majority on a proposal from the Commission and after consulting the
European Parliament and the Economic and Social Committee, shall adopt the provisions referred to in
Article 171.

The Council, acting in accordance with the procedure referred to in Article 251 and after consulting the
Economic and Social Committee, shall adopt the provisions referred to in Articles 167, 168 and 169.
Adoption of
the Member States
concerned.

the supplementary programmes shall require the agreement of

At the beginning of each year the Commission shall send a report to the European Parliament and to the
Council. The report shall include information on research and technological development activities and
the dissemination of results during the previous year, and the work programme for the current year.

Article 173

TITLE XIX

ENVIRONMENT

Article 174

1.

Community policy on the environment shall contribute to pursuit of the following objectives:

— preserving, protecting and improving the quality of the environment,

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— protecting human health,

— prudent and rational utilisation of natural resources,

— promoting measures at international

level

to deal with regional or worldwide environmental

problems.

Community policy on the environment shall aim at a high level of protection taking into account
2.
the diversity of situations in the various regions of
It shall be based on the
precautionary principle and on the principles that preventive action should be taken, that environmental
damage should as a priority be rectified at source and that the polluter should pay.

the Community.

In this context, harmonisation measures answering environmental protection requirements shall include,
where appropriate, a safeguard clause allowing Member States to take provisional measures,
for
non-economic environmental reasons, subject to a Community inspection procedure.

3.

In preparing its policy on the environment, the Community shall take account of:

— available scientific and technical data,

— environmental conditions in the various regions of the Community,

— the potential benefits and costs of action or lack of action,

— the economic and social development of the Community as a whole and the balanced development

of its regions.

4.
Within their respective spheres of competence, the Community and the Member States shall
cooperate with third countries and with the competent international organisations. The arrangements for
Community cooperation may be the subject of agreements between the Community and the third
parties concerned, which shall be negotiated and concluded in accordance with Article 300.

The previous subparagraph shall be without prejudice to Member States' competence to negotiate in
international bodies and to conclude international agreements.

Article 175 (*)

1.
The Council, acting in accordance with the procedure referred to in Article 251 and after
consulting the Economic and Social Committee and the Committee of the Regions, shall decide what
action is to be taken by the Community in order to achieve the objectives referred to in Article 174.

2.
By way of derogation from the decision-making procedure provided for in paragraph 1 and
without prejudice to Article 95, the Council, acting unanimously on a proposal from the Commission
and after consulting the European Parliament, the Economic and Social Committee and the Committee
of the Regions, shall adopt:

(a)

provisions primarily of a fiscal nature;

(*) Article amended by the Treaty of Nice.

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(b) measures affecting:

— town and country planning,

— quantitative management of water resources or affecting, directly or indirectly, the availability

of those resources,

— land use, with the exception of waste management;

(c) measures significantly affecting a Member State's choice between different energy sources and the

general structure of its energy supply.

The Council may, under the conditions laid down in the first subparagraph, define those matters referred
to in this paragraph on which decisions are to be taken by a qualified majority.

3.
In other areas, general action programmes setting out priority objectives to be attained shall be
adopted by the Council, acting in accordance with the procedure referred to in Article 251 and after
consulting the Economic and Social Committee and the Committee of the Regions.

The Council, acting under the terms of paragraph 1 or paragraph 2 according to the case, shall adopt
the measures necessary for the implementation of these programmes.

Without prejudice to certain measures of a Community nature, the Member States shall finance

4.
and implement the environment policy.

Without prejudice to the principle that the polluter should pay,

if a measure based on the
5.
provisions of paragraph 1 involves costs deemed disproportionate for the public authorities of a
Member State, the Council shall, in the act adopting that measure, lay down appropriate provisions
in the form of:

— temporary derogations, and/or

— financial support from the Cohesion Fund set up pursuant to Article 161.

The protective measures adopted pursuant to Article 175 shall not prevent any Member State from
maintaining or introducing more stringent protective measures. Such measures must be compatible with
this Treaty. They shall be notified to the Commission.

Article 176

TITLE XX

DEVELOPMENT COOPERATION

Article 177

Community policy in the sphere of development cooperation, which shall be complementary to

1.
the policies pursued by the Member States, shall foster:

— the sustainable economic and social development of the developing countries, and more particularly

the most disadvantaged among them,

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— the smooth and gradual integration of the developing countries into the world economy,

— the campaign against poverty in the developing countries.

2.
Community policy in this area shall contribute to the general objective of developing and
consolidating democracy and the rule of law, and to that of respecting human rights and fundamental
freedoms.

3.
The Community and the Member States shall comply with the commitments and take account of
the objectives they have approved in the context of the United Nations and other competent inter-
national organisations.

The Community shall take account of the objectives referred to in Article 177 in the policies that it
implements which are likely to affect developing countries.

Article 178

Article 179

1.
Without prejudice to the other provisions of this Treaty, the Council, acting in accordance with
the procedure referred to in Article 251, shall adopt the measures necessary to further the objectives
referred to in Article 177. Such measures may take the form of multiannual programmes.

The European Investment Bank shall contribute, under the terms laid down in its Statute, to the

2.
implementation of the measures referred to in paragraph 1.

The provisions of this Article shall not affect cooperation with the African, Caribbean and Pacific

3.
countries in the framework of the ACP-EC Convention.

Article 180

1.
The Community and the Member States shall coordinate their policies on development coop-
eration and shall consult each other on their aid programmes, including in international organisations
and during international conferences. They may undertake joint action. Member States shall contribute if
necessary to the implementation of Community aid programmes.

The Commission may take any useful

2.
paragraph 1.

initiative to promote the coordination referred to in

Article 181

Within their respective spheres of competence, the Community and the Member States shall cooperate
with third countries and with the competent
international organisations. The arrangements for
Community cooperation may be the subject of agreements between the Community and the third
parties concerned, which shall be negotiated and concluded in accordance with Article 300.

The previous paragraph shall be without prejudice to Member States' competence to negotiate in
international bodies and to conclude international agreements.

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TITLE XXI (*)

ECONOMIC, FINANCIAL AND TECHNICAL COOPERATION WITH THIRD
COUNTRIES

Article 181a

Without prejudice to the other provisions of this Treaty, and in particular those of Title XX, the
1.
Community shall carry out, within its spheres of competence, economic, financial and technical coop-
eration measures with third countries. Such measures shall be complementary to those carried out by
the Member States and consistent with the development policy of the Community.

Community policy in this area shall contribute to the general objective of developing and consolidating
democracy and the rule of law, and to the objective of respecting human rights and fundamental
freedoms.

2.
The Council, acting by a qualified majority on a proposal from the Commission and after
consulting the European Parliament, shall adopt the measures necessary for the implementation of
paragraph 1. The Council shall act unanimously for the association agreements referred to in Article
310 and for the agreements to be concluded with the States which are candidates for accession to the
Union.

3.
Within their respective spheres of competence, the Community and the Member States shall
cooperate with third countries and the competent international organisations. The arrangements for
Community cooperation may be the subject of agreements between the Community and the third
parties concerned, which shall be negotiated and concluded in accordance with Article 300.

The first subparagraph shall be without prejudice to the Member States' competence to negotiate in
international bodies and to conclude international agreements.

PART FOUR

ASSOCIATION OF THE OVERSEAS COUNTRIES AND TERRITORIES

Article 182

The Member States agree to associate with the Community the non-European countries and territories
which have special relations with Denmark, France, the Netherlands and the United Kingdom. These
countries and territories (hereinafter called the ‘countries and territories’) are listed in Annex II to this
Treaty.

The purpose of association shall be to promote the economic and social development of the countries
and territories and to establish close economic relations between them and the Community as a whole.

In accordance with the principles set out in the preamble to this Treaty, association shall serve primarily
to further the interests and prosperity of the inhabitants of these countries and territories in order to
lead them to the economic, social and cultural development to which they aspire.

(*) Title added by the Treaty of Nice.

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Association shall have the following objectives.

Article 183

1. Member States shall apply to their trade with the countries and territories the same treatment as

they accord each other pursuant to this Treaty.

2.

Each country or territory shall apply to its trade with Member States and with the other countries
and territories the same treatment as that which it applies to the European State with which is has
special relations.

3. The Member States shall contribute to the investments required for the progressive development of

these countries and territories.

4.

5.

For investments financed by the Community, participation in tenders and supplies shall be open on
equal terms to all natural and legal persons who are nationals of a Member State or of one of the
countries and territories.

In relations between Member States and the countries and territories the right of establishment of
nationals and companies or firms shall be regulated in accordance with the provisions and
procedures laid down in the Chapter relating to the right of establishment and on a non-discrimi-
natory basis, subject to any special provisions laid down pursuant to Article 187.

Customs duties on imports into the Member States of goods originating in the countries and
1.
territories shall be prohibited in conformity with the prohibition of customs duties between Member
States in accordance with the provisions of this Treaty.

Article 184

Customs duties on imports into each country or territory from Member States or from the other

2.
countries or territories shall be prohibited in accordance with the provisions of Article 25.

The countries and territories may, however, levy customs duties which meet the needs of their

3.
development and industrialisation or produce revenue for their budgets.

The duties referred to in the preceding subparagraph may not exceed the level of those imposed on
imports of products from the Member State with which each country or territory has special relations.

4.
Paragraph 2 shall not apply to countries and territories which, by reason of the particular
international obligations by which they are bound, already apply a non-discriminatory customs tariff.

5.
The introduction of or any change in customs duties imposed on goods imported into the
countries and territories shall not, either in law or in fact, give rise to any direct or indirect discrimi-
nation between imports from the various Member States.

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Article 185

If the level of the duties applicable to goods from a third country on entry into a country or territory is
liable, when the provisions of Article 184(1) have been applied, to cause deflections of trade to the
detriment of any Member State, the latter may request the Commission to propose to the other Member
States the measures needed to remedy the situation.

Article 186

to the provisions relating to public health, public security or public policy,

Subject
freedom of
movement within Member States for workers from the countries and territories, and within the
countries and territories for workers from Member States, shall be governed by agreements to be
concluded subsequently with the unanimous approval of Member States.

Article 187

The Council, acting unanimously, shall, on the basis of the experience acquired under the association of
the countries and territories with the Community and of the principles set out in this Treaty, lay down
provisions as regards the detailed rules and the procedure for the association of the countries and
territories with the Community.

The provisions of Articles 182 to 187 shall apply to Greenland, subject to the specific provisions for
Greenland set out in the Protocol on special arrangements for Greenland, annexed to this Treaty.

Article 188

PART FIVE

INSTITUTIONS OF THE COMMUNITY

TITLE I

PROVISIONS GOVERNING THE INSTITUTIONS

CHAPTER 1

THE INSTITUTIONS

SECTION 1

THE EUROPEAN PARLIAMENT

Article 189 (*)

The European Parliament, which shall consist of representatives of the peoples of the States brought
together in the Community, shall exercise the powers conferred upon it by this Treaty.

The number of Members of the European Parliament shall not exceed 732.

(*) Article amended by the Treaty of Nice.

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The representatives in the European Parliament of the peoples of the States brought together in

1.
the Community shall be elected by direct universal suffrage.

Article 190 (*)

2. (**)

The number of representatives elected in each Member State shall be as follows:

Belgium
Denmark
Germany
Greece
Spain
France
Ireland
Italy
Luxembourg
Netherlands
Austria
Portugal
Finland
Sweden
United Kingdom

25
16
99
25
64
87
15
87
6
31
21
25
16
22
87.

In the event of amendments to this paragraph, the number of representatives elected in each Member
State must ensure appropriate representation of the peoples of the States brought together in the
Community.

3.

Representatives shall be elected for a term of five years.

The European Parliament shall draw up a proposal for elections by direct universal suffrage in
4.
accordance with a uniform procedure in all Member States or in accordance with principles common to
all Member States.

The Council shall, acting unanimously after obtaining the assent of the European Parliament, which shall
lay down the appropriate provisions, which it shall
act by a majority of its component members,
recommend to Member States
respective constitutional
requirements.

for adoption in accordance with their

5.
The European Parliament, after seeking an opinion from the Commission and with the approval
of the Council acting by a qualified majority, shall lay down the regulations and general conditions
governing the performance of the duties of its Members. All rules or conditions relating to the taxation
of Members or former Members shall require unanimity within the Council.

Political parties at European level are important as a factor for integration within the Union. They
contribute to forming a European awareness and to expressing the political will of the citizens of the
Union.

Article 191 (*)

(*) Article amended by the Treaty of Nice.
(**) This paragraph will be amended, on 1 January 2004, in accordance with the Protocol on the enlargement of the

European Union (see the end of this publication).

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The Council, acting in accordance with the procedure referred to in Article 251, shall lay down the
regulations governing political parties at European level and in particular the rules regarding their
funding.

In so far as provided in this Treaty, the European Parliament shall participate in the process leading up
to the adoption of Community acts by exercising its powers under the procedures laid down in Articles
251 and 252 and by giving its assent or delivering advisory opinions.

Article 192

The European Parliament may, acting by a majority of its Members, request the Commission to submit
any appropriate proposal on matters on which it considers that a Community act is required for the
purpose of implementing this Treaty.

Article 193

In the course of its duties, the European Parliament may, at the request of a quarter of its Members, set
up a temporary Committee of Inquiry to investigate, without prejudice to the powers conferred by this
Treaty on other institutions or bodies, alleged contraventions or maladministration in the implemen-
tation of Community law, except where the alleged facts are being examined before a court and while
the case is still subject to legal proceedings.

The temporary Committee of Inquiry shall cease to exist on the submission of its report.

The detailed provisions governing the exercise of the right of inquiry shall be determined by common
accord of the European Parliament, the Council and the Commission.

Article 194

Any citizen of the Union, and any natural or legal person residing or having its registered office in a
individually or in association with other citizens or
Member State, shall have the right to address,
persons, a petition to the European Parliament on a matter which comes within the Community's
fields of activity and which affects him, her or it directly.

Article 195

1.
The European Parliament shall appoint an Ombudsman empowered to receive complaints from
any citizen of the Union or any natural or legal person residing or having its registered office in a
Member State concerning instances of maladministration in the activities of the Community institutions
or bodies, with the exception of the Court of Justice and the Court of First Instance acting in their
judicial role.

In accordance with his duties, the Ombudsman shall conduct inquiries for which he finds grounds,
either on his own initiative or on the basis of complaints submitted to him direct or through a Member
of the European Parliament, except where the alleged facts are or have been the subject of legal
proceedings. Where the Ombudsman establishes an instance of maladministration, he shall refer the
matter to the institution concerned, which shall have a period of three months in which to inform him
of its views. The Ombudsman shall then forward a report to the European Parliament and the institution
concerned. The person lodging the complaint shall be informed of the outcome of such inquiries.

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The Ombudsman shall submit an annual report to the European Parliament on the outcome of his
inquiries.

The Ombudsman shall be appointed after each election of the European Parliament for the

2.
duration of its term of office. The Ombudsman shall be eligible for reappointment.

The Ombudsman may be dismissed by the Court of Justice at the request of the European Parliament if
he no longer fulfils the conditions required for the performance of his duties or if he is guilty of serious
misconduct.

The Ombudsman shall be completely independent in the performance of his duties. In the
3.
performance of
take instructions from any body. The
Ombudsman may not, during his term of office, engage in any other occupation, whether gainful or not.

those duties he shall neither seek nor

4.
The European Parliament shall, after seeking an opinion from the Commission and with the
approval of the Council acting by a qualified majority, lay down the regulations and general conditions
governing the performance of the Ombudsman's duties.

Article 196

The European Parliament shall hold an annual session. It shall meet, without requiring to be convened,
on the second Tuesday in March.

The European Parliament may meet in extraordinary session at the request of a majority of its Members
or at the request of the Council or of the Commission.

The European Parliament shall elect its President and its officers from among its Members.

Article 197

Members of the Commission may attend all meetings and shall, at their request, be heard on behalf of
the Commission.

The Commission shall reply orally or in writing to questions put to it by the European Parliament or by
its Members.

The Council shall be heard by the European Parliament in accordance with the conditions laid down by
the Council in its Rules of Procedure.

Save as otherwise provided in this Treaty, the European Parliament shall act by an absolute majority of
the votes cast.

Article 198

The Rules of Procedure shall determine the quorum.

Article 199

The European Parliament shall adopt its Rules of Procedure, acting by a majority of its Members.

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The proceedings of the European Parliament shall be published in the manner laid down in its Rules of
Procedure.

The European Parliament shall discuss in open session the annual general report submitted to it by the
Commission.

Article 200

If a motion of censure on the activities of the Commission is tabled before it, the European Parliament
shall not vote thereon until at least three days after the motion has been tabled and only by open vote.

Article 201

If the motion of censure is carried by a two-thirds majority of the votes cast, representing a majority of
the Members of the European Parliament, the Members of the Commission shall resign as a body. They
shall continue to deal with current business until they are replaced in accordance with Article 214. In
this case, the term of office of the Members of the Commission appointed to replace them shall expire
on the date on which the term of office of the Members of the Commission obliged to resign as a body
would have expired.

SECTION 2

THE COUNCIL

Article 202

To ensure that the objectives set out in this Treaty are attained the Council shall, in accordance with the
provisions of this Treaty:

— ensure coordination of the general economic policies of the Member States,

— have power to take decisions,

— confer on the Commission, in the acts which the Council adopts, powers for the implementation of
the rules which the Council lays down. The Council may impose certain requirements in respect of
the exercise of these powers. The Council may also reserve the right, in specific cases, to exercise
directly implementing powers itself. The procedures referred to above must be consonant with
principles and rules to be laid down in advance by the Council, acting unanimously on a proposal
from the Commission and after obtaining the opinion of the European Parliament.

The Council shall consist of a representative of each Member State at ministerial level, authorised to
commit the government of that Member State.

Article 203

The office of President shall be held in turn by each Member State in the Council for a term of six
months in the order decided by the Council acting unanimously.

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The Council shall meet when convened by its President on his own initiative or at the request of one of
its Members or of the Commission.

Article 204

Article 205 (*)

1.

Save as otherwise provided in this Treaty, the Council shall act by a majority of its Members.

Where the Council is required to act by a qualified majority, the votes of its Members shall be

2.
weighted as follows:

Belgium
Denmark
Germany
Greece
Spain
France
Ireland
Italy
Luxembourg
Netherlands
Austria
Portugal
Finland
Sweden
United Kingdom

5
3
10
5
8
10
3
10
2
5
4
5
3
4
10.

For their adoption, acts of the Council shall require at least:

— 62 votes in favour where this Treaty requires them to be adopted on a proposal from the

Commission,

— 62 votes in favour, cast by at least 10 members, in other cases.

Abstentions by Members present in person or represented shall not prevent the adoption by the

3.
Council of acts which require unanimity.

Where a vote is taken, any Member of the Council may also act on behalf of not more than one other
member.

Article 206

Article 207 (**)

A committee consisting of

the Member States shall be
1.
responsible for preparing the work of the Council and for carrying out the tasks assigned to it by
the Council. The Committee may adopt procedural decisions in cases provided for in the Council's Rules
of Procedure.

the Permanent Representatives of

(*) This Article will be amended, on 1 January 2005, in accordance with the Protocol on the enlargement of the

European Union (see the end of this publication).

(**) Article amended by the Treaty of Nice.

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2.
The Council shall be assisted by a General Secretariat, under the responsibility of a Secretary-
General, High Representative for the common foreign and security policy, who shall be assisted by a
Deputy Secretary-General responsible for the running of the General Secretariat. The Secretary-General
and the Deputy Secretary-General shall be appointed by the Council acting by a qualified majority.

The Council shall decide on the organisation of the General Secretariat.

3.

The Council shall adopt its Rules of Procedure.

For the purpose of applying Article 255(3), the Council shall elaborate in these Rules the conditions
under which the public shall have access to Council documents. For the purpose of this paragraph, the
Council shall define the cases in which it is to be regarded as acting in its legislative capacity, with a
view to allowing greater access to documents in those cases, while at the same time preserving the
effectiveness of its decision-making process. In any event, when the Council acts in its legislative
capacity, the results of votes and explanations of vote as well as statements in the minutes shall be
made public.

The Council may request the Commission to undertake any studies the Council considers desirable for
the attainment of the common objectives, and to submit to it any appropriate proposals.

Article 208

The Council shall, after receiving an opinion from the Commission, determine the rules governing the
committees provided for in this Treaty.

Article 209

Article 210 (*)

The Council shall, acting by a qualified majority, determine the salaries, allowances and pensions of the
Judges, Advocates-General and
President and Members of
Registrar of the Court of Justice and of the Members and Registrar of the Court of First Instance. It
shall also, again by a qualified majority, determine any payment to be made instead of remuneration.

the Commission, and of

the President,

SECTION 3

THE COMMISSION

Article 211

In order to ensure the proper functioning and development of the common market, the Commission
shall:

— ensure that the provisions of this Treaty and the measures taken by the institutions pursuant

thereto are applied,

(*) Article amended by the Treaty of Nice.

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— formulate recommendations or deliver opinions on matters dealt with in this Treaty, if it expressly

so provides or if the Commission considers it necessary,

— have its own power of decision and participate in the shaping of measures taken by the Council

and by the European Parliament in the manner provided for in this Treaty,

— exercise the powers conferred on it by the Council for the implementation of the rules laid down

by the latter.

The Commission shall publish annually, not later than one month before the opening of the session of
the European Parliament, a general report on the activities of the Community.

Article 212

1. (*)
general competence and whose independence is beyond doubt.

The Commission shall consist of 20 Members, who shall be chosen on the grounds of their

Article 213

The number of Members of the Commission may be altered by the Council, acting unanimously.

Only nationals of Member States may be Members of the Commission.

The Commission must include at least one national of each of the Member States, but may not include
more than two Members having the nationality of the same State.

The Members of the Commission shall, in the general interest of the Community, be completely

2.
independent in the performance of their duties.

In the performance of these duties, they shall neither seek nor take instructions from any government or
from any other body. They shall refrain from any action incompatible with their duties. Each Member
State undertakes to respect this principle and not to seek to influence the Members of the Commission
in the performance of their tasks.

The Members of the Commission may not, during their term of office, engage in any other occupation,
whether gainful or not. When entering upon their duties they shall give a solemn undertaking that, both
during and after their term of office, they will respect the obligations arising therefrom and in particular
their duty to behave with integrity and discretion as regards the acceptance, after they have ceased to
hold office, of certain appointments or benefits. In the event of any breach of these obligations, the
Court of Justice may, on application by the Council or the Commission, rule that the Member concerned
be, according to the circumstances, either compulsorily retired in accordance with Article 216 or
deprived of his right to a pension or other benefits in its stead.

(*) This paragraph will be amended, on 1 January 2005, and thereafter when the Union comprises 27 Member States
in accordance with the Protocol on the enlargement of the European Union (see the end of this publication).

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The Members of the Commission shall be appointed, in accordance with the procedure referred

1.
to in paragraph 2, for a period of five years, subject, if need be, to Article 201.

Article 214 (*)

Their term of office shall be renewable.

The Council, meeting in the composition of Heads of State or Government and acting by a
2.
qualified majority, shall nominate the person it intends to appoint as President of the Commission; the
nomination shall be approved by the European Parliament.

The Council, acting by a qualified majority and by common accord with the nominee for President, shall
adopt the list of the other persons whom it intends to appoint as Members of the Commission, drawn
up in accordance with the proposals made by each Member State.

The President and the other Members of the Commission thus nominated shall be subject as a body to a
vote of approval by the European Parliament. After approval by the European Parliament, the President
and the other Members of the Commission shall be appointed by the Council, acting by a qualified
majority.

Article 215 (*)

Apart from normal replacement, or death, the duties of a Member of the Commission shall end when he
resigns or is compulsorily retired.

A vacancy caused by resignation, compulsory retirement or death shall be filled for the remainder of the
Member's term of office by a new Member appointed by the Council, acting by a qualified majority. The
Council may, acting unanimously, decide that such a vacancy need not be filled.

In the event of resignation, compulsory retirement or death, the President shall be replaced for the
remainder of his term of office. The procedure laid down in Article 214(2) shall be applicable for the
replacement of the President.

Save in the case of compulsory retirement under Article 216, Members of the Commission shall remain
in office until they have been replaced or until the Council has decided that the vacancy need not be
filled, as provided for in the second paragraph of this Article.

If any Member of the Commission no longer fulfils the conditions required for the performance of his
duties or if he has been guilty of serious misconduct, the Court of Justice may, on application by the
Council or the Commission, compulsorily retire him.

Article 216

1.
The Commission shall work under the political guidance of its President, who shall decide on its
internal organisation in order to ensure that it acts consistently, efficiently and on the basis of colle-
giality.

Article 217 (*)

(*) Article amended by the Treaty of Nice.

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2.
The responsibilities incumbent upon the Commission shall be structured and allocated among its
Members by its President. The President may reshuffle the allocation of those responsibilities during the
Commission's term of office. The Members of the Commission shall carry out the duties devolved upon
them by the President under his authority.

After obtaining the approval of the College, the President shall appoint Vice-Presidents from

3.
among its Members.

A Member of the Commission shall resign if the President so requests, after obtaining the

4.
approval of the College.

Article 218

The Council and the Commission shall consult each other and shall settle by common accord

1.
their methods of cooperation.

The Commission shall adopt

2.
its Rules of Procedure so as to ensure that both it and its
departments operate in accordance with the provisions of this Treaty. It shall ensure that these Rules
are published.

Article 219 (*)

The Commission shall act by a majority of the number of Members provided for in Article 213.

A meeting of the Commission shall be valid only if the number of Members laid down in its Rules of
Procedure is present.

SECTION 4

THE COURT OF JUSTICE

Article 220 (*)

The Court of Justice and the Court of First Instance, each within its jurisdiction, shall ensure that in the
interpretation and application of this Treaty the law is observed.

In addition, judicial panels may be attached to the Court of First Instance under the conditions laid down
in Article 225a in order to exercise, in certain specific areas, the judicial competence laid down in this
Treaty.

The Court of Justice shall consist of one judge per Member State.

Article 221 (*)

The Court of Justice shall sit in chambers or in a Grand Chamber, in accordance with the rules laid
down for that purpose in the Statute of the Court of Justice.

When provided for in the Statute, the Court of Justice may also sit as a full Court.

(*) Article amended by the Treaty of Nice.

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Article 222 (*)

The Court of Justice shall be assisted by eight Advocates-General. Should the Court of Justice so request,
the Council, acting unanimously, may increase the number of Advocates-General.

It shall be the duty of the Advocate-General, acting with complete impartiality and independence, to
make, in open court, reasoned submissions on cases which, in accordance with the Statute of the Court
of Justice, require his involvement.

Article 223 (*)

The Judges and Advocates-General of the Court of Justice shall be chosen from persons whose inde-
pendence is beyond doubt and who possess the qualifications required for appointment to the highest
judicial offices in their respective countries or who are jurisconsults of recognised competence; they shall
be appointed by common accord of the governments of the Member States for a term of six years.

Every three years there shall be a partial replacement of
accordance with the conditions laid down in the Statute of the Court of Justice.

the Judges and Advocates-General,

in

The Judges shall elect the President of the Court of Justice from among their number for a term of three
years. He may be re-elected.

Retiring Judges and Advocates-General may be reappointed.

The Court of Justice shall appoint its Registrar and lay down the rules governing his service.

The Court of Justice shall establish its Rules of Procedure. Those Rules shall require the approval of the
Council, acting by a qualified majority.

Article 224 (*)

The Court of First Instance shall comprise at least one judge per Member State. The number of Judges
shall be determined by the Statute of the Court of Justice. The Statute may provide for the Court of First
Instance to be assisted by Advocates-General.

The members of the Court of First Instance shall be chosen from persons whose independence is beyond
doubt and who possess the ability required for appointment to high judicial office. They shall be
appointed by common accord of the governments of the Member States for a term of six years. The
membership shall be partially renewed every three years. Retiring members shall be eligible for reap-
pointment.

The Judges shall elect the President of the Court of First Instance from among their number for a term
of three years. He may be re-elected.

The Court of First Instance shall appoint its Registrar and lay down the rules governing his service.

The Court of First Instance shall establish its Rules of Procedure in agreement with the Court of Justice.
Those Rules shall require the approval of the Council, acting by a qualified majority.

Unless the Statute of the Court of Justice provides otherwise, the provisions of this Treaty relating to the
Court of Justice shall apply to the Court of First Instance.

(*) Article amended by the Treaty of Nice.

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Article 225 (*)

1.
The Court of First Instance shall have jurisdiction to hear and determine at first instance actions
or proceedings referred to in Articles 230, 232, 235, 236 and 238, with the exception of those assigned
to a judicial panel and those reserved in the Statute for the Court of Justice. The Statute may provide for
the Court of First Instance to have jurisdiction for other classes of action or proceeding.

Decisions given by the Court of First Instance under this paragraph may be subject to a right of appeal
to the Court of Justice on points of law only, under the conditions and within the limits laid down by
the Statute.

The Court of First Instance shall have jurisdiction to hear and determine actions or proceedings

2.
brought against decisions of the judicial panels set up under Article 225a.

Decisions given by the Court of First Instance under this paragraph may exceptionally be subject to
review by the Court of Justice, under the conditions and within the limits laid down by the Statute,
where there is a serious risk of the unity or consistency of Community law being affected.

The Court of First Instance shall have jurisdiction to hear and determine questions referred for a

3.
preliminary ruling under Article 234, in specific areas laid down by the Statute.

Where the Court of First Instance considers that the case requires a decision of principle likely to affect
the unity or consistency of Community law, it may refer the case to the Court of Justice for a ruling.

Decisions given by the Court of First Instance on questions referred for a preliminary ruling may
exceptionally be subject to review by the Court of Justice, under the conditions and within the limits
laid down by the Statute, where there is a serious risk of the unity or consistency of Community law
being affected.

Article 225a (**)

The Council, acting unanimously on a proposal from the Commission and after consulting the European
Parliament and the Court of Justice or at the request of the Court of Justice and after consulting the
European Parliament and the Commission, may create judicial panels to hear and determine at first
instance certain classes of action or proceeding brought in specific areas.

The decision establishing a judicial panel shall lay down the rules on the organisation of the panel and
the extent of the jurisdiction conferred upon it.

Decisions given by judicial panels may be subject to a right of appeal on points of law only or, when
provided for in the decision establishing the panel, a right of appeal also on matters of fact, before the
Court of First Instance.

(*) Article amended by the Treaty of Nice.
(**) Article inserted by the Treaty of Nice.

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The members of the judicial panels shall be chosen from persons whose independence is beyond doubt
and who possess the ability required for appointment to judicial office. They shall be appointed by the
Council, acting unanimously.

The judicial panels shall establish their Rules of Procedure in agreement with the Court of Justice. Those
Rules shall require the approval of the Council, acting by a qualified majority.

Unless the decision establishing the judicial panel provides otherwise, the provisions of this Treaty
relating to the Court of Justice and the provisions of the Statute of the Court of Justice shall apply
to the judicial panels.

Article 226

If the Commission considers that a Member State has failed to fulfil an obligation under this Treaty, it
shall deliver a reasoned opinion on the matter after giving the State concerned the opportunity to
submit its observations.

the State concerned does not comply with the opinion within the period laid down by the

If
Commission, the latter may bring the matter before the Court of Justice.

Article 227

A Member State which considers that another Member State has failed to fulfil an obligation under this
Treaty may bring the matter before the Court of Justice.

Before a Member State brings an action against another Member State for an alleged infringement of an
obligation under this Treaty, it shall bring the matter before the Commission.

The Commission shall deliver a reasoned opinion after each of the States concerned has been given the
opportunity to submit its own case and its observations on the other party's case both orally and in
writing.

If the Commission has not delivered an opinion within three months of the date on which the matter
was brought before it, the absence of such opinion shall not prevent the matter from being brought
before the Court of Justice.

Article 228

1.
If the Court of Justice finds that a Member State has failed to fulfil an obligation under this
Treaty, the State shall be required to take the necessary measures to comply with the judgment of the
Court of Justice.

If the Commission considers that the Member State concerned has not taken such measures it
2.
shall, after giving that State the opportunity to submit its observations,
issue a reasoned opinion
specifying the points on which the Member State concerned has not complied with the judgment of
the Court of Justice.

If the Member State concerned fails to take the necessary measures to comply with the Court's judgment
within the time limit laid down by the Commission, the latter may bring the case before the Court of
Justice. In so doing it shall specify the amount of the lump sum or penalty payment to be paid by the
Member State concerned which it considers appropriate in the circumstances.

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If the Court of Justice finds that the Member State concerned has not complied with its judgment it may
impose a lump sum or penalty payment on it.

This procedure shall be without prejudice to Article 227.

Regulations adopted jointly by the European Parliament and the Council, and by the Council, pursuant
to the provisions of this Treaty, may give the Court of Justice unlimited jurisdiction with regard to the
penalties provided for in such regulations.

Article 229

Article 229a (*)

Without prejudice to the other provisions of this Treaty, the Council, acting unanimously on a proposal
from the Commission and after consulting the European Parliament, may adopt provisions to confer
jurisdiction, to the extent that it shall determine, on the Court of Justice in disputes relating to the
application of acts adopted on the basis of this Treaty which create Community industrial property
rights. The Council shall recommend those provisions to the Member States for adoption in accordance
with their respective constitutional requirements.

The Court of Justice shall review the legality of acts adopted jointly by the European Parliament and the
Council, of acts of the Council, of the Commission and of the ECB, other than recommendations and
opinions, and of acts of the European Parliament intended to produce legal effects vis-à-vis third parties.

Article 230 (**)

for this purpose have jurisdiction in actions brought by a Member State,

It shall
Parliament, the Council or the Commission on grounds of lack of competence,
essential procedural requirement,
application, or misuse of powers.

the European
infringement of an
infringement of this Treaty or of any rule of law relating to its

The Court of Justice shall have jurisdiction under the same conditions in actions brought by the Court of
Auditors and by the ECB for the purpose of protecting their prerogatives.

Any natural or legal person may, under the same conditions, institute proceedings against a decision
addressed to that person or against a decision which, although in the form of a regulation or a decision
addressed to another person, is of direct and individual concern to the former.

The proceedings provided for in this article shall be instituted within two months of the publication of
the measure, or of its notification to the plaintiff, or, in the absence thereof, of the day on which it came
to the knowledge of the latter, as the case may be.

(*) Article inserted by the Treaty of Nice.
(**) Article amended by the Treaty of Nice.

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If the action is well founded, the Court of Justice shall declare the act concerned to be void.

Article 231

In the case of a regulation, however, the Court of Justice shall, if it considers this necessary, state which
of the effects of the regulation which it has declared void shall be considered as definitive.

Article 232

Should the European Parliament, the Council or the Commission, in infringement of this Treaty, fail to
act, the Member States and the other institutions of the Community may bring an action before the
Court of Justice to have the infringement established.

The action shall be admissible only if the institution concerned has first been called upon to act. If,
within two months of being so called upon, the institution concerned has not defined its position, the
action may be brought within a further period of two months.

Any natural or legal person may, under the conditions laid down in the preceding paragraphs, complain
to the Court of Justice that an institution of the Community has failed to address to that person any act
other than a recommendation or an opinion.

in actions or proceedings
The Court of Justice shall have jurisdiction, under the same conditions,
brought by the ECB in the areas falling within the latter's field of competence and in actions or
proceedings brought against the latter.

Article 233

The institution or institutions whose act has been declared void or whose failure to act has been
declared contrary to this Treaty shall be required to take the necessary measures to comply with the
judgment of the Court of Justice.

This obligation shall not affect any obligation which may result from the application of the second
paragraph of Article 288.

This article shall also apply to the ECB.

The Court of Justice shall have jurisdiction to give preliminary rulings concerning:

Article 234

(a)

the interpretation of this Treaty;

(b)

the validity and interpretation of acts of the institutions of the Community and of the ECB;

(c)

the interpretation of the statutes of bodies established by an act of the Council, where those statutes
so provide.

Where such a question is raised before any court or tribunal of a Member State, that court or tribunal
may, if it considers that a decision on the question is necessary to enable it to give judgment, request the
Court of Justice to give a ruling thereon.

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Where any such question is raised in a case pending before a court or tribunal of a Member State
against whose decisions there is no judicial remedy under national law, that court or tribunal shall bring
the matter before the Court of Justice.

The Court of Justice shall have jurisdiction in disputes relating to compensation for damage provided for
in the second paragraph of Article 288.

Article 235

The Court of Justice shall have jurisdiction in any dispute between the Community and its servants
within the limits and under the conditions laid down in the Staff Regulations or the Conditions of
employment.

Article 236

Article 237

The Court of
concerning:

Justice shall, within the limits hereinafter laid down, have jurisdiction in disputes

(a)

the fulfilment by Member States of obligations under the Statute of the European Investment Bank.
In this connection, the Board of Directors of the Bank shall enjoy the powers conferred upon the
Commission by Article 226;

(b) measures adopted by the Board of Governors of the European Investment Bank. In this connection,
the Bank may institute
the Commission or the Board of Directors of

any Member State,
proceedings under the conditions laid down in Article 230;

(c) measures adopted by the Board of Directors of the European Investment Bank. Proceedings against
such measures may be instituted only by Member States or by the Commission, under the
conditions laid down in Article 230, and solely on the grounds of non-compliance with the
procedure provided for in Article 21(2), (5), (6) and (7) of the Statute of the Bank;

(d)

the fulfilment by national central banks of obligations under this Treaty and the Statute of the
ESCB. In this connection the powers of the Council of the ECB in respect of national central banks
shall be the same as those conferred upon the Commission in respect of Member States by Article
226. If the Court of Justice finds that a national central bank has failed to fulfil an obligation under
this Treaty, that bank shall be required to take the necessary measures to comply with the
judgment of the Court of Justice.

Justice shall have jurisdiction to give judgment pursuant

The Court of
to any arbitration clause
contained in a contract concluded by or on behalf of the Community, whether that contract be
governed by public or private law.

Article 238

The Court of Justice shall have jurisdiction in any dispute between Member States which relates to the
subject matter of this Treaty if the dispute is submitted to it under a special agreement between the
parties.

Article 239

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Save where jurisdiction is conferred on the Court of Justice by this Treaty, disputes to which the
Community is a party shall not on that ground be excluded from the jurisdiction of the courts or
tribunals of the Member States.

Article 240

Article 241

Notwithstanding the expiry of the period laid down in the fifth paragraph of Article 230, any party may,
in proceedings in which a regulation adopted jointly by the European Parliament and the Council, or a
regulation of the Council, of the Commission, or of the ECB is at issue, plead the grounds specified in
the second paragraph of Article 230 in order to invoke before the Court of Justice the inapplicability of
that regulation.

Actions brought before the Court of Justice shall not have suspensory effect. The Court of Justice may,
however, if it considers that circumstances so require, order that application of the contested act be
suspended.

Article 242

The Court of Justice may in any cases before it prescribe any necessary interim measures.

Article 243

The judgments of the Court of Justice shall be enforceable under the conditions laid down in Article
256.

Article 244

The Statute of the Court of Justice shall be laid down in a separate Protocol.

Article 245 (*)

The Council, acting unanimously at the request of the Court of Justice and after consulting the European
Parliament and the Commission, or at the request of the Commission and after consulting the European
Parliament and the Court of Justice, may amend the provisions of the Statute, with the exception of Title
I.

SECTION 5

THE COURT OF AUDITORS

Article 246

The Court of Auditors shall carry out the audit.

1.

The Court of Auditors shall consist of one national from each Member State.

Article 247 (*)

(*) Article amended by the Treaty of Nice.

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2.
The Members of the Court of Auditors shall be chosen from among persons who belong or have
belonged in their respective countries to external audit bodies or who are especially qualified for this
office. Their independence must be beyond doubt.

3.
The Members of the Court of Auditors shall be appointed for a term of six years. The Council,
acting by a qualified majority after consulting the European Parliament, shall adopt the list of Members
drawn up in accordance with the proposals made by each Member State. The term of office of the
Members of the Court of Auditors shall be renewable.

They shall elect the President of the Court of Auditors from among their number for a term of three
years. The President may be re-elected.

The Members of the Court of Auditors shall,
4.
completely independent in the performance of their duties.

in the general

interest of the Community, be

In the performance of these duties, they shall neither seek nor take instructions from any government or
from any other body. They shall refrain from any action incompatible with their duties.

The Members of the Court of Auditors may not, during their term of office, engage in any other
5.
occupation, whether gainful or not. When entering upon their duties they shall give a solemn under-
taking that, both during and after their term of office, they will respect the obligations arising therefrom
and in particular their duty to behave with integrity and discretion as regards the acceptance, after they
have ceased to hold office, of certain appointments or benefits.

Apart from normal replacement, or death, the duties of a Member of the Court of Auditors shall
6.
end when he resigns, or is compulsorily retired by a ruling of the Court of Justice pursuant to paragraph
7.

The vacancy thus caused shall be filled for the remainder of the Member's term of office.

Save in the case of compulsory retirement, Members of the Court of Auditors shall remain in office until
they have been replaced.

A Member of the Court of Auditors may be deprived of his office or of his right to a pension or
7.
other benefits in its stead only if the Court of Justice, at the request of the Court of Auditors, finds that
he no longer fulfils the requisite conditions or meets the obligations arising from his office.

8.
The Council, acting by a qualified majority, shall determine the conditions of employment of the
President and the Members of the Court of Auditors and in particular their salaries, allowances and
pensions. It shall also, by the same majority, determine any payment to be made instead of remun-
eration.

9.
The provisions of the Protocol on the privileges and immunities of the European Communities
applicable to the Judges of the Court of Justice shall also apply to the Members of the Court of Auditors.

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1.
the
The Court of Auditors shall examine the accounts of all revenue and expenditure of
Community. It shall also examine the accounts of all revenue and expenditure of all bodies set up by
the Community in so far as the relevant constituent instrument does not preclude such examination.

Article 248 (*)

The Court of Auditors shall provide the European Parliament and the Council with a statement of
assurance as to the reliability of the accounts and the legality and regularity of the underlying trans-
actions which shall be published in the Official Journal of the European Union. This statement may be
supplemented by specific assessments for each major area of Community activity.

2.
The Court of Auditors shall examine whether all revenue has been received and all expenditure
incurred in a lawful and regular manner and whether the financial management has been sound. In
doing so, it shall report in particular on any cases of irregularity.

The audit of revenue shall be carried out on the basis both of the amounts established as due and the
amounts actually paid to the Community.

The audit of expenditure shall be carried out on the basis both of commitments undertaken and
payments made.

These audits may be carried out before the closure of accounts for the financial year in question.

The audit shall be based on records and,

3.
if necessary, performed on the spot in the other
institutions of the Community, on the premises of any body which manages revenue or expenditure
on behalf of the Community and in the Member States, including on the premises of any natural or legal
person in receipt of payments from the budget. In the Member States the audit shall be carried out in
liaison with national audit bodies or, if these do not have the necessary powers, with the competent
national departments. The Court of Auditors and the national audit bodies of the Member States shall
cooperate in a spirit of trust while maintaining their independence. These bodies or departments shall
inform the Court of Auditors whether they intend to take part in the audit.

The other institutions of the Community, any bodies managing revenue or expenditure on behalf of the
Community, any natural or legal person in receipt of payments from the budget, and the national audit
bodies or, if these do not have the necessary powers, the competent national departments, shall forward
to the Court of Auditors, at its request, any document or information necessary to carry out its task.

In respect of the European Investment Bank's activity in managing Community expenditure and revenue,
the Court's rights of access to information held by the Bank shall be governed by an agreement between
the Court, the Bank and the Commission. In the absence of an agreement, the Court shall nevertheless
have access to information necessary for the audit of Community expenditure and revenue managed by
the Bank.

(*) Article amended by the Treaty of Nice.

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4.
The Court of Auditors shall draw up an annual report after the close of each financial year. It
shall be forwarded to the other institutions of the Community and shall be published, together with the
replies of these institutions to the observations of the Court of Auditors, in the Official Journal of the
European Union.

The Court of Auditors may also, at any time, submit observations, particularly in the form of special
reports, on specific questions and deliver opinions at the request of one of the other institutions of the
Community.

It shall adopt its annual reports, special reports or opinions by a majority of its Members. However, it
may establish internal chambers in order to adopt certain categories of reports or opinions under the
conditions laid down by its Rules of Procedure.

It shall assist the European Parliament and the Council in exercising their powers of control over the
implementation of the budget.

The Court of Auditors shall draw up its Rules of Procedure. Those rules shall require the approval of the
Council, acting by a qualified majority.

CHAPTER 2

PROVISIONS COMMON TO SEVERAL INSTITUTIONS

Article 249

In order to carry out their task and in accordance with the provisions of this Treaty, the European
Parliament acting jointly with the Council, the Council and the Commission shall make regulations and
issue directives, take decisions, make recommendations or deliver opinions.

A regulation shall have general application. It shall be binding in its entirety and directly applicable in all
Member States.

A directive shall be binding, as to the result to be achieved, upon each Member State to which it is
addressed, but shall leave to the national authorities the choice of form and methods.

A decision shall be binding in its entirety upon those to whom it is addressed.

Recommendations and opinions shall have no binding force.

Where,

1.
in pursuance of this Treaty, the Council acts on a proposal from the Commission,
unanimity shall be required for an act constituting an amendment to that proposal, subject to Article
251(4) and (5).

Article 250

As long as the Council has not acted, the Commission may alter its proposal at any time during

2.
the procedures leading to the adoption of a Community act.

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Where reference is made in this Treaty to this Article for the adoption of an act, the following

1.
procedure shall apply.

Article 251

2.

The Commission shall submit a proposal to the European Parliament and the Council.

The Council, acting by a qualified majority after obtaining the opinion of the European Parliament:

— if it approves all the amendments contained in the European Parliament's opinion, may adopt the

proposed act thus amended,

— if the European Parliament does not propose any amendments, may adopt the proposed act,

— shall otherwise adopt a common position and communicate it to the European Parliament. The
Council shall inform the European Parliament fully of the reasons which led it to adopt its common
position. The Commission shall inform the European Parliament fully of its position.

If, within three months of such communication, the European Parliament:

(a)

(b)

(c)

approves the common position or has not taken a decision, the act in question shall be deemed to
have been adopted in accordance with that common position;

rejects, by an absolute majority of its component members, the common position, the proposed act
shall be deemed not to have been adopted;

proposes amendments to the common position by an absolute majority of
its component
members, the amended text shall be forwarded to the Council and to the Commission, which
shall deliver an opinion on those amendments.

If, within three months of the matter being referred to it, the Council, acting by a qualified
3.
majority, approves all the amendments of the European Parliament, the act in question shall be deemed
to have been adopted in the form of the common position thus amended; however, the Council shall act
unanimously on the amendments on which the Commission has delivered a negative opinion. If the
Council does not approve all the amendments, the President of the Council, in agreement with the
President of the European Parliament, shall within six weeks convene a meeting of the Conciliation
Committee.

4.
The Conciliation Committee, which shall be composed of the Members of the Council or their
representatives and an equal number of representatives of the European Parliament, shall have the task
of reaching agreement on a joint text, by a qualified majority of the Members of the Council or their
representatives and by a majority of the representatives of the European Parliament. The Commission
shall take part in the Conciliation Committee's proceedings and shall take all the necessary initiatives
with a view to reconciling the positions of the European Parliament and the Council. In fulfilling this
task, the Conciliation Committee shall address the common position on the basis of the amendments
proposed by the European Parliament.

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5.
If, within six weeks of its being convened, the Conciliation Committee approves a joint text, the
European Parliament, acting by an absolute majority of the votes cast, and the Council, acting by a
qualified majority, shall each have a period of six weeks from that approval in which to adopt the act in
question in accordance with the joint text. If either of the two institutions fails to approve the proposed
act within that period, it shall be deemed not to have been adopted.

Where the Conciliation Committee does not approve a joint text, the proposed act shall be

6.
deemed not to have been adopted.

7.
The periods of three months and six weeks referred to in this Article shall be extended by a
maximum of one month and two weeks respectively at the initiative of the European Parliament or the
Council.

Article 252

Where reference is made in this Treaty to this Article for the adoption of an act, the following procedure
shall apply.

(a) The Council, acting by a qualified majority on a proposal from the Commission and after obtaining

the opinion of the European Parliament, shall adopt a common position.

(b) The Council's common position shall be communicated to the European Parliament. The Council
inform the European Parliament fully of the reasons which led the

and the Commission shall
Council to adopt its common position and also of the Commission's position.

If, within three months of such communication, the European Parliament approves this common
position or has not taken a decision within that period, the Council shall definitively adopt the act
in question in accordance with the common position.

(c)

The European Parliament may, within the period of three months referred to in point (b), by an
absolute majority of its component Members, propose amendments to the Council's common
position. The European Parliament may also, by the same majority, reject the Council's common
position. The result of the proceedings shall be transmitted to the Council and the Commission.

If the European Parliament has rejected the Council's common position, unanimity shall be required
for the Council to act on a second reading.

(d) The Commission shall, within a period of one month, re-examine the proposal on the basis of
which the Council adopted its common position, by taking into account the amendments proposed
by the European Parliament.

The Commission shall forward to the Council, at the same time as its re-examined proposal, the
amendments of the European Parliament which it has not accepted, and shall express its opinion
on them. The Council may adopt these amendments unanimously.

(e)

The Council, acting by a qualified majority, shall adopt the proposal as re-examined by the
Commission.

Unanimity shall be required for the Council to amend the proposal as re-examined by the
Commission.

(f)

In the cases referred to in points (c), (d) and (e), the Council shall be required to act within a period
of three months. If no decision is taken within this period, the Commission proposal shall be
deemed not to have been adopted.

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(g) The periods referred to in points (b) and (f) may be extended by a maximum of one month by

common accord between the Council and the European Parliament.

Regulations, directives and decisions adopted jointly by the European Parliament and the Council, and
such acts adopted by the Council or the Commission, shall state the reasons on which they are based
and shall refer to any proposals or opinions which were required to be obtained pursuant to this Treaty.

Article 253

Article 254 (*)

1.
Regulations, directives and decisions adopted in accordance with the procedure referred to in
Article 251 shall be signed by the President of the European Parliament and by the President of the
Council and published in the Official Journal of the European Union. They shall enter into force on the date
specified in them or, in the absence thereof, on the 20th day following that of their publication.

2.
Regulations of the Council and of the Commission, as well as directives of those institutions
which are addressed to all Member States, shall be published in the Official Journal of the European Union.
They shall enter into force on the date specified in them or, in the absence thereof, on the 20th day
following that of their publication.

Other directives, and decisions, shall be notified to those to whom they are addressed and shall

3.
take effect upon such notification.

Article 255

1.
Any citizen of the Union, and any natural or legal person residing or having its registered office
in a Member State, shall have a right of access to European Parliament, Council and Commission
documents, subject to the principles and the conditions to be defined in accordance with paragraphs
2 and 3.

2.
General principles and limits on grounds of public or private interest governing this right of
access to documents shall be determined by the Council, acting in accordance with the procedure
referred to in Article 251 within two years of the entry into force of the Treaty of Amsterdam.

Each institution referred to above shall elaborate in its own Rules of Procedure specific provisions

3.
regarding access to its documents.

Article 256

Decisions of the Council or of the Commission which impose a pecuniary obligation on persons other
than States, shall be enforceable.

Enforcement shall be governed by the rules of civil procedure in force in the State in the territory of
which it is carried out. The order for its enforcement shall be appended to the decision, without other
formality than verification of the authenticity of the decision, by the national authority which the
government of each Member State shall designate for this purpose and shall make known to the
Commission and to the Court of Justice.

(*) Article amended by the Treaty of Nice.

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When these formalities have been completed on application by the party concerned, the latter may
proceed to enforcement in accordance with the national law, by bringing the matter directly before the
competent authority.

Enforcement may be suspended only by a decision of the Court of Justice. However, the courts of the
country concerned shall have jurisdiction over complaints that enforcement is being carried out in an
irregular manner.

CHAPTER 3

THE ECONOMIC AND SOCIAL COMMITTEE

Article 257 (*)

An Economic and Social Committee is hereby established. It shall have advisory status.

The Committee shall consist of representatives of the various economic and social components of
organised civil society, and in particular representatives of producers,
farmers, carriers, workers,
dealers, craftsmen, professional occupations, consumers and the general interest.

The number of members of the Economic and Social Committee shall not exceed 350.

Article 258 (*)

The number of members of the Committee shall be as follows:

Belgium
Denmark
Germany
Greece
Spain
France
Ireland
Italy
Luxembourg
Netherlands
Austria
Portugal
Finland
Sweden
United Kingdom

12
9
24
12
21
24
9
24
6
12
12
12
9
12
24.

The members of the Committee may not be bound by any mandatory instructions. They shall be
completely independent in the performance of their duties, in the general interest of the Community.

The Council, acting by a qualified majority, shall determine the allowances of members of
Committee.

the

(*) Article amended by the Treaty of Nice.

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Article 259 (*)

1.
The members of the Committee shall be appointed for four years, on proposals from the Member
States. The Council, acting by a qualified majority, shall adopt the list of members drawn up in
accordance with the proposals made by each Member State. The term of office of the members of
the Committee shall be renewable.

The Council shall consult the Commission. It may obtain the opinion of European bodies which
2.
are representative of the various economic and social sectors to which the activities of the Community
are of concern.

The Committee shall elect its chairman and officers from among its members for a term of two years.

Article 260

It shall adopt its Rules of Procedure.

The Committee shall be convened by its chairman at the request of the Council or of the Commission. It
may also meet on its own initiative.

Article 261

The Committee shall include specialised sections for the principal fields covered by this Treaty.

These specialised sections shall operate within the general terms of reference of the Committee. They
may not be consulted independently of the Committee.

Subcommittees may also be established within the Committee to prepare on specific questions or in
specific fields, draft opinions to be submitted to the Committee for its consideration.

The Rules of Procedure shall lay down the methods of composition and the terms of reference of the
specialised sections and of the subcommittees.

Article 262

The Committee must be consulted by the Council or by the Commission where this Treaty so provides.
The Committee may be consulted by these institutions in all cases in which they consider it appropriate.
It may issue an opinion on its own initiative in cases in which it considers such action appropriate.

The Council or the Commission shall, if it considers it necessary, set the Committee, for the submission
of its opinion, a time limit which may not be less than one month from the date on which the chairman
receives notification to this effect. Upon expiry of the time limit, the absence of an opinion shall not
prevent further action.

The opinion of the Committee and that of the specialised section, together with a record of the
proceedings, shall be forwarded to the Council and to the Commission.

The Committee may be consulted by the European Parliament.

(*) Article amended by the Treaty of Nice.

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CHAPTER 4

THE COMMITTEE OF THE REGIONS

Article 263 (*)

A committee, hereinafter referred to as ‘the Committee of the Regions’, consisting of representatives of
regional and local bodies who either hold a regional or local authority electoral mandate or are
politically accountable to an elected assembly, is hereby established with advisory status.

The number of members of the Committee of the Regions shall not exceed 350.

The number of members of the Committee shall be as follows:

Belgium
Denmark
Germany
Greece
Spain
France
Ireland
Italy
Luxembourg
Netherlands
Austria
Portugal
Finland
Sweden
United Kingdom

12
9
24
12
21
24
9
24
6
12
12
12
9
12
24.

The members of the Committee and an equal number of alternate members shall be appointed for four
years, on proposals from the respective Member States. Their term of office shall be renewable. The
Council, acting by a qualified majority, shall adopt the list of members and alternate members drawn up
in accordance with the proposals made by each Member State. When the mandate referred to in the first
paragraph on the basis of which they were proposed comes to an end, the term of office of members of
the Committee shall terminate automatically and they shall then be replaced for the remainder of the
said term of office in accordance with the same procedure. No member of the Committee shall at the
same time be a Member of the European Parliament.

The members of the Committee may not be bound by any mandatory instructions. They shall be
completely independent in the performance of their duties, in the general interest of the Community.

The Committee of the Regions shall elect its chairman and officers from among its members for a term
of two years.

Article 264

It shall adopt its Rules of Procedure.

(*) Article amended by the Treaty of Nice.

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The Committee shall be convened by its chairman at the request of the Council or of the Commission. It
may also meet on its own initiative.

Article 265

The Committee of the Regions shall be consulted by the Council or by the Commission where this
Treaty so provides and in all other cases, in particular those which concern cross-border cooperation, in
which one of these two institutions considers it appropriate.

The Council or the Commission shall, if it considers it necessary, set the Committee, for the submission
of its opinion, a time limit which may not be less than one month from the date on which the chairman
receives notification to this effect. Upon expiry of the time limit, the absence of an opinion shall not
prevent further action.

Where the Economic and Social Committee is consulted pursuant to Article 262, the Committee of the
Regions shall be informed by the Council or the Commission of the request for an opinion. Where it
considers that specific regional
interests are involved, the Committee of the Regions may issue an
opinion on the matter.

The Committee of the Regions may be consulted by the European Parliament.

It may issue an opinion on its own initiative in cases in which it considers such action appropriate.

The opinion of the Committee, together with a record of the proceedings, shall be forwarded to the
Council and to the Commission.

CHAPTER 5

THE EUROPEAN INVESTMENT BANK

Article 266 (*)

The European Investment Bank shall have legal personality.

The members of the European Investment Bank shall be the Member States.

The Statute of the European Investment Bank is laid down in a Protocol annexed to this Treaty. The
Council acting unanimously, at the request of the European Investment Bank and after consulting the
European Parliament and the Commission, or at the request of the Commission and after consulting the
European Parliament and the European Investment Bank, may amend Articles 4, 11 and 12 and Article
18(5) of the Statute of the Bank.

Article 267

The task of the European Investment Bank shall be to contribute, by having recourse to the capital
market and utilising its own resources, to the balanced and steady development of the common market
in the interest of the Community. For this purpose the Bank shall, operating on a non-profit-making
basis, grant loans and give guarantees which facilitate the financing of the following projects in all
sectors of the economy:

(*) Article amended by the Treaty of Nice.

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(a)

projects for developing less-developed regions;

(b) projects for modernising or converting undertakings or for developing fresh activities called for by
the progressive establishment of the common market, where these projects are of such a size or
nature that they cannot be entirely financed by the various means available in the individual
Member States;

(c)

projects of common interest to several Member States which are of such a size or nature that they
cannot be entirely financed by the various means available in the individual Member States.

In carrying out its task, the Bank shall facilitate the financing of investment programmes in conjunction
with assistance from the Structural Funds and other Community Financial Instruments.

TITLE II

FINANCIAL PROVISIONS

Article 268

All items of revenue and expenditure of the Community, including those relating to the European Social
Fund, shall be included in estimates to be drawn up for each financial year and shall be shown in the
budget.

Administrative expenditure occasioned for the institutions by the provisions of the Treaty on European
Union relating to common foreign and security policy and to cooperation in the fields of justice and
home affairs shall be charged to the budget. The operational expenditure occasioned by the implemen-
tation of the said provisions may, under the conditions referred to therein, be charged to the budget.

The revenue and expenditure shown in the budget shall be in balance.

Without prejudice to other revenue, the budget shall be financed wholly from own resources.

Article 269

The Council, acting unanimously on a proposal from the Commission and after consulting the European
Parliament, shall lay down provisions relating to the system of own resources of the Community, which
it shall recommend to the Member States for adoption in accordance with their respective constitutional
requirements.

Article 270

With a view to maintaining budgetary discipline, the Commission shall not make any proposal for a
Community act, or alter its proposals, or adopt any implementing measure which is likely to have
appreciable implications for the budget without providing the assurance that that proposal or that
measure is capable of being financed within the limit of the Community's own resources arising
under provisions laid down by the Council pursuant to Article 269.

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Article 271

The expenditure shown in the budget shall be authorised for one financial year, unless the regulations
made pursuant to Article 279 provide otherwise.

In accordance with conditions to be laid down pursuant to Article 279, any appropriations, other than
those relating to staff expenditure, that are unexpended at the end of the financial year may be carried
forward to the next financial year only.

Appropriations shall be classified under different chapters grouping items of expenditure according to
their nature or purpose and subdivided, as far as may be necessary, in accordance with the regulations
made pursuant to Article 279.

The expenditure of the European Parliament, the Council, the Commission and the Court of Justice shall
be set out in separate parts of the budget, without prejudice to special arrangements for certain common
items of expenditure.

1.

The financial year shall run from 1 January to 31 December.

Article 272

2.
Each institution of the Community shall, before 1 July, draw up estimates of its expenditure. The
Commission shall consolidate these estimates in a preliminary draft budget. It shall attach thereto an
opinion which may contain different estimates.

The preliminary draft budget shall contain an estimate of revenue and an estimate of expenditure.

The Commission shall place the preliminary draft budget before the Council not later than

3.
1 September of the year preceding that in which the budget is to be implemented.

The Council shall consult the Commission and, where appropriate, the other institutions concerned
whenever it intends to depart from the preliminary draft budget.

The Council, acting by a qualified majority, shall establish the draft budget and forward it to the
European Parliament.

The draft budget shall be placed before the European Parliament not later than 5 October of the

4.
year preceding that in which the budget is to be implemented.

The European Parliament shall have the right to amend the draft budget, acting by a majority of its
Members, and to propose to the Council, acting by an absolute majority of the votes cast, modifications
to the draft budget relating to expenditure necessarily resulting from this Treaty or from acts adopted in
accordance therewith.

If, within 45 days of the draft budget being placed before it, the European Parliament has given its
approval, the budget shall stand as finally adopted. If within this period the European Parliament has not
amended the draft budget nor proposed any modifications thereto, the budget shall be deemed to be
finally adopted.

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If within this period the European Parliament has adopted amendments or proposed modifications, the
draft budget together with the amendments or proposed modifications shall be forwarded to the
Council.

After discussing the draft budget with the Commission and, where appropriate, with the other

5.
institutions concerned, the Council shall act under the following conditions:

(a)

the Council may, acting by a qualified majority, modify any of the amendments adopted by the
European Parliament;

(b) with regard to the proposed modifications:

— where a modification proposed by the European Parliament does not have the effect of
increasing the total amount of the expenditure of an institution, owing in particular to the
fact that the increase in expenditure which it would involve would be expressly compensated
by one or more proposed modifications correspondingly reducing expenditure, the Council
may, acting by a qualified majority, reject the proposed modification. In the absence of a
decision to reject it, the proposed modification shall stand as accepted,

— where a modification proposed by the European Parliament has the effect of increasing the
total amount of the expenditure of an institution, the Council may, acting by a qualified
majority, accept this proposed modification. In the absence of a decision to accept it, the
proposed modification shall stand as rejected,

— where, pursuant to one of the two preceding subparagraphs, the Council has rejected a
it may, acting by a qualified majority, either retain the amount

proposed modification,
shown in the draft budget or fix another amount.

The draft budget shall be modified on the basis of the proposed modifications accepted by the Council.

If, within 15 days of the draft being placed before it, the Council has not modified any of the
amendments adopted by the European Parliament and if the modifications proposed by the latter
have been accepted, the budget shall be deemed to be finally adopted. The Council shall inform the
European Parliament that it has not modified any of the amendments and that the proposed modifi-
cations have been accepted.

If within this period the Council has modified one or more of the amendments adopted by the European
Parliament or if the modifications proposed by the latter have been rejected or modified, the modified
draft budget shall again be forwarded to the European Parliament. The Council shall
inform the
European Parliament of the results of its deliberations.

Within 15 days of the draft budget being placed before it, the European Parliament, which shall
6.
have been notified of the action taken on its proposed modifications, may, acting by a majority of its
Members and three fifths of the votes cast, amend or reject the modifications to its amendments made
by the Council and shall adopt the budget accordingly. If within this period the European Parliament has
not acted, the budget shall be deemed to be finally adopted.

When the procedure provided for in this Article has been completed, the President of the

7.
European Parliament shall declare that the budget has been finally adopted.

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8.
However, the European Parliament, acting by a majority of its Members and two thirds of the
votes cast, may, if there are important reasons, reject the draft budget and ask for a new draft to be
submitted to it.

9.
A maximum rate of increase in relation to the expenditure of the same type to be incurred during
the current year shall be fixed annually for the total expenditure other than that necessarily resulting
from this Treaty or from acts adopted in accordance therewith.

The Commission shall, after consulting the Economic Policy Committee, declare what this maximum
rate is as it results from:

— the trend, in terms of volume, of the gross national product within the Community,

— the average variation in the budgets of the Member States,

and

— the trend of the cost of living during the preceding financial year.

The maximum rate shall be communicated, before 1 May, to all the institutions of the Community. The
latter shall be required to conform to this during the budgetary procedure, subject to the provisions of
the fourth and fifth subparagraphs of this paragraph.

If, in respect of expenditure other than that necessarily resulting from this Treaty or from acts adopted
in accordance therewith, the actual rate of increase in the draft budget established by the Council is over
half the maximum rate, the European Parliament may, exercising its right of amendment, further
increase the total amount of that expenditure to a limit not exceeding half the maximum rate.

Where the European Parliament, the Council or the Commission consider that the activities of the
Communities require that
the rate determined according to the procedure laid down in this
paragraph should be exceeded, another rate may be fixed by agreement between the Council, acting
by a qualified majority, and the European Parliament, acting by a majority of its Members and three
fifths of the votes cast.

Each institution shall exercise the powers conferred upon it by this article, with due regard for
10.
the provisions of the Treaty and for acts adopted in accordance therewith, in particular those relating to
the Communities' own resources and to the balance between revenue and expenditure.

Article 273

If, at the beginning of a financial year, the budget has not yet been voted, a sum equivalent to not more
than one twelfth of the budget appropriations for the preceding financial year may be spent each month
in respect of any chapter or other subdivision of the budget in accordance with the provisions of the
Regulations made pursuant to Article 279; this arrangement shall not, however, have the effect of
placing at the disposal of the Commission appropriations in excess of one twelfth of those provided
for in the draft budget in course of preparation.

The Council may, acting by a qualified majority, provided that the other conditions laid down in the
first subparagraph are observed, authorise expenditure in excess of one twelfth.

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If the decision relates to expenditure which does not necessarily result from this Treaty or from acts
adopted in accordance therewith, the Council shall forward it immediately to the European Parliament;
within 30 days the European Parliament, acting by a majority of its Members and three fifths of the
votes cast, may adopt a different decision on the expenditure in excess of the one twelfth referred to in
the first subparagraph. This part of the decision of the Council shall be suspended until the European
Parliament has taken its decision. If within the said period the European Parliament has not taken a
decision which differs from the decision of the Council, the latter shall be deemed to be finally adopted.

The decisions referred to in the second and third subparagraphs shall lay down the necessary measures
relating to resources to ensure application of this Article.

Article 274

The Commission shall implement the budget, in accordance with the provisions of the regulations made
pursuant to Article 279, on its own responsibility and within the limits of the appropriations, having
regard to the principles of sound financial management. Member States shall cooperate with the
Commission to ensure that the appropriations are used in accordance with the principles of sound
financial management.

The regulations shall lay down detailed rules for each institution concerning its part in effecting its own
expenditure.

Within the budget, the Commission may, subject to the limits and conditions laid down in the regu-
lations made pursuant to Article 279, transfer appropriations from one chapter to another or from one
subdivision to another.

The Commission shall submit annually to the Council and to the European Parliament the accounts of
the preceding financial year relating to the implementation of the budget. The Commission shall also
forward to them a financial statement of the assets and liabilities of the Community.

Article 275

Article 276

1.
The European Parliament, acting on a recommendation from the Council which shall act by a
qualified majority, shall give a discharge to the Commission in respect of the implementation of the
budget. To this end, the Council and the European Parliament in turn shall examine the accounts and
the financial statement referred to in Article 275, the annual report by the Court of Auditors together
with the replies of the institutions under audit to the observations of the Court of Auditors, the
statement of assurance referred to in Article 248(1), second subparagraph and any relevant special
reports by the Court of Auditors.

2.
Before giving a discharge to the Commission, or for any other purpose in connection with the
exercise of its powers over the implementation of the budget, the European Parliament may ask to hear
the Commission give evidence with regard to the execution of expenditure or the operation of financial
control systems. The Commission shall submit any necessary information to the European Parliament at
the latter's request.

3.
The Commission shall take all appropriate steps to act on the observations in the decisions giving
discharge and on other observations by the European Parliament relating to the execution of expen-
diture, as well as on comments accompanying the recommendations on discharge adopted by the
Council.

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At the request of the European Parliament or the Council, the Commission shall report on the measures
taken in the light of these observations and comments and in particular on the instructions given to the
departments which are responsible for the implementation of the budget. These reports shall also be
forwarded to the Court of Auditors.

The budget shall be drawn up in the unit of account determined in accordance with the provisions of
the regulations made pursuant to Article 279.

Article 277

Article 278

The Commission may, provided it notifies the competent authorities of the Member States concerned,
transfer into the currency of one of the Member States its holdings in the currency of another Member
State, to the extent necessary to enable them to be used for purposes which come within the scope of
this Treaty. The Commission shall as far as possible avoid making such transfers if it possesses cash or
liquid assets in the currencies which it needs.

The Commission shall deal with each Member State through the authority designated by the State
concerned.
In carrying out financial operations the Commission shall employ the services of the
bank of issue of the Member State concerned or of any other financial institution approved by that State.

Article 279 (*)

The Council, acting unanimously on a proposal from the Commission and after consulting the

1.
European Parliament and obtaining the opinion of the Court of Auditors, shall:

(a) make Financial Regulations specifying in particular the procedure to be adopted for establishing

and implementing the budget and for presenting and auditing accounts;

(b)

lay down rules concerning the responsibility of financial controllers, authorising officers and
accounting officers, and concerning appropriate arrangements for inspection.

From 1 January 2007, the Council shall act by a qualified majority on a proposal from the Commission
and after consulting the European Parliament and obtaining the opinion of the Court of Auditors.

2.
The Council, acting unanimously on a proposal from the Commission and after consulting the
European Parliament and obtaining the opinion of the Court of Auditors, shall determine the methods
and procedure whereby the budget
relating to the
Community's own resources shall be made available to the Commission, and determine the measures
to be applied, if need be, to meet cash requirements.

revenue provided under

the arrangements

Article 280

1.
The Community and the Member States shall counter fraud and any other illegal activities
affecting the financial interests of the Community through measures to be taken in accordance with
this article, which shall act as a deterrent and be such as to afford effective protection in the Member
States.

(*) Article amended by the Treaty of Nice.

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Member States shall take the same measures to counter fraud affecting the financial interests of

2.
the Community as they take to counter fraud affecting their own financial interests.

3.
Without prejudice to other provisions of this Treaty, the Member States shall coordinate their
action aimed at protecting the financial interests of the Community against fraud. To this end they shall
organise, together with the Commission, close and regular cooperation between the competent auth-
orities.

The Council, acting in accordance with the procedure referred to in Article 251, after consulting
4.
the Court of Auditors, shall adopt the necessary measures in the fields of the prevention of and fight
against fraud affecting the financial interests of the Community with a view to affording effective and
equivalent protection in the Member States. These measures shall not concern the application of national
criminal law or the national administration of justice.

The Commission, in cooperation with Member States, shall each year submit to the European
5.
Parliament and to the Council a report on the measures taken for the implementation of this article.

PART SIX

GENERAL AND FINAL PROVISIONS

The Community shall have legal personality.

Article 281

Article 282

In each of the Member States, the Community shall enjoy the most extensive legal capacity accorded to
legal persons under their laws; it may, in particular, acquire or dispose of movable and immovable
property and may be a party to legal proceedings. To this end, the Community shall be represented by
the Commission.

Article 283

The Council shall, acting by a qualified majority on a proposal from the Commission and after
consulting the other
the
European Communities and the Conditions of employment of other servants of those Communities.

lay down the Staff Regulations of officials of

institutions concerned,

The Commission may, within the limits and under conditions laid down by the Council in accordance
with the provisions of this Treaty, collect any information and carry out any checks required for the
performance of the tasks entrusted to it.

Article 284

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Article 285

1.
Without prejudice to Article 5 of the Protocol on the Statute of the European System of Central
Banks and of the European Central Bank, the Council, acting in accordance with the procedure referred
to in Article 251, shall adopt measures for the production of statistics where necessary for the
performance of the activities of the Community.

The production of Community statistics shall conform to impartiality, reliability, objectivity,
it shall not entail excessive

2.
scientific independence, cost-effectiveness and statistical confidentiality;
burdens on economic operators.

1.
From 1 January 1999, Community acts on the protection of individuals with regard to the
processing of personal data and the free movement of such data shall apply to the institutions and
bodies set up by, or on the basis of, this Treaty.

Article 286

Before the date referred to in paragraph 1, the Council, acting in accordance with the procedure
2.
referred to in Article 251, shall establish an independent supervisory body responsible for monitoring
the application of such Community acts to Community institutions and bodies and shall adopt any other
relevant provisions as appropriate.

Article 287

The members of the institutions of the Community, the members of committees, and the officials and
other servants of the Community shall be required, even after their duties have ceased, not to disclose
information of the kind covered by the obligation of professional secrecy,
in particular information
about undertakings, their business relations or their cost components.

The contractual liability of the Community shall be governed by the law applicable to the contract in
question.

Article 288

In the case of non-contractual liability, the Community shall, in accordance with the general principles
common to the laws of the Member States, make good any damage caused by its institutions or by its
servants in the performance of their duties.

The preceding paragraph shall apply under the same conditions to damage caused by the ECB or by its
servants in the performance of their duties.

The personal liability of its servants towards the Community shall be governed by the provisions laid
down in their Staff Regulations or in the Conditions of employment applicable to them.

Article 289

The seat of
governments of the Member States.

the institutions of

the Community shall be determined by common accord of

the

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The rules governing the languages of the institutions of the Community shall, without prejudice to the
provisions contained in the Statute of the Court of Justice, be determined by the Council, acting
unanimously.

Article 290 (*)

Article 291

The Community shall enjoy in the territories of the Member States such privileges and immunities as are
necessary for the performance of its tasks, under the conditions laid down in the Protocol of 8 April
1965 on the privileges and immunities of the European Communities. The same shall apply to the
European Central Bank, the European Monetary Institute, and the European Investment Bank.

Member States undertake not to submit a dispute concerning the interpretation or application of this
Treaty to any method of settlement other than those provided for therein.

Article 292

Article 293

Member States shall, so far as is necessary, enter into negotiations with each other with a view to
securing for the benefit of their nationals:

— the protection of persons and the enjoyment and protection of rights under the same conditions as

those accorded by each State to its own nationals,

— the abolition of double taxation within the Community,

— the mutual recognition of companies or firms within the meaning of the second paragraph of
Article 48, the retention of legal personality in the event of transfer of their seat from one country
to another, and the possibility of mergers between companies or firms governed by the laws of
different countries,

— the simplification of formalities governing the reciprocal recognition and enforcement of judgments

of courts or tribunals and of arbitration awards.

Article 294

Member States shall accord nationals of the other Member States the same treatment as their own
nationals as regards participation in the capital of companies or firms within the meaning of Article 48,
without prejudice to the application of the other provisions of this Treaty.

This Treaty shall in no way prejudice the rules in Member States governing the system of property
ownership.

Article 295

1.

The provisions of this Treaty shall not preclude the application of the following rules:

Article 296

(*) Article amended by the Treaty of Nice.

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(a)

(b)

no Member State shall be obliged to supply information the disclosure of which it considers
contrary to the essential interests of its security;

any Member State may take such measures as it considers necessary for the protection of the
essential interests of its security which are connected with the production of or trade in arms,
munitions and war material; such measures shall not adversely affect the conditions of competition
in the common market regarding products which are not
intended for specifically military
purposes.

2.
The Council may, acting unanimously on a proposal from the Commission, make changes to the
list, which it drew up on 15 April 1958, of the products to which the provisions of paragraph 1(b)
apply.

Article 297

Member States shall consult each other with a view to taking together the steps needed to prevent the
functioning of the common market being affected by measures which a Member State may be called
upon to take in the event of serious internal disturbances affecting the maintenance of law and order, in
the event of war, serious international tension constituting a threat of war, or in order to carry out
obligations it has accepted for the purpose of maintaining peace and international security.

Article 298

If measures taken in the circumstances referred to in Articles 296 and 297 have the effect of distorting
the conditions of competition in the common market, the Commission shall, together with the State
concerned, examine how these measures can be adjusted to the rules laid down in the Treaty.

By way of derogation from the procedure laid down in Articles 226 and 227, the Commission or any
Member State may bring the matter directly before the Court of Justice if it considers that another
Member State is making improper use of the powers provided for in Articles 296 and 297. The Court of
Justice shall give its ruling in camera.

Article 299

This Treaty shall apply to the Kingdom of Belgium, the Kingdom of Denmark, the Federal
1.
Republic of Germany, the Hellenic Republic, the Kingdom of Spain, the French Republic, Ireland, the
Italian Republic, the Grand Duchy of Luxembourg, the Kingdom of the Netherlands, the Republic of
Austria, the Portuguese Republic, the Republic of Finland, the Kingdom of Sweden and the United
Kingdom of Great Britain and Northern Ireland.

The provisions of this Treaty shall apply to the French overseas departments, the Azores, Madeira

2.
and the Canary Islands.

taking account of

the structural social and economic situation of

However,
the French overseas
departments, the Azores, Madeira and the Canary Islands, which is compounded by their remoteness,
insularity, small size, difficult topography and climate, economic dependence on a few products, the
permanence and combination of which severely restrain their development, the Council, acting by a
qualified majority on a proposal from the Commission and after consulting the European Parliament,
shall adopt specific measures aimed, in particular, at laying down the conditions of application of the
present Treaty to those regions, including common policies.

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The Council shall, when adopting the relevant measures referred to in the second subparagraph, take
into account areas such as customs and trade policies, fiscal policy, free zones, agriculture and fisheries
policies, conditions for supply of raw materials and essential consumer goods, State aids and conditions
of access to structural funds and to horizontal Community programmes.

The Council shall adopt the measures referred to in the second subparagraph taking into account the
special characteristics and constraints of the outermost regions without undermining the integrity and
the coherence of the Community legal order, including the internal market and common policies.

The special arrangements for association set out in part four of this Treaty shall apply to the

3.
overseas countries and territories listed in Annex II to this Treaty.

This Treaty shall not apply to those overseas countries and territories having special relations with the
United Kingdom of Great Britain and Northern Ireland which are not included in the aforementioned
list.

The provisions of this Treaty shall apply to the European territories for whose external relations a

4.
Member State is responsible.

5.
The provisions of this Treaty shall apply to the Åland Islands in accordance with the provisions
set out in Protocol 2 to the Act concerning the conditions of accession of the Republic of Austria, the
Republic of Finland and the Kingdom of Sweden.

6.

Notwithstanding the preceding paragraphs:

(a)

this Treaty shall not apply to the Faeroe Islands;

(b)

(c)

this Treaty shall not apply to the sovereign base areas of the United Kingdom of Great Britain and
Northern Ireland in Cyprus;

this Treaty shall apply to the Channel Islands and the Isle of Man only to the extent necessary to
ensure the implementation of the arrangements for those islands set out in the Treaty concerning
the accession of new Member States to the European Economic Community and to the European
Atomic Energy Community signed on 22 January 1972.

Article 300 (*)

Where this Treaty provides for the conclusion of agreements between the Community and one or
1.
more States or international organisations, the Commission shall make recommendations to the Council,
which shall authorise the Commission to open the necessary negotiations. The Commission shall
conduct these negotiations in consultation with special committees appointed by the Council to assist
it in this task and within the framework of such directives as the Council may issue to it.

In exercising the powers conferred upon it by this paragraph, the Council shall act by a qualified
majority, except in the cases where the first subparagraph of paragraph 2 provides that the Council
shall act unanimously.

(*) Article amended by the Treaty of Nice.

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2.
Subject to the powers vested in the Commission in this field, the signing, which may be accom-
panied by a decision on provisional application before entry into force, and the conclusion of the
agreements shall be decided on by the Council, acting by a qualified majority on a proposal from
the Commission. The Council shall act unanimously when the agreement covers a field for which
unanimity is required for the adoption of internal rules and for the agreements referred to in Article
310.

By way of derogation from the rules laid down in paragraph 3, the same procedures shall apply for a
decision to suspend the application of an agreement, and for the purpose of establishing the positions to
be adopted on behalf of the Community in a body set up by an agreement, when that body is called
upon to adopt decisions having legal effects, with the exception of decisions supplementing or amending
the institutional framework of the agreement.

The European Parliament shall be immediately and fully informed of any decision under this paragraph
concerning the provisional application or the suspension of agreements, or the establishment of the
Community position in a body set up by an agreement.

The Council shall conclude agreements after consulting the European Parliament, except for the
3.
agreements referred to in Article 133(3), including cases where the agreement covers a field for which
the procedure referred to in Article 251 or that referred to in Article 252 is required for the adoption of
internal rules. The European Parliament shall deliver its opinion within a time limit which the Council
may lay down according to the urgency of the matter. In the absence of an opinion within that time
limit, the Council may act.

By way of derogation from the previous subparagraph, agreements referred to in Article 310, other
agreements establishing a specific institutional
framework by organising cooperation procedures,
agreements having important budgetary implications for the Community and agreements entailing
amendment of an act adopted under the procedure referred to in Article 251 shall be concluded
after the assent of the European Parliament has been obtained.

The Council and the European Parliament may, in an urgent situation, agree upon a time limit for the
assent.

When concluding an agreement, the Council may, by way of derogation from paragraph 2,
4.
the Community where the
authorise the Commission to approve modifications on behalf of
agreement provides for them to be adopted by a simplified procedure or by a body set up by the
agreement; it may attach specific conditions to such authorisation.

5.
When the Council envisages concluding an agreement which calls for amendments to this Treaty,
the amendments must first be adopted in accordance with the procedure laid down in Article 48 of the
Treaty on European Union.

6.
The European Parliament, the Council, the Commission or a Member State may obtain the
opinion of the Court of Justice as to whether an agreement envisaged is compatible with the provisions
of this Treaty. Where the opinion of the Court of Justice is adverse, the agreement may enter into force
only in accordance with Article 48 of the Treaty on European Union.

Agreements concluded under the conditions set out in this Article shall be binding on the

7.
institutions of the Community and on Member States.

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Article 301

Where it is provided, in a common position or in a joint action adopted according to the provisions of
the Treaty on European Union relating to the common foreign and security policy, for an action by the
Community to interrupt or to reduce, in part or completely, economic relations with one or more third
countries, the Council shall take the necessary urgent measures. The Council shall act by a qualified
majority on a proposal from the Commission.

Article 302

It shall be for the Commission to ensure the maintenance of all appropriate relations with the organs of
the United Nations and of its specialised agencies.

The Commission shall also maintain such relations as are appropriate with all international organi-
sations.

The Community shall establish all appropriate forms of cooperation with the Council of Europe.

Article 303

The Community shall establish close cooperation with the Organisation for Economic Cooperation and
Development, the details of which shall be determined by common accord.

Article 304

Article 305

1.
The provisions of this Treaty shall not affect the provisions of the Treaty establishing the
European Coal and Steel Community, in particular as regards the rights and obligations of Member
States, the powers of the institutions of that Community and the rules laid down by that Treaty for the
functioning of the common market in coal and steel.

The provisions of this Treaty shall not derogate from those of the Treaty establishing the

2.
European Atomic Energy Community.

The provisions of this Treaty shall not preclude the existence or completion of regional unions between
Belgium and Luxembourg, or between Belgium, Luxembourg and the Netherlands, to the extent that the
objectives of these regional unions are not attained by application of this Treaty.

Article 306

Article 307

The rights and obligations arising from agreements concluded before 1 January 1958 or, for acceding
States, before the date of their accession, between one or more Member States on the one hand, and one
or more third countries on the other, shall not be affected by the provisions of this Treaty.

To the extent that such agreements are not compatible with this Treaty, the Member State or States
concerned shall take all appropriate steps to eliminate the incompatibilities established. Member States
shall, where necessary, assist each other to this end and shall, where appropriate, adopt a common
attitude.

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In applying the agreements referred to in the first paragraph, Member States shall take into account the
fact that the advantages accorded under this Treaty by each Member State form an integral part of the
establishment of the Community and are thereby inseparably linked with the creation of common
institutions, the conferring of powers upon them and the granting of the same advantages by all the
other Member States.

Article 308

If action by the Community should prove necessary to attain, in the course of the operation of the
common market, one of the objectives of the Community, and this Treaty has not provided the
necessary powers, the Council shall, acting unanimously on a proposal from the Commission and
after consulting the European Parliament, take the appropriate measures.

Article 309 (*)

1.
Where a decision has been taken to suspend the voting rights of the representative of the
government of a Member State in accordance with Article 7(3) of the Treaty on European Union,
these voting rights shall also be suspended with regard to this Treaty.

2.
Moreover, where the existence of a serious and persistent breach by a Member State of principles
mentioned in Article 6(1) of the Treaty on European Union has been determined in accordance with
Article 7(2) of that Treaty, the Council, acting by a qualified majority, may decide to suspend certain of
the rights deriving from the application of this Treaty to the Member State in question. In doing so, the
Council shall take into account the possible consequences of such a suspension on the rights and
obligations of natural and legal persons.

The obligations of the Member State in question under this Treaty shall in any case continue to be
binding on that State.

3.
The Council, acting by a qualified majority, may decide subsequently to vary or revoke measures
taken in accordance with paragraph 2 in response to changes in the situation which led to their being
imposed.

4.
When taking decisions referred to in paragraphs 2 and 3, the Council shall act without taking
into account the votes of the representative of the government of the Member State in question. By way
of derogation from Article 205(2) a qualified majority shall be defined as the same proportion of the
weighted votes of the members of the Council concerned as laid down in Article 205(2).

This paragraph shall also apply in the event of voting rights being suspended in accordance with
paragraph 1. In such cases, a decision requiring unanimity shall be taken without the vote of the
representative of the government of the Member State in question.

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

Article 310

(*) Article amended by the Treaty of Nice.

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The protocols annexed to this Treaty by common accord of the Member States shall form an integral
part thereof.

Article 311

This Treaty is concluded for an unlimited period.

Article 312

FINAL PROVISIONS

Article 313

This Treaty shall be ratified by the High Contracting Parties in accordance with their respective consti-
tutional requirements. The Instruments of ratification shall be deposited with the Government of the
Italian Republic.

This Treaty shall enter into force on the first day of the month following the deposit of the Instrument
of ratification by the last signatory State to take this step. If, however, such deposit is made less than 15
days before the beginning of the following month, this Treaty shall not enter into force until the first
day of the second month after the date of such deposit.

Article 314

This Treaty, drawn up in a single original in the Dutch, French, German, and Italian languages, all four
texts being equally authentic, shall be deposited in the archives of the Government of the Italian
Republic, which shall transmit a certified copy to each of the Governments of the other signatory States.

Pursuant to the Accession Treaties, the Danish, English, Finnish, Greek, Irish, Portuguese, Spanish and
Swedish versions of this Treaty shall also be authentic.

IN WITNESS WHEREOF, the undersigned Plenipotentiaries have signed this Treaty.

Done at Rome this twenty-fifth day of March in the year one thousand nine hundred and fifty-seven.

(List of signatories not reproduced)

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ANNEXES

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ANNEX I

LIST

referred to in Article 32 of the Treaty

(1)
No in the Brussels nomenclature

(2)
Description of products

Chapter 1

Chapter 2

Chapter 3

Chapter 4

Chapter 5

05.04

05.15

Chapter 6

Chapter 7

Chapter 8

Chapter 9

Chapter 10

Chapter 11

Chapter 12

Chapter 13

ex 13.03

Chapter 15

15.01

15.02

15.03

15.04

15.07

15.12

15.13

15.17

Live animals

Meat and edible meat offal

Fish, crustaceans and molluscs

Dairy produce; birds' eggs; natural honey

Guts, bladders and stomachs of animals (other than fish), whole and pieces thereof

Animal products not elsewhere specified or included; dead animals of Chapter 1 or Chapter
3, unfit for human consumption

Live trees and other plants; bulbs, roots and the like; cut flowers and ornamental foliage

Edible vegetables and certain roots and tubers

Edible fruit and nuts; peel of melons or citrus fruit

Coffee, tea and spices, excluding maté (heading No 09.03)

Cereals

Products of the milling industry; malt and starches; gluten; inulin

Oil seeds and oleaginous fruit; miscellaneous grains, seeds and fruit; industrial and medical
plants; straw and fodder

Pectin

Lard and other rendered pig fat; rendered poultry fat

Unrendered fats of bovine cattle, sheep or goats; tallow (including ‘premier jus’) produced
from those fats

Lard stearin, oleostearin and tallow stearin; lard oil, oleo-oil and tallow oil, not emulsified
or mixed or prepared in any way

Fats and oil, of fish and marine mammals, whether or not refined

Fixed vegetable oils, fluid or solid, crude, refined or purified

Animal or vegetable fats and oils, hydrogenated, whether or not refined, but not further
prepared

Margarine, imitation lard and other prepared edible fats

Residues resulting from the treatment of fatty substances or animal or vegetable waxes

Chapter 16

Preparations of meat, of fish, of crustaceans or molluscs

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(1)
No in the Brussels nomenclature

(2)
Description of products

Chapter 17

17.01

17.02

17.03

17.05 (*)

Chapter 18

18.01

18.02

Chapter 20

Chapter 22

22.04

22.05

22.07

ex 22.08 (*)
ex 22.09 (*)

Beet sugar and cane sugar, solid

Other sugars; sugar syrups; artificial honey (whether or not mixed with natural honey);
caramel

Molasses, whether or not decolourised

Flavoured or coloured sugars, syrups and molasses, but not including fruit juices containing
added sugar in any proportion

Cocoa beans, whole or broken, raw or roasted

Cocoa shells, husks, skins and waste

Preparations of vegetables, fruit or other parts of plants

Grape must, in fermentation or with fermentation arrested otherwise than by the addition
of alcohol

Wine of fresh grapes; grape must with fermentation arrested by the addition of alcohol

Other fermented beverages (for example, cider, perry and mead)

Ethyl alcohol or neutral spirits, whether or not denatured, of any strength, obtained from
agricultural products listed in Annex I to the Treaty, excluding liqueurs and other spirituous
beverages and compound alcoholic preparations (known as ‘concentrated extracts’) for the
manufacture of beverages

ex 22.10 (*)

Vinegar and substitutes for vinegar

Chapter 23

Chapter 24

24.01

Chapter 45

45.01

Chapter 54

54.01

Chapter 57

57.01

Residues and waste from the food industries; prepared animal fodder

Unmanufactured tobacco, tobacco refuse

Natural cork, unworked, crushed, granulated or ground; waste cork

Flax, raw or processed but not spun; flax tow and waste (including pulled or garnetted rags)

True hemp (Cannabis sativa), raw or processed but not spun; tow and waste of true hemp
(including pulled or garnetted rags or ropes)

(*) Heading added by Article 1 of Regulation No 7a of the Council of the European Economic Community, of 18 December 1959 (OJ 7, 30.1.1961,

p. 71 — Special edition (English edition) 1959 to 1962, p. 68).

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ANNEX II

OVERSEAS COUNTRIES AND TERRITORIES

to which the provisions of part four of the Treaty apply

— Greenland

— New Caledonia and Dependencies

— French Polynesia

— French Southern and Antarctic Territories

— Wallis and Futuna Islands

— Mayotte

— Saint Pierre and Miquelon

— Aruba

— Netherlands Antilles:

— Bonaire

— Curaçao

— Saba

— Sint Eustatius

— Sint Maarten

— Anguilla

— Cayman Islands

— Falkland Islands

— South Georgia and the South Sandwich Islands

— Montserrat

— Pitcairn

— Saint Helena and Dependencies

— British Antarctic Territory

— British Indian Ocean Territory

— Turks and Caicos Islands

— British Virgin Islands

— Bermuda

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PROTOCOLS ADOPTED AT NICE

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PROTOCOL

ON THE ENLARGEMENT OF THE EUROPEAN UNION

THE HIGH CONTRACTING PARTIES

HAVE AGREED UPON the following provisions, which shall be annexed to the Treaty on European
Union and to the Treaties establishing the European Communities:

Article 1

Repeal of the Protocol on the institutions

The Protocol on the institutions with the prospect of enlargement of the European Union, annexed to
the Treaty on European Union and to the Treaties establishing the European Communities, is hereby
repealed.

Article 2

Provisions concerning the European Parliament

1.
On 1 January 2004 and with effect from the start of the 2004 to 2009 term, in Article 190(2) of
the Treaty establishing the European Community and in Article 108(2) of the Treaty establishing the
European Atomic Energy Community, the first subparagraph shall be replaced by the following:

‘The number of representatives elected in each Member State shall be as follows:

Belgium
Denmark
Germany
Greece
Spain
France
Ireland
Italy
Luxembourg
Netherlands
Austria
Portugal
Finland
Sweden
United Kingdom

22
13
99
22
50
72
12
72
6
25
17
22
13
18
72’.

Subject to paragraph 3, the total number of representatives in the European Parliament for the
2.
2004 to 2009 term shall be equal to the number of representatives specified in Article 190(2) of the
Treaty establishing the European Community and in Article 108(2) of the Treaty establishing the
European Atomic Energy Community plus the number of representatives of the new Member States
resulting from the accession treaties signed by 1 January 2004 at the latest.

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3.
If the total number of members referred to in paragraph 2 is less than 732, a pro rata correction
shall be applied to the number of representatives to be elected in each Member State, so that the total
number is as close as possible to 732, without such a correction leading to the number of represen-
tatives to be elected in each Member State being higher than that provided for in Article 190(2) of the
Treaty establishing the European Community and in Article 108(2) of the Treaty establishing the
European Atomic Energy Community for the 1999 to 2004 term.

The Council shall adopt a decision to that effect.

By way of derogation from the second paragraph of Article 189 of the Treaty establishing the
4.
European Community and from the second paragraph of Article 107 of the Treaty establishing the
European Atomic Energy Community, in the event of the entry into force of accession treaties after the
adoption of the Council decision provided for in the second subparagraph of paragraph 3 of this Article,
the number of members of the European Parliament may temporarily exceed 732 for the period for
which that decision applies. The same correction as that referred to in the first subparagraph of
paragraph 3 of this Article shall be applied to the number of representatives to be elected in the
Member States in question.

Provisions concerning the weighting of votes in the Council

Article 3

1.

On 1 January 2005:

(a)

in Article 205 of the Treaty establishing the European Community and in Article 118 of the Treaty
establishing the European Atomic Energy Community:

(i) paragraph 2 shall be replaced by the following:

Where the Council is required to act by a qualified majority, the votes of its members

‘2.
shall be weighted as follows:

Belgium
Denmark
Germany
Greece
Spain
France
Ireland
Italy
Luxembourg
Netherlands
Austria
Portugal
Finland
Sweden
United Kingdom

12
7
29
12
27
29
7
29
4
13
10
12
7
10
29

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Acts of the Council shall require for their adoption at least 169 votes in favour cast by a
majority of the members where this Treaty requires them to be adopted on a proposal from
the Commission.

In other cases, for their adoption acts of the Council shall require at least 169 votes in favour,
cast by at least two-thirds of the members.’;

(ii)

the following paragraph 4 shall be added:

When a decision is to be adopted by the Council by a qualified majority, a member of
‘4.
the Council may request verification that the Member States constituting the qualified majority
represent at least 62 % of the total population of the Union. If that condition is shown not to
have been met, the decision in question shall not be adopted.’

(b)

In Article 23(2) of the Treaty on European Union, the third subparagraph shall be replaced by the
following text:

‘The votes of the members of the Council shall be weighted in accordance with Article 205(2) of
the Treaty establishing the European Community. For their adoption, decisions shall require at least
169 votes in favour cast by at least two thirds of the members. When a decision is to be adopted
by the Council by a qualified majority, a member of the Council may request verification that the
Member States constituting the qualified majority represent at least 62 % of the total population of
the Union. If that condition is shown not to have been met, the decision in question shall not be
adopted.’

(c)

In Article 34 of the Treaty on European Union, paragraph 3 shall be replaced by the following:

‘3.
Where the Council is required to act by a qualified majority, the votes of its members shall
be weighted as laid down in Article 205(2) of the Treaty establishing the European Community,
and for their adoption acts of the Council shall require at least 169 votes in favour, cast by at least
two thirds of the members. When a decision is to be adopted by the Council by a qualified
majority, a member of the Council may request verification that the Member States constituting
the qualified majority represent at least 62 % of the total population of the Union. If that condition
is shown not to have been met, the decision in question shall not be adopted.’

2.
At the time of each accession, the threshold referred to in the second subparagraph of Article
205(2) of the Treaty establishing the European Community and in the second subparagraph of Article
118(2) of the Treaty establishing the European Atomic Energy Community shall be calculated in such a
way that the qualified majority threshold expressed in votes does not exceed the threshold resulting
from the table in the Declaration on the enlargement of the European Union, included in the Final Act
of the Conference which adopted the Treaty of Nice.

Article 4

Provisions concerning the Commission

1.
On 1 January 2005 and with effect from when the first Commission following that date takes up
its duties, Article 213(1) of the Treaty establishing the European Community and Article 126(1) of the
Treaty establishing the European Atomic Energy Community shall be replaced by the following:

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The Members of the Commission shall be chosen on the grounds of their general competence

‘1.
and their independence shall be beyond doubt.

The Commission shall include one national of each of the Member States.

The number of Members of the Commission may be altered by the Council, acting unanimously.’

When the Union consists of 27 Member States, Article 213(1) of the Treaty establishing the
2.
European Community and Article 126(1) of the Treaty establishing the European Atomic Energy
Community shall be replaced by the following:

The Members of the Commission shall be chosen on the grounds of their general competence

‘1.
and their independence shall be beyond doubt.

The number of Members of the Commission shall be less than the number of Member States. The
Members of the Commission shall be chosen according to a rotation system based on the principle of
equality, the implementing arrangements for which shall be adopted by the Council, acting unani-
mously.

The number of Members of the Commission shall be set by the Council, acting unanimously.’

This amendment shall apply as from the date on which the first Commission following the date of
accession of the 27th Member State of the Union takes up its duties.

The Council, acting unanimously after signing the treaty of accession of the 27th Member State

3.
of the Union, shall adopt:

— the number of Members of the Commission,

— the implementing arrangements for a rotation system based on the principle of equality containing
all the criteria and rules necessary for determining the composition of successive colleges auto-
matically on the basis of the following principles:

(a) Member States shall be treated on a strictly equal footing as regards determination of the
the Commission;
sequence of, and the time spent by,
consequently, the difference between the total number of terms of office held by nationals
of any given pair of Member States may never be more than one;

their nationals as Members of

(b)

subject to point (a), each successive college shall be so composed as to reflect satisfactorily the
demographic and geographical range of all the Member States of the Union.

Any State which accedes to the Union shall be entitled, at the time of its accession, to have one

4.
of its nationals as a Member of the Commission until paragraph 2 applies.

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PROTOCOL

ON THE STATUTE OF THE COURT OF JUSTICE

THE HIGH CONTRACTING PARTIES

DESIRING to lay down the Statute of the Court of Justice provided for in Article 245 of the Treaty
establishing the European Community and in Article 160 of the Treaty establishing the European
Atomic Energy Community,

HAVE AGREED upon the following provisions, which shall be annexed to the Treaty on European
Union, the Treaty establishing the European Community and the Treaty establishing the European
Atomic Energy Community:

The Court of Justice shall be constituted and shall function in accordance with the provisions of the
Treaty on European Union (EU Treaty), of the Treaty establishing the European Community (EC Treaty),
of the Treaty establishing the European Atomic Energy Community (EAEC Treaty) and of this Statute.

Article 1

TITLE I

JUDGES AND ADVOCATES-GENERAL

Article 2

Before taking up his duties each Judge shall,
impartially and conscientiously and to preserve the secrecy of the deliberations of the Court.

in open court, take an oath to perform his duties

The Judges shall be immune from legal proceedings. After they have ceased to hold office, they shall
continue to enjoy immunity in respect of acts performed by them in their official capacity, including
words spoken or written.

Article 3

The Court, sitting as a full Court, may waive the immunity.

Where immunity has been waived and criminal proceedings are instituted against a Judge, he shall be
tried, in any of the Member States, only by the court competent to judge the members of the highest
national judiciary.

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Articles 12 to 15 and Article 18 of the Protocol on the privileges and immunities of the European
Communities shall apply to the Judges, Advocates-General, Registrar and Assistant Rapporteurs of the
Court, without prejudice to the provisions relating to immunity from legal proceedings of Judges which
are set out in the preceding paragraphs.

The Judges may not hold any political or administrative office.

Article 4

They may not engage in any occupation, whether gainful or not, unless exemption is exceptionally
granted by the Council.

When taking up their duties, they shall give a solemn undertaking that, both during and after their term
of office, they will respect the obligations arising therefrom,
in particular the duty to behave with
integrity and discretion as regards the acceptance, after they have ceased to hold office, of certain
appointments or benefits.

Any doubt on this point shall be settled by decision of the Court.

Apart from normal replacement, or death, the duties of a Judge shall end when he resigns.

Article 5

Where a Judge resigns, his letter of resignation shall be addressed to the President of the Court for
transmission to the President of the Council. Upon this notification a vacancy shall arise on the bench.

Save where Article 6 applies, a Judge shall continue to hold office until his successor takes up his duties.

Article 6

A Judge may be deprived of his office or of his right to a pension or other benefits in its stead only if, in
the unanimous opinion of the Judges and Advocates-General of the Court, he no longer fulfils the
requisite conditions or meets the obligations arising from his office. The Judge concerned shall not take
part in any such deliberations.

The Registrar of the Court shall communicate the decision of the Court to the President of the European
Parliament and to the President of the Commission and shall notify it to the President of the Council.

In the case of a decision depriving a Judge of his office, a vacancy shall arise on the bench upon this
latter notification.

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A Judge who is to replace a member of the Court whose term of office has not expired shall be
appointed for the remainder of his predecessor's term.

Article 7

The provisions of Articles 2 to 7 shall apply to the Advocates-General.

Article 8

TITLE II

ORGANISATION

Article 9

When, every three years, the Judges are partially replaced, eight and seven Judges shall be replaced
alternately.

When, every three years, the Advocates-General are partially replaced, four Advocates-General shall be
replaced on each occasion.

The Registrar shall take an oath before the Court to perform his duties impartially and conscientiously
and to preserve the secrecy of the deliberations of the Court.

Article 10

The Court shall arrange for replacement of the Registrar on occasions when he is prevented from
attending the Court.

Article 11

Officials and other servants shall be attached to the Court to enable it to function. They shall be
responsible to the Registrar under the authority of the President.

Article 12

Article 13

On a proposal from the Court, the Council may, acting unanimously, provide for the appointment of
Assistant Rapporteurs and lay down the rules governing their service. The Assistant Rapporteurs may be
required, under conditions laid down in the Rules of Procedure, to participate in preparatory inquiries in
cases pending before the Court and to cooperate with the Judge who acts as Rapporteur.

The Assistant Rapporteurs shall be chosen from persons whose independence is beyond doubt and who
possess the necessary legal qualifications; they shall be appointed by the Council. They shall take an oath
before the Court to perform their duties impartially and conscientiously and to preserve the secrecy of
the deliberations of the Court.

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The Judges, the Advocates-General and the Registrar shall be required to reside at the place where the
Court has its seat.

Article 14

The Court shall remain permanently in session. The duration of
determined by the Court with due regard to the needs of its business.

the judicial vacations shall be

Article 15

The Court shall form chambers consisting of three and five Judges. The Judges shall elect the Presidents
of the chambers from among their number. The Presidents of the chambers of five Judges shall be
elected for three years. They may be re-elected once.

Article 16

The Grand Chamber shall consist of 11 Judges. It shall be presided over by the President of the Court.
The Presidents of the chambers of five Judges and other Judges appointed in accordance with the
conditions laid down in the Rules of Procedure shall also form part of the Grand Chamber.

The Court shall sit in a Grand Chamber when a Member State or an institution of the Communities that
is party to the proceedings so requests.

The Court shall sit as a full Court where cases are brought before it pursuant to Article 195(2), Article
213(2), Article 216 or Article 247(7) of the EC Treaty or Article 107d(2), Article 126(2), Article 129 or
Article 160b(7) of the EAEC Treaty.

Moreover, where it considers that a case before it is of exceptional importance, the Court may decide,
after hearing the Advocate-General, to refer the case to the full Court.

Decisions of the Court shall be valid only when an uneven number of its members is sitting in the
deliberations.

Article 17

Decisions of the chambers consisting of either three or five Judges shall be valid only if they are taken
by three Judges.

Decisions of the Grand Chamber shall be valid only if nine Judges are sitting.

Decisions of the full Court shall be valid only if 11 Judges are sitting.

In the event of one of the Judges of a chamber being prevented from attending, a Judge of another
chamber may be called upon to sit in accordance with conditions laid down in the Rules of Procedure.

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No Judge or Advocate-General may take part in the disposal of any case in which he has previously
taken part as agent or adviser or has acted for one of the parties, or in which he has been called upon to
pronounce as a member of a court or tribunal, of a commission of inquiry or in any other capacity.

Article 18

If, for some special reason, any Judge or Advocate-General considers that he should not take part in the
judgment or examination of a particular case, he shall so inform the President. If, for some special
reason, the President considers that any Judge or Advocate-General should not sit or make submissions
in a particular case, he shall notify him accordingly.

Any difficulty arising as to the application of this article shall be settled by decision of the Court.

A party may not apply for a change in the composition of the Court or of one of its chambers on the
grounds of either the nationality of a Judge or the absence from the Court or from the chamber of a
Judge of the nationality of that party.

TITLE III

PROCEDURE

Article 19

The Member States and the institutions of the Communities shall be represented before the Court by an
agent appointed for each case; the agent may be assisted by an adviser or by a lawyer.

The States, other than the Member States, which are parties to the Agreement on the European
Economic Area and also the EFTA Surveillance Authority referred to in that Agreement shall be
represented in same manner.

Other parties must be represented by a lawyer.

Only a lawyer authorised to practise before a court of a Member State or of another State which is a
party to the Agreement on the European Economic Area may represent or assist a party before the
Court.

Such agents, advisers and lawyers shall, when they appear before the Court, enjoy the rights and
immunities necessary to the independent exercise of their duties, under conditions laid down in the
Rules of Procedure.

As regards such advisers and lawyers who appear before it, the Court shall have the powers normally
accorded to courts of law, under conditions laid down in the Rules of Procedure.

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University teachers being nationals of a Member State whose law accords them a right of audience shall
have the same rights before the Court as are accorded by this article to lawyers.

The procedure before the Court shall consist of two parts: written and oral.

Article 20

The written procedure shall consist of the communication to the parties and to the institutions of the
Communities whose decisions are in dispute, of applications, statements of case, defences and obser-
vations, and of replies, if any, as well as of all papers and documents in support or of certified copies of
them.

Communications shall be made by the Registrar in the order and within the time laid down in the Rules
of Procedure.

The oral procedure shall consist of the reading of the report presented by a Judge acting as Rapporteur,
the hearing by the Court of agents, advisers and lawyers and of the submissions of the Advocate-
General, as well as the hearing, if any, of witnesses and experts.

Where it considers that the case raises no new point of law, the Court may decide, after hearing the
Advocate-General, that the case shall be determined without a submission from the Advocate-General.

Article 21

A case shall be brought before the Court by a written application addressed to the Registrar. The
application shall contain the applicant's name and permanent address and the description of the
signatory, the name of the party or names of the parties against whom the application is made, the
subject-matter of the dispute, the form of order sought and a brief statement of the pleas in law on
which the application is based.

The application shall be accompanied, where appropriate, by the measure the annulment of which is
sought or, in the circumstances referred to in Article 232 of the EC Treaty and article 148 of the EAEC
Treaty, by documentary evidence of the date on which an institution was, in accordance with those
Articles, requested to act. If the documents are not submitted with the application, the Registrar shall ask
the party concerned to produce them within a reasonable period, but in that event the rights of the
party shall not lapse even if such documents are produced after the time limit for bringing proceedings.

Article 22

A case governed by Article 18 of the EAEC Treaty shall be brought before the Court by an appeal
addressed to the Registrar. The appeal shall contain the name and permanent address of the applicant
and the description of the signatory, a reference to the decision against which the appeal is brought, the
names of the respondents, the subject-matter of the dispute, the submissions and a brief statement of the
grounds on which the appeal is based.

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The appeal shall be accompanied by a certified copy of the decision of the Arbitration Committee which
is contested.

If the Court rejects the appeal, the decision of the Arbitration Committee shall become final.

If the Court annuls the decision of the Arbitration Committee, the matter may be re-opened, where
appropriate, on the initiative of one of the parties in the case, before the Arbitration Committee. The
latter shall conform to any decisions on points of law given by the Court.

Article 23

In the cases governed by Article 35(1) of the EU Treaty, by Article 234 of the EC Treaty and by Article
150 of the EAEC Treaty, the decision of the court or tribunal of a Member State which suspends its
proceedings and refers a case to the Court shall be notified to the Court by the court or tribunal
concerned. The decision shall then be notified by the Registrar of the Court to the parties, to the
Member States and to the Commission, and also to the Council or to the European Central Bank if the
act the validity or interpretation of which is in dispute originates from one of them, and to the
European Parliament and the Council if the act the validity or interpretation of which is in dispute
was adopted jointly by those two institutions.

Within two months of this notification, the parties, the Member States, the Commission and, where
appropriate, the European Parliament, the Council and the European Central Bank, shall be entitled to
submit statements of case or written observations to the Court.

In the cases governed by Article 234 of the EC Treaty, the decision of the national court or tribunal
shall, moreover, be notified by the Registrar of the Court to the States, other than the Member States,
which are parties to the Agreement on the European Economic Area and also to the EFTA Surveillance
Authority referred to in that Agreement which may, within two months of notification, where one of
the fields of application of that Agreement is concerned, submit statements of case or written obser-
vations to the Court.

The Court may require the parties to produce all documents and to supply all information which the
Court considers desirable. Formal note shall be taken of any refusal.

Article 24

The Court may also require the Member States and institutions not being parties to the case to supply all
information which the Court considers necessary for the proceedings.

The Court may at any time entrust any individual, body, authority, committee or other organisation it
chooses with the task of giving an expert opinion.

Article 25

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Witnesses may be heard under conditions laid down in the Rules of Procedure.

Article 26

With respect to defaulting witnesses the Court shall have the powers generally granted to courts and
tribunals and may impose pecuniary penalties under conditions laid down in the Rules of Procedure.

Article 27

Witnesses and experts may be heard on oath taken in the form laid down in the Rules of Procedure or
in the manner laid down by the law of the country of the witness or expert.

Article 28

The Court may order that a witness or expert be heard by the judicial authority of his place of
permanent residence.

Article 29

The order shall be sent for implementation to the competent judicial authority under conditions laid
down in the Rules of Procedure. The documents drawn up in compliance with the letters rogatory shall
be returned to the Court under the same conditions.

The Court shall defray the expenses, without prejudice to the right to charge them, where appropriate,
to the parties.

Article 30

A Member State shall treat any violation of an oath by a witness or expert in the same manner as if the
offence had been committed before one of its courts with jurisdiction in civil proceedings. At the
instance of the Court, the Member State concerned shall prosecute the offender before its competent
court.

The hearing in court shall be public, unless the Court, of its own motion or on application by the
parties, decides otherwise for serious reasons.

Article 31

During the hearings the Court may examine the experts, the witnesses and the parties themselves. The
latter, however, may address the Court only through their representatives.

Article 32

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Minutes shall be made of each hearing and signed by the President and the Registrar.

Article 33

The case list shall be established by the President.

Article 34

The deliberations of the Court shall be and shall remain secret.

Article 35

Judgments shall state the reasons on which they are based. They shall contain the names of the Judges
who took part in the deliberations.

Article 36

Judgments shall be signed by the President and the Registrar. They shall be read in open court.

Article 37

The Court shall adjudicate upon costs.

Article 38

Article 39

The President of the Court may, by way of summary procedure, which may, in so far as necessary, differ
from some of the rules contained in this Statute and which shall be laid down in the Rules of Procedure,
adjudicate upon applications to suspend execution, as provided for in Article 242 of the EC Treaty and
Article 157 of the EAEC Treaty, or to prescribe interim measures pursuant to Article 243 of the EC
Treaty or Article 158 of the EAEC Treaty, or to suspend enforcement in accordance with the fourth
paragraph of Article 256 of the EC Treaty or the third paragraph of Article 164 of the EAEC Treaty.

Should the President be prevented from attending, his place shall be taken by another Judge under
conditions laid down in the Rules of Procedure.

The ruling of the President or of the Judge replacing him shall be provisional and shall in no way
prejudice the decision of the Court on the substance of the case.

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Member States and institutions of the Communities may intervene in cases before the Court.

Article 40

The same right shall be open to any other person establishing an interest in the result of any case
submitted to the Court, save in cases between Member States, between institutions of the Communities
or between Member States and institutions of the Communities.

Without prejudice to the second paragraph, the States, other than the Member States, which are parties
to the Agreement on the European Economic Area, and also the EFTA Surveillance Authority referred to
in that Agreement, may intervene in cases before the Court where one of the fields of application that
Agreement is concerned.

An application to intervene shall be limited to supporting the form of order sought by one of the
parties.

Article 41

Where the defending party, after having been duly summoned, fails to file written submissions in
judgment shall be given against that party by default. An objection may be lodged against
defence,
the judgment within one month of it being notified. The objection shall not have the effect of staying
enforcement of the judgment by default unless the Court decides otherwise.

Member States, institutions of the Communities and any other natural or legal persons may, in cases and
under conditions to be determined by the Rules of Procedure, institute third-party proceedings to contest
a judgment rendered without their being heard, where the judgment is prejudicial to their rights.

Article 42

If the meaning or scope of a judgment is in doubt, the Court shall construe it on application by any
party or any institution of the Communities establishing an interest therein.

Article 43

An application for revision of a judgment may be made to the Court only on discovery of a fact which
is of such a nature as to be a decisive factor, and which, when the judgment was given, was unknown to
the Court and to the party claiming the revision.

Article 44

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The revision shall be opened by a judgment of the Court expressly recording the existence of a new fact,
recognising that it is of such a character as to lay the case open to revision and declaring the application
admissible on this ground.

No application for revision may be made after the lapse of 10 years from the date of the judgment.

Article 45

Periods of grace based on considerations of distance shall be determined by the Rules of Procedure.

No right shall be prejudiced in consequence of the expiry of a time limit if the party concerned proves
the existence of unforeseeable circumstances or of force majeure.

Article 46

Proceedings against the Communities in matters arising from non-contractual liability shall be barred
after a period of five years from the occurrence of the event giving rise thereto. The period of limitation
shall be interrupted if proceedings are instituted before the Court or if prior to such proceedings an
application is made by the aggrieved party to the relevant institution of the Communities. In the latter
event the proceedings must be instituted within the period of two months provided for in Article 230 of
the EC Treaty and Article 146 of the EAEC Treaty; the provisions of the second paragraph of Article
232 of the EC Treaty and the second paragraph of Article 148 of the EAEC Treaty, respectively, shall
apply where appropriate.

THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES

TITLE IV

Article 47

Articles 2 to 8, Articles 14 and 15, the first, second, fourth and fifth paragraphs of Article 17 and
Article 18 shall apply to the Court of First Instance and its members. The oath referred to in Article 2
shall be taken before the Court of Justice and the decisions referred to in Articles 3, 4 and 6 shall be
adopted by that Court after hearing the Court of First Instance.

The fourth paragraph of Article 3 and Articles 10, 11 and 14 shall apply to the Registrar of the Court of
First Instance mutatis mutandis.

The Court of First Instance shall consist of 15 Judges.

Article 48

The Members of the Court of First Instance may be called upon to perform the task of an Advocate-
General.

Article 49

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It shall be the duty of the Advocate-General, acting with complete impartiality and independence, to
make, in open court, reasoned submissions on certain cases brought before the Court of First Instance in
order to assist the Court of First Instance in the performance of its task.

The criteria for selecting such cases, as well as the procedures for designating the Advocates-General,
shall be laid down in the Rules of Procedure of the Court of First Instance.

A Member called upon to perform the task of Advocate-General in a case may not take part in the
judgment of the case.

Article 50

The Court of First Instance shall sit in chambers of three or five Judges. The Judges shall elect the
Presidents of the chambers from among their number. The Presidents of the chambers of five Judges
shall be elected for three years. They may be re-elected once.

The composition of the chambers and the assignment of cases to them shall be governed by the Rules of
Procedure. In certain cases governed by the Rules of Procedure, the Court of First Instance may sit as a
full court or be constituted by a single Judge.

The Rules of Procedure may also provide that the Court of First Instance may sit in a Grand Chamber in
cases and under the conditions specified therein.

By way of exception to the rule laid down in Article 225(1) of the EC Treaty and Article 140a(1) of the
EAEC Treaty, the Court of Justice shall have jurisdiction in actions brought by the Member States, by the
institutions of the Communities and by the European Central Bank.

Article 51

Article 52

The President of the Court of Justice and the President of the Court of First Instance shall determine, by
common accord, the conditions under which officials and other servants attached to the Court of Justice
shall render their services to the Court of First Instance to enable it to function. Certain officials or other
servants shall be responsible to the Registrar of the Court of First Instance under the authority of the
President of the Court of First Instance.

The procedure before the Court of First Instance shall be governed by Title III.

Article 53

Such further and more detailed provisions as may be necessary shall be laid down in its Rules of
Procedure. The Rules of Procedure may derogate from the fourth paragraph of Article 40 and from
Article 41 in order to take account of the specific features of litigation in the field of intellectual
property.

Notwithstanding the fourth paragraph of Article 20, the Advocate-General may make his reasoned
submissions in writing.

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Article 54

Where an application or other procedural document addressed to the Court of First Instance is lodged
by mistake with the Registrar of the Court of Justice,
it shall be transmitted immediately by that
likewise, where an application or other
Registrar to the Registrar of the Court of First Instance;
procedural document addressed to the Court of Justice is lodged by mistake with the Registrar of the
Court of First Instance, it shall be transmitted immediately by that Registrar to the Registrar of the Court
of Justice.

Where the Court of First Instance finds that it does not have jurisdiction to hear and determine an
action in respect of which the Court of Justice has jurisdiction, it shall refer that action to the Court of
Justice; likewise, where the Court of Justice finds that an action falls within the jurisdiction of the Court
of First Instance, it shall refer that action to the Court of First Instance, whereupon that Court may not
decline jurisdiction.

Where the Court of Justice and the Court of First Instance are seised of cases in which the same relief is
sought, the same issue of interpretation is raised or the validity of the same act is called in question, the
Court of First Instance may, after hearing the parties, stay the proceedings before it until such time as
the Court of Justice shall have delivered judgment. Where applications are made for the same act to be
declared void, the Court of First Instance may also decline jurisdiction in order that the Court of Justice
may rule on such applications. In the cases referred to in this paragraph, the Court of Justice may also
decide to stay the proceedings before it; in that event, the proceedings before the Court of First Instance
shall continue.

Article 55

Final decisions of the Court of First Instance, decisions disposing of the substantive issues in part only or
disposing of a procedural issue concerning a plea of lack of competence or inadmissibility, shall be
notified by the Registrar of the Court of First Instance to all parties as well as all Member States and the
institutions of the Communities even if they did not intervene in the case before the Court of First
Instance.

Article 56

An appeal may be brought before the Court of Justice, within two months of the notification of the
decision appealed against, against final decisions of the Court of First Instance and decisions of that
Court disposing of the substantive issues in part only or disposing of a procedural issue concerning a
plea of lack of competence or inadmissibility.

Such an appeal may be brought by any party which has been unsuccessful, in whole or in part, in its
the
submissions. However,
Communities may bring such an appeal only where the decision of the Court of First
Instance
directly affects them.

than the Member States and the institutions of

interveners other

With the exception of cases relating to disputes between the Communities and their servants, an appeal
may also be brought by Member States and institutions of the Communities which did not intervene in
the proceedings before the Court of First Instance. Such Member States and institutions shall be in the
same position as Member States or institutions which intervened at first instance.

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Any person whose application to intervene has been dismissed by the Court of First Instance may appeal
to the Court of Justice within two weeks from the notification of the decision dismissing the application.

Article 57

The parties to the proceedings may appeal to the Court of Justice against any decision of the Court of
First Instance made pursuant to Article 242 or Article 243 or the fourth paragraph of Article 256 of the
EC Treaty or Article 157 or Article 158 or the third paragraph of Article 164 of the EAEC Treaty within
two months from their notification.

The appeal referred to in the first two paragraphs of this Article shall be heard and determined under
the procedure referred to in Article 39.

An appeal to the Court of Justice shall be limited to points of law. It shall lie on the grounds of lack of
competence of the Court of First Instance, a breach of procedure before it which adversely affects the
interests of the appellant as well as the infringement of Community law by the Court of First Instance.

Article 58

No appeal shall lie regarding only the amount of the costs or the party ordered to pay them.

Article 59

Where an appeal is brought against a decision of the Court of First Instance, the procedure before the
Court of Justice shall consist of a written part and an oral part. In accordance with conditions laid down
in the Rules of Procedure, the Court of Justice, having heard the Advocate-General and the parties, may
dispense with the oral procedure.

Without prejudice to Articles 242 and 243 of the EC Treaty or Articles 157 and 158 of the EAEC
Treaty, an appeal shall not have suspensory effect.

Article 60

By way of derogation from Article 244 of the EC Treaty and Article 159 of the EAEC Treaty, decisions
of the Court of First Instance declaring a regulation to be void shall take effect only as from the date of
expiry of the period referred to in the first paragraph of Article 56 of this Statute or, if an appeal shall
have been brought within that period, as from the date of dismissal of the appeal, without prejudice,
however, to the right of a party to apply to the Court of Justice, pursuant to Articles 242 and 243 of the
EC Treaty or Articles 157 and 158 of the EAEC Treaty, for the suspension of the effects of the
regulation which has been declared void or for the prescription of any other interim measure.

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Article 61

If the appeal is well founded, the Court of Justice shall quash the decision of the Court of First Instance.
It may itself give final judgment in the matter, where the state of the proceedings so permits, or refer the
case back to the Court of First Instance for judgment.

Where a case is referred back to the Court of First Instance, that Court shall be bound by the decision of
the Court of Justice on points of law.

When an appeal brought by a Member State or an institution of the Communities, which did not
intervene in the proceedings before the Court of First Instance, is well founded, the Court of Justice may,
if it considers this necessary, state which of the effects of the decision of the Court of First Instance
which has been quashed shall be considered as definitive in respect of the parties to the litigation.

Article 62

In the cases provided for in Article 225(2) and (3) of the EC Treaty and Article 140a(2) and (3) of the
EAEC Treaty, where the First Advocate-General considers that there is a serious risk of the unity or
consistency of Community law being affected, he may propose that the Court of Justice review the
decision of the Court of First Instance.

The proposal must be made within one month of delivery of the decision by the Court of First Instance.
Within one month of receiving the proposal made by the First Advocate-General, the Court of Justice
shall decide whether or not the decision should be reviewed.

TITLE V

FINAL PROVISIONS

Article 63

The Rules of Procedure of the Court of Justice and of the Court of First Instance shall contain any
provisions necessary for applying and, where required, supplementing this Statute.

Article 64

Until the rules governing the language arrangements applicable at the Court of Justice and the Court of
First Instance have been adopted in this Statute, the provisions of the Rules of Procedure of the Court of
Justice and of the Rules of Procedure of the Court of First Instance governing language arrangements
shall continue to apply. Those provisions may only be amended or repealed in accordance with the
procedure laid down for amending this Statute.

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PROTOCOL

ON THE FINANCIAL CONSEQUENCES
OF THE EXPIRY OF THE ECSC TREATY AND ON THE
RESEARCH FUND FOR COAL AND STEEL

THE HIGH CONTRACTING PARTIES,

DESIRING to settle certain questions relating to the expiry of the Treaty establishing the European Coal
and Steel Community (ECSC),

WISHING to confer ownership of the ECSC funds on the European Community,

TAKING ACCOUNT of the desire to use these funds for research in sectors related to the coal and steel
industry and therefore the necessity to provide for certain special rules in this regard,

HAVE AGREED UPON the following provisions, which shall be annexed to the Treaty establishing the
European Community:

All assets and liabilities of the ECSC, as they exist on 23 July 2002, shall be transferred to the

1.
European Community on 24 July 2002.

Article 1

2.
The net worth of these assets and liabilities, as they appear in the balance sheet of the ECSC of
23 July 2002, subject to any increase or decrease which may occur as a result of the liquidation
operations, shall be considered as assets intended for research in the sectors related to the coal and
steel industry, referred to as the ‘ECSC in liquidation’. On completion of the liquidation they shall be
referred to as the ‘assets of the Research Fund for Coal and Steel’.

3.
The revenue from these assets, referred to as the ‘Research Fund for Coal and Steel’, shall be used
exclusively for research, outside the research framework programme, in the sectors related to the coal
and steel industry in accordance with the provisions of this Protocol and of acts adopted on the basis
hereof.

Article 2

The Council, acting unanimously on a proposal from the Commission and after consulting the European
Parliament, shall adopt all the necessary provisions for the implementation of this Protocol, including
essential principles and proper decision-making procedures,
in particular for the adoption of multi-
annual financial guidelines for managing the assets of the Research Fund for Coal and Steel and technical
guidelines for the research programme of the Research Fund for Coal and Steel.

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Except as otherwise provided in this Protocol and in the acts adopted on the basis hereof, the provisions
of the Treaty establishing the European Community shall apply.

Article 3

This Protocol shall apply from 24 July 2002.

Article 4

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PROTOCOL

ON ARTICLE 67 OF THE TREATY
ESTABLISHING THE EUROPEAN COMMUNITY

THE HIGH CONTRACTING PARTIES

HAVE AGREED UPON the following provision, which shall be annexed to the Treaty establishing the
European Community:

From 1 May 2004, the Council shall act by a qualified majority, on a proposal from the Commission
and after consulting the European Parliament, in order to adopt the measures referred to in Article 66 of
the Treaty establishing the European Community.

Sole Article