Introduction
European integration has been driven by the belief that economic interdependence can transform former rivals into partners. By linking markets, the prospect of war becomes both costly and irrational, fostering a durable peace among states.
Fundamental Idea Behind Integration Law
Peace through commerce is the core principle that underlies the development of European integration law. The notion is that trade creates mutual benefits that make conflict unprofitable, thereby encouraging lasting peace.
Negative and Positive Integration
Integration can be understood through two complementary approaches:
- Negative integration – the removal of obstacles created by national borders.
- Positive integration – the creation of common rules and harmonised legislation.
Negative integration focuses on eliminating barriers, while positive integration builds a shared regulatory framework that allows the internal market to function without borders.
Negative Integration Explained
The aim is to supprimer les obstacles (remove obstacles) that arise from differing national regulations, standards, and administrative practices. By doing so, the market becomes more fluid and competition is enhanced.
Positive Integration Explained
Positive integration seeks to adopt common rules and harmonise legislation. This creates a level playing field, ensuring that businesses and individuals can operate across the Union under the same conditions.
Key Mechanisms for Building Unity
David Mitrany introduced the concept of spill‑over (engrenage) through functionalist cooperation. Starting with concrete sectoral cooperation—what he called a "solidarity of fact"—states gradually expand cooperation, establishing institutions only when they become necessary. This step‑by‑step approach allows integration to deepen without threatening state sovereignty.
Foundational Institutions
The European Coal and Steel Community (CECA) exemplifies supranational authority. Its decisions are directly applicable to member states, binding them without the need for national transposition. This demonstrates how supranational bodies can create binding obligations that further integration.
Customs Union vs. Free‑Trade Area
Although both aim to reduce trade barriers, they differ fundamentally:
- Free‑trade area – eliminates internal tariffs but allows each member to maintain its own external tariffs toward third countries.
- Customs union – adds a common external tariff, meaning all members apply the same duties to imports from outside the Union.
Thus, a customs union is not identical to a free‑trade area; the external tariff is the distinguishing feature.
The Four Fundamental Freedoms
The internal market is built on four freedoms that guarantee the free movement of:
- Goods
- Services
- Persons
- Capital
These freedoms create a borderless space where economic actors can operate across member states without hindrance.
Definition of the Internal Market
Article 26 of the Treaty on the Functioning of the European Union (TFUE) defines the internal market as un espace sans frontières intérieures – a space without internal borders. This definition underscores the ambition to eliminate all obstacles that impede the free flow of the four freedoms.
The Schuman Proposal
The historic Schuman proposal sought to pool Franco‑German production of charbon et de l’acier (coal and steel). By placing these strategic raw materials under a common authority, the proposal laid the groundwork for deeper economic integration.
Adoption of the Euro
On 1 January 1999, the euro became the official currency for eleven EU states. This monetary integration represented a major step toward a more cohesive internal market, facilitating trade, investment, and price transparency across the participating countries.
Summary
European integration rests on the principle that trade promotes peace. Through negative integration, barriers are removed; through positive integration, common rules are established. Institutions like the CECA demonstrate supranational authority, while mechanisms such as spill‑over guide the gradual deepening of cooperation. Understanding the distinction between customs unions and free‑trade areas, the four fundamental freedoms, and the role of the euro provides a comprehensive view of how the EU internal market functions as a borderless economic space.
