Wednesday 21 February 2018

Debt Crisis: New treaty proposals give more powers to European Commission

French President Nicolas Sarkozy
French President Nicolas Sarkozy
Italian Prime Minister Mario Monti reporters

A NEW draft of the intergovernmental treaty aimed at restoring confidence in the eurozone economy gives more power to the European Commission

It has also proposed an increase in the number of member countries needed to ratify it to 15 from an earlier figure of nine.

The changes include:

- more powers for the European Commission in relation to fiscal rules

- new rules to be included in EU treaties within five years

- new wording likely to anger Britain

And as in the original draft, the new rules would not apply to the 17 eurozone member states until they had ratified it.

It could also prompt a referendum here if changes have to be made to the Constitution.

The draft, which emerged today as new Italian Prime Minister Mario Monti met with French leader Nicolas Sarkozy in Paris on a day the euro slumped in value, also gives greater powers to the European Commission over countries that breach new fiscal rules.

While the original draft suggested that member states would take each other to court over breaches of fiscal rules, because the deal was struck outside of the EU treaties, the new text states: “The European Commission many, on behalf of contracting parties, bring an action for an alleged infringement…before the European Court of Justice of the European Union.”

It also expects that the new rules will be included in EU treaties within the next five years.

But some of the proposals will anger the non-eurozone member state Britain, which last month blocked EU treaty change at a December Brussels summit before Prime Minister David Cameron walked out of talks, because the draft includes a reference to the internal market.

Britain is also expected to oppose the plans to give the European Commission more powers.

The draft is being discussed by member state officials in Brussels today as well as some MEPs and European Commission officials and may need to be amended further before it is finalised.

And it is still not clear how non-eurozone member states would sign up to it.

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