European Union (Amendment) Bill

Yes, I hear my right hon. Friend saying that the treaty is near to being the constitution. It is worth pointing out that the abolition of the term ““European Community””, and its replacement with ““European Union”” throughout the treaties, was the main innovation in the constitution. That underlines one of the European Scrutiny Committee’s fundamental conclusions, which is that we are talking about a distinction that amounts to no substantive difference. Article 275 says:"““The Court of Justice of the European Union shall not have jurisdiction with respect to the provisions relating to the common foreign and security policy nor with respect to acts adopted on the basis of those provisions.””" The problem is that the treaty does not define ““common foreign and security policy””. The only definition is included in the provisions on foreign and security policy. The treaty continues:"““However, the Court shall have jurisdiction to monitor compliance with Article 40 of the Treaty on European Union and to rule on proceedings, brought in accordance with the conditions laid down in the fourth paragraph of Article 263 of this Treaty.””" If hon. Members have become confused it is understandable, because the matter is complex. Article 40 of the treaty on European Union—the European Scrutiny Committee Chairman told us to read the treaty, and I am enjoying reading it—states:"““The implementation of the common foreign and security policy shall not affect the application of the procedures and the extent of the powers of the institutions laid down by the Treaties for the exercise of the Union competences referred to in Articles 3 to 6 of the Treaty on the Functioning of the European Union.””" Notwithstanding the exclusion of the European Court of Justice from common foreign and security policy, anything that is included in the treaty on the function of the European Union that overlaps with common foreign and security policy is included in the jurisdiction of the Court. That includes matters such as trade, aid and, as my right hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) has said from a sedentary position, competition. Article 270 on the European Court of Justice refers to the terms and conditions of employees of the European Union, and the boundaries will get blurred. Members of the External Action Service of the European Union will presumably be employees of the European Union, so that aspect of foreign policy will inevitably be tangled up with the European Court of Justice—for example, there could be an international dispute that turns on the employment conditions of an employee of the European Union in the form of the External Action Service. That is one area in which blurring is likely to take place. Let us remember how the jurisprudence of the Supreme Court of the United States developed on matters such as tax, trade and agriculture. The Supreme Court of the United States has no explicit powers to regulate tax. There is no federal power in the United States constitution that grants taxation powers to the Federal Government, and such powers were obtained by extrapolating the right to regulate trade between the states of the United States of America. On agricultural quantities, for example, there is no federal power in the United States constitution to regulate quantitative restrictions within a state of the United States of America. However, because a court has argued that what is produced in one state affects trade in another, trade provisions have been used to get into another area of the law, which is how the United States became the modern federation that it is today. The exclusions in these treaties have been expressly drafted to prevent such leakage of jurisdiction upwards to the federal institutions of the European Union, but I fear that it will be difficult to prevent that. Returning to the European Defence Agency, it is clear that many supporters of the EDA dream of creating a single market for defence manufacturers in the European Union. There are specific exclusions that exclude defence from the single market in the existing treaties, which will be carried forward into the new treaties. However, let us face it: what constitutes a defence good as opposed to an ordinary civil good? Let me give an example. We export Land Rovers throughout the world, and a Land Rover can be a civilian or military vehicle. Many of the parts used for the civilian versions are also used for the military versions. One of the exclusions from the European Court of Justice is trade. I always thought that the application of sanctions against a third country was an act of foreign policy, but the European Union does not count it as such—the application of sanctions is a trade matter, which falls under qualified majority voting and is included in the jurisdiction of the European Court of Justice and enforceable by the Court. Let us suppose that we had a dispute with our European partners about a major defence contract and they wanted to stop us from having an arrangement with a third country. Given the provisions that international sanctions be subject to qualified majority voting, that issue could be included. Civilian parts of the order could be included, even if they were included as military hardware. I should like to ask the Minister a question, if he will give me his attention. When there are disputes about the treaties, they are routinely referred to the European Court of Justice for resolution except in so far as they are excluded. Yet it is illegal to refer any dispute about the treaties to any body outside the European Union. By rule of the treaties, there are matters of international law that cannot be referred to the European Court of Justice, nor to any other international jurisdiction. How would such a dispute be resolved? In the end, it is inconceivable that a dispute within the EU about the treaties would not eventually and somehow be resolved by the European Court of Justice. The Court might well exclude itself from jurisdiction, but we would be relying on that self-exclusion. In the boundary areas in which foreign and defence policy overlaps with policy on trade, aid or other issues included in the existing treaty establishing the European Community, it is easy to see how the jurisdiction of the Court could be incrementally enlarged, case by case, as we have seen it operate year after year. Finally, I wish to return to the question of permanent structured co-operation, given that I was provoked by the Chairman of the European Scrutiny Committee. Qualified majority voting also erodes the intergovernmental character of what has traditionally been dealt with under the treaty on European Union. Permanent structured co-operation is created by a qualified majority vote of the European Council. A member state can be removed from the permanent structured co-operation under article 28E, paragraph 4—I am going back to the other numbering, which shows how confusing it is. The article states:"““If a participating Member State no longer fulfils the criteria or is no longer able to meet the commitments referred to in Articles 1 and 2 of the Protocol on permanent structured cooperation, the Council may adopt a decision suspending the participation of the Member State concerned.””" It goes on to say that such a decision will be taken by qualified majority voting.